An Act to Amend the Maine Tree Growth Tax Law to Encourage Housing Construction Reference to the Joint Select Committee on Housing suggested and ordered printed.
Maine Legislature, Session 131, LD 0341
Committee: Housing
Sponsors: DUCHARME, ARATA, CARMICHAEL, DUNPHY, LANDRY, THORNE, FARRIN
Amends: 36 MRSA §581

Legislative Document
No. 341
H.P. 215
House of Representatives, January 30, 2023
An Act to Amend the Maine Tree Growth Tax Law to Encourage 
Housing Construction
Reference to the Joint Select Committee on Housing suggested and ordered printed.
ROBERT B. HUNT
Clerk
Presented by Representative DUCHARME of Madison.
Cosponsored by Representatives: ARATA of New Gloucester, CARMICHAEL of Greenbush, 
DUNPHY of Embden, LANDRY of Farmington, THORNE of Carmel, Senator: FARRIN of 
Somerset.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  36 MRSA §581, sub-§3, as amended by PL 2021, c. 630, Pt. C, §5, is further 
amended to read:
3.  Penalty.  If Except as provided in subsection 3-A, if land is withdrawn from taxation 
under this subchapter, the assessor shall impose a penalty upon the owner. The penalty is 
the greater of:
A.  An amount equal to the taxes that would have been assessed on the land on the first 
day of April for the 5 tax years, or any lesser number of tax years starting with the year 
in which the land was first classified, preceding the withdrawal had that land been 
assessed in each of those years at its just value on the date of withdrawal less all taxes 
paid on that land over the preceding 5 years, or any lesser number of tax years starting 
with the year in which the land was first classified, and increased by interest at the 
prevailing municipal rate from the date or dates on which those amounts would have 
been payable; and
B.  An amount computed by multiplying the amount, if any, by which the just value of 
the land on the date of withdrawal exceeds the 100% valuation of the land pursuant to 
this subchapter on the preceding April 1st by the following rates.
(1)  If the land was subject to valuation under this subchapter for 10 years or fewer 
prior to the date of withdrawal, the rate is 30%.
(2)  If the land was subject to valuation under this subchapter for more than 10 
years prior to the date of withdrawal, the rate is 30% reduced by one percentage 
point for each full year beyond 10 years that the land was subject to valuation under 
this subchapter prior to the date of withdrawal, except that the minimum rate is 
20%.
For purposes of this subsection and subsection 3-A, just value at the time of withdrawal is 
the assessed just value of comparable property in the municipality adjusted by the 
municipality's certified assessment ratio.
Sec. 2.  36 MRSA §581, sub-§3-A is enacted to read:
3-A.  Penalty; use of land for single-family housing construction.  If land is 
withdrawn from taxation under this subchapter and a portion of the land will be used for 
construction of single-family residential housing and the conditions required for building 
construction are met within 2 years of withdrawal, the assessor shall impose a penalty upon 
the owner that is the lesser of the amounts calculated under subsection 3, paragraphs A and 
B.  If single-family residential housing on the land is not completed within 2 years of 
withdrawal or the conditions required for building construction are not met, the penalty 
must be calculated under subsection 3 and a supplemental penalty may be assessed.
SUMMARY
This bill reduces the penalty for withdrawal of land from classification under the Maine 
Tree Growth Tax Law if the land is used for the construction of single-family residential 
housing and the conditions required for building construction are met within 2 years of 
withdrawal.