An Act to Establish the Pine Tree Development Zones Program LR 2032(02) i/
Maine Legislature, Session 121, LD 1385
Committee Amendment CA_A_S68 (Senate)
Amends: 36 MRSA §1760, 36 MRSA §2529, 36 MRSA §6754

COMMITTEE AMENDMENT "4,, to S.P. 456, L.D. 1385, Bill, 
Act To Establish the Pine Tree Development Zones Program" 
"An 
Amend the bill by inserting after the title and before the 
enacting clause the following: 
'Emergency preamble. Whereas, Acts of the Legislature do not 
become effective until 90 days after adjournment unless enacted 
as emergencies; and 
Whereas, the creation of Pine Tree Development Zones will 
provide 
a 
crucial economic boost to areas of the State in 
distress; and 
Whereas, in the judgment of the Legislature, these facts 
create an emergency within the meaning of the Constitution of 
Maine 
and 
require 
the 
following 
legislation 
as 
immediately 
necessary for the preservation of the public peace, health and 
safety; now, therefore,' 
Further amend the bill by striking out everything after the 
enacting clause and before the summary and inserting in its place 
the following: 
'Sec. 1. 30-A MRS A §5223, sub-§3, as enacted by PL 2001, c. 
669, §l, is amended by amending the last blocked paragraph to 
read: 
The conditions in paragraphs A to D do not apply to approved 
downtown 
tax 
increment 
financing districts or 
tax 
increment 
Page I-LR2032(2) 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT ,~" to S.P. 456, L.D. 1385 
financing districts included within Pine Tree Development Zones 
designated and approved under subchapter 3. 
Sec. 2. 30-A MRS A c. 206, sub-c. 3 is enacted to read: 
P:rm: TREE DEVELOPMENT ZQRES 
§5245. 
Findings and declaration of necessity 
1. 
Legislative finding. 
The Legislature finds that there 
is a need to encourage development in economically distressed 
areas of the State in order to: 
A. 
Provide new employment opportunities: 
B. 
Improve existing employment opportunities; 
C. 
Improve and broaden the tax base; and 
D. 
ImprQv~ the g~n~ral el;:QnQmy Qf the State. 
2. 
Authorization. 
FQr the reaSQns set out in subsectiQn 
I. a unit Qf local gQvernment. or 2 or mQre l;:Qoperating units of 
lQcal gQvernment. may develQP a prQgram for imprQving a district 
within its l;:ollel;:tive boundaries: 
A. 
To provide impetus for targeted business development; 
B. 
TQ inl;:rease employment; and 
C. 
To provide the facilities outlined in the development 
program 
adopted 
by 
the 
participating 
units 
Qf 
lQl;:al 
gQvernment. 
3. 
Declaration of public pu~se. The Legislature declares 
that the al;:tiQns required tQ assist the implementatiQn of these 
deve1Qpment programs are a Publil;: purpose and that the exel;:ution 
and financing of these programs are a Publil;: purpQse. 
§5246. 
Definitions 
As used in this subchapter. unless the context otherwise 
indil;:ates. the fQllowing terms have the fQllowing meanings. 
1. 
Affiliated business. 
"Affiliated business" 
means 
a 
member Qf a grQup of 2 Qr mQre businesses in which mQre than 50~ 
of the vQting stol;:k Qf each member cQrporatiQn or mQre than 50~ 
of the Qwnership interest in a business other than a l;:orpQration 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT "A" to S.P. 456, L.D. 1385 
is directly or indirectly owned by a 
common owner or owners, 
either corporate or noncorporate, or by one or more of the member 
businesses. 
2. 
Applicant. 
"Applicant" 
means 
any 
unit 
of 
local 
government and any group of cooperating units of local government 
in 
the 
State 
that 
apply 
for 
designation 
as 
a 
Pine 
Tree 
Development Zone under section 5247. 
• 
Average 
emplo}!Dlent 
during 
base 
period. 
"Average 
employment during base period" for a business means the total 
number of qualified employees of that business on each of 6 
consecutive measurement days in each of the 3 calendar years in 
the base period as chosen by the business divided by 18. 
4. 
