CHAPTER 220
H.P. 223 - L.D. 287
An Act to Improve the Administration of Tax Increment Financing
Emergency preamble. Whereas, Acts of the Legislature do not become effective until 90 days after adjournment unless enacted as emergencies; and
Whereas, the provisions of the Maine Revised Statutes, Title 30-A, chapter 207 relating to municipal and state tax increment financing districts are of vital importance to the economic development of the State; and
Whereas, certain amendments and clarifications to Title 30-A, chapter 207 are necessary to effectuate the legislative intent; and
Whereas, unless this legislation is effective immediately, the effectiveness of these provisions as an incentive for economic development will be impaired to the detriment of the State and its people; and
Whereas, in the judgment of the Legislature, these facts create an emergency within the meaning of the Constitution of Maine and require the following legislation as immediately necessary for the preservation of the public peace, health and safety; now, therefore,
Be it enacted by the People of the State of Maine as follows:
Sec. 1. 30-A MRSA §5252, sub-§4, as amended by PL 1991, c. 431, §§1 and 2, is further amended to read:
4. Development program. "Development program" means a statement of means and objectives designed to provide new employment opportunities, retain existing employment, improve or broaden the tax base and improve the quality of life, the physical facilities and structures and or the quality of pedestrian and vehicular traffic control and transportation within the development district. The statement must include:
A. A financial plan;
B. A complete list of public facilities to be constructed;
C. The uses of private property within the district;
D. Plans for the relocation of persons displaced by the development activities;
E. The proposed regulations and facilities to improve transportation;
F. The environmental controls to be applied;
G. The proposed operation of the district after the planned capital improvements are completed; and
H. The duration of the program that must not exceed 30 years from the date of designation of the district.
Sec. 2. 30-A MRSA §5252, sub-§8, ¶A, as amended by PL 1989, c. 6; c. 9, §2; and c. 104, Pt. C, §§8 and 10, is further amended to read:
A. The term "project costs" does not include the cost of facilities, buildings, or portions of buildings, used predominantly for the general conduct of government or for public recreational purposes. These facilities and buildings include, but are not limited to, city halls and other headquarters of government where the governing body meets regularly, courthouses, jails, police stations and other State Government and local government office buildings, recreation centers, athletic fields and swimming pools.
Sec. 3. 30-A §5254, sub-§3, as amended by PL 1991, c. 856, §4, is further amended to read:
3. Development program fund; tax increment revenues. If a municipality has elected to retain all or a percentage of the retained captured assessed value under subsection 1, the municipality shall:
A. Establish a development program fund that consists of the following:
(1) A development sinking fund account that is pledged to and charged with the payment of the interest and principal as the interest and principal fall due and the necessary charges of paying interest and principal on any notes, bonds or other evidences of indebtedness that were issued to fund or refund the cost of the development program fund; and
(2) A project cost account that is pledged to and charged with the payment of project costs as outlined in the financial plan and are paid in a manner other than as described in subparagraph (1);
B. Annually set aside all tax increment revenues on retained captured assessed values and all state tax increment revenues payable to the municipality for public purposes and deposit all such revenues to the appropriate development program fund account in the following priority:
(1) To the development sinking fund account, an amount sufficient, together with estimated future revenues to be deposited to the account and earnings on the amount, to satisfy all annual debt service on bonds and notes issued under section 5257 and the financial plan; and
(2) To the project cost account, an amount sufficient, together with estimated future revenues to be deposited to the account and earnings on the amount, to satisfy all annual project costs to be paid from the account;
C. Be permitted to make transfers between development program fund accounts as required, provided that the transfers do not result in a balance in the development sinking fund account that is insufficient to cover the annual obligations of that account; and
D. Annually return to the municipal general fund any tax increment revenues remaining in the development sinking fund account in excess of those estimated to be required to satisfy the obligations of the development sinking fund account after taking into account any transfers permitted by paragraph C. The municipality, at any time during the term of the district, by vote of the municipal officers, may return to the municipal general fund any tax increment revenues remaining in the project cost account in excess of those estimated to be required to satisfy the obligations of the development project cost account after taking into account any transfer permitted by paragraph C. In either case the corresponding amount of local valuation may not be included as part of the retained captured assessed value as specified by the municipality.
Notwithstanding the provisions of section 5253, subsection 1, paragraph F and any other provision of law, in the case of investments exceeding $100,000,000 in shipyard facilities in districts authorized prior to June 30, 1999, revenues must be set aside and deposited by the municipality to the appropriate development program fund account and expended to satisfy the obligations of the accounts without the need for further action by the municipality by appropriation or otherwise. Unless otherwise provided by the municipality in connection with its approval of the district, tax increment revenues on all captured assessed value may not be taken into account for purposes of calculating any limitation on the municipality's annual expenditures or appropriations and the payment of tax increment revenues on captured assessed value is not subject to any limitation or restriction on the municipality's authority or power to enter into contracts with respect to making payments for a term equal to the term of the district.
Sec. 4. 30-A MRSA §5254-A, sub-§2, ¶A, as amended by PL 1993, c. 429, §3, is further amended to read:
A. On or before April 15th of each year, designated businesses located within a state tax increment financing district shall report the amount of sales tax paid in connection with operations within the district, the number of employees within the district, the state income taxes withheld from employees within the district for the immediately preceding calendar year and any further information the committee may reasonably require.
On or before June 30th of each year, the committee shall determine the state tax increment of a district for the preceding calendar year.
Sec. 5. 30-A MRSA §5254-A, sub-§3-A, ¶¶A and B, as enacted by PL 1991, c. 856, §5, are amended to read:
A. The amount of retained state tax increment revenues paid to a municipality may not exceed the amount of tax increment revenues generated by the municipality pursuant to section 5254, subsection 3 and actually required to satisfy the estimated obligations of the be deposited in a development sinking program fund account; and
B. All retained state tax increment revenues not actually required to satisfy the estimated obligations of the development sinking program fund account revert to the State.
Emergency clause. In view of the emergency cited in the preamble, this Act takes effect when approved.
Effective May 20, 1997.
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