An Act To Distribute Tax Revenue To Offset Costs Incurred by Adult Use Marijuana Host Municipalities
Maine Legislature, Session 130, LD 1185
Committee: Taxation
Sponsors: PERRY
Amends: 28-B MRSA §407, 36 MRSA §1818, 36 MRSA §4925

Legislative Document
No. 1185
H.P. 863
House of Representatives, March 22, 2021
An Act To Distribute Tax Revenue To Offset Costs Incurred by 
Adult Use Marijuana Host Municipalities
Received by the Clerk of the House on March 18, 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 PERRY of Bangor.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  28-B MRSA §407 is enacted to read:
§407.  Revenue allocation to municipalities
1.  Local Government Marijuana Revenue Fund established.  To assist in offsetting 
negative effects on local resources of local regulation and enforcement of adult use 
marijuana laws, there is established the Local Government Marijuana Revenue Fund, 
referred to in this section as "the fund."
2.  Fund sources.  The fund receives money transferred to the fund pursuant to Title 
36, section 1818, subsection 2 and Title 36, section 4925, subsection 2.
3.  Distribution of funds.  The Treasurer of State shall distribute the balance in the 
fund on the 20th day of each month. Money in the fund must be distributed to each 
municipality that has authorized, pursuant to sections 401 to 403, a marijuana establishment 
within the municipality in proportion to the ratio of revenues generated by the sale of adult 
use marijuana and adult use marijuana products pursuant to Title 36, sections 1811 and 
4925 by all marijuana establishments operating within the municipality to the revenues 
generated by the sale of adult use marijuana and adult use marijuana products pursuant to 
Title 36, sections 1811 and 4925 by all marijuana establishments operating within the State.
4.  Unorganized and deorganized areas.  For purposes of municipal marijuana 
revenue distribution pursuant to this section, unorganized and deorganized areas must be 
treated as if they are municipalities.
Sec. 2.  36 MRSA §1818, as enacted by PL 2017, c. 409, Pt. D, §4, is repealed and 
the following enacted in its place:
§1818.  Tax on adult use marijuana and adult use marijuana products
All sales tax revenue collected pursuant to section 1811 on the sale of adult use 
marijuana and adult use marijuana products must be deposited into the General Fund, 
except that, on or before the last day of each month, the State Controller shall transfer:
1.  Adult Use Marijuana Public Health and Safety Fund.  Twelve percent of the 
sales tax revenue received by the State Tax Assessor during the preceding month pursuant 
to section 1811 to the Adult Use Marijuana Public Health and Safety Fund established 
under Title 28-B, section 1101; and
2.  Local Government Marijuana Revenue Fund.  Twelve percent of the sales tax 
revenue received by the State Tax Assessor during the preceding month pursuant to section 
1811 to the Local Government Marijuana Revenue Fund established under Title 28-B, 
section 407 calculated after the transfer pursuant to subsection 1 and after the subtraction 
of the costs of the State Tax Assessor in administering this subsection.  For the purposes of 
this subsection, "costs of the State Tax Assessor in administering this subsection" means, 
for each month in the 12-month period after the effective date of this subsection, the actual 
and anticipated cost to the State Tax Assessor of administering this subsection and, in all 
subsequent months, the previous month's actual cost of administering this subsection.
Sec. 3.  36 MRSA §4925, as enacted by PL 2019, c. 231, Pt. B, §7, is repealed and 
the following enacted in its place:
§4925.  Application of excise tax revenue
All excise tax revenue collected by the State Tax Assessor on the sale of adult use 
marijuana pursuant to this chapter must be deposited into the General Fund, except that, on 
or before the last day of each month, the State Tax Assessor shall transfer:
1.  Adult Use Marijuana Public Health and Safety Fund.  Twelve percent of the 
excise tax revenue received during the preceding month pursuant to this chapter to the 
Adult Use Marijuana Public Health and Safety Fund established under Title 28-B, section 
1101; and
2.  Local Government Marijuana Revenue Fund.  Twelve percent of the excise tax 
revenue received during the preceding month into the Local Government Marijuana 
Revenue Fund established under Title 28-B, section 407 calculated after the transfer 
pursuant to subsection 1 and after the subtraction of the costs of the State Tax Assessor in 
administering this subsection. For the purposes of this subsection, "costs of the State Tax 
Assessor in administering this subsection" means, for each month in the 12-month period 
after the effective date of this subsection, the actual and anticipated cost to the State Tax 
Assessor of administering this subsection and, in all subsequent months, the previous 
month's actual cost of administering this subsection.
SUMMARY
This bill establishes the Local Government Marijuana Revenue Fund and requires the 
transfer to the fund of 12% of revenue from the sales tax on adult use marijuana and adult 
use marijuana products and the marijuana excise tax.  The fund must be distributed to a 
municipality where marijuana establishments are operating in proportion to the ratio of 
revenues generated by the sales and excise taxes on adult use marijuana and adult use 
marijuana products within the municipality to the revenues generated by all marijuana 
establishments operating in the State.