Healthy Forest Enterprise Incentives Program (HF)

The primary goal of the Healthy Forest Enterprise Incentives Program is to promote forest health in Arizona. The program achieves this by proving incentives for certified businesses that are primarily engaged in harvesting, initial processing or transporting of qualifying forest products. The program offers the following incentives:

• Use Fuel Tax Reduction - The use fuel tax is reduced from 26 cents to 13 cents a gallon for use class motor vehicle
• Transaction Privilege Tax Exemption (TPT Exemption) on:
• Purchased qualifying equipment
• Leased or rented qualifying equipment
• Construction contracts
• Use Tax Exemption - on qualifying equipment purchased out-of-state
• Property Tax Reduction - Both real and personal property can be reclassified from class one (25 percent assessment ratio) to Class six (5 percent assessment ratio) for a period of five years
• New Job Income Tax Credit - Arizona income tax credit earned over a three-year period for each net new job created, totaling up to $3,000 per employee

For more detailed information about program incentives please read below or direct your questions to the Program Manager.

• HF Program Summary
• HF Program Guidelines
• HF Wage Offer By County

Eligible Applicants
Eligible applicants include: a harvester, an initial processor or a transporter that:

1. Is primarily (more than 50 percent) engaged in a qualifying project,
2. Employs at least 3 full-time employees, and
3. Enters into a Memorandum of Understanding (MOU) with Commerce.

Application Process
Please note: each incentive has different requirements. To ensure eligibility for each incentive please read the HF Program Guidelines.

• To become a certified business and receive HF program incentives an eligible business must:
• Apply for program incentives by completing an Application Form and entering into a MOU with Commerce.
• Within 60 days of receipt of a complete application, Commerce will notify the business of approval or denial.
• If the business is approved, a Letter of Certification will be issued to the eligible business, explaining the next steps to obtain the program incentives.
• The certified business must then submit a copy of the Letter of Certification to the Arizona Department of Revenue for approval before using the certification to obtain program incentives. To obtain approval the Arizona Department of Revenue is asking that the business submit a Tax Clearance Application Form with a copy of the Letter of Certification.
• Within 60 days of receipt of the Letter of Certification, Revenue will notify the business of approval or denial.
• If the Letter of Certification is approved, incentives offered under the Healthy Forest Enterprise Incentives Program can be claimed.

Supplemental Forms

• HF Prime Contractor Application
• Draft Forester Approval Letter

Recertification & Reporting Process
Listed below are the forms necessary to obtain recertification and annually report to Commerce.

• On or by March 1st of each year the business must submit an Annual Report to Commerce to maintain eligibility.
• Within 30 days of expiration of the current certification a business must submit a Recertification Form to maintain eligibility.

Email Updates
Commerce will soon begin the process of drafting rules for the Healthy Forest Enterprise Incentives Program and will seek public comment. As soon as rules are adopted, Commerce will place an update on this website and will notify businesses and others who have requested information. If you have not yet placed your e-mail address on our list, please click here to send an e-mail requesting notification. Please be sure to name the program for which you would like notification.