An Act To Promote the Production and Use of Fuels Derived from Agricultural and Forest Products
Maine Legislature, Session 121, LD 1492
Committee: Taxation
Sponsors: SUSLOVIC, JOY, KOFFMAN, SMITH, KNEELAND, MARTIN
Amends: 36 MRSA §52

Legislative Document 
No. 1492 
H.P.1089 
House of Representati ves, March 31, 2003 
An Act To Promote the Production and Use of Fuels Derived from 
Agricultural and Forest Products 
Submitted by the Department of Environmental Protection pursuant to Joint Rule 204. 
Reference to the Committee on Taxation suggested and ordered printed. 
Presented by Representative SUSLOVIC of Portland. 
77l~ 
/J7.71}u~ 
MILLICENT M. MacFARLAND 
Clerk 
Cosponsored by Representatives: JOY of Crystal, KOFFMAN of Bar Harbor, SMITH of 
Monmouth, Senators: KNEELAND of Aroostook, MARTIN of Aroostook. 
Printeuon n:cycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. I. 36 MRSA §52I9-W is enacted to read: 
§52l9-K. 
Biofuel production and use 
1. 
Definition. 
As used in this section, unless the context 
otherwise indicates, the term "biofuel" means 
any product or 
energy 
source 
used 
to 
propel 
motor 
vehicles 
or 
otherwise 
substitute for liquid fuels that is derived from agricultural 
crops or residues or from forest products or byproducts, 
as 
distinct 
from 
petroleum 
or 
other 
fossil 
carbon 
sources. 
"Biofuel" includes, but is not limited to, 
ethanol, 
methanol 
derived from wood, levulinic acid, biodiesel, pyrolysis oils from 
wood or combinations of any of the above that may be used to 
propel motor vehicles either alone or in blends with conventional 
gasoline or diesel fuels or may be used in place of petroleum 
products in whole or in part to fire heating devices or any 
stationary power device. 
2. 
Credit allowed. 
A taxpayer engaged in the production of 
biofuels is allowed a credit against the tax imposed by this Part 
in the amount of 5¢ per gallon of biofuel produced wi thin the 
State during the taxable year that replaces the use of petroleum 
or liquid fuels derived from other fossil carbon sources. 
In 
blends with petroleum or other nonbiofuels, the credi1~ is allowed 
only on the portion of that blend that the biofuel constitutes. 
3. 
Limitations. 
Reimbursement to a producer of biofuels 
under subsection 2 is subject to the following limitation. 
The 
credit allowed, 
including carryovers, 
may not 
redu.ce the tax 
otherwise due under this Part below zero. 
A person entitled to a 
credit under this section for any taxable year may carryover and 
apply to the tax liability for anyone or more of the next 
succeeding 5 taxable years the portion of any unused credits. 
4. 
Certification. 
A taxpayer engaged in the production of 
biofuels claiming 
a 
credit under 
subsection 
shall provide 
information 
to 
the 
Commissioner 
of 
Environmental 
Protection 
regarding the biofuel being produced, 
including the 
type of 
forest or agricultural product being utilized, the nature and 
composition of the biofuel being produced, 
the proportion and 
composition of any nonbiofuel with which the biofuel is blended 
and the type of application for which it is intended to be used. 
Upon review of the information, the commissioner shall provide 
the taxpayer with a letter of certification that the biofuel 
produced during the taxable year is eligible for a tax credit 
under this section. 
Page l-LR1861(1) 
5. 
Aeplication. 
This 
section 
applies 
to 
tax 
years 
beginning on or after January 1, 2004. 
SUMMARY 
This bill is intended to promote the production and use of 
fuels derived from agricultural and forest resources, byproducts 
and wastes, replacing products that are currently derived from 
petroleum, coal, natural gas or other forms of fossil carbon. 
The bill provides an income tax credit of 5¢ per gallon for the 
production of liq~id fuels from biomass.