An Act To Alleviate Overcrowding in Public Schools
Maine Legislature, Session 122, LD 1110
Committee: Taxation
Sponsors: VAUGHAN, CAIN, LANSLEY, STEDMAN
Amends: 36 MRSA §343, 36 MRSA §5122

Legislative Document 
No.1HO 
H.P.763 
House of Representatives, March 1,2005 
An Act To Alleviate Overcrowding in Public Schools 
Reference to the Committee on Taxation suggested and ordered printed. 
Presented by Representative VAUGHAN of Durham. 
!Jl~ 
/J7.7l/d£~ 
MILLICENT M. MacFARLAND 
Clerk 
Cosponsored by Representatives: CAIN of Orono, LANSLEY of Sabattus, STEDMAN of 
Hartland. 
Primed on recycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 20-A MRSA c. 310 is enacted to read: 
CHAPTER 310 
TAX C~J;:l)l-;r_FQg~TJlDE;lITS IN 
OVERCRONDED SCHOOLS 
S800l. 
Definitions 
As 
used in this 
chapter, 
unless 
the 
context 
otherwise 
indicates, the following terms have the following meanings. 
1. 
Overcrowded schoQl. 
"Overcrowded school" means a public 
elementary or secondary school with an average student-to-teacher 
ratio greater than 
to 1, 
as measured according to rules 
adopted by the state board. 
2. 
Receiving school. 
"Receiving school" means a public or 
private elementary or secondary school that is not an overcrowded 
school that receives a student from an overcrowded school. 
3. 
Sending school. 
"Sending school" means an overcrowded 
school that a 
student chooses to leave in order 
1:0 
attend a 
public or private elementary or secondary school that is not an 
overcrowded school. 
4. 
Tax credit. 
"Tax credit" means a property tax credit 
pursuant to Title 36, section 343 or an income tax modification 
pursuant to Title 36, section 5122, subsection 2, paragraph U. 
S8002. 
Eligibility 
A parent or legal guardian of a student in an overcrowded 
school is eligible to receive 
a~_t~a~x~~c~r~e~d~i~t~~~~'f~_t~h~a~t~~s~t~u~d~e~n~t 
chooses to attend a public or private school that is not an 
overcrowded school. 
~8003. Rules 
The 
state 
board 
shall 
adoRt 
rules 
to 
implement 
this 
chapter. 
Those 
rules must 
include 
a 
method 
for 
calculating 
average student-to-teacher ratios and an administrative process 
for ensuring that eligibility for a tax credit is not affected-ill' 
a 
student's 
selection of 
a 
rece~v~ng school. 
Rules 
adopted 
pursuant to this section are major substantive rules as defined 
in Title 5, chapter 375, subchapter 2-A. 
Page l-LR156l(1) 
Sec. 2. 36 MRSA §343 is enacted to read: 
§343. 
Education tax credit 
A municipality may issue a credit against property taxes 
owed for tuition costs paid by a resident who sends a child to a 
school outside of that municipality pursuant to Title 
20-A, 
chapter 310. 
The 
amount of the credit is determined by the 
municipality. 
Sec. 3. 36 MRSA §5122. sub-§2. ,Q. as corrected by RR 2003, c. 
.14 
]6 
1, §38, is amended to read: 
Q. 
A fraction of any amount previously added back by the 
taxpayer 
to 
federal 
adjusted 
gross 
income 
pursuant 
to 
subsection 1, paragraph N. 
(I) 
With respect to property first placed in service 
during taxable years beginning in 2002, the adjustment 
under this paragraph is available for each year during 
the 
recovery 
period, 
beginning 
years 
after 
the 
beginning of the taxable year during which the property 
was first placed in service. 
The fraction is equal to 
the amount added back under subsection 1, paragraph N 
with respect to the property, divided by the number of 
years in the recovery period minus 2. 
(2) 
With 
respect 
to 
all 
other 
property, 
for 
the 
taxable year 
immediately following the 
taxable year 
during which the property was first placed in service, 
the fraction allowed by this paragraph is equal to 5°" 
of the amount added back under subsection 1, paragraph 
N with respect to the property. 
For each subsequent 
taxable year dur ing the recovery period, the fraction 
is 
equal 
to 
95% 
of 
the 
amount 
added 
back 
under 
subsection 1, paragraph N with respect to the property, 
divided by the number of years in the recovery period 
minus 2. 
In the case of property expensed pursuant to Section 179 of 
the Code, 
the term "recovery period" means 
the recovery 
period that would have been applicable to the property had 
Section 179 not been applied; aBe 
4G 
Sec. 4. 36 MRSA §5122. sub-§2. ,T. as amended by PL 2003, c. 
'iO 
705, §12 and affected by §14, is further amended to read: 
T. 
2002 
For income tax years beginning on 
and before January 1, 
2004, 
an 
or after January 1, 
amount equal to the 
total premiums spent for long-term care insurance policies 
certified under Title 24-A, section 5075-A as long as the 
amount subtracted is reduced by the long-term care premiums 
claimed as an itemized deduction pursuant to section 5125. 
For income tax years beginning on or after January 1, 2004, 
an amount equal to the total premiums spent for qualified 
long-term care 
insurance contracts certified under Title 
24-A, section 5075-A, as long as the amount subtracted is 
reduced by any amount claimed as a deduction for federal 
income tax purposes in accordance with the Code, 
Section 
162(1) 
and by the long-term care premiums claimed as an 
itemized deduction pursuant to section 5125Tj and 
Sec. 5. 36 MRSA §5122, sub-§2, 1fU is enacted to read: 
U. 
For income tax year.!?-.Mginning on or after January 1, 
2005, 
an amount equal to costs incurred by a resident to 
send a 
child to a 
school outside of the municipality in 
which the resident lives pursuant to Title 20-A, 
chapter 
310. 
If a 
resident is issued a 
tax credit pursuant to 
section 343, the amount of that credit must be deducted from 
the amount claimed under this paragraph. 
SUMMARY 
Current law allows a resident of a municipality to send a 
child to a school outside that municipality; the costs of doing 
so are borne by the resident. 
This 
bill 
allows 
overcrowded 
school 
to 
a 
send 
resident 
whose 
that child to 
child 
attends 
another 
public 
an 
or 
private 
school 
and 
seek 
a 
property 
tax 
credit 
from 
the 
municipality in which the resident lives. 
The 
amount of the 
property tax credit is determined by the municipality. 
This bill 
also 
provides 
an 
income modification to 
that resident. 
The 
amount of the modification is limited to the difference between 
the actual cost and the amount of the property tax credit issued 
by a municipality to the resident.