An ActTo Amend Provisions ofthe Submerged Lands Law Subinitted by the Departmentof Conservation pursuant to Joint Rule 204.
Maine Legislature, Session 124, LD 1322
Committee: Agriculture, Conservation and Forestry
Sponsors: FLOOD, DAMON, BERRY, CAIN, PIER, WEBSTER, BARTLETT, NUTTING, RECTOR
Amends: 12 MRSA §1862

MAINE STATE LEGISLATURE 
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124th MAl E'LEGISL.ATURE 
FIRST REGULAR SESSIO~~-2009 
Legislative Document 
No. 1322 
H.P.926 
House of Representatives, March 31,2009 
An ActTo Amend Provisions ofthe Submerged Lands Law 
Subinitted by the Departmentof Conservation pursuant to Joint Rule 204. 
Reference to the Committee on Agriculture, Conservation and Forestry suggested and 
ordered printed. 
Presented by Representative FLOOD of Winthrop. 
Cosponsored by Senator DAMON of Hancoc1c and 
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1n.JJ?!LC~{ 
MILLICENT M. MacFARLAND 
Clerk 
Representatives: BERRY of Bowdoinham, CAIN of Orono, PIER of Bremen, PIOTTlof 
'Unity, WEBSTER of Freeport, Senators: BARTLETT of Cumberland, NUTTING of 
Androscoggin, RECTOR of Knox. 
Printed on r~cyclcd pnper 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 12 MRSA §1862, sub-§l, ene, as enacted by PL 1997, c. 678, § 13, is 
amended to read: 
C. 
"Fair market rental value," for all uses of submerged lands except slip space 
rented or otherwise made available for private use for a fee, means the municipally 
assessed value per square foot for the adjacent upland multiplied byareduction factor 
plus.a base rate based on the use of the leas.ed submerged land as specified in thls 
section. This value is then mUltiplied by the square foot area of the proposed lease 
area to determine the annual rental rate. For slip space rented or otherwise made 
available for private use for a fee, the fair market rental value is the gross income 
from that space multiplied by a reduction factor as specified in this section based on 
the use of the leased submerged land. 
Sec. 2. 12 MRSA §1862, sub-§l, ~-1, as enacted by PL 2005, c. 134, §2, is 
repealed. 
Sec. 3. 12 MRS A §1862, sub-§1, 'ilE-:1 is enacted to read: 
E-l. "Offshore project" means a project that extends beyond localized development 
adjacent to a single facility or property. "Offshore project" does not include a shore-
based pier, marina or boatyard or utility cable and pipelines serving. neighboring 
communities or islands. 
"Offshore project" includes, but is not limited to, wind 
farms, tidal energy facilities, tanker ports, ship berthing platforms requiring 
secondary transp0l1 to shore,. an interstate or international pipeline or cable and 
sfmilar projects. 
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Sec. 4. 12 MRSA §1862, sub-§2, 4ijfA, as enacted by PL 1997, c .. 678, § 13, IS 
amended to read: 
A. 
For fill, permanent causeways, bridges, marinas, wharves, docks, pilings, 
moorings or other permanent structures and for nonpermanent structures occupying a 
total of 500 square feet or more of submerged land or occupying a total of 2,000 
square feet or more of submerged land if us~d exclusively for commercial fishing 
activities:. 
. 
(I) The director shall charge the lessee a ease rent that practically approximates 
the fair market rental value of the submerged land. 
The reduction factors and 
base rate for use categories are as follows: 
(a) A reduction factor of 0%, with no base rate or 00 rental fee, for nonprofit 
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organizations or publicly owned facilities that offer free public useor public 
use with nominal user fees. 
Public uses include, but are not limited to, 
municipal utilities and facilities that provide public access to the water, town 
wharves, walkways, fishing piers, boat launclws, parks, nature reserves, 
swimming or skating areas and other projects designed to allow or enhance 
public recreation, fishing, fowling and navigation and for which user fees are. 
used exclusively for the maintenance of the facility; 
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(b) A reduction factor of -l--% 0.1% plus a base rate of$0.025 per square foot 
for commercial fishing uses of renewable aquatic resources. Commercial 
uses of renewable aquatic resources include,but are not limited to, facilities 
that are directly involved in' commercial fishing activities. Such facilities 
'include, but are not limited to, fish piers, lobster impoundments, fish 
,processing facilities and floats or piers for the storage of gear; 
. (c) A reduction factor of 2% for any slip space rented or otherwise made 
available for private use by commercial fishing boats for a fee; 
(d) A reduction factor of;!-% 0.2% plus a base rate of $0.05 per square foot 
for water-dependent commerce, industry and private uses. 
Water-dep~ndent 
commerce, industry and private uses other than commercial uses of 
renewable aquatic resources include, but are not limited to, all facilities that 
are functionally dependent upon a waterfront location, can not reasonably be 
located or operated on an upland site or are essential to the operation of the 
marine industry. 
Such facilities include, but are not limited to, privately 
owned piers and docks, cargo ports, private bmit ramps, shipping and ferry 
terminals, tllg and barge facilities, businesses that are engaged in watercraft 
construction, maintenance or repair, aquariums and the area within marinas 
occupied by service facilities, gas docks, breakwaters arid other structures not 
used for slip space; 
(e) A reduction factor of 4% for any slip space rented or otherwise made 
available for private use for recreational boats for a fee. For facilities that' 
include slip space under constructive easement, the rental fee may be reduced , 
proportionally by the ratio of linear leIigth of slip space within the area under 
constructive easement to the total linear length of all slip space within the 
facilitv; and 
(f) A reduction factor of ;!-% 0.2% for upland uses and fill located on 
submerged lands prior to July 1, 2009 and 0.4% for new upland uses and fill 
after July 1, 2009 plus a base rate of $0.05 per square foot. Upland uses 
include, but ai'e not limited to, all uses that can operate in a location other 
than on the waterfront or that are not essential to the operation of the marine 
industry. These facilities include, but are not limited to, residences, offices, 
restaurants and parking lots. 
