The "Economic Development District Act of 2025" seeks to create a structured framework for establishing economic development districts in Arkansas by introducing Chapter 177 to the Arkansas Code. This chapter defines key terms such as "economic development district" and "available funds," and outlines the roles of various authorities, particularly the Department of Commerce, which is tasked with supporting the establishment and management of these districts. The bill details the process for creating a district, which can be initiated by local municipalities or counties, and requires a proposal that includes a map, a preliminary economic development plan, and an assessment of economic conditions. It also establishes financial obligations for these districts, including remitting a portion of property and sales charge increments to the Department of Commerce.

Additionally, the bill introduces provisions for the governance, financial oversight, and management of economic development districts. It mandates that boards consist of five to nine members and emphasizes transparency through annual audits. The bill allows for the imposition of property and sales charges, with specific conditions for increases, and establishes a framework for grants and abatements to promote economic development. It also outlines the process for issuing and repaying bonds to finance projects, requiring a two-thirds majority vote for approval. The bill includes a contingent effective date of January 1, 2027, which is dependent on the adoption of Senate Joint Resolution 15 in the 2026 general election.