An Act to Allow a Local Option Sales Tax on Short-term Lodging to Fund Affordable Housing
Maine Legislature, Session 131, LD 1298
Committee Amendment CA_A_H883 (House)
Amends: 36 MRSA §1951-A

L.D.1298
COMMITTEE AMENDMENT "/-f » to H.P. 823, L.D. 1298, "An Act to Allow a
Local Option Sales Tax on Short-term Lodging to Fund Affordable Housing"
Amend the bill in section 1 in the first line (page 1, line 2 in L.D.) by striking out the
following: "§1821" and inserting the following: '§1822'
Amend the bill in section 1 in §1821 in the first line (page 1, line 3 in L.D.) by striking
out the following: "§1821" and inserting the following: 'S1822'
Amend the bill in section 1 in §1821 by striking out all of subsection 2 (page 1, lines
20 to 24 in L.D.) and inserting the following:
'2. Authorization to impose local option sales tax. A municioalitv by referendum
conducted pursuant to subsection 9 may unoose a localj3j3tion salesi tax of 1 % on the value
of rental of living quarters m any hotel, roomme house or tourist or trailer camp. A local
option sales tax may not be imposed in the unorganized territory,'
Amend the bill in section 1 in §1821 in subsection 5 in the 2nd line (page 1, line 31 in
L,D.) by inserting after the following: "1951^A" the following: '. subsection 1'
Amend the bill in section 1 in §1821 by striking out all of subsection 6 and replacing
it with the following;
'6. Distribution of revenue. By the 20th day of each month, the assessor shall certjfa
to the State Controller and the Treasurer of State the amount of revenue attributable to the
local option sales tax collected in the previous month in each oarticipating municipality.
after deducting from that revenue the costs of administerine this section. For the ourposes
of this subsection, "costs of administerine this section" means the lesser of the actual cost
to the assessor of administerme this section and 2% of the total revenue generated by a
local option sales tax,
By the end of each month, the Treasurerof State shall make payments to the participating
municipalities of the amounts certified by the assessor pursuant to this subsection.'
Amend the bill in section 1 in §1821 by stdking out all of subsection 10 and replacing
it with the followmg:
COMMITTEE AMENDMENT
•A-
COMMITTEE AMENDMENT "f-\" to H.P. 823, L,D. 1298
'10. Effective date of tax; acceptance by voters. A local ootion sales tax authorized
by this section takes effect on the first day of the first month that begins after 120 days have
passed from the municioal referendum vote under subsection 9 if the referendum is
approved by a maiority of the legal voters voting at the election and the total number of
votes cast equals or exceeds 20% of the total number of votes cast in the municmality in
the most recent gubernatorial election. A local option sales tax mav not take effect before
January 1. 2025.'
Amend the bill by inserting after section 1 the following:
'See. 2. 36 MRSA §1951-A, sub-§3, as amended by PL 2011, c. 285, §7, is
repealed.
Sec. 3. Appropriations and allocations. The following appropriations and
allocations are made.
ADMINISTRATIVE AND FINANCIAL SERVICES, DEPARTMENT OF
Revenue Services, Bureau of 0002
Initiative: Provides one-time funding for computer programming, testing and outreach
costs related to the municipal local option sales tax on short-term lodging.
GENERAL FUND 2023-24 2024-25
AllOther $0 $271,481
GENERAL FUND TOTAL $0 $271,481
Revenue Services, Bureau of 0002
Initiative: Provides funding for one Tax Examiner TH position and related All Other costs
to administer the local option sales tax on short-term lodging.
GENERAL FUND 2023-24 2024-25
Personal Services $0 $94,114
AllOther $0 $4,614
GENERAL FUND TOTAL $0 $98,728
ADMINISTRATIVE AND FINANCIAL
SERVICES, DEPARTMENT OF
DEPARTMENT TOTALS 2023-24 2024-25
3334 GENERAL FUND $0 $370,209
DEPARTMENT TOTAL-ALL FUNDS $0 $370,209
'
8 Amend the bill by relettering or renumbering any nonconsecutive Part letter or section
number to read consecutively.
COMMITTEE AMENDMENT
"A
COMMITTEE AMENDMENT " /~T" to H,P. 823, L.D. 1298
SUMMARY
This amendment aligns the rented living quarters subject to the local option sales tax
with the rented living quarters subject to the sales tax under current law and includes a
provision excluding the unorganized territory from participation in a local option sales tax.
The amendment also clarifies that the retailer collectmg sales tax pursuant to the local
option sales tax authorized by the bill must file monthly and make payments on forms
prescribed by the State Tax Assessor and also repeals a provision of law that allows
individuals collectmg sales tax on casual rentals of living quarters to file and pay sales tax
on their individual income tax returns. The amendment adds a process and timeline for the
distribution of revenues by the Treasurer of State to participatmg municipalities. The
amendment also clarifies that a local option sales tax does not take effect until the first day
of the first month that begms after 120 i&ys after the municipal referendum adopting the
tax and specifies that a local option sales tax may not take effect before January 1,2025.
FISCAL NOTE REQUIRED
(See attached)
COMMITTEE AMENDMENT
Revised: 03/26/24 ^K?<^
'• •..
LD 1298 LR 2113(02)
An Act to Allow a Local Option Sales Tax on Short-term Lodging to Fund Affordable Housing
Fiscal Note for Bill as Amended by Committee Amendment /f / /-/—/i
Committee: Taxation
Fiscal Note Required: Yes
Fiscal Note
Projections Projections
FY 2023-24 FY 2024-25 FY 2025-26 FY 2026-27
Net Cost (Savings)
GeperalFund . $0 $3.70,209, $.135,172 $139,871
Appropriations/AIlocations
General Fund $0 $370,209 $135,172 $139,871
Fiscal Detail and Notes
This bill allows municipalities by referendum to impose a local option sales tax of 1% on short-term lodging that is
subject to the sales and use tax, It is not known how many and which municipalities will conduct a successful
referendum to impose such a tax, but those that do will see revenue increases. Maine Revenue Services has indicated
that there may be some reduction in the demand for short-term lodging because of the new tax, If that occurs there
would be some reduction in revenue to the General Fund, the Local Government Fund and the Tourism Marketing
Fund. This fiscal note does not reflect a reduction in revenue in these categories.
The bill includes ongoing General Fund appropriations to the Department of Administrative and Financial Services,
Bureau of Revenue Services of $98,927 in fiscal year 2024-25 for one Tax Examiner III position beginning October 1,
;.' . 2024 to administer a local option sales tax on short-term lodging. It also includes a one-time General Fund
appropriation to the Bureau of Revenue Services of $271,481 in fiscal year 2024-25 for computer programming,
implementation and testing and outreach costs associated with a local option sales tax.
. Additional costs to the Office of Treasurer of State associated with distributing local option sales tax revenue to
'partloipating municipalities are considered to be minor and can be absorbed within existing budgeted resources,
LR2113(02) - Fiscal Note - Page 1 of 1