An Act To Phase Out the Business Equipment Tax Reimbursement
Maine Legislature, Session 121, LD 1169
Committee: Taxation
Sponsors: TRAHAN
Amends: 36 MRSA §662

Legislative Document 
No. 1169 
H.P.866 
House of Representatives, March 5, 2003 
An Act To Phase Out the Business Equipment Tax Reimbursement 
Reference to the Committee on Taxation suggested and ordered printed. 
Presented by Representative TRAHAN of Waldoboro. 
Printed on recycled paper 
/J1~ 
/J1.11l4C~ 
MILLICENT M. MacFARLAND 
Clerk 
Be it enacted by the People of the State of Maine as follows: 
Sec. I. 36 MRSA §662 is enacted to read: 
§662. 
Certain business personal property 
1. 
Definitions. 
As 
used 
in 
context 
otherwise 
indicates, 
the 
following meanings. 
this 
section, 
unless 
following 
terms 
have 
the 
the 
A. 
"Base General Fund revenue" 
means General Fund revenue 
for the previous fiscal year adjusted by the increase in the 
Consumer Price Index as defined in section 5402, subsection 
for the previous calendar year. 
B. 
"Projected General Fund revenue" means the amount of 
projected General Fund revenue for the current fiscal year 
determined 
by 
the 
December 
1st 
report 
of 
the 
Revenue 
Forecasting 
Committee 
under 
Title 
5, 
section 
1710 F, 
subsection 3. 
2. 
Exempt property. 
An exemption is provided under this 
Part 
for 
a 
percentage 
of 
the 
just value 
of 
property 
that 
gua1ifies 
for 
reimbursement 
under 
chapter 
915. 
Except 
as 
provided in subsection 5, the exempt percentage of just value is 
25'1-0 for property tax years beginning on April L 
2004, 
50o~o of 
just value for property tax years beginning on April 1, 2005, 75% 
of just value for property tax years beginning on April L 
2006 
and 100°'0 of just value for property tax years beginning after 
April 1, 2007. 
3. 
Reimbursement 
to 
municipalities. 
The 
State 
shall 
reimburse municipalities for 
100°" of the property tax revenue 
loss suffered as a result of this section using the procedure 
specified in section 661. 
4. 
Business Equipment Tax Reimbursement Exemption Fund. 
The Business Eguipment Tax Reimbursement Exemption Fund, referred 
to in this section as "the fund," is established for the purposes 
of 
this 
section. 
Beginning 
December 
15, 
2003 
and 
annually 
thereafter ( the State Controller shall transfer to the fund an 
amount determined by subtracting the base General Fund revenue 
from the projected General Fund revenue for the fiscal year. 
Money in the fund does not lapse but is carried forward for the 
purposes of this section. 
S. 
Exempt percentage. 
Before March 15th annually, 
the 
State 
Tax 
Assessor 
shall estimate 
the 
amount 
that will 
be 
transferred to the 
fund during the 
succeeding year. 
If the 
amount estimated is not sufficient to fund reimbursement of the 
exemption specified under subsection 2, the State Tax Assessor 
shall 
determine 
the 
percentage 
of 
just 
value 
that 
can 
be 
reimbursed based on the amount transferred to the fund under 
subsection 4. 
The assessor shall notify municipalities of the 
exempt percentage that applies to the property tax year beginning 
on April 1st of the year of the transfer. 
SUMMARY 
This bill provides 
for 
the 
replacement of 
the business 
equipment tax reimbursement program over 4 years or longer with a 
property 
tax 
exemption 
for 
personal 
property 
that 
would 
be 
eligible 
for 
reimbursement 
under 
the 
business 
equipment 
tax 
reimbursement program. 
Municipalities would be reimbursed for 
100% 
of 
the 
property 
tax 
revenue 
loss 
resulting 
from 
the 
exemption. 
Funding 
for 
municipal 
reimbursement 
would 
be 
set 
aside from the amount by which projected General Fund revenues 
exceed 
the 
previous 
fiscal 
year's 
revenues 
adjusted 
for 
inflation. 
If excess revenues are not estimated to be sufficient 
for 
full 
funding, 
the 
percentage 
of 
exempt 
value 
would 
be 
adjusted 
to 
reflect 
the 
amount 
available 
for 
municipal 
reimbursement.