An Act To Return Funds to Maine Property Tax Payers (AFTER DEADLINE)
Maine Legislature, Session 129, LD 1713
Committee: Taxation
Sponsors: GIDEON, JACKSON, BERRY, BICKFORD, MORALES, TIPPING
Amends: 5 MRSA §1518-A, 5 MRSA §1536

Legislative Document
No. 1713
H.P. 1223
House of Representatives, May 9, 2019
An Act To Return Funds to Maine Property Tax Payers
(AFTER DEADLINE)
Approved for introduction by a majority of the Legislative Council pursuant to Joint Rule 
205.
Reference to the Committee on Taxation suggested and ordered printed.
ROBERT B. HUNT
Clerk
Presented by Speaker GIDEON of Freeport.
Cosponsored by President JACKSON of Aroostook and
Representatives: BERRY of Bowdoinham, BICKFORD of Auburn, MORALES of South 
Portland, TIPPING of Orono.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  5 MRSA §1518-A, as amended by PL 2015, c. 390, §1, is further amended 
to read:
§1518-A.  Property Tax Relief Fund for Maine Residents
1.  Property Tax Relief Fund for Maine Residents.  There is created the Property 
Tax Relief Fund for Maine Residents, referred to in this section as "the fund," which must 
be used to provide property tax relief to residents of the State.  The fund consists of all 
resources transferred to the fund under subsection 4 and section 1536 and other resources 
made available to the fund.  The fund must be used to reduce the individual income tax 
rates to 4% pursuant to subsection 1-A provide relief payments to property tax payers 
pursuant to subsection 1-B.
1-A.  Implementation.  By September 1, 2016 and annually thereafter, the State 
Controller shall inform the State Tax Assessor of the amount available in the fund for the 
purposes of subsection 1.
A.  By November 1st annually, the State Tax Assessor shall calculate the amount by 
which the income tax rates under Title 36, section 5111, subsections 1-F, 2-F and 3-F 
may be reduced during the subsequent tax year using the amount available from the 
fund. Bracket rate reductions must be a minimum of 0.2 percentage points in the first 
year in which reductions are made and a minimum of 0.1 percentage points in 
subsequent years. If sufficient funds are not available to pay for the minimum 
reduction, a rate reduction may not be made until the amount in the fund is sufficient 
to pay for the reduction. When the amount is sufficient to pay for the reduction, the 
reduction must first be applied equally to each bracket under Title 36, section 5111, 
subsections 1-F, 2-F and 3-F until the lower bracket reaches 4%. Funds available 
from the fund in subsequent years must be applied to reduce the higher bracket rates 
until there is a single bracket with a rate of 4%, after which future tax relief may be 
identified.
B.  The State Tax Assessor shall provide public notice of new bracket rates calculated 
under this subsection by November 15th annually.
C.  New bracket rates calculated under this subsection apply beginning with tax years 
that begin on or after January 1st of the calendar year following the determinations 
made under this subsection.
1-B.  Process.  The process for providing relief payments to property tax payers is 
established pursuant to this subsection.
A.  As used in this subsection, unless the context otherwise indicates, the following 
terms have the following meanings.
(1)  "Homestead" means any residential property, including cooperative property, 
that receives a homestead property tax exemption.
(2)  "Homestead property tax exemption" means the exemption established in 
Title 36, chapter 105, subchapter 4-B.
(3)  "Property tax payer" means an individual who owns a homestead.
(4)  "Relief payment" means the funds, as determined pursuant to paragraph C, 
provided to the owner of a homestead pursuant to paragraph D to offset property 
tax payments made by that owner.
B.  By October 1, 2019 and annually thereafter, for each homestead in this State:
(1)  The assessor for each municipality shall provide the Treasurer of State with 
the number of homesteads in that assessor's municipality and the name and 
address of the property tax payer for each homestead; and
(2)  The State Tax Assessor shall provide the Treasurer of State with the number 
of homesteads in the unorganized territory and the name and address of the 
property tax payer for each homestead.
