Bill > HB1937

This bill amends Arkansas law regarding the valuation of mineral rights and oil and gas well production equipment for property tax purposes. The legislation expands the definition of a "well" to include various types of hydrocarbon production, including natural gas and combinations of different hydrocarbons. It provides detailed guidance for county assessors on how to assess mineral interests and production equipment, including a standard valuation of one dollar per foot for production equipment (with an exception for inoperable well casings). The bill clarifies that mineral interests can be taxed separately from land ownership when held by different parties, and establishes rules for assessing the value of wells, including how to calculate working interest and income approaches. The valuation methods now explicitly include provisions for both oil and gas production, using average prices from the previous calendar year. The bill is intended to be remedial and clarify existing tax assessment practices, with the new provisions becoming effective for assessment years beginning on or after January 1, 2025. This update aims to provide more consistency and uniformity in how mineral rights and production equipment are valued for tax purposes in Arkansas.

Agriculture and Natural Resources, Budget and Finance

https://arkleg.state.ar.us/Bills/Detail?id=hb1937&ddBienniumSession=2025%2F2025R