Fill must include the placement of solid 
material other than pilings or other open support structures upon submerged 
lands. 
WfleH. If the director determines that the rnunicipally assessed value' of the 
adjacellt upland is not an accurate indicator of the value of submerged land, the 
director may make adjustments in the municipally assessed value so that it more' 
closely reflects the value of comparable waterfront properties in the vicinity or 
require the applicant to provide an appraisal of the submerged land. 
The 
appraisal must be approved by the director~~ 
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For offshore projects where municipally assessed value for the adjacent upland or 
submerged lands appraisals are unavailable or the director determines that such 
assessment or appraisals do not accurately indicate the value of the submerged 
land, the director may 'establish the submerged lands annual rental rate and other 
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public compensation as appropriate by negotiation between the bureau and the 
applicant. In such cases the annual rent and other public compensation must take 
into account the proposed use of the submerged larids, the extent to which 
traditional and customary public uses may be diminished, the public benefit of 
the project, the economic value of the. project and the avoided cost to the 
applicant. If the State's ability to determine the values listed in this paragraph or 
to carry out negotiations requires expe11ise beyond the program's capability, the 
applicant must pay for the costs of contracting for such expertise; 
(2) After October 1, 1990, the director may revalue all existing rents to full fair 
market rental value. 
Rents for all uses except slip space may be adjusted 
. annually as needed over a period not to exceed 5 years until the full fair market 
rental value is reached. Thereafter After the full fair market rental value is 
reached, the director may revalue rents for all. uses except slip space every 5 
years based on changes in muri icipally assessed value and programmatic cost 
adjustments to the base rate. Adjustments to the base rate may not exceed 4% 
per year. Rents for slip space may fluctuate annually depending on the gross 
income of the facility; 
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(3) The director may also lease a buffer zone of not more than 30 feet in width 
around a permanent structure located on submerged or intertidal land, provided 
thatthe lease is necessary to preserve the integrity and safety of the structure and 
that the Commissioner of Marine Resources consents to that lease; 
(4) Any existing or proposed lease may be subleased for the period of the 
original lease for the purpose of providing berthingspace for any boat or vessel; 
(5) No portion of an existing or proposed lease may be transferred from a persQn 
subleasiilg that portion to provide be11hing space for any boat or vessel except for 
a transfer to heirs upon death of the sublessee holder or a transfer to the original 
leaseholder subject to terms agreed to by the lessor and sublessee at the time of 
the sublease. This subparagraph does not apply to any subleasing arrangements 
entered into before June 15, 1989; and 
(6) The director may grant the proposed lease if the director fillds that, in 
addition to any bther findings that the director may require, the proposed lease: 
(a) Will not unreasonably interfere with navigation; 
(b) Will not unreasonably interfere with fishing or other existing marine uses 
of the area; 
(c) Will not unreasonably diminish the availability of services and facilities 
necessary for commercial marine activities; and 
(d) 
Will not unreasonably interfere with ingress and egress of riparian 
owners. 
The bureau shall adopt rules pe11aining to this subparagraph by March 15, 1990. 
Sec. 5. 12 MRS A §1862, sub-§2, ~, as enacted by PL 1997, c. 678, § 13, is 
amended to read: 
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D. 
The director may establish a reasonable minimum rent to which any lease is 
subject, notto exceed $100 is $150 per year. 
Sec. 6. 12 MRSA §1862, sub-§9, as enacted by PL 1997, c. 678, § 13, is amended 
to read: 
9. Public compensation. Whefl With respect to any lease, including, but not limited 
to, leases foi· offshore projects, when the dii'ector determines that the public should be 
compensated for the loss or diminution of traditional and customary public uses resulting 
from the activities proposed by the lessee, the director may negotiate with the lessee to 
provide public access improvements such as walkways, boat launching ramps, parking 
space or other facilities or negotiate a fee in lieu of such improvements as a condition of 
the lease. The determination of loss or diminution of traditional and customary public 
uses and appropriate public compensation must be made in consultation with local 
municipal officials. 
Sec. 7. Application. This Act applies to new and renewal leases',issued under the 
Maine Revised Statutes, Title 12, chapter 220, subchapter 5 after June 30, 2009 arid all 
leases after December 31,2009. 
SUMMARY 
This bill amends the definition of "fair market rental value," adjusts rental rates for 
submerged lands leases to be more fair and equitable by raising the minimum lease rent 
from $100 to $150 annually and provides for gradual adjustments to rental rates based on 
changes in assessed property values and programlT!atic cost increases over time. The bill 
provides for the phase~in of rental increases for leaseholders starting in 2010 whose 
adjusted rent will increase above '$1,200. following the repeal of the $1,200 maximum 
rental cap on June 30, 2009. The bill also replaces the definition of "large-scale project" 
with a new definition for "offshore project" and authorizes the Director of the Bureau of 
Parks and Lands within the Department of Conservation to negotiate rental terms for the 
leasing of those facilities. 
Public Law 2007, chapter 540 required the Department of Conservation, Bureau of 
Parks and Lands to review its submerged lands fee schedule in cooperation with a 
. working group of interested parties. This bill results from that review.