C.  Using the data provided pursuant to paragraph B, the Treasurer of State shall 
determine the amount of relief payment each property tax payer is entitled to by 
dividing the amount of the funds available in the fund by the total number of 
homesteads in the State.
D.  In any year in which the amount of the relief payment for each homestead is at 
least $100, as determined pursuant to paragraph C, the Treasurer of State shall mail 
by December 1st of that year a check in the amount of the relief payment to each 
property tax payer at the address of the homestead provided to the Treasurer of State 
pursuant to paragraph B.  Funds for the relief payments must come from the fund.
2.  Nonlapsing fund.  Any unexpended balance in the Property Tax Relief Fund for 
Maine Residents may not lapse but must be carried forward to be used pursuant to 
subsection 1-A 1-B.
3.  Transfer for income tax reduction.  In the fiscal years immediately following 
the calculation of the income tax rate reduction under subsection 1-A, paragraph A, the 
State Tax Assessor shall certify to the State Controller the amount of the reduction in 
General Fund revenue by fiscal year, and the State Controller shall transfer from the fund 
the amount certified for the reduction in revenue attributable to adjustments made under 
subsection 1-A to the General Fund unappropriated surplus.
4.  Transfer from General Fund revenue growth.   Beginning with fiscal year 
2013-14 and before any other transfers from the General Fund, the State Controller shall 
transfer to the fund at the close of each fiscal year 40% of the amount by which General 
Fund budgeted revenue for that fiscal year exceeds the General Fund appropriation 
limitation calculated for that fiscal year under section 1534.
5.  Report.  Beginning January 2, 2020 and annually thereafter, the Treasurer of State 
shall report to the joint standing committee of the Legislature having jurisdiction over 
taxation matters and the joint standing committee of the Legislature having jurisdiction 
over appropriations and financial affairs the amount of funds in the fund, the amount of 
the property tax relief payment calculated pursuant to subsection 1-B, paragraph C and 
the number and amount of property tax relief payments distributed, if any, pursuant to 
subsection 1-B, paragraph D.
Sec. 2.  5 MRSA §1536, sub-§1, ¶F, as enacted by PL 2011, c. 692, §2 and 
affected by §3, is amended to read:
F.  Twenty percent to the Property Tax Relief Fund for Maine Residents established 
in section 1518-A.
Sec. 3.  5 MRSA §1536, sub-§3, as amended by PL 2015, c. 267, Pt. L, §8, is 
further amended to read:
3.  Exceptions; stabilization fund at limit.  If the stabilization fund is at its limit of 
18% of General Fund revenue of the immediately preceding year, then amounts that 
would otherwise have been transferred to the stabilization fund pursuant to subsections 1 
and 2 must be transferred to the Property Tax Relief Fund for Maine Residents 
established in section 1518-A.
SUMMARY
The Tax Relief Fund for Maine Residents, which is funded by the transfer of 20% of 
the unappropriated surplus of the General Fund after all required deductions of 
appropriations, budgeted financial commitments and adjustments considered necessary 
by the State Controller have been made, was established to provide income tax relief by 
reducing income tax rates once a certain level of funds in the fund is reached; to date, the 
required level of funding to provide income tax relief has not been reached.
This bill renames the fund the Property Tax Relief Fund for Maine Residents and 
requires it to be used to provide property tax relief payments directly to residents of this 
State whose residence qualifies for an exemption under the Maine homestead property tax 
exemption.  The amount of the tax relief payment is determined annually by dividing the 
total amount of funds available in the Property Tax Relief Fund for Maine Residents by 
the total number of homesteads that qualify for the Maine homestead property tax 
exemption.  If that amount is at least $100, the Treasurer of State is required, by 
December 1st, to mail checks for the tax relief payment to each owner of a qualifying 
homestead.