The bill amends the method of valuation for mineral rights under the Arkansas Constitution, specifically Article 16, Section 5, to enhance clarity and consistency in the assessment of oil and gas well production equipment. It introduces new legal language that emphasizes the legislative intent for the act to be remedial and to clarify existing laws. The bill defines key terms such as "well" and "production equipment," and establishes that county assessors must assess mineral interests separately from the fee simple interest in the land when applicable. It also specifies that production equipment will be assessed as real property at a value of one dollar per foot, with certain exceptions for inoperable casing.

Additionally, the bill outlines the assessment process for wells, including how to handle increases in production and the calculation of working interest-assessed value. It mandates that all valuation methods and guidance provided to county assessors must comply with the new requirements. The effective date for these changes is set for assessment years beginning on or after January 1, 2025.

Statutes affected:
Old version HB1937 Original - 3-31-2025 04:31 PM: 26-26-1110(a)
Old version HB1937 V2 - 4-3-2025 11:08 AM: 26-26-1110(a)
HB 1937: 26-26-1110(a)
Act 821: 26-26-1110(a)