LITTLE ROCK, Ark. – A Little Rock rubber company received only a portion of its contracted agreement after the state said it ran out of funds for the quarter. Unless a permanent solution is reached, the company’s owner said he fears the business may shut down.

Davis Rubber has been around since the 1920s, and the company breaks down used tires delivered by tire stores and other industries. The repurposed materials are used for fuel, playground flooring and other things. 

Traditionally, people pay a small fee when they purchase new tires. This money goes to the ADEQ to reimburse companies like Davis Rubber for disposing of the used tires. Phillip Davis said ADEQ notified him that they would be unable to pay the full reimbursement for the quarter that included June. The company ceased accepting tires last month because of this.

Davis said he had to fire a number of employees after receiving the news.

“Last week, we had seven people laid off,” Davis said.

An ADEQ spokesperson sent a statement in response to this:

“On August 15, 2022, the Division of Environmental Quality (DEQ) sent a letter to the Regional Solid Waste Management Boards and Districts addressing the quarterly disbursements. (I have attached a copy of the letter for you.)

If there are insufficient funds available in a quarter for all submitted requests, A.C.A. §8-9-405 (e)(2) requires DEQ to calculate the total available funding and allocate the funds based on a pro rata share of each used tire program’s reimbursement request compared to total funds available. For the quarter ending on June 30, 2022, the available funding for distribution was $1,364,369.12, and total reimbursement requests were $2,005,49I.27. Consequently, each approved used tire program received 68.0316% of their original request.

DEQ is continuing to monitor the situation and keeping an open line of communication with the waste tire districts.”

Davis said if a permanent solution is not reached, services will be discontinued again.

“We’ve told the district if you don’t have money, we’ll shut down again on the 15th of September,” Davis said.

Ken Liner is the store manager for Discount Tire & Brake in Little Rock. He said backed-up tires extended to the parking lot this week.

“They weren’t able to come pick them up,” Liner said. “We weren’t able to get rid of them. We don’t have the square footage to keep them.”

Davis said if future quarters result in a similar payout, he does not think the company can continue.

“We can’t operate on that,” Davis said. “We’ll just have to close down.”