An Act Related to the Report of the Tax Expenditure Review Task Force
Maine Legislature, Session 126, LD 1762
Senate Amendment SA_B_S387 (Senate)
Amends: 36 MRSA §5219-I, 36 MRSA §5219-K, 30-A MRSA §5681, 36 MRSA §683, 36 MRSA §68, 36 MRSA §699, 36 MRSA §700-A, 36 MRSA §700-B, 36 MRSA §1811, 36 MRSA §1752, 36 MRSA §1760

SENATE AMENDMENT" 8 " to H.P. 1264, L.D. 1762, Bill, "An Act Related to 
the Report of the Tax Expenditure Review Task Force" 
Amend the bill by striking out everything after the enacting clause and before the 
summary and inserting the following: 
'PART A 
Sec. A-I. PL 2013, c. 368, Pt. S, §8 is repealed. 
Sec. A-2. PL 2013, c. 368, Pt. S, §9 is repealed. 
Sec. A-3. State Controller; post-closing. The State Controller is authorized to 
keep open the official system of general accounts of State Government for fiscal year 
2013-14 in order to make post-closing entries and adjustments to carry out the provisions 
of this Act. 
PARTB 
Sec. B-1. 36 MRSA §5219-II, first~, as enacted by PL 2013, c. 368, Pt. L, § 1, is 
amended to read: 
For tax years beginning on or after January 1, 2013 and before January 1, 2104, a 
Maine resident individual is allowed a property tax fairness credit as computed under this 
section against the taxes imposed under this Part. 
Sec. B-2. 36 MRSA §5219-KK is enacted to read: 
§5219-KK. Property tax fairness credit on or after January 1,2014 
For tax years beginning on or after January 1, 2014, a Maine resident individual is 
allowed a property tax fairness credit as computed under this section against the taxes 
imposed under this Part. 
1. Definitions. As used in this section, unless the context otherwise indicates, the 
following terms have the following meanings. 
SENATE AMENDMENT 
SENATE AMENDMENT" B "to H.P. 1264, L.D. 1762 
A. "Benefit base" means property taxes paid by the resident individual during the tax 
year on the individual's homestead in this State or rent constituting property taxes 
paid by the resident individual during the tax year on a homestead in the State, not to 
exceed $4,000. In the case of resident married individuals filing separate returns, 
each of whom claims the credit on the same homestead, the benefit base for each 
spouse may not exceed $2,000. 
B. "Dwelling" means an individual house or apartment, duplex unit, cooperative unit, 
condominium unit, mobile home or mobile home pad. 
C. "Homestead" means the dwelling owned or rented by the taxpayer or held in a 
revocable living trust for the benefit of the taxpayer and occupied by the taxpayer and 
the taxpayer's dependents as a home, and may consist of a part of a multidwelling or 
multipurpose building and a part of the land, up to 10 acres, upon which it is built. 
"Owned" includes a vendee in possession under a land contract, one or more joint 
tenants or tenants in common and possession under a legally binding agreement that 
allows the owner of the dwelling to transfer the property but continue to occupy the 
dwelling as a home until some future event stated in the agreement. 
D. "Rent constituting property taxes" means 20% of the gross rent actually paid in 
cash or its equivalent during the tax year solely for the right of occupancy of a 
homestead in the State. "Rent constituting property taxes" does not include rent 
subsidized by government programs that limit housing costs to a percentage of 
household income except that this exclusion does not apply to persons receiving 
social security disability or supplemental security income disability benefits. For the 
purposes of this paragraph, "gross rent" means rent paid at arm's length solely for the 
right of occupancy of a homestead, exclusive of charges for any utilities, services, 
furniture, furnishings or personal property appliances furnished by the landlord as 
part of the rental agreement, whether or not expressly set out in the rental agreement. 
If the landlord and tenant have not dealt with each other at arm's length, and the 
assessor is satisfied that the gross rent charged was excessive, the assessor may adjust 
the gross rent to a reasonable amount for purposes of this section. 
