An Act Regarding the Maine Economic Development Evaluation
Maine Legislature, Session 123, LD 2317
Amends: 5 MRSA §13063, 5 MRSA §13070-J, 5 MRSA §13103, 7 MRSA §309, 36 MRSA §6652

Legislative Document 
No. 2317 
S.P.926 
April 10, 2008 
An Act Regarding the Maine Economic Development Evaluation 
Reported by Senator SCHNEIDER of Penobscot for the Joint Standing Committee on 
Business, Research and Economic Development pursuant to Public Law 2007, chapter 434, 
section 9. 
Printed on reCycled paper 
JOY 1. O'BRIEN 
Secretary of the Senate 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 5 MRS A §13056-B, as enacted by PL 2007, c. 434, §2, is amended to 
read: 
§13056-B. Reporting requirements of recipients of economic development funding 
To assist the department in preparing the comprehensive economic development 
evaluation pursuant to section 13056-A, a recipient of state economic development 
funding, including General Fund appropriations, dedicated revenue, tax expenditures as 
defined by section 1666 
and general obligation bond proceeds for economic 
development, shall, in addition to any other reporting requirements required by law, 
collect, maintain and provide data as requested by the department. 
Sec. 2. 5 MRS A §13058, sub-§5, as amended by PL 1999, c. 776, §§4 and 5, is 
further amended to read: 
5. Review of program; report to Governor and Legislature. The commissioner 
shall review and evaluate the programs and functions of the department and the operation 
of the economic delivery system, with the information obtained from the economic 
development evaluation pursuant to section 13056-A. 
The Maine £mall Business 
Commission, as established in section 13032, shall conduct the evaluation and review 
required by this section '>'lith respect to small business programs. The commissioner shall 
report the commissioner's findings and recommendations with respect to the issues 
described in this subsection to the Governor and to the Legislature no later than February 
st of each first regular session of the Legislature. The commissioner shall conduct the 
review and evaluation with respect to the following: 
A. 
The purpose of these programs and the degree to which the purpose is being 
met; 
B. 
The degree of significance of the purpose of the programs and functions of the 
department; 
C. 
The extent of the coordination of programs and services as required in 
subsection 4; 
D. 
The needs, problems and opportunities that are not being met by the programs 
and services ofthe department; 
E. 
The types of programs and services necessary to meet the needs, problems and 
opportunities as set out in paragraph D; 
F. 
The problems and successes in the economic delivery system; 
G. 
The state of small business in this State, including economic data, the 
effectiveness of state programs to aid small business, problems of small business that 
may be affected by state policies and such other information on small business as 
desired by the commissioner; 
H. 
Within available resources, the extent of business growth and change, including 
business expansions, new businesses and business closings; 
Page I - 123LR3592(OI)-1 
I. 
Within available resources, the status of investments in business in the State; and 
1. 
The extent to which the purposes of the Maine Downtown Center are being met. 
Sec. 3. 5 MRSA §13063-0, sub-§l, as enacted by PL 2003, c. 451, Pt. MMM, 
§ 1, is amended to read: 
1. Accounting and reporting requirements. The department shall: 
A. 
Maintain an accurate accounting of the use of all program funds as required by 
state procedures and program guidelines, including a detailed accounting of all 
program funding sources and expenditures; and 
B. Undertake an ongoing process to evaluate the impact of the projects undertaken 
with program funds. The evaluation process must include benchmarks and criteria to 
II 
evaluate the success of the fund. The benchmarks and criteria must be designed by 
the department to provide the follo'Ning: 
(I) An assessment of the direct and indirect economic impact of the funded 
projects; and 
(2) 
An assessment of the contribution of the fund to the creation of nev,' 
entrepreneurial opportunities; and 
C. 
Each year, submit a report to the joint standing committee of the Legislature 
having jurisdiction over business, research and economic development matters. The 
report must include: 
(I) An accounting of the use of all program funds received and expendec1 1nce 
the program's inception; 
(2) A summary of the status of any approved projects; 
(3) A summary of the results of any completed projects; 
(4) Evaluation data and assessment; and 
(5) 
Other information required to be submitted and evaluated by the joint 
'2(j 
standin!I committee of the I .eQislature havinQ jurisdiction over business. research 
and economic development matters. 