Base level of emplO3JllE!nt. 
"Base level of employment" 
means the greater of either the total employment in the State of 
a business and its affiliated businesses as of the December 31st 
immediately preceding its certification as a qualified Pine Tree 
Development Zone business or its average employment during the 
base period. 
5. 
Base period. 
"Base period" means the 3 calendar years 
prior to the year in which a business is certified as a qualified 
Pine Tree Development Zone business. 
6. 
CoDmissioner. 
"Commissioner" means the Commissioner of 
Economic and Community Development. 
7. 
Department. 
"Department" 
means 
the 
Department 
of 
Economic and Community Development. 
8. 
Financial services. 
"Financial services" means services 
provided by an insurance company subject to taxation under Title 
36, 
chapter 357: 
a 
financial institution subject to taxation 
under Title 36, chapter 819: or a mutual fund service provider as 
defined in Title 36, section 5212, subsection 1, paragraph E. 
9. 
Labor market average veeklr wage. 
"Labor market average 
weekly wage" means the average weekly wage as published by the 
Department of Labor for the labor market or markets in which 
potential qualified Pine Tree Development 
Zone 
employees 
are 
located for the 12 most recently reported months preceding the 
date of application for zone designation. 
10. 
Labor 
market 
unemplo,yment 
rate. 
"Labor 
market 
unemployment 
rate" 
means 
the 
average 
unemployment 
rate 
as 
published by the Department of Labor for the labor market or 
markets in which potential qualified Pine Tree Development Zone 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT" If. to S.P. 456, L.D. 1385 
employees are located for the 12 most recently reported months 
preceding the date of application for zone designation. 
11. 
Manufacturing. 
"Manufacturing" means the production of 
tangible 
personal 
property 
intended 
to 
be 
sold 
or 
leased 
ultimately for final use or consumption or the production of 
tangible personal property pursuant to 
a 
contract with the 
Federal Government or any agency thereof. 
12. 
Person. 
"Person" has the same meaning as defined in 
Title 36. section Ill. subsection 3. 
13. 
Pine Tree nevelopnent Zone. 
"Pine Tree Development 
Zone" or "zone" means a specified area within the boundaries of a 
unit of local government. or within the boundaries of cooperating 
units of local government in a multijurisdictional application. 
that has been designated by the commissioner as 
a Pine Tree 
Development Zone in accordance with section 5247. 
14. 
Pine 
Tree 
DeyelORJllent 
Zone 
benefits. 
"Pine 
Tree 
Development Zone benefits" means: 
A. 
The exclusion from the limitations established under 
section 
5223. 
subsection 
of 
tax 
increment 
financing 
districts included within a Pine Tree Development Zone: 
B. 
Expanded 
employment 
tax 
increment 
financing benefits 
under Title 36. chapter 917: 
C. The sales tax exemptions under Title 36. section 1760. 
subsections 86 and 87: and 
D. The Pine Tree Development Zone tax credits provided by 
Title 36. sections 2529 and 52l9-W. 
15. 
Production. 
"Production" 
has 
the 
same 
meaning 
as 
defined in Title 36. section 1752. subsection 9-B. 
16. 
olJPlified 
business 
activiU. 
"Oualified 
business 
activity" means a business activity that is conducted within a 
Pine Tree Development Zone and is directly related to financial 
services. manufacturing or a 
targeted technology business for 
which the business receives a certificate from the commissioner 
pursuant to section 525Q-B. 
17. 
QIJPlified 
Pine 
Tree 
DeyelQpnent 
Zone 
business. 
"Oualified Pine Tree Development Zone business" or "qualified 
business" means any for-profit business in this State engaged in 
financial 
services. 
manufacturing 
or 
a 
targeted 
technology 
business that adds qualified Pine Tree Development Zone employees 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT "A" to S.P. 456, L.D. 1385 
above its base level of employment in this State and that meets 
the following criteria: 
A. It demonstrates that the establishment or expansion of 
operations within the Pine Tree Development Zone would not 
occur within the State absent the availability of the Pine 
Tree Development Zone benefits; and 
B. It has received a certificate as a gualified business 
pursuant to section 5250-B. 
