An Act To Promote Major Business Headquarters Expansions in Maine, Promote the Commercialization of Research and Development in Maine and Create Jobs
Maine Legislature, Session 128, LD 1639
Committee: Taxation
Sponsors: JACKSON, FREDETTE, BREEN, DOW, VOLK, GIDEON, HILLIARD
Amends: 36 MRSA §5219-O

Legislative Document
No. 1639
S.P. 591
In Senate, June 9, 2017
An Act To Promote Major Business Headquarters Expansions in 
Maine, Promote the Commercialization of Research and 
Development in Maine and Create Jobs
Reference to the Committee on Taxation suggested and ordered printed.
HEATHER J.R. PRIEST
Secretary of the Senate
Presented by Senator JACKSON of Aroostook.  (GOVERNOR'S BILL)
Cosponsored by Representative FREDETTE of Newport and
Senators: BREEN of Cumberland, DOW of Lincoln, VOLK of Cumberland, Representatives: 
Speaker GIDEON of Freeport, HILLIARD of Belgrade.
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  36 MRSA §5219-OO is enacted to read: 
§5219-OO.  Credit for major business headquarters expansions  
1.  Definitions.  As used in this section, unless the context otherwise indicates, the 
following terms have the following meanings. 
A.  "Base period" means the 3 calendar years prior to the year in which a certificate is 
approved by the commissioner under this section. 
B.  "Certified applicant" means a qualified applicant that has received a certificate of 
approval from the commissioner pursuant to this section. 
C.  "Commissioner" means the Commissioner of Economic and Community 
Development. 
D.  "Employees based in the State" means employees that perform more than 50% of 
employee-related activities for the employer at the headquarters in the State. 
E.  "Facility" means one or more buildings and includes the real and personal 
property located in those buildings. 
F.  "Full-time" means an average of 36 hours weekly during the period of 
measurement. 
G.  "Headquarters" means the principal facility from which the applicant directs its 
national or global business activities, as determined by the commissioner at the time 
of application. 
H.  "Qualified applicant" means an applicant that, at the time an application for a 
certificate of approval is submitted, satisfies all of the following criteria: 
(1)  The applicant's headquarters are or will be located in the State; 
(2)  The applicant employs at least 5,000 full-time employees worldwide of 
which at least 25% are or will be based in this State; 
(3)  The applicant has business locations in at least 3 other states or foreign 
countries; and 
(4)  The applicant intends to make a qualified investment in the State within 5 
years following the date of the application. 
I.  "Qualified investment" means an investment of at least $35,000,000 to design, 
permit, construct, modify, equip or expand the applicant's headquarters in the State 
or, for full-time employees based in the State, to train, retrain or educate them, or pay 
their student loan debt.  The investments and activities of a qualified applicant and 
other entities that are members of the qualified applicant's unitary business must be 
aggregated to determine whether a qualified investment has been made.  A qualified 
investment does not include an investment made prior to the issuance of a certificate 
of approval or after December 31, 2022. 
2.  Procedures for application; certificate of approval.  The provisions of this 
subsection govern the procedures for providing for and obtaining a certificate of 
approval. 
A.  A qualified applicant may apply to the commissioner for a certificate of approval. 
An applicant shall submit to the commissioner information demonstrating that the 
applicant is a qualified applicant.  If a certified applicant undertakes to make an 
additional qualified investment, the certified applicant may apply to the 
commissioner for an additional certificate of approval. 
B.  The commissioner, within 30 days of receipt of an application submitted pursuant 
to paragraph A, shall determine whether the applicant is a qualified applicant and 
shall issue either a certificate of approval or a written denial indicating why the 
applicant is not qualified. The certificate issued by the commissioner must describe 
the qualified investment and specify the total amount of qualified investment 
approved under the certificate. 