2. Credit. A resident individual filing a single or married separate return or resident 
spouses filing joint returns are allowed a credit against the taxes imposed under this Part 
in an amount equal to 50% of the amount by which the benefit base exceeds 8% of the 
resident individual's or the resident spouses' total federal adjusted gross income. The 
credit may not exceed $1.000. In the case of resident married individuals filing separate 
returns, each of whom claims the credit on the same homestead, the credit for each 
spouse may not exceed $500. 
3. Refundability of credit. The tax credit is refundable after the application of 
nonrefundable credits. 
PARTC 
Sec. C-l. 30-A MRSA §5681, as amended by PL 2013, c. 368, Pt. J, §1, is 
repealed. 
SENATE AMENDMENT 
SENATE AMENDMENT" & "to H.P. 1264, L.D. 1762 
Sec. C-2. 36 MRSA §683, sub-§l, as amended by PL 2009, c. 213, Pt. YYY, § 1 
and affected by c. 652, Pt. A, §63, is further amended to read: 
1. Exemption amount. Except for assessments for special benefits, the lesser of 
$50,000 and 50% of the just value of $10,000 of the homestead of a permanent resident 
of this State who has owned a homestead in this State for the preceding 12 months is 
exempt from taxation. In determining the local assessed value of the exemption, the 
assessor shall multiply the amount of the exemption by the ratio of current just value 
upon which the assessment is based as furnished in the assessor's annual return pursuant 
to section 383. lfthe title to the homestead is held by the applicant jointly or in common 
with others, the exemption may not exceed $10,000 the lesser of $50,000 and 50% of the 
just value of the homestead, but may be apportioned among the owners who reside on the 
property to the extent of their respective interests. 
A municipality responsible for 
administering the homestead exemption has no obligation to create separate accounts for 
each partial interest in a homestead owned jointly or in common. 
Sec. C-3. 36 MRSA §683, sub-§3, as amended by PL 2005, c. 2, Pt. F, §3 and 
affected by §5, is repealed and the following enacted in its place: 
3. Effect on state valuation. The percentage of just value of exempt homestead 
property to be included in the annual determination of state valuation under sections 208 
and 305 is the percentage specified in section 685, subsection 2. 
Sec. C-4. 36 MRSA §683, sub-§4, as amended by PL 2005, c. 2, Pt. F, §3 and 
affected by §5, is further amended to read: 
4. Property tax rate. Fifty ~ereeflt of the value of homestead exe~tiofls llflder this 
subeh~ter The percentage of just value of exempt homestead property specified in 
section 685, subsection 2 must be included in the total municipal valuation used to 
determine the municipal tax rate. The municipal tax rate as finally determined may be 
applied to only the taxable portion of each homestead qualified for that tax year. 
Sec. C-S. 36 MRSA §68S, sub-§2, as amended by PL 2005, c. 2, Pt. F, §4 and 
affected by §5, is repealed and the following enacted in its place: 
2. Entitlement to reimbursement by the State; calculation. A municipality that 
has approved homestead exemptions under this subchapter may recover from the State 
the applicable percentage of property tax revenue lost by reason of the exemptions, upon 
proof in a fonn satisfactory to the bureau, as follows. 
A. The bureau shall reimburse the Unorganized Territory Education and Services 
Fund for 50% of taxes lost by reason of the exemptions. 
B. 
For municipalities with a full value property tax mill rate at or below the 
statewide average, the bureau shall reimburse the municipality for 50% of taxes lost 
by reason of the exemptions. 
C. For municipalities with a full value property tax mill rate that is between one and 
times the statewide average, the bureau shall reimburse the municipality for a 
percentage of taxes lost by reason of the exemptions that is half of the ratio of the full 
value property tax mill rate of the municipality divided by the statewide average 
property tax mill rate. 
SENATE AMENDMENT 
SENATE AMENDMENT" S "to H.P. 1264, L.D. 1762 
D. For municipalities with a full value property tax mill rate at or above a rate that is 
double the statewide average, the bureau shall reimburse the municipality for 100% 
of taxes lost by reason of the exemptions. 
Sec. C-6. 36 MRSA §699, suh-§2, as enacted by PL 2005, c. 623, §l, is amended 
to read: 
2. 
Intent. 
It is the intent of the Legislature to fund fully traRsfers to the 
Disflf9flortioRate Tax BardeR FaRd aRder seetioR 700 A, 
sabseetioR 
aRd 
reimbursements under the business equipment tax reimbursement program under section 
6652, subsection 4, paragraph B. 
