An Act To Provide a Tax Credit for High-quality Child Care Sites
Maine Legislature, Session 125, LD 1118
Committee Amendment CA_A_H597 (House)
Amends: 22 MRSA §4100, 36 MRSA §5218

COMMITTEE AMENDMENT" A " 
to H.P. 830, L.D. 1118, Bill, "An Act To 
Provide a Tax Credit for High-quality Child Care Sites" 
Amend the bill by striking out everything after the enacting clause and before the 
summary and inserting the following: 
'Sec. 1. 22 MRSA §4100, sub-§2, as reallocated by RR 1999, c. 2, §26, is 
amended to read: 
2. List of sites. The department shall develop and maintain a list of quality child 
care sites in the State. The department shall provide a list of the quality child care sites 
and the steps at which they are rated to the Department of Administrative and Financial 
Services, Bureau of Revenue Services. 
Sec. 2. 22 MRSA §4100, sub-§§3 to 5 are enacted to read: 
3. Quality ratine svstem. 
The department shall establish a 4-step quality rating 
system for child care sites by rule in which step one includes those child care sites that 
meet minimum licensing standards, steps 2 and 3 include those child care sites that have 
additional requirements related to licensing compliance, learning environment, program 
evaluation, professional development. administrative policies, parental involvement and 
assessment, and step 4 includes those child care sites that provide the highest level of 
quality child care services, including accreditation by an independent nationally 
recognized program approved by the Office of Child Care and Head Start. 
4. Public-private partnership. For purposes of the income tax credit provided 
under Title 36, section 5219-0, subsection 2-A, paragraph B, the department shall certify 
to the State Tax Assessor public-private partnership funds that support the development 
of quality child care sites. 
5. Rulemaking. The department shall adopt rules to implement this section. Rules 
adopted pursuant to this subsection are routine technical rules as defined in Title 5, 
chapter 375, subchapter 2-A. 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT "a" to H.P. 830, L.D. 1118 
Sec. 3. 36 MRSA §5218, as amended by PL 2005, c. 519, Pt. DD, §§1 to 3, is 
further amended to read: 
§5218. Income tax credit for child care expenses 
1. Resident taxpayer. A resident individual is allowed a credit against the tax 
otherwise due under this Part in the amount of ~ 
23% of the federal tax credit 
allowable for child and dependent care expenses in the same tax year, except that for tax 
years beginning in 2003, 2004 and 2005, the applicable percentage is 21.5% instead of 
~. 
2. Nonresident taxpayer. A nonresident individual is allowed a credit against the 
tax otherwise due under this Part in the amount of ~ 
23% of the federal tax credit 
allowable for child and dependent care expenses multiplied by the ratio of the individual's 
Maine adjusted gross income, as defined in section 5102, subsection l-C, paragraph B, to 
the individual's entire federal adjusted gross income, as modified by section 5122, except 
that for tax years beginning in 2003, 2004 and 2005, the applicable percentage is 21.5% 
instead of25%. 
2-A. Part-year resident taxpayer. An individual who files a return as a part-year 
resident in accordance with section 5224-A is allowed a credit against the tax otherwise 
due under this Part in the amount of ~ 
23%, except that for tax years beginning in 
2003, 2004 and 2005 the applicable percentage is 21.5%, instead of 25%, of the federal 
tax credit allowable for child and dependent care expenses multiplied by a ratio, the 
numerator of which is the individual's Maine adjusted gross income as defined in section 
5102, subsection l-C, paragraph A for that portion of the taxable year during which the 
individual was a resident plus the individual's Maine adjusted gross income as defined in 
section 5102, subsection l-C, paragraph B for that portion of the taxable year during 
which the individual was a nonresident and the denominator of which is the individual's 
entire federal adjusted gross income, as modified by section 5122. 
3. Quality child care services. The credit provided by subsections 1, 2 and 2-A 
doubles in amount increases as follows if the child care expenses were incurred through 
the use of quality child care services as defined in section 5219-Q, subsection 1 and in 
accordance with the quality rating system established by the Department of Health and 
Human Services, Office of Child Care and Head Start pursuant to Title 22, section 4100, 
subsection 3. 
A. If child care services are provided at a child care site with a quality rating of step 
under Title 22, section 4100, subsection 3, the credit increases to 30% ofthe federal 
credit. 
B. If child care services are provided at a child care site with a guality rating of step 
under Title 22, section 4100, subsection 3, the credit increases to 38% of the federal 
credit. 
C. If child care services are provided at a child care site with a guality rating of step 
under Title 22, section 4100, subsection 3, the credit increases to 50% of the federal 
credit. 
4. Refund. The credit allowed by this section may result in a refund of up to $-W(} 
$1,000. In the case of a nonresident individual, the refundable portion of the credit may 
COMMITTEE AMENDMENT 
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COMMITIEE AMENDMENT "4" to H.P. 830, LD. 1118 
not exceed ~ 
$1,000 multiplied by the ratio of the individual's Maine adjusted gross 
income, as defined in section 5102, subsection l-C, paragraph B, to the individual's entire 
federal adjusted gross income, as modified by section 5122. In the case of an individual 
who files a return as a part-year resident in accordance with section 5224-A, the 
refundable portion of the credit may not exceed ~ 
$1,000 multiplied by a ratio, the 
numerator of which is the individual's Maine adjusted gross income as defined in section 
5102, subsection l-C, paragraph A for that portion of the taxable year during which the 
individual was a resident plus the individual's Maine adjusted gross income as defined in 
section 5102, subsection l-C, paragraph B for that portion of the taxable year during 
which the individual was a nonresident and the denominator of which is the individual's 
entire federal adjusted gross income, as modified by section 5122. 
