An Act To Improve Access to Property Tax Exemptions for New Homeowners
Maine Legislature, Session 130, LD 1482
Committee: Taxation
Sponsors: GROHOSKI
Amends: 36 MRSA §681, 36 MRSA §683, 36 MRSA §685

Legislative Document
No. 1482
H.P. 1097
House of Representatives, April 14, 2021
An Act To Improve Access to Property Tax Exemptions for New 
Homeowners
Received by the Clerk of the House on April 12, 2021.  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 GROHOSKI of Ellsworth.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  36 MRSA §681, sub-§5, ¶B, as enacted by PL 2005, c. 647, §3 and affected 
by §5, is amended to read:
B.  Shareholder Prior to property tax years beginning on or after April 1, 2022, 
shareholder for the preceding 12 months in the cooperative housing corporation 
specified in paragraph A; and
Sec. 2.  36 MRSA §683, sub-§1, as amended by PL 2017, c. 478, §1, is further 
amended to read:
1.  Exemption amount.  Except Prior to property tax years beginning on or after April 
1, 2022, except for assessments for special benefits, the just value of $10,000 of the 
homestead of a permanent resident of this State who has owned a homestead in this State 
for the preceding 12 months is exempt from taxation.  Beginning with property tax years 
beginning on or after April 1, 2022, except for assessments for special benefits, the just 
value of $10,000 of the homestead of a permanent resident of this State is exempt from 
taxation.  Notwithstanding this subsection, a permanent resident of this State who loses 
ownership of a homestead in this State due to a tax lien foreclosure and subsequently 
regains ownership of the homestead from the municipality that foreclosed on the tax lien is 
deemed to have continuously owned the homestead and may not be determined ineligible 
for the exemption provided in this section due to the ownership of the homestead by the 
municipality.  In determining the local assessed value of the exemption, the assessor shall 
multiply the amount of the exemption by the ratio of current just value upon which the 
assessment is based as furnished in the assessor's annual return pursuant to section 383.  If 
the title to the homestead is held by the applicant jointly or in common with others, the 
exemption may not exceed $10,000 of the just value of the homestead, but may be 
apportioned among the owners who reside on the property to the extent of their respective 
interests.  A municipality responsible for administering the homestead exemption has no 
obligation to create separate accounts for each partial interest in a homestead owned jointly 
or in common.
Sec. 3.  36 MRSA §683, sub-§3, as amended by PL 2019, c. 343, Pt. H, §3, is further 
amended to read:
3.  Effect on state valuation.  For property tax years beginning before April 1, 2018, 
50% of the just value of all the homestead exemptions under this subchapter must be 
included in the annual determination of state valuation under sections 208 and 305.  For 
property tax years beginning on April 1, 2018 and April 1, 2019, 62.5% of the just value 
of all the homestead exemptions under this subchapter must be included in the annual 
determination of state valuation under sections 208 and 305.  For property tax years 
beginning on or after April 1, 2020, 70% of the just value of all the homestead exemptions 
under this subchapter must be included in the annual determination of state valuation under 
sections 208 and 305, except as provided in subsection 3-A.
Sec. 4.  36 MRSA §683, sub-§3-A is enacted to read:
3-A.  Effect on state valuation for reimbursement made first year of eligibility.  
For property tax years beginning on or after April 1, 2022, 100% of the just value of all the 
homestead exemptions under this subchapter provided for the first year a homestead is 
eligible under this subchapter must be included in the annual determination of state 
valuation under sections 208 and 305; after the first year, the percentage of reimbursement 
is that specified in subsection 3.
Sec. 5.  36 MRSA §683, sub-§4, as amended by PL 2019, c. 343, Pt. H, §3, is further 
amended to read:
4.  Property tax rate.  For property tax years beginning before April 1, 2018, 50% of 
the just value of all the homestead exemptions under this subchapter must be included in 
the total municipal valuation used to determine the municipal tax rate.  For property tax 
years beginning on April 1, 2018 and April 1, 2019, 62.5% of the just value of all the 
homestead exemptions under this subchapter must be included in the total municipal 
valuation used to determine the municipal tax rate.  For Except as provided in subsection 
4-A, for property tax years beginning on or after April 1, 2020, 70% of the just value of all 
the homestead exemptions under this subchapter must be included in the total municipal 
valuation used to determine the municipal tax rate.  The municipal tax rate as finally 
determined may be applied to only the taxable portion of each homestead qualified for that 
tax year.  
Sec. 6.  36 MRSA §683, sub-§4-A is enacted to read:
4-A.  Property tax rate including reimbursement made first year of eligibility.  For 
property tax years beginning on or after April 1, 2022, 100% of the just value of all the 
homestead exemptions under this subchapter provided for the first year a homestead is 
eligible under this subchapter must be included in the total municipal valuation used to 
determine the municipal tax rate; after the first year, the percentage of just value is that 
specified in subsection 4.
Sec. 7.  36 MRSA §685, sub-§2, as amended by PL 2019, c. 343, Pt. H, §4, is further 
amended to read:
2.  Entitlement to reimbursement by the State; calculation.  A municipality that has 
approved homestead exemptions under this subchapter may recover from the State:
A.  For property tax years beginning before April 1, 2018, 50% of the taxes lost by 
reason of the exemptions under section 683, subsections 1 and 1-B;
B.  For property tax years beginning on April 1, 2018 and April 1, 2019, 62.5% of the 
taxes lost by reason of the exemptions under section 683, subsections 1 and 1-B; and
C.  For Except as provided in paragraph D, for property tax years beginning on or after 
April 1, 2020, 70% of the taxes lost by reason of the exemptions under section 683, 
subsections 1 and 1‑B.; and
D.  Notwithstanding paragraph C, for property tax years beginning on or after April 1, 
2022, 100% of the taxes lost by reason of the exemptions provided to permanent 
residents of this State who claim and receive the exemption for the first year for which 
their homesteads are eligible.
The municipality must provide proof in a form satisfactory to the bureau.  The bureau shall 
reimburse the Unorganized Territory Education and Services Fund in the same manner for 
taxes lost by reason of the exemptions.
SUMMARY
This bill removes the requirement that a person own a homestead in this State for 12 
months before being eligible for the homestead property tax exemption. This bill also 
requires the State to provide reimbursement of 100% of the revenue lost by a municipality 
due to removing that 12-month requirement, but only for the first year of eligibility.  If a 
resident is eligible for the homestead exemption but does not take it until after the first year 
of eligibility, that exemption is eligible only for 70% reimbursement by the State.  After 
the first year of eligibility, the state reimbursement rate drops to the current rate of 70%.