Sec. C-7. 36 MRSA §700-A, as enacted by PL 2005, c. 623, § 1, is repealed. 
Sec. C-8. 36 MRSA §700-B, as amended by PL 2009, c. 213, Pt. S, §1O and 
affected by §16, is repealed. 
Sec. C-9. Application. This Part applies to property tax years beginning on or 
after April 1,2015. 
Sec. C-IO. Effective date. Those sections of this Part that repeal the Maine 
Revised Statutes, Title 30-A, section 5681 and Title 36, sections 700-A and 700-B take 
effect July 1,2015. 
PARTD 
Sec. D-l. 36 MRSA §1811, first ~, as amended by PL 2013, c. 368, Pt. M, §2 
and Pt. N, §2, is repealed and the following enacted in its place: 
A tax is imposed on the value of all tangible personal property and taxable services 
sold at retail in this State. The rate of tax is 7% on the value of liquor sold in licensed 
establishments as defined in Title 28-A, section 2, subsection 15, in accordance with Title 
28-A, chapter 43; 7% on the value of rental of living quarters in any hotel, rooming house 
or tourist or trailer camp; 10% on the value of rental for a period of less than one year of 
an automobile, of a pickup truck or van with a gross vehicle weight of less than 26,000 
pounds rented from a person primarily engaged in the business of renting automobiles or 
of a loaner vehicle that is provided other than to a motor vehicle dealer's service 
customers pursuant to a manufacturer's or dealer's warranty; 7% on the value of prepared 
food; and 5% on the value of all other tangible personal property and taxable services. 
Notwithstanding the other provisions of this section, from October 1, 2013 to September 
30, 2014, the rate of tax is 8% on the value of rental of living quarters in any hotel, 
rooming house or tourist or trailer camp; 8% on the value of prepared food; 8% on the 
value of liquor sold in licensed establishments as defined in Title 28-A, section 2, 
subsection 15, in accordance with Title 28-A, chapter 43; and 5.5% on the value of all 
other tangible personal property and taxable services. Value is measured by the sale 
price, except as otherwise provided. The value of rental for a period of less than one year 
of an automobile or of a pickup truck or van with a gross vehicle weight of less than 
26,000 pounds rented from a person primarily engaged in the business of renting 
automobiles is the total rental charged to the lessee and includes, but is not limited to, 
maintenance and service contracts, drop-off or pick-up fees, airport surcharges, mileage 
fees and any separately itemized charges on the rental agreement to recover the owner's 
SENATE AMENDMENT 
SENATE AMENDMENT" e "to H.P. 1264, L.D. 1762 
estimated costs of the charges imposed by government authority for title fees, inspection 
fees, local excise tax and agent fees on all vehicles in its rental fleet registered in the 
State. All fees must be disclosed when an estimated quote is provided to the lessee. This 
paragraph is repealed October 1, 2014. 
Sec. D-2. 36 MRS A §1811, as amended by PL 2013, c. 368, Pt. M, §2 and Pt. N, 
§2, is further amended by inserting after the first paragraph a new paragraph to read: 
Beginning October 1, 2014, a tax is imposed on the value of all tangible personal 
property and taxable services sold at retail in this State. The rate of tax is 8% on the 
value of liquor sold in licensed establishments as defined in Title 28-A, section 2, 
subsection 15, in accordance with Title 28-A, chapter 43; 10% on the value of rental of 
living quarters in any hotel, rooming house or tourist or trailer camp; 10% on the value of 
rental for a period of less than one year of an automobile, of a pickup truck or van with a 
gross vehicle weight of less than 26,000 pounds rented from a person primarily engaged 
in the business of renting automobiles or of a loaner vehicle that is provided other than to 
a motor vehicle dealer's service customers pursuant to a manufacturer's or dealer's 
warranty; 8% on the value of prepared food; and 5% on the value of all other tangible 
personal property and taxable services. Notwithstanding the other provisions of this 
section, from October 1, 2014 to June 30, 2015, the rate of tax is 5.5% on the value of all 
other tangible personal property and taxable services. Value is measured by the sale 
price, except as otherwise provided. The value of rental for a period of less than one year 
of an automobile or of a pickup truck or van with a gross vehicle weight of less than 
26,000 pounds rented from a person primarily engaged in the business of renting 
automobiles is the total rental charged to the lessee and includes, but is not limited to, 
maintenance and service contracts, drop-off or pick-up fees, airport surcharges, mileage 
fees and any separately itemized charges on the rental agreement to recover the owner's 
estimated costs of the charges imposed by government authority for title fees, inspection 
fees, local excise tax and agent fees on all vehicles in its rental fleet registered in the 
State. All fees must be disclosed when an estimated quote is provided to the lessee. 