Sec. 4. 36 MRSA §S219-Q, as amended by PL 2005, c. 618, §§ll to 13, is further 
amended to read: 
§5219-Q. Quality child care investment credit 
1. 
Definition. 
As used in this section, unless the context otherwise indicates, 
"quality child care services" means services provided at a child care site that meets 
minimum licensing the standards and.;. requirements established by the Department of 
Health and Human Services. Office of Child Care and Head Start in accordance with the 
quality rating system under Title 22, section 4100. 
A. 
Is accredited by an independent, nationally recogni:t:ed program approved by the 
Department of Health and Human Services, Office of Child Care and Head Start; 
B. 
Utili:t:es recogni:t:ed quality indicators for child care services approved by the 
Department of Health and Human Services, Office of Child Care and Head Start; and 
C. 
Includes provisions for parent and dient input, a revie';'+' of the provider's policies 
and procedures, a review of the provider's program records and an on site program 
revie>.v. 
For large, multifunetion agencies, only those portions of the child care sites that '.vers 
reviewed by the accrediting body may be considered sites that provide quality child care 
services. 
I-A. Certification. Upon application by an investor, the Department of Health and 
Human Services, Office of Child Care and Head Start shall certify if an investment in a 
child care site contributed significantly toward the ability of the child care site to improve 
its level of child care services toward the goal of providing quality child care services. 
The department shall send a list of taxpayers making certified investments in the previous 
year to the State Tax Assessor by February 1st annually. The department may not certify 
more than $50,000 in investments in a calendar year. 
2. Credit allowed. A taxpayer that has made an investment in child care services 
certified under subsection 1 A during the tax year is allowed a credit against the taK 
imposed by this Part in an amount equal to the qualifying portion of expenditures paid or 
expenses incurred by the taxpayer for certified investments in child care services as 
calculated pl:lfsuant to subsection 3. 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT "A" to H.P. 830, L.D. 1118 
2-A. Credit allowed. A taxpayer is allowed a credit against the tax imposed by this 
Part equal to the qualifying portion of the total of the following: 
A. Expenditures paid or incurred by the taxpayer during the tax year certified under 
subsection I-A; and 
B. Contributions made by the taxpayer to a child care public-private partnership fund 
certified by the Department of Health and Human Services, Office of Child Care and 
Head Start under Title 22, section 4100, subsection 4. 
3. Qualifying portion. For purposes of calculating the credit provided by this 
section, the qualifying portion is: 
A. 
For a corporation, 30% of up to $30,000 of the total of expenditures and 
contributions as provided in subsection 2-A, apportioned if part of an affiliated group 
engaged in a unitary business; and 
B. 
For an individual taxpayer, if the taxpayer expends or contributes as provided in 
subsection 2-A at least $10,000 in one year, $1,000 each year for 10 years and 
$10,000 at the end of the lO-year period. 
4. Limitation; carry-over. The credit provided by this section may not reduce the 
tax otherwise due under this Part below zero. Any unused portion of the credit may be 
carried over to the following year or years until exhausted. 
Sec. 5. Application. This Act applies to tax years beginning on or after January I, 
2012. 
Sec. 6. Appropriations and allocations. The following appropriations and 
allocations are made. 
ADMINISTRATIVE AND FINANCIAL SERVICES, DEPARTMENT OF 
Revenue Services - Bureau of 0002 
Initiative: Appropriates funds for computer programming to update the existing child care 
credit calculation used by Internet filing and electronic filing programs. 
GENERAL FUND 
All Other 
GENERAL FUND TOTAL 
SUMMARY 
2011-12 
$10,000 
$10,000 
2012-13 
$0 
$0 
This amendment, which is the minority report, replaces the bill. It requires the 
Department of Health and Human Services to provide a list of the quality child care 
facilities to the Department of Administrative and Financial Services, Maine Revenue 
Services in order to track the credit and to establish the 4 steps of the quality rating 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT "A" to H.P. 830, L.D. 1118 
system in rule. It provides that certain contributions are components of one credit rather 
than 2 separate credits. It also adds an appropriations and allocations section. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Approved: 06/07/11 Mac:. 
LD 1118 
LR 1847(02) 
An Act To Provide a Tax Credit for High-quality Child Care Sites 
Fiscal Note for Bill as Amended by Committee Amendment ,~" 
Committee: Taxation 
Fiscal Note Required: Yes 
Fiscal Note 
FY 2011-12 
FY 2012-13 
Projections 
FY 2013-14 
Net Cost (Savings) 
General Fund 
Appropriations/Allocations 
General Fund 
Fiscal Detail and Notes 
$10,000 
$10,000 
$0 
$0 
$0 
$0 
Projections 
FY 2014-15 
$0 
$0 
This bill includes a one-time $10,000 appropriation in fiscal year 2011-12 for Maine Revenue Services to update the 
existing child care credit calculation used by internet filing and electronic filing programs to administer the income tax 
credit for high-quality child care. Any additional costs to the Department of Heath and Human Services can be 
absorbed within existing budgeted resources. 
LRI847(02) - Fiscal Note - Page 1 of 1