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State Exemption Reimbursements
36 M.R.S. § 661
As required by the Constitution of Maine, article IV, part third, § 23, the Legislature must reimburse each municipality at least 50% of the property tax revenue loss suffered by that municipality during the previous calendar year as a result of statutory property tax exemptions or credits enacted after April 1, 1978.
A municipality may apply for reimbursement by November 1 of the following year with the State Tax Assessor on the Municipal Valuation Return.
The following exemptions qualify for reimbursement:
- Animal Waste Facility (36 M.R.S. § 656(1)(J))
- Business Equipment Tax Exemption (36 M.R.S. §§ 691 - 700-B)
- Homestead (36 M.R.S. §§ 681 - 689)
- Snowgrooming Equipment (36 M.R.S. § 655(1)(T))
- Veterans Exemption (36 M.R.S. § 653)
- Veterans Organizations (36 M.R.S. § 652(1)(E))
TREE GROWTH TAX LAW REIMBURSEMENT (36 M.R.S. §§ 571 - 584-A)
Although the Tree Growth Tax Law program is not an exemption, eligible applicants may receive a reduced per acre rate on their forested land which results in a property tax reduction.
A municipality is entitled to annual payments if it submits the Municipal Valuation Return in a timely manner and if it achieves the appropriate minimum assessment ratio (36 M.R.S. § 327).
The reimbursement is 90% of the tax revenue lost due to tree growth enrollment. The tax revenue lost is the tax that would have been assessed if the land were valued according to the municipality's undeveloped acreage rate (or the state valuation undeveloped rate, if lower) less the tax that was actually assessed.
If a municipality fails to achieve the minimum assessment ratio, they will lose 10% of the calculated reimbursement for each percentage point below that ratio.