PARTE 
Sec. E-l. 36 MRSA §1752, sub-§1-1 is enacted to read: 
1-1. 
Amusement, entertainment and recreation services. 
"Amusement, 
entertainment and recreation services" is defined pursuant to this subsection. 
A. "Amusement. entertainment and recreation services" means the following, unless 
excluded under paragraph B: 
(1) Admission fees to entertainment venues and performances, including but not 
limited to theaters, movies, lectures, concerts, festivals, amusement parks, water 
parks, fairs other than licensed agricultural fairs, race tracks, carnivals, circuses, 
sports activities, stadiums, amphitheaters, museums, planetariums, animal parks, 
petting zoos, aquariums, historical sites and convention centers; 
(2) Fees charged for participation in or entry to sporting and gaming activities, 
including but not limited to golf, skiing, tennis, miniature golf courses, arcades, 
billiard parlors, go-cart courses and paintball; 
SENATE AMENDMENT 
SENATE AMENDMENT" B "to H.P. 1264, L.D. 1762 
(3) Admission fees charged for exhibition shows, including but not limited to 
automobile, boat, camping, home, garden, animal and antique shows; 
(4) 
Fees charged for scenic and sight-seeing excursions, including but not 
limited to aircraft, helicopter, balloon, blimp, watercraft, railroad, bus, trolley and 
wagon rides, whitewater rafting and guided recreation, but excluding scenic and 
sight-seeing excursions on federally navigable waters; and 
(5) Entertainment service, including but not limited to those provided by bands, 
orchestras, disc jockeys, comedians, clowns, jugglers, children's entertainers and 
ventriloquists. 
B. "Amusement, entertainment and recreation services" does not include: 
(1) Fees charged for admission to a licensed agricultural fair or charges for 
participation in any events or activities occurring at the fair organized by a school 
or incorporated nonprofit organization if all the proceeds from the event or 
activity are used for the charitable purposes of the school or organization; 
(2) 
Fees charged for lessons or training in dance, mUSIC, theater, arts and 
gymnastics, martial arts and other athletic pursuits; 
(3) Fees charged for admission to: 
Ca) Concerts, dance productions, theatrical productions, sports activities or 
similar events or activities organized and performed by a school, if all 
proceeds of the event or activity are used for the charitable purposes of that 
school; or 
(b) Festivals and special events organized by governmental entities, schools 
or incorporated, nonprofit organizations or charges for participation in any 
events or activities occurring at the festival or special event organized by the 
governmental entity, school or incorporated, nonprofit organization if all the 
proceeds of the festival or special event are directed to support a purpose of 
the governmental entity, school or organization; or 
(4) Fees charged for children's summer camps. 
Sec. E-2. 36 MRSA §1752, sub-§§2-F and 2-G are enacted to read: 
2-F. Fabrication facility. "Fabrication facility" means a site consisting of at least 35 
acres at which the primary business is the performance of fabrication services and any 
activities associated with or in support of fabrication services. 
2-G. Fabrication services. "Fabrication services" means the production of tangible 
personal property for a consideration for a person who furnishes, either directly or 
indirectly, the materials used in that production. 
Sec. E-3. 36 MRSA §1752, sub-§8-D is enacted to read: 
8-D. Personal property services. "Personal property services" is defined pursuant 
to this subsection. 
SENATE AMENDMENT 
SENATE AMENDMENT" e "to H.P. 1264, L.D. 1762 
A. 
