An Act Related to Service Charges in Lieu of Property Taxes on Tax-exempt Property
Maine Legislature, Session 126, LD 0562
Committee: Taxation
Sponsors: WILSON, KATZ, HAYES, POULIOT, SHAW, HASKELL
Amends: 36 MRSA §508, 36 MRSA §509

Legislative Document 
No. 562 
H.P. 381 
House of Representatives, February 19, 2013 
An Act Related to Service Charges in Lieu of Property Taxes on 
Tax-exempt Property 
Reference to the Committee on Taxation suggested and ordered printed. 
MILLICENT M. MacFARLAND 
Clerk 
Presented by Representative WILSON of Augusta. 
Cosponsored by Senator KATZ of Kennebec and 
Representatives: HAYES of Buckfield, POULIOT of Augusta, SHAW of Standish, Senator: 
HASKELL of Cumberland. 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  36 MRSA §508, as enacted by PL 2007, c. 627, §12, is repealed. 
Sec. 2.  36 MRSA §509 is enacted to read: 
§509.  Service charges 
1.  Imposition.  A municipality may impose service charges on property that is 
exempt from taxation under section 652 except for: 
A.  Property that is exempt under section 652, subsection 1, paragraph G; and 
B.  Property owned by an educational institution exempt under section 652, 
subsection 1, paragraph B other than property that is rented for residential purposes to 
persons who are not students at that educational institution. 
2.  Determination of service charges.  Service charges must be calculated according 
to the actual cost of providing municipal services to the exempt property and to the 
persons who use that property.  Revenues derived from the service charges must be used 
to fund, to the extent possible, the costs of those services.  Service charges must be 
calculated based on the square footage of building space occupied by the exempt property 
unless the municipality determines that a different measure more accurately represents 
the cost of services for which the service charges are imposed. 
3.  Imposition of service charges.  The municipal legislative body shall identify the 
categories of institutions and organizations upon which service charges are to be 
imposed.  A municipality that imposes service charges on any institution or organization 
must impose those service charges on every similarly situated institution or organization. 
4.  Municipal services for which charges may be imposed.  Service charges may 
be imposed under this section for any services provided by a municipality other than 
education and general assistance. 
5.  Limitation.  The total service charges levied by a municipality on any institution 
or organization under this section may not exceed 2% of the gross annual revenues of the 
institution or organization. In order to qualify for this limitation, the institution or 
organization must file with the municipality an audit of the revenues of the institution or 
organization for the year immediately prior to the year in which the service charge is 
imposed. 
6.  Administration.  A municipality that chooses to impose service charges under 
this section shall adopt any ordinances necessary to carry out the provisions of this 
section. Determinations of service charges may be appealed in accordance with an 
appeals process provided by municipal ordinance. Unpaid service charges may be 
collected in the manner provided in Title 38, section 1208. 
SUMMARY 
This bill permits municipalities to impose service charges on tax-exempt property 
owned by nongovernmental institutions and organizations other than educational 
institutions, houses of worship and parsonages.  Service charges must be calculated to 
cover the cost of services provided and be based on the square footage of building space 
occupied by the institution or organization unless the municipality determines that a 
different measure more accurately represents the cost of services for which the charge is 
imposed.  Service charges may be imposed to cover the cost of any services provided by 
the municipality to the property other than education or general assistance.  The bill 
repeals an existing service charge law that applies to a limited class of property that 
would be covered under this bill.