18. 
Qualified 
Pine 
Tree 
Develo.pnent 
Zone 
employees. 
"Oualified Pine 
Tree 
Development 
Zone 
employees" 
means 
new, 
full-time employees hired in this State by a gualified Pine Tree 
Development 
Zone 
business for 
work directly in one or more 
gualified business 
activities 
for 
whom 
a 
retirement 
program 
subject to the Employee Retirement Income Security Act of 1974, 
United States Code, Sections 101 to 1461 (2003) 
and group 
health insurance 
are provided 
and 
whose 
wages 
derived 
from 
employment within the Pine Tree Development Zone, calculated on a 
calendar year and per capita basis, are greater than the average 
annual per capita wages in the local labor market area in the 
county in which the gualified employee is employed. 
Oualified 
Pine Tree Development Zone employees must be residents of this 
State. 
19. 
State average weekly wage. 
"State average weekly wage" 
means the average weekly wage as published by the Department of 
Labor for the State as a whole for the 12 most recently reported 
months preceding the date of application for zone designation. 
20. 
State upemplo,yment rate. 
"State unemployment rate" 
means the average unemployment rate published by the Department 
of Labor for the State as a whole for the 12 most recently 
reported months 
preceding the date 
of application for 
zone 
designation. 
21. 
Targeted 
tecbno1ogy business. 
"Targeted technology 
business" 
means 
a 
business primarily involved in a 
targeted 
technology as defined in Title 5, section 15301. 
22. 
Unit of 10cal government. 
"Unit of local government" 
means a municipality, county, plantation, unorganized territory 
or Indian tribe. 
§5247. 
Pine Tree Develo.pnent Zones 
1. 
Creation. 
One or more units of local government, or an 
organization representing one or more units of local government, 
may apply to the commissioner for the designation of a Pine Tree 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT ·A .. to S.P. 456, L.D. 1385 
Development Zone within the boundaries of the unit or units of 
local government in accordance with the reguirements of this 
subchapter. 
County 
governments 
may 
apply 
on 
behalf 
of 
unorganized territories. Groups of units of local government may 
apply 
for 
multi jurisdictional 
or 
joint 
projects. 
Multijurisdictional applications reguire designation of one unit 
of local government as the lead applicant and consent for that 
designation by each participating unit of 
local 
government. 
Counties may also apply on behalf of a consortium of units of 
local government. The designation of a Pine Tree Development Zone 
may not conflict with the provisions of a municipal or other unit 
of local government charter. 
Zones that meet the reguirements of 
subsection 2 are authorized for designation as follows: 
A. 
Aroostook County, 
including up to 100 acres of land 
reserved for the Aroostook Band of Micmacs and the Houlton 
Band of Maliseet Indians; 
B. 
The Androscoggin Valley region, including the Lewiston 
Enterprise 
Community 
Zone 
as 
designated by 
the 
federal 
Agriculture, 
Rural 
Development, 
Food 
and 
Drug 
Administration, 
and Related Agencies, 
Appropriations Act, 
Public Law 105-277 (1999); 
C. 
The Penobscot Valley region, including up to 500 acres 
of land reserved for the Penobscot Nation; and 
D. 
Washington County and the Downeast region, including up 
to 500 acres of land reserved for the Passamaguoddy Tribe. 
The commissioner may designate up to 4 additional zones through 
the process established in section 5249. 
2. 
Requirements for designation. 
The commissioner shall 
adopt 
rules 
establishing 
the 
m1n1mum 
reguirements 
for 
the 
designation of Pine Tree Development Zones. 
Additionally. each 
participating unit of local government must agree to maintain at 
least one prepermitted construction or development site available 
within the zone on a continual basis throughout the term of the 
zone. 
3. 
Limitations. 
The designation of Pine Tree Development 
Zones is subject to the following limitations: 
A. 
The total area of a zone. including all noncontiguous 
parcels, may not exceed 5,000 acres; 
B. 
A zone located in Aroostook County as described in 
subsection I. paragraph A may include property that is also 
included within the Aroostook County Empowerment Zone as 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT ,A .. to S.P. 456, L.D. 1385 
designated by the federal Community Renewal Tax Relief Act 
of 2000, Public Law 106-554; 
C. 