"Personal property services" means the following services related to tangible 
personal property: 
(1) Dry cleaning, laundry and diaper services not including self-service laundry 
services; 
(2) Embroidery and monogramming; 
(3) Car washing; 
(4) Pressure cleaning and washing; 
(5) Pet services such as exercising, sitting, training, grooming and boarding for 
nonmedical purposes; 
(6) Picture framing; 
(7) Furniture cleaning, repair and restoration; 
(8) Rug cleaning; 
(9) Art restoration; 
(10) 
Installation, repair or maintenance of jewelry, cameras, guns, musical 
instruments, electronic and mechanical equipment, lawn and garden equipment, 
computer hardware and appliances; and 
(11) Tailoring and clothing and shoe repair. 
B. "Personal property services" does not include: 
(1) Fabrication services; 
(2) Services performed on tangible personal property used or held for use at or 
located at a manufacturing facility or fabrication facility; or 
(3) Services performed on a motor vehicle or aircraft. 
Sec. E-4. 36 MRS A §1752, sub-§14, ~, as amended by PL 2011, c. 211, §22, 
is further amended to read: 
B. "Sale price" does not include: 
(1) Discounts allowed and taken on sales; 
(2) 
Allowances in cash or by credit made upon the return of merchandise 
pursuant to warranty; 
(3) The price of property returned by customers, when the full price is refunded 
either in cash or by credit; 
(4) +he Except for labor or services included in personal property services, the 
price received for labor or services used in installing or applying or repairing the 
property sold, if separately charged or stated; 
SENATE AMENDMENT 
SENATE AMENDMENT" ~"to H.P. 1264, L.D. 1762 
(5) Any amount charged or collected, in lieu of a gratuity or tip, as a specifically 
stated service charge, when that amount is to be disbursed by a hotel, restaurant 
or other eating establishment to its employees as wages; 
(6) The amount of any tax imposed by the United States on or with respect to 
retail sales, whether imposed upon the retailer or the consumer, except any 
manufacturers', importers', alcohol or tobacco excise tax; 
(7) The cost of transportation from the retailer's place of business or other point 
from which shipment is made directly to the purchaser, provided that those 
charges are separately stated and the transportation occurs by means of common 
carrier, contract carrier or the United States mail; 
(8) The fee imposed by Title 10, section 1169, subsection 11; 
(9) The fee imposed by section 4832, subsection 1; 
(10) The lead-acid battery deposit imposed by Title 38, section 1604, subsection 
2-B; 
(11) Any amount charged or collected by a person engaged in the rental of living 
quarters as a forfeited room deposit or cancellation fee if the prospective 
occupant of the living quarters cancels the reservation on or before the scheduled 
date of arrival; 
(12) The premium imposed on motor vehicle oil by Title 10, section 1020, 
subsection 6-A; or 
(13) Any amount charged for the disposal of used tires. 
Sec. E-5. 36 MRSA §1752, sub-§17-B, as amended by PL 2013, c. 156, §2, is 
repealed. 
Sec. E-6. 36 MRSA §1752, sub-§17-C is enacted to read: 
17-C. Taxable service. "Taxable service" means: 
A. The rental of living quarters in a hotel, rooming house or tourist or trailer camp; 
B. The transmission and distribution of electricity; 
C. The rental or lease of an automobile, camp trailer or motor home as dermed in 
Title 29-A, section 101; 
D. The rental or lease of a pickup truck or van with a gross vehicle weight of less 
than 26,000 pounds from a person primarily engaged in the business of renting 
automobiles; 
E. The sale of an extended service contract on an automobile or truck that entitles the 
purchaser to specific benefits in the service of the automobile or truck for a specific 
duration; 
F. The sale of prepaid calling service; 
G. Amusement, entertainment and recreation services; and 
SENATE AMENDMENT 
SENATE AMENDMENT" IS "to H.P. 1264, L.D. 1762 
H. Personal property services. 
Sec. E-7. 36 MRSA §1760, sub-§34, as amended by PL 2005, c. 218, §23, is 
repealed.' 
SUMMARY 
This amendment strikes and replaces the bill. 
Part A repeals the contingent transfer of $40,000,000 from state-municipal revenue 
sharing and the inclusion in the cascade of transfers to state-municipal revenue sharing 
for fiscal year 2014-15 in Public Law 2013, chapter 368, Part S. 
