An Act To Encourage Computer Data Center Development by Providing a Sales Tax Refund or Exemption
Maine Legislature, Session 128, LD 1722
Committee: Taxation
Sponsors: STANLEY, DILL, GOLDEN, HERBIG, HILLIARD, NADEAU, JACKSON, MASON, MIRAMANT
Amends: 36 MRSA §2021

Legislative Document
No. 1722
H.P. 1202
House of Representatives, December 22, 2017
An Act To Encourage Computer Data Center Development by 
Providing a Sales Tax Refund or Exemption
Approved for introduction by a majority of the Legislative Council pursuant to Joint Rule 
203.
Received by the Clerk of the House on December 19, 2017.  Referred to the Committee on 
Taxation pursuant to Joint Rule 308.2 and ordered printed pursuant to Joint Rule 401.
ROBERT B. HUNT
Clerk
Presented by Representative STANLEY of Medway.
Cosponsored by Senator DILL of Penobscot and
Representatives: GOLDEN of Lewiston, HERBIG of Belfast, HILLIARD of Belgrade, 
NADEAU of Winslow, Senators: JACKSON of Aroostook, MASON of Androscoggin, 
MIRAMANT of Knox.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  36 MRSA §2021 is enacted to read:
§2021.  Refund of sales tax for computer data center purchases
1.  Definitions.  As used in this section, unless the context otherwise indicates, the 
following terms have the following meanings.
A.  "Computer data center" or "center" means a facility comprising one or more 
buildings, occupied by one or more businesses, with a combined square footage of at 
least 20,000 square feet constructed or refurbished to be used primarily to house 
working servers and having:
(1)  An uninterruptible power supply or generator backup power;
(2)  Sophisticated fire prevention and suppression systems; and
(3)  Enhanced building security measures, such as restricted access to the facility, 
permanent security guards, video camera surveillance, electronic passcode 
systems, keycards, biometric scans or similar security features.
For a computer data center comprising multiple buildings, each separate building is 
considered a computer data center if the building has all of the characteristics listed in 
subparagraphs (1) to (3).
B.  "Electronic data storage and data management services" includes, but is not 
limited to:
(1)  Providing data storage and backup services;
(2)  Providing computer power and hosting enterprise software applications;
(3)  Hosting websites; and
(4)  Providing online services such as e-mail, website browsing and searching, 
media applications and other services, regardless of whether a charge is made for 
those services.
C.  "Eligible computer data center" means a computer data center located in the State 
for which a building permit is issued before October 1, 2021 and that has a space of 
at least 20,000 square feet dedicated to housing working servers that was not 
dedicated to housing working servers before October 1, 2018.
D.  "Eligible power infrastructure" means all fixtures and equipment necessary for the 
transformation, distribution or management of the electricity required to operate 
eligible server equipment within an eligible computer data center, including electrical 
substations, generators, wiring and cogeneration equipment.
E.  "Eligible server equipment" means server equipment installed in an eligible 
computer data center on or after October 1, 2018 and server equipment that replaces 
existing server equipment, if the sale or use of the server equipment being replaced 
qualifies for a sales tax refund or exemption under this section and is installed and put 
into regular use before October 1, 2021.
F.  "Qualifying business" means a business entity that exists for the primary purpose 
of engaging in commercial activity for profit and that is the owner or lessee of an 
eligible computer data center that certifies that it will add at least 20 qualifying jobs 
at that center within 6 years after the date the qualifying business first becomes 
eligible for a sales tax refund or exemption under this section.
G.  "Qualifying job" means a full-time job with an average weekly wage that exceeds 
the average weekly wage for the county in which the job is located.
H.  "Server" means a blade or rack-mounted server computer used in a computer data 
center exclusively to provide electronic data storage and data management services 
for internal use by the owner or lessee of the computer data center, for the clients of 
the owner or lessee of the computer data center or for both.  "Server" does not include 
a personal computer.
I.  "Server equipment" means the server chassis and all computer hardware contained 
within the server chassis.  "Server equipment" also includes computer software, other 
than custom computer software, necessary to operate the server.  "Server equipment" 
does not include the rack upon which the server chassis is installed and computer 
peripheral equipment such as keyboards, monitors, printers and other devices.
2.   Sales tax refund authorized.  A qualifying business is eligible for a refund of 
sales tax paid by that business on the purchase of the following services or items upon 
presenting to the State Tax Assessor evidence that the transaction is eligible for refund 
under this section:
A.  Eligible server equipment;
B.  Eligible power infrastructure; and
C.  Electronic data storage and data management services.
An application for a refund must be filed with the assessor within 36 months after the 
date of purchase.
3.  Sales tax exemption; certificate.  A purchaser is not required to pay sales tax on 
the purchase of services or items eligible for a refund under this section if the purchaser 
has obtained a certificate from the State Tax Assessor stating that the purchaser is eligible 
to purchase services or items eligible for a refund without paying sales tax.  The seller is 
required to obtain a copy of the certificate together with an affidavit as prescribed by the 
assessor, to be maintained in the seller's records, attesting to the qualification of the 
purchase for a sales tax exemption pursuant to this section.  In order to qualify for this 
sales tax exemption, the items or services must be used directly and primarily in an 
eligible computer data center.
4.  Recapture.  A qualifying business that fails to add at least 20 new full-time 
employees within 6 years after the qualifying business first becomes eligible for a sales 
tax refund or exemption under this section must be assessed the amount of sales tax 
refunded or forgone by the State plus interest at the rate specified in section 186.
5.  Audit.  The State Tax Assessor has the authority to audit any claim filed under 
this section. If the assessor determines that the amount claimed for a sales tax refund or 
exemption is incorrect, the assessor shall redetermine the claim and notify the claimant in 
writing of the redetermination. If the claimant has received reimbursement of an amount 
that the assessor concludes should not have been reimbursed, the assessor may issue an 
assessment for that amount within 3 years from the date the reimbursement claim was 
filed or at any time if a fraudulent reimbursement claim was filed. The claimant may seek 
reconsideration, pursuant to section 151, of the redetermination or assessment.
SUMMARY
This bill provides a sales tax refund or exemption for the purchase of eligible server 
equipment, eligible power infrastructure and electronic data storage and data management 
services by an eligible computer data center that begins operation between October 1, 
2018 and October 1, 2021.  A qualifying business must add at least 20 full-time jobs with 
above-average wages within 6 years after the business first becomes eligible or the 
amount of refunded or exempt taxes plus interest will be recaptured by the State.