Arkansas Governor Sarah Huckabee Sanders signed Executive Order 26-15 on September 29, 2026, declaring a state of emergency and temporarily suspending penalties that normally apply when dyed diesel fuel is used in the fuel tanks of highway vehicles.
The order, effective from September 30 through October 30, 2026, suspends the penalty provisions of Ark. Code Ann. § 26-56-226(a)(1) and § 26-56-227(b), which impose additional tax and a $10.00-per-gallon penalty on fuel found in the tank of a vehicle using dyed distillate special fuel, or a mix of dyed and undyed fuel.
The relief applies only to vehicles meeting specific conditions: the vehicle must qualify as a Class 2, 3, 4, 5, 6, or 8 motor vehicle, be owned and operated by an individual or business engaged in agricultural or forestry operations, be primarily used for that business, be registered in Arkansas, and not be a licensed vehicle under the International Fuel Tax Agreement.
The order cites an "unforeseen hardship in the agriculture and forestry industries as a result of the increased price of diesel fuel." It notes that the 2026 crop enterprise budgets published by the University of Arkansas Cooperative Extension Service assumed a diesel price of $2.46 per gallon, "which is less than half the price presently prevailing in this State."
According to the order, U.S. distillate inventories were 13% below the five-year seasonal average as of September 11, 2026, and global distillate production is expected to remain below last year's levels.
The order states that agriculture is Arkansas' largest industry, contributing more than $25.6 billion annually and providing over 248,000 jobs. Arkansas' 37,200 farms and ranches operate on 13.6 million acres, while forestland covers approximately 18.8 million acres. Forest industries contribute $7.3 billion to the state's economy, making Arkansas the most forestry-dependent state in the South.
Sanders said farmers and timber harvesters maintain on-site storage of dyed diesel for nontaxable off-road use, and allowing that fuel in highway vehicles "will make fuel immediately available to those operations."
The order also references President Trump's national emergency declaration in Executive Order 14156, which found that "an affordable and reliable domestic supply of energy is a fundamental requirement for the national and economic security of any nation," and which has been extended through January 20, 2027.
Under the order, the Secretary of the Department of Finance and Administration must request dyed diesel fuel penalty relief from the Internal Revenue Service within three business days. All state departments, agencies, boards, commissions, and officers are directed to cooperate with actions taken under the order.