Part B changes the formula for the property tax fairness credit, lowering the 
eligibility threshold from a tax burden of 10% of income to 8% of income, increasing the 
maximum benefit to $1,000, providing a gradual phase-out in the maximum benefit as 
income rises and basing eligibility on federal adjusted gross income. 
Part C increases the homestead property tax exemption from $10,000 to the lesser of 
$50,000 and 50% of the just value of the homestead for property tax years beginning on 
or after April 1, 2015. This Part also replaces state-municipal revenue sharing with a 
municipal homestead reimbursement payment. The new municipal reimbursement 
formula provides larger reimbursement rates to municipalities with more resident 
homestead exemptions and higher property tax mill rates. 
Part D makes permanent the temporary sales tax of 8% imposed on prepared meals 
and 10% imposed on lodging. 
Part E expands the base of the sales tax to include defined amusement, entertainment 
and recreation services and personal property services and repeals the exemption from the 
sales tax of vending machine sales. 
FISCAL NOTE REQUIRED 
(See attached) 
SPONSORED BY: ~a~Vl!!::J=~_-g:_,-_~_-____ / 
, 
(Senator WOODBURY) 
COUNTY: Cumberland 
SENATE AMENDMENT 
Approved: 02/11114 
;f?ae 
LD 1762 
LR 2721(10) 
An Act Related to the Report of the Tax Expenditure Review Task Force 
Fiscal Note for Senate Amendment "6' to Original Bill 
Sponsor: Sen. Woodbury of Cumberland 
Fiscal Note Required: Yes 
Fiscal Note 
Projections Projections FY 
Net Cost (Savings) 
General Fund 
Appropriations! Allocations 
General Fund 
Revenue 
General Fund 
Other Special Revenue Funds 
Transfers 
General Fund 
Fiscal Detail and Notes 
FY 2013-14 
FY 2014-15 
$0 
$39,738,110 
$0 
$0 
$0 
($14,738,110) 
$0 
($775,690) 
$0 
($25,000,000) 
FY 2015-16 
2016-17 
($105,077,165) 
($74,277,188) 
$96,000,000 
$130,688,000 
$201,077,165 
$204,965,188 
($156,381,280) 
($149,612,814) 
$0 
$0 
This amendment increases the General Fund cost of the bill by $39,738,110 in fiscal year 2014-15, and reduces the 
General Fund cost of the bill by $105,077,165 in fiscal year 2015-16 and $74,277,188 in fiscal year 2016-17. It 
eliminates the transfers from the Maine Budget Stabilization Fund and the Tax Relief Fund to the General Fund 
unappropriated surplus contained in the bill. It increases the homestead property tax exemption from $10,000 to 
$50,000 or 50% of the just value of the homestead, requiring a General Fund appropriation to the Department of 
Administrative Services of $96,000,000 in fiscal year 2015-16 and $130,688,000 in fiscal year 2016-17. It also makes 
the following changes to General Fund revenue and transfers for Municipal Revenue Sharing and Tourism. 
Expand the sales tax base to certain services 
- General Fund 
FY 2013-14 
$0 
FY 2014-15 
$15,530,790 
LR2721 (1 0) - Fiscal Note - Page 1 of2 
FY 2015-16 
FY 2016-17 
$25,650,000 
$26,640,000 
- Municipal Revenue Sharing 
$0 
$817,410 
$0 
$0 
Increase sales tax on prepared meals and lodging 
- General Fund 
$0 
$6,515,100 
$48,674,245 
$48,656,288 
- Municipal Revenue Sharing 
$0 
$342,900 
$0 
$0 
- Tourism 
$0 
$325,755 
$2,433,712 
Change the formula for the property tax fairness credit 
- General Fund 
$0 
($36,784,000) 
($29,954,115) 
($22,377,626) 
- Municipal Revenue Sharing 
($1,936,000) 
Repeals municipal revenue sharing effective July 1,2015 
- General Fund 
$0 
$0 
$156,724,180 
$152,062,814 
- Municipal Revenue Sharing 
$0 
($156,724,180) 
($152,062,814) 
LR2721(1O) - Fiscal Note - Page 2 of2