C.  Upon issuance of a certificate of completion in accordance with paragraph F, the 
commissioner shall issue, on behalf of the State, a memorandum to the qualified 
applicant describing the benefits provided by this section at the time the certificate of 
completion is issued. The memorandum must provide that the certificate of 
completion does not prohibit the commissioner from revoking a certificate in 
accordance with paragraph E and does not prohibit the assessor from assessing and 
collecting an overpaid benefit in accordance with the provisions of this Title. 
D.  A certified applicant shall obtain approval from the commissioner to transfer the 
certificate of approval or, if the certified applicant has obtained a certificate of 
completion, that certificate of completion to another person.  A certificate of approval 
or certificate of completion may be transferred only if all or substantially all of the 
assets of the certified applicant are, or will be, transferred to that person or if 50% or 
more of the certified applicant's voting stock is, or will be, acquired by that person. 
The commissioner shall approve the transfer of the certificate of approval or the 
certificate of completion only if at least one of the following conditions is satisfied: 
(1)  The transferee is a member of the applicant's unitary affiliated group at the 
time of the transfer; or 
(2)  The commissioner finds that the transferee will, and has the capacity to, 
maintain operations of the headquarters in the State in a manner that meets the 
minimum qualifications for continued eligibility of benefits under this section 
after the transfer occurs.  
If the commissioner approves the transfer of the certificate, the transferee, from the 
date of the transfer, must be treated as the certified applicant and as eligible to claim 
any remaining benefit under the certificate of approval or the certificate of 
completion that has not been previously claimed by the transferor. 
E.  The commissioner must revoke a certificate of approval if the certified applicant 
or a person to whom a certificate of approval has been transferred pursuant to 
paragraph D fails to make a qualified investment within 5 years of the date of the 
certificate of approval.  The commissioner shall revoke a certificate of approval or a 
certificate of completion if the applicant ceases operations of the headquarters in the 
State or the certificate of approval or certificate of completion is transferred to 
another person without approval from the commissioner pursuant to paragraph D.  A 
certified applicant whose certificate of completion is revoked within 5 years after the 
date issued, for the tax year during which the certificate is revoked, shall add to the 
taxpayer's income tax liability imposed by this Part an amount equal to the total 
credits claimed under this section. A certified applicant whose certificate of 
completion is revoked 6 years after through 10 years after the date the certificate was 
issued, shall, for the tax year during which the certificate is revoked, add to the 
taxpayer's income tax liability imposed by this Part an amount equal to the total 
credits claimed under this section for the period 6 years after through 10 years after 
the date the certificate was issued. 
F.  Upon making the qualified investment and completing the headquarters and 
employment criteria in subsection 1, paragraph H, a certified applicant shall submit 
an application to the commissioner for a certificate of completion.  If the 
commissioner determines that a qualified investment has been made, the applicant's 
headquarters is located in the State and at least 25% of the company's employees, as 
measured at the time of application for the certificate of approval, are based in the 
State, the commissioner shall issue a certificate of completion to the certified 
applicant as soon as is practical.  
The commissioner may not issue certificates of approval under this subsection that total, 
in the aggregate, more than $100,000,000 of qualified investment. 
3.  Refundable credit allowed.  A qualified applicant is allowed a credit as provided 
in this subsection. 
A.  Subject to the limitations under paragraph B, beginning with the tax year during 
which the certificate of completion is issued and the tax year beginning in 2020, 
whichever is later, and for each of the following 19 tax years, a certified applicant is 
allowed a credit against the tax due under this Part for the taxable year in an amount 
equal to 2% of the certified applicant's qualified investment.  The credit allowed 
under this paragraph is refundable. 
B.  The credit under this subsection is limited as follows: 
(1)  A credit is not allowed for any tax year during which the taxpayer employs a 
number of full-time employees based in the State during the taxable year that is 
less than: 
(a)  During the first 5 tax years after the certificate of completion is issued, 
the certified applicant's number of full-time employees based in the State on 
the date the certificate of completion is issued; or  
(b)  More than 5 tax years after the certificate of completion is issued, 110% 
of the number of the certified applicant's full-time employees based in the 
State on the date the certificate of completion is issued.  The level of 
employment for the tax year is measured on the last day of the tax year; and 
(2)  Cumulative credits under this subsection may not exceed $16,000,000 under 
any one certificate. 