Sec. 4. 5 MRSA §13070-J, sub-§l,~, as amended by PL 2005, c. 519, Pt. 
TTT, § 1. is further amended to read: 
D. 
"Economic development incentive" means federal and state statutorily defined 
I 
programs that receive state funds. dedicated revenue funds and tax expenditures as 
defined by section 1666. whose purposes are to create, attract or retain business 
entities related to business development in the State. including but not limited to the 
following: 
(I) Assistance from Maine Quality Centers under Title 20-A, chapter 431-A; 
(2) 
The Governor's Training Initiative Program under Title 26, chapter 25, 
subchapter 4; 
(3) Municipal tax increment financing under Title 30-A, chapter 206; 
(4) The jobs and investment tax credit under Title 36, section 5215; 
(5) The research expense tax credit under Title 36, section 5219-K; 
(6) Reimbursement for taxes paid on certain business property under Title 36, 
chapter 915; 
(7) Employment tax increment financing under Title 36, chapter 917; 
(8) The shipbuilding facility credit under Title 36, chapter 919; 
(9) The credit for seed capital investment under Title 36, section 5216-B; or 
(10) The credit for pollution-reducing boilers under Title 36, section 5219-Z. 
Sec. 5. 5 MRSA §13070-J, sub-§3, as amended by PL 2001, c. 710, §3 and 
affected by §4, is repealed. 
Sec. 6. 5 MRSA §13070-J, sub-§4,~, as amended by PL 2001, c. 642, §3 and 
affected by § 12, is repealed. 
Sec. 7. 5 MRSA §13070-J, sub-§4, ~, as amended by PL 2001, c. 481, §2, is 
further amended to read: 
E. 
The department shall report by October January 1 st annually to the State Tax 
Assessor a listing of businesses that have failed to submit reperts information 
required under subsection 3 section 13056-B. The report must document that each 
business included in the report was provided with reasonable official notification of 
its noncompliance and that its failure to submit the required repefl information within 
days would result in the withholding and potential forfeiture of reimbursements 
for which the business may be eligible under Title 36, chapter 915. The notification 
must be in the form of a letter posted by certified mail before August October 15th of 
the reporting year. If the department subsequently receives a report the information 
from the business, the department shall so notify the State Tax Assessor. 
Sec. 8. 5 MRSA §13070-J, sub-§4, ~F, as enacted by PL 1999, c. 768, §2, is 
amended to read: 
F. 
Prior to any forfeiture of benefits under Title 36, section 6652, subsection 3, the 
department shall make a written determination that the repefl information required by 
subsection 3 section 13056-B either has not been received or is not in an acceptable 
form. 
A copy of that written determination, including the reasons for the 
determination, must be mailed to the claimant by certified mail. The determination 
made by the department constitutes final agency action that is subject to review by 
the Superior Court in accordance with the Maine Administrative Procedure Act, 
except that sections 11006 and 11007 do not apply. The Superior Court shalI conduct 
a de novo hearing and make a de novo determination as to whether the claimant has 
filed a report in substantial compliance with this section. The Superior Court shall 
make its own determination as to all questions of fact and law. The Superior Court 
shalI enter such orders and decrees as the case may require. In the event that the 
department's determination is appealed to Superior Court pursuant to this paragraph, 
forfeiture of the claimant's right to receive reimbursement of taxes under Title 36, 
chapter 915 may not occur unless the Superior Court, subject to any appeal to the 
Law Court, finds that the claimant had not substantially complied with the reporting 
requirements of this section. 
Sec. 9. 5 MRSA §13103, sub-§2, ~G, as amended by PL 2003, c. 50, Pt. B, § 1 
and affected by §2, is further amended to read: 
G. 
Submit each biennium a report to the Governor, the joint standing committee of 
the Legislature having jurisdiction over appropriations and financial affairs and the 
joint standing committee of the Legislature having jurisdiction over business, 
research and economic development matters. 
The report must include detailed 
information on the status of the funds in the Maine Biomedical Research Fund, and a 
listing and explanation of each specific source of funding from grant sources for 
biomedical research and its use and the number of new jobs created in the State and 
'",here those jobs are located. 