Pine Tree Development Zone benefits may not be used to 
encourage or facilitate the transfer of existing positions 
or property of a qualified business or affiliated businesses 
into a zone from a location elsewhere in the State; 
D. 
Pine Tree Development Zone benefits may not be provided 
based upon any employees or positions transferred by the 
business 
or 
affiliated 
businesses 
into 
a 
Pine 
Tree 
Development Zone from a location elsewhere in the State; 
E. 
A Pine Tree Development Zone may not consist of more 
than 20 noncontiguous parcels of property; 
F. 
All property included within the boundaries of a Pine 
Tree Development Zone must be suitable for one or more 
qualified Pine Tree Development Zone business activities; 
G. 
All property included within a Pine Tree Development 
Zone must be within a labor market area for which the labor 
market 
unemployment 
rate 
is 
greater 
than 
the 
state 
unemployment rate at the time of application; 
H. 
All property included within a Pine Tree Development 
Zone must be within a labor market area for which the labor 
market average weekly wage is below the state average weekly 
wage at the time of application; and 
I. 
The restrictions contained in paragraphs G and H may be 
waived for property that is contained within a labor market 
area that has sustained a greater than 5~ loss of population 
or workforce during the 3-year period immediately preceding 
the time of application if the loss is caused by business 
closings. 
4. 
Ap,p1ication. 
An application for designation of a Pine 
Tree 
Development 
Zone 
must 
include, 
but is not necessarily 
limited to, the following: 
A. 
A narrative description of the Pine Tree Development 
Zone to be designated; 
B. 
Maps 
and any other information necessary to clearly 
identify 
the 
geographic 
boundaries 
of 
the 
Pine 
Tree 
Development Zone and any subzones it may include; 
C. 
Evidence that the Pine Tree Development Zone meets the 
requirements of subsection 3; 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT .. A 
.. to S.P. 456, L.D. 1385 
D. 
Any information evidencing economic distress: and 
E. 
A development plan that includes: 
(1) Documentation of all municipal commitments required 
under subsection 2: 
(2) A description of how the Pine Tree Development Zone 
will be administered, including any related interlocal 
cooperative agreements: 
(3) A description of the goals and objectives to be 
accomplished through the Pine Tree Development Zone: 
(4) A description of the resources to be committed to 
the Pine Tree Development Zone by the applicant or 
applicants: and 
(5) Plans for accomplishing the goals and objectives, 
including a marketing plan and related time line and 
milestones. 
5. 
Termination. 
All 
Pine 
Tree 
Development 
Zone 
designations approved under this subchapter and all Pine Tree 
Development Zone benefits are terminated on December 31, 2018. 
§5248. 
Procedure 
1. 
Notice and hearing. 
Before designating a 
Pine Tree 
Development Zone or adopting a development plan, the legislative 
bogy 
of 
each 
applicant 
unit 
of 
local 
government 
or 
the 
legislative body's 
designee 
must 
hold at least 
one 
public 
hearing. 
Notice of the hearing must be published at least 10 
days before the hearing in a newspaper of general circulation 
within the unit of local government. 
2. 
Vote of "nit of local govermaent legislatiye bod,y. 
Each 
applicant unit of local government must designate that portion of 
the Pine Tree Deyelopment Zone contained within its boundaries 
and take all actions required to satisfy the requirements of 
section 5247, subsection 2 by majority vote of its legislative 
body. 
3. 
Effectiye date. 
The 
establishment of 
a 
Pine 
Tree 
Development 
Zone 
is 
effective 
upon 
designation 
by 
the 
commissioner. 
4. 
Administration of zone. 
The participating units of 
local 
government 
may 
create 
an 
organization, 
designate 
an 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT "A " to S.P. 456, L.D. 1385 
existing 
department 
or 
agency 
or 
enter 
into 
a 
contractual 
arrangement 
with 
a 
private entity 
to 
administer 
activities 
authorized under this subchapter. 
5. 
Amendments. 
