An Act To Improve the Effectiveness of the New Markets Capital Investment Credit
Maine Legislature, Session 128, LD 1796
Committee: Taxation
Amends: 36 MRSA §5219-H

Legislative Document
No. 1796
H.P. 1240
House of Representatives, January 22, 2018
An Act To Improve the Effectiveness of the New Markets Capital 
Investment Credit
Reported by Representative TIPPING of Orono for the Joint Standing Committee on 
Taxation pursuant to the Maine Revised Statutes, Title 3, section 999, subsection 4.
Reference to the Committee on Taxation suggested and ordered printed pursuant to Joint 
Rule 218.
ROBERT B. HUNT
Clerk
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  36 MRSA §5219-HH, sub-§1, ¶J, as amended by PL 2013, c. 75, §1, is 
further amended to read:
J.  "Qualified low-income community investment" means any capital or equity 
investment in, or loan to, any qualified active low-income community business made 
after September 28, 2011.  Except as otherwise provided in this paragraph, with 
respect to any one qualified active low-income community business, the maximum 
amount of qualified low-income community investments that may be made with the 
proceeds of qualified equity investments that have been certified under Title 10, 
section 1100-Z, subsection 3, paragraph G is $10,000,000 per project constructed, 
maintained or operated by the qualified active low-income community business 
whether made by one or several qualified community development entities.  With 
respect to investments in a qualified active low-income community business that is a 
manufacturing or value-added production enterprise, the limit on the qualified low-
income community investment is $40,000,000 per project constructed, maintained or 
operated by the qualified active low-income community business.  For the purposes 
of this paragraph, with respect to projects to which the $10,000,000 limitation 
applies, "project" includes all land, buildings, structures, machinery and equipment 
located at the same location and constructed, maintained or operated by the qualified 
active low-income community business.  For the purposes of this paragraph, with 
respect to projects to which the $40,000,000 limitation applies, "project" means, and 
refers separately to, each manufacturing or value-added production facility that 
projects to create or retain more than 200 jobs, including the land, buildings, 
structures, machinery and equipment functionally related to, and integrated with, the 
manufacturing or production process conducted on the site of that facility.  "Project" 
does not mean or include the component pieces of an integrated manufacturing or 
production process conducted on the site of a particular facility.  "Qualified low-
income community investment" does not include a capital or equity investment  made 
after November 9, 2015 if more than 5% of the investment is used to refinance costs, 
expenses or investments incurred or paid by the qualified active low-income 
community business or a party related to the qualified active low-income community 
business prior to the date of the qualified low-income community investment; make 
equity distributions from the qualified active low-income community business to its 
owners; acquire an existing business or enterprise in the State; or pay transaction 
fees.
SUMMARY
This bill implements the recommendation of the tax expenditure report of the Joint 
Standing Committee on Taxation and the evaluation report of the Office of Program 
Evaluation and Government Accountability with regard to the new markets capital 
investment credit by excluding from the definition of "qualified low-income community 
investment" a capital or equity investment if more than 5% of the investment is used to 
refinance costs, expenses or investments incurred or paid by the qualified active low-
income community business or a party related to the qualified active low-income 
community business prior to the date of the qualified low-income community investment; 
make equity distributions from the qualified active low-income community business to its 
owners; acquire an existing business or enterprise in the State; or pay transaction fees.  
This bill excludes from the tax credit investments that are used to cover payments 
referred to as "same-day loans."