4.  Reporting required.  A certified applicant and the commissioner are required to 
make reports pursuant to this subsection. 
A.  On or before March 1st of each year, a certified applicant shall file a report with 
the commissioner for the tax year ending during the immediately preceding calendar 
year, referred to in this paragraph as the "report year," containing the following 
information:  
(1)  The number of full-time employees based in this State of the certified 
applicant on the last day of the tax year ending during the calendar year 
immediately preceding the report year; and 
(2)  The incremental amount of qualified investment made in the report year. 
The commissioner may prescribe forms for the annual report described in this 
paragraph.  The commissioner shall provide copies of the reports to the State Tax 
Assessor at the time the report is received. 
B.  The commissioner shall report to the joint standing committee of the Legislature 
having jurisdiction over taxation matters aggregate data on employment levels and 
qualified investment amounts of certified applicants for each year. The report must be 
submitted by April 15th of the first regular session of each Legislature. 
5.  Refund of certain unused credit carry-forward amounts.  Notwithstanding the 
limits on the amount of credit carry-forward that may be claimed by a taxpayer during the 
taxable year under sections 5215, 5219-K, 5219-L, 5219-GG, 5219-JJ, 5219-MM and 
5219-NN, a qualified applicant claiming a credit under subsection 3, subject to the 
carry-forward period specified in section 5215, 5219-K, 5219-L, 5219-GG, 5219-JJ, 
5219-MM or 5219-NN, as applicable, may claim for the taxable year the full amount of 
the unused credit carry-forward amount under those sections. The total aggregate credit 
carry-forward amount allowed for the taxable year under this subsection is limited to the 
amount of credit allowed for the taxable year under subsection 3.  The credit 
carry-forward amount allowed under this subsection is refundable.  If a credit 
carry-forward amount is claimed under this subsection, the associated credit 
carry-forward amount under sections 5215, 5219-K, 5219-L, 5219-GG, 5219-JJ, 
5219-MM and 5219-NN must be reduced by the associated amount claimed under this 
subsection and the credit carry-forward amount claimed under this subsection may not be 
claimed under section 5215, 5219-K, 5219-L, 5219-GG, 5219-JJ, 5219-MM or 5219-NN. 
Sec. 2.  Legislative findings.  The Legislature finds that it is in the best interest of 
the people of the State of Maine to encourage the location and expansion of major 
business headquarters in the State and to encourage the recruitment and training of 
employees for these facilities.  The Legislature further finds that the location and 
expansion of major business headquarters in Maine will create jobs, benefit small 
businesses that supply goods and services to the major business headquarters and its 
employees, increase the tax base, and provide many other direct and indirect economic 
benefits to the State. 
The Legislature further finds that providing benefits only to those major businesses 
located in the State is an appropriate way to encourage major businesses to locate in this 
State and to encourage major businesses in this State to expand.  The Legislature further 
finds that the benefits to the State from providing those businesses far exceeds the costs 
to the State of providing the incentives provided in this legislation and that the provisions 
of this legislation are necessary to accomplish these objectives. 
SUMMARY 
This bill creates a refundable Maine income tax credit for the construction or 
expansion of major business headquarters in the State as long as certain investment and 
employment levels are met.  The refundable so-called headquarters credit is equal to 2% 
of the qualified investment per year for 20 years, subject to certain limitations. 
The bill also allows a taxpayer receiving the headquarters credit to elect to have any 
unused credit carry-forward for the research expense tax credit, super credit for 
substantial expansions of research and development, jobs and investment tax credit and 
Maine capital investment credit be made refundable for any tax year to the extent of the 
headquarters credit.