A participating unit of local government 
may 
amend 
the designation of that portion of 
a 
Pine 
Tree 
Development Zone contained within its boundaries or an adopted 
development plan only after meeting the requirements of this 
section for designation of a 
Pine Tree Development 
Zone 
or 
adoption of a development plan and with the concurrence of all 
other participating units of local government. 
A participating 
unit of local government may not amend the designation of a Pine 
Tree Development Zone if the amendment would result in the zone's 
being out of compliance with any of the requirements in section 
5247. 
§5249. 
Selection criteria 
1. 
Review and selection. 
The commissioner shall review 
applications and select zones for designation based upon the 
following criteria: 
A. 
Severity of economic distress within the region affected 
by the Pine Tree Development Zone: 
B. 
Viability of a development plan described under section 
5247. subsection 4. paragraph E: 
C. 
Commitment of local and regional financial resources; 
D. 
Partnerships with public and private organizations; and 
E. 
Impact 
on 
surrounding 
regions 
of 
the 
Pine 
Tree 
Development Zone. 
§5250. 
Program administration: rules 
The 
commissioner 
shall 
administer 
this 
subchapter. 
The 
commissioner 
shall 
adopt 
rules 
pursuant 
to 
the 
Maine 
Administrative Procedure Act for 
implementation of Pine Tree 
Development 
Zones. 
including. 
but not limited to. 
rules for 
determining 
and 
certifying eligibility. 
selecting 
zones 
for 
designation and evaluating on a periodic basis the progress and 
success of each Zone in achieving its goals. Rules adopted under 
this section are routine technical rules as defined in Title 5. 
chapter 375. subchapter 2-A. 
§5250-A. 
Unorganized territo~ 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT ·A " to S.P. 456, L.D. 1385 
For the purposes of this subchapter. a county may act as a 
municipality for the unorganized territory within the county and 
may 
designate 
development 
districts 
within 
the 
unorganized 
territory. 
When a county acts under this section. the county 
commissioners 
act as 
the municipality 
and 
as 
the municipal 
legislative body. the State Tax Assessor acts as the municipal 
assessor and the unorganized territory education and services 
fund receives the funds designated for the municipal general fund. 
§5250-B. 
Certification of gya1ified business 
A business may apply to the commissioner for certification 
as a qualified Pine Tree Development Zone business. 
Upon review 
and determination by the 
cOmmissioner that 
a 
business is 
a 
qualified Pine Tree Development Zone business. the commissioner 
shall issue a certificate of qualification to the business that 
includes a description of the qualified business activity for 
which the certificate is being issued. 
§5250-C. 
Report 
Not 
later 
than 
April 
I. 
2005 
and 
April 
1st of 
each 
odd-numbered year thereafter. the commissioner shall report to 
the 
joint 
standing 
committee 
of 
the 
Legislature 
having 
jurisdiction over economic development matters on the status of 
the Pine Tree Development Zones. 
Sec. 3. 36 MRSA §1760, sub-§§86 and 87 are enacted to read: 
86. 
Construction contracts with ql1al ified deyelQpDlent zone 
businesses. 
Sales to 
a 
construction contractor of 
tangible 
personal property that is to be physically incorporated in, and 
become a permanent part of. real property that is owned by or for 
sale to a qualified Pine Tree Development Zone business. 
as 
defined in Title 30-A. section 5246, subsection 17. which real 
property will be used in the qualified business activity. as 
defined in Title 30-A, 
section 5246. 
subsection 16. 
of the 
qualified Pine Tree Development Zone business in a Pine Tree 
Development 
Zone, 
as 
defined 
in Title 
30-A. 
section 
5246. 
subsection 13. 
The exemption provided by this subsection is 
limited to sales to a construction contractor occurring within a 
period of 
years 
from 
the date the qualified Pine Tree 
Development Zone business receiving the property is certified 
pursuant to Title 30-A. section 5250-B or until December 31, 
2018. whichever occurs first. 
87. 
Sales of tangible persona! prqperty to Wlalified 
deyelqgment zone businesses. 