Sec. 10. 7 MRSA §309, as amended by PL 1999, c. 72, §6, is further amended to 
read: 
§309. Annual review 
The commissioner and the Agriculture Development Committee shall, on an annual 
basis, review the effectiveness of the programs operated under the provisions of this 
chapter and provide a summary of the review to the Commissioner of Economic and 
Community Development. 
Sec. 11. 36 MRSA §6652, sub-§3, as enacted by PL 1999, c. 768, §6, is amended 
to read: 
3. Withholding for failure to report. Provided that the Department of Economic 
and Community Development has complied with the notice requirements of Title 5, 
section 13070-J, subsection 4, paragraph E and the notice required by that provision has 
been received by the claimant, the State Tax Assessor shall withhold reimbursement 
under this chapter for a claimant listed by the department pursuant to Title 5, section 
13070-J, subsection 4, paragraph E as failing to submit the repeFts information required 
by Title 5, section 13070 J, subsection 3 13056-B and who, as of the date of the claim for 
which payment is being withheld, has failed to submit a report information that has 
become due. Upon notification by the department of its receipt of the required reJ*lFt 
information in an acceptable form, the State Tax Assessor shall make the payment that 
was withheld. The right to receive payment is forfeited if the overdue reJ*lFt information 
is not received in an acceptable form by the department within 180 days following the 
date the claim for reimbursement was filed, except that a forfeiture may not occur unless 
and until the following requirements have been satisfied: 
A. 
The assessor has notified the Department of Economic and Community 
Development, at least 60 days prior to the expiration of the 180 day period, of the 
date on which that 180 day period will expire; 
B. 
The Department of Economic and Community Development has notified the 
claimant in writing by certified mail within 15 days of receiving the assessor's notice 
that the department has made a determination under Title 5, section 13070-J, 
subsection 4, paragraph F that the repOO information filed by the claimant has not 
been received or is in unacceptable form and that the right to reimbursement is 
subject to forfeiture if a report the information in acceptable form is not filed within 
days following the date the claim for reimbursement was filed; and 
C. 
The claimant has either not appealed the determination of the Department of 
Economic and Community Development to Superior Court within 30 days of receipt 
by the claimant of the written determination in accordance with Title 5, section 
13070-J, subsection 4, paragraph F or the claimant has appealed and the department's 
determination has been upheld on appeal. 
Sec. 12. Report on assessment methods. The Office of Program Evaluation 
and Government Accountability, in collaboration with the Department of Administrative 
and Financial Services, Bureau of Revenue Services, shall develop recommendations, 
including a proposed methodology, for assessing economic development tax expenditures 
to provide funding for the comprehensive evaluation of state investments in economic 
development pursuant to the Maine Revised Statutes, Title 5, section 13056-A. 
By 
January 1, 2009, the Office of Program Evaluation and Government Accountability shall 
submit its findings and recommendations in a report to the joint standing committee of 
the Legislature having jurisdiction over business, research and economic development 
matters. 
SUMMARY 
This bill implements the recommendations of the Department of Economic and 
Community Development relating to streamlining and improving the comprehensive 
economic development evaluation for the State's economic development programs and 
incentives. 
It also reduces duplicative statutory reporting requirements that will be 
included in the department's comprehensive evaluation process. The bill amends the 
definition for "economic development incentive." 
"r" '),!" Iln-n 
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~ 
(See attached) 
Fiscal Detail and Notes: 
Approved: 04/09/08 ;'/!;?ac 
LD 
LR 3592(01) 
An Act Regarding the Maine Economic Development Evaluation 
Fiscal Note for Original Bill 
Committee: Business, Research and Economic Development 
Fiscal Note Required: Yes 
Fiscal Note 
Minor cost increase - General Fund 
Additional Costs to the Department of Agriculture, Food and Rural Resources can be absorbed within existing 
budgeted resources. 
Additional costs to report on assessment methods can be absorbed by the Office of Program Evaluation and 
Government Accountability utilizing existing budgeted resources. This report requirement could result in diverting 
resources from other projects currently on OPEGA's work plan which has been approved by the Government 
Oversight Committee. 
This legislation may result in minor savings to the Department of Economic and Community Development as a result 
of the elimination of certain evaluation requirements. The amount of savings is not expected to be significant. 
LR3592(01) - Fiscal Note - Page I of 1