An Act Regarding the Calculation of Tree Growth Reimbursements to Municipalities
Maine Legislature, Session 123, LD 0665
Committee: Taxation
Sponsors: MILLETT, NASS, HAMPER, HAYES, HOTHAM
Amends: 36 MRSA §578

Legislative Document 
No. 665 
H.P.514 
House of Representatives, February 8, 2007 
An Act Regarding the Calculation of Tree Growth Reimbursements 
to Municipalities 
(EMERGENCY) 
Reference to the Committee on Taxation suggested and ordered printed. 
Presented by Representative MILLETT of Waterford. 
Cosponsored by Senator NASS of York and 
1Il~ 
1I1.1J?0£~ 
MILLICENT M. MacFARLAND 
Clerk 
Representatives: HAMPER of Oxford, HAYES of Buckfield, HOTHAM of Dixfield. 
Pnnteu pn fCl.;ydeJ paper 
Emergency preamble. Whereas, acts and resolves of the Legislature do not 
become effective until 90 days after adjournment unless enacted as emergencies; and 
Whereas, the current formula for reimbursement to municipalities for property tax 
losses under the Maine Tree Growth Tax Law does not accurately rellect the impact on 
many municipalities; and 
Whereas, this situation causes fiscal difficulties for many municipalities that need to 
be addressed as soon as possible; 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, 
I I 
therefore, 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 36 MRSA §578, sub-§l, as amended by PL 2005, c. 457, Pt. CCC, § I, is 
further amended to read: 
1. 
Organized areas. 
The municipal assessors or chief assessor of a primary 
assessing area shall adjust the State Tax Assessor's 100% valuation per acre for each 
forest type of their county by whatever ratio, or percentage of current just value, is 
applied to other property within the municipality to obtain the assessed values. Forest 
land in the organized areas, subject to taxation under this subchapter, must be taxed at the 
property tax rate applicable to other property in the municipality. 
The State Tax Assessor shall determine annually the amount of acreage in each 
municipality that is classified and taxed in accordance with this subchapter. Each such 
municipality is entitled to annual payments from money appropriated by the Legislature if 
it submits an annual return in accordance with section 383 and if it achieves the 
appropriate minimum assessment ratio described in section 327. The State Tax Assessor 
shall pay any municipal claim found to be in satisfactory form by August I st of the year 
following the submission of the annual return. The per acre reimbursement is 90% of the 
per acre tax revenue lost as a result of this subchapter. For purposes of this section, the 
tax lost is the tax that would have been assessed, but for this subchapter, on the classified 
forest lands if they were assessed according to the undeveloped acreage valuations used 
in the state valuation then in effect, or according to the current local valuation on 
undeveloped acreage, whichever is less, minus the tax that was actually assessed on the 
same lands in accordance with this subchapter. A municipality that fails to achieve the 
minimum assessment ratio established in section 327 loses 10% of the reimbursement 
provided by this section for each one percentage point the minimum assessment ratio falls 
below the ratio established in section 327. 
No municipality may receive a reimbursement payment under this section that ",,'ould 
exceed an amount determined by calculating the tree grov.1h ta}( loss less the municipal 
savings in educational costs attributable to reduced state valuation. 
• 
A. 
The tree grov.'th tax loss is the adjl:lsted ta)( that 'Nol:lld have been assessed, bl:lt 
for this sl:lbchapter, on the classified forest lands if they were assessed according to 
the I:Indeveloped acreage vall:lations I:Ised in the state vall:lation then in effect minl:ls 
the tax that was actually assessed on the same lands in accordance '""ith this 
sl:lbchapter. 
In determining the adjl:lsted tax that wOl:lld have been assessed, the tax rate to be used 
is compl:lted by adding the additional school support reql:lired by the modified state 
vall:lation attribl:ltable to the increased vall:lation of forest land to the original tax 
committed and dividing this sum by the modified total ml:lnicipal vall:lation. The 
adjusted tax rate is then applied to the vall:lation of forest land based on the 
1 
I:Indeveloped acreage vall:lations, adjl:lsted by the certified ratio, to determine the 
adjl:lsted tax. 
B. 
The municipal savings in educational costs is determined by multiplying the 
school sl:lbsidy index by the change in state valuation attributable to the use of the 
valuations determined in accordance with this subchapter on classif)ed forest lands 
rather than their vall:lation using the undeveloped acreage valuations used in the state 
valuation then in effect. 
Emergency clause. 
In view of the emergency cited III the preamble, this 
legislation takes effect when approved. 
SUMMARY 
This bill changes the formula for calculation of state reimbursement to municipalities 
for lost revenue under the Maine Tree Growth Tax Law by deleting the adjustment for 
additional 
general purpose aid for local schools resulting from the reduced state 
valuation due to tree growth valuations.