Sales of tangible personal property 
to a qualified Pine Tree Development Zone business. as defined in 
Title 30 A. 
section 5246. subsection 17. for use directly and 
COMMITTEE AMENDMENT 
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~ 
COMMITTEE AMENDMENT ,~" to S.P. 456, L.D. 1385 
primarily in one 
or 
more 
qualified business activities, 
as 
defined 
in Title 
30-A, 
section 
5246. 
subsection 
16. 
The 
exemption 
provided 
by 
this 
subsection 
is 
limited 
for 
each 
qualified Pine Tree Development Zone business to sales occurring 
within a period of 10 years 
from the date the business is 
certified pursuant 
to Title 
30-A. 
section 
5250-B 
or 
until 
December 31, 2018. whichever occurs first. 
Sec. 4. 36 MRSA §2529 is enacted to read: 
§2529. 
Pine Tree Develqpment Zone tax credit 
1. 
Credit allowed. 
A taxpayer that is a qualified Pine 
Tree Development Zone business as defined in Title 30-A. section 
5246, subsection 17 is allowed a credit in the amount of: 
A. 
One hundred percent of the tax associated with premiums 
sold 
by 
a 
qualified business 
located 
in 
a 
Pine 
Tree 
Development Zone that would otherwise be due under this 
chapter for each of the first 5 taxable years that the 
taxpayer is required to file a 
return pursuant to this 
chapter beginning after the taxpayer cOmmences its qualified 
business activity, as defined in Title 30-A, section 5246, 
subsection 16, 
and that are directly attributable to 
a 
qualified business activity; and 
B. 
Fifty percent of the tax associated with premiums sold 
by a qualified business in a Pine Tree Development Zone that 
would otherwise be due under this chapter for each of the 
taxable years beginning with the 6th taxable year and ending 
with the 10th taxable year that the taxpayer is required to 
file a return pursuant to this chapter after the taxpayer 
commences its qualified business activity, as defined in 
Title 
30-A, 
section 5246. 
subsection 16. 
and that are 
attributable to a qualified business activity. 
2. 
Apportioned credit in certain circumstances. 
In the 
case of 
a 
qualified Pine Tree Development 
Zone business as 
defined in Title 30-A, section 5246, subsection 17, including any 
affiliated members of the qualified business. that has a business 
presence in the State other than that conducted wi thin a Pine 
Tree Development Zone, as defined by Title 30-A, section 5246, 
subsection 13, the credit provided for in this section is to be 
calculated based upon a pro forma determination. 
The pro forma 
determination must be based on the assumption that all of the 
business 
activities 
conducted 
by 
the 
qualified 
Pine 
Tree 
Development Zone business and the affiliated members, if any, 
within this State constitute a unitary business, but only the 
qualified 
business 
activity 
conducted 
in 
the 
Pine 
Tree 
Development Zone is subject to tax imposed by this Part. 
The 
Page ll-LR2032(2) 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT .. A 
.. to S.P. 456, L.D. 1385 
portion 
of 
the 
tax 
liability 
of 
the 
qualified 
Pine 
Tree 
Development Zone business and the affiliated members, if any, 
related to the business activity conducted in the Pine Tree 
Development Zone must be determined by use of a percentage, the 
numerator of which is the property value and the payroll for the 
taxable 
year 
directly attributed 
to 
the 
qualified 
business 
activity of the business and the denominator of which is the 
statewide property value and payroll for the taxable year of the 
qualified business and its affiliated members. 
3. 
Limitation. 
The credit provided by this section may not 
be claimed for calendar years beginning on or after January 1. 
2019. 
Sec. S. 36 MRSA §S219-W is enacted to read: 
§S219-W. 
Pine Tree Development Zone tax credit 
1. 
Credit allowed. 
Except as provided by subsection 2, a 
taxpayer that is a qualified Pine Tree Development Zone business 
as defined in Title 30-A. section 5246. subsection 17 is allowed 
a credit in the amount of: 
A. 
One hundred percent of the tax that would otherwise be 
due under this Part for each of the first 5 taxable years 
that the taxpayer is required to file a return pursuant to 
this 
Part 
beginning 
after 
the 
taxpayer 
commences 
its 
qualified business activity. 
as 
defined in Title 
30-A. 
section 5246. subsection 16: and 
B. 
Fifty percent of the tax that would otherwise be due 
under this Part for each of the taxable years beginning with 
the 6th taxable year and ending with the 10th taxable year 
that the taxpayer is required to file a return pursuant to 
this 
Part 
after 
the 
taxpayer 
commences 
its 
qualified 
business activity. as defined in Title 3D-A. section 5246. 
subsection 16. 
2. 
Apj!Ortioned credit in certain circumstances. 
In the 
case of a 
qualified Pine Tree Development Zone business. 
as 
defined in Title 30-A, section 5246. subsection 17. that has a 
business presence in the State other than that conducted within a 
Pine Tree Development Zone. as defined by Title 30-A. section 
5246. subsection 13. including. but not limited to. a qualified 
Pine Tree Development Zone business that is required to file a 
combined report pursuant to section 5220. subsections 5 and 6. 
the 
Maine 
income 
tax liability of 
the qualified Pine 
Tree 
Development 
Zone business. 
and the affiliated members of its 
unitary group. if any. upon which the credit provided for in this 
section must be calculated based upon a pro forma determination. 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT .. A 
.. to S.P. 456, L.D. 1385 
The pro forma determination must be based on the assumption that 
al1 of the business activities conducted by the qualified Pine 
Tree Development Zone business and the affiliated members of its 
unitary 
group, if any, within this State constitute a unitary 
business, but only the qualified business activity conducted in 
the Pine Tree Development Zone is subject to tax imposed by this 
Part. 
The portion of the tax liability of the qualified Pine 
Tree Development Zone business and the affiliated members of its 
unitary group, if any, related to the business activity conducted 
in the Pine Tree Deyelopment Zone must be determined by use of a 
percentage, the numerator of which is the property value and the 
payroll for the taxable year directly attributed to the qualified 
business activity of the business and the denominator of which is 
the statewide property value and payroll for the taxable year of 
the qualified business and the members of its unitary group. 
3. 
Sole pro.prietors and owners of pass-through entities. 
In the case of a sole proprietor or the owner of a partnership, 
limited liability company, S corporation, trust or other entity 
that is treated as a pass-through entity for income tax purposes 
under the Code, the amount of the credit allowed under subsection 
is the amount of tax otherwise due under this Part that relates 
to taxable income received by the sole proprietor or owner from 
the qualified business as apportioned. 
4. Limitation. 
The credit provided by this section may not 
be claimed for tax years beginning on or after January 1, 2019. 
Sec. 6. 36 MRSA §6754, sub-§l, 1JD is enacted to read: 
D. 
For qualified Pine Tree Development Zone employees, as 
defined in Title 30-A, section 5246, subsection 18, employed 
directly in the qualified business activity of a qualified 
Pine Tree Development Zone business, as defined in Title 
30-A, section 5246, subsection 17, for whom a certificate of 
qualification has been issued in accordance with Title 30-A, 
section 5250-B, the reimbursement under this subsection is 
equal to 80% of the withholding taxes withheld each year for 
which reimbursement is requested and attributed to those 
qualified employees for a period of no more than 10 years. 
In no event may reimbursement under this subsection be paid 
for years beginning after December 31, 2018. 
Sec. 7. Administrative costs to be absorbed. 
The Department of 
Administrative and Financial Services, Bureau of Revenue Services 
shall absorb within existing resources any administrative costs 
involved in the implementation of this Act. 
Sec. 8. Effective date. 
That section of this Act that enacts 
the 
Maine 
Revised 
Statutes, 
Title 
36, 
section 
1760, 
COMMITTEE AMENDMENT 
~~. 
".. 
~ 
~\\ .. 
COMMITTEE AMENDMENT .. f+ to S.P. 456, L.D. 1385 
subsections 86 and 87 is effective for sales made on or after 
July 1, 2003. 
That section of this Act that enacts Title 36, 
section 2529 is effective for calendar years beginning on or 
after January 1, 2003. 
That section of this Act that enacts 
Title 36, section 52l9-W is effective for tax years beginning on 
or after January 1, 2003. 
That section of this Act that enacts 
Title 36, section 6754, subsection 1, paragraph D is effective 
for 
withholding 
taxes 
withheld 
by 
a 
qualified 
Pine 
Tree 
Development Zone business on or after July 1, 2003. 
Emergency clause. 
preamble, 
this 
Act 
otherwise indicated.' 
In view of 
takes 
effect 
the emergency cited in 
when 
approved, 
except 
SUMMARY 
the 
as 
This amendment replaces the original bill. 
The amendment 
establishes the Pine Tree Development Zone program within the 
Department of Economic and Community Development and authorizes 
qualified businesses in the manufacturing, target technology and 
financial services sectors to receive the following benefits as a 
result of their operations established or expanded within the 
zones: 
1. 
Sales tax exemptions for certain building materials 
purchased pursuant to construction contracts with qualified Pine 
Tree Development Zone businesses and for all tangible personal 
property purchased by qualified businesses; 
2. 
Exclusion from the calculation of a municipality's total 
tax increment financing district area and original assessed value 
limitations of tax increment financing districts established in 
Pine Tree Development Zones; 
3. 
Employment tax increment financing equal to 
80% 
of 
qualified 
employees' 
state 
income 
tax 
withholdings 
directly 
attributable to qualified business activities for a period of no 
more than 10 years; and 
4. 
A tax credit equal to 100°-& of the state income tax and 
insurance 
premiums 
tax 
due 
and 
directly 
attributable 
to 
operations within the zones for each of the first 5 years, 
followed by a credit equal to 50% of the state income tax due and 
attributable to operations within the zones for the 6th through 
10th years. 
It is specified in the bill that in no event may any of the 
tax benefits described above be available to taxpayers after 
December 31, 2018. 
Page l4-LR2032(2) 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT .. A 
.. to S.P. 456, L.D. 1385 
The 
amendment 
also 
limits 
designation 
of 
Pine 
Tree 
Development Zones to areas that have a greater unemployment rate 
than the state average and lower wages than the state average or 
that have sustained a loss of workforce or population greater 
than 5"0 in the previous 3-year period due to business closings. 
In addition, the amendment includes technical changes to the 
original bill, adds an emergency preamble and emergency clause, 
and creates 
a 
reporting requirement for the 
Commissioner of 
Economic and Community Development. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Net Cost (Savings) 
General Fund 
Revenue 
General Fund 
Other Special Revenue Funds 
Fiscal Detail and Notes 
Approved: 04/11103 ~ae 
Office of Fiscal and Program Review 
LD 1385 
An Act to Establish the Pine Tree Development Zones Program 
LR 2032(02) 
i/ 
Fiscal Note for Bill as Amended by Committee Amendment rt" S -tt/l 
Committee: Business, Research and Economic Development 
Fiscal Note Required: Yes 
Fiscal Note 
2003-04 
$165,549 
($165,549) 
($8,897) 
2004-05 
$466,437 
($466,437) 
($25,067) 
Projections 
2005-06 
$706,941 
($706,941) 
($38,777) 
Projections 
2006-07 
$875,657 
($875,65' 
($48,032) 
The table below summarizes the net General Fund revenue impact of the bill based on the assumption that 
approximately $150,000,000 of investment over 4 years within the 8 Pine Tree Development Zones would be within 
baseline economic assumptions. 
2003-04 
2004-05 
2005-06 
2006-07 
Sales Tax Exemption for Construction Contractors 
(160,144) 
(409,256) 
(474,000) 
(474,000) 
Sales Tax Exemption for Tangible Personal Property 
(2,684) 
(9,545) 
(17,480) 
(25,425) 
Pine Tree Development Zone Income Tax Credit 
(2,721) 
(25,396) 
(59,800) 
(96,042) 
Employment Tax Increment Financing 
(22,240) 
(155,661) 
(280,190) 
(165,549) 
(466,437) 
(706,941) 
(875,657) 
Maine Revenue Services will incur additional one-time costs of approximately $24,000 as a result of this bill. This 
bill does not include a General Fund appropriation for that purpose. 
LR2032(2) - Fiscal Note - Page 1 of 1