130th MAINE LEGISLATURE
FIRST SPECIAL SESSION-2021
Legislative Document No. 1482
H.P. 1097 House of Representatives, April 14, 2021
An Act To Improve Access to Property Tax Exemptions for New
Homeowners
Received by the Clerk of the House on April 12, 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 GROHOSKI of Ellsworth.
Printed on recycled paper
 1 Be it enacted by the People of the State of Maine as follows:
2 Sec. 1. 36 MRSA §681, sub-§5, ¶B, as enacted by PL 2005, c. 647, §3 and affected
3 by §5, is amended to read:
4 B. Shareholder Prior to property tax years beginning on or after April 1, 2022,
5 shareholder for the preceding 12 months in the cooperative housing corporation
6 specified in paragraph A; and
7 Sec. 2. 36 MRSA §683, sub-§1, as amended by PL 2017, c. 478, §1, is further
8 amended to read:
9 1. Exemption amount. Except Prior to property tax years beginning on or after April
10 1, 2022, except for assessments for special benefits, the just value of $10,000 of the
11 homestead of a permanent resident of this State who has owned a homestead in this State
12 for the preceding 12 months is exempt from taxation. Beginning with property tax years
13 beginning on or after April 1, 2022, except for assessments for special benefits, the just
14 value of $10,000 of the homestead of a permanent resident of this State is exempt from
15 taxation. Notwithstanding this subsection, a permanent resident of this State who loses
16 ownership of a homestead in this State due to a tax lien foreclosure and subsequently
17 regains ownership of the homestead from the municipality that foreclosed on the tax lien is
18 deemed to have continuously owned the homestead and may not be determined ineligible
19 for the exemption provided in this section due to the ownership of the homestead by the
20 municipality. In determining the local assessed value of the exemption, the assessor shall
21 multiply the amount of the exemption by the ratio of current just value upon which the
22 assessment is based as furnished in the assessor's annual return pursuant to section 383. If
23 the title to the homestead is held by the applicant jointly or in common with others, the
24 exemption may not exceed $10,000 of the just value of the homestead, but may be
25 apportioned among the owners who reside on the property to the extent of their respective
26 interests. A municipality responsible for administering the homestead exemption has no
27 obligation to create separate accounts for each partial interest in a homestead owned jointly
28 or in common.
29 Sec. 3. 36 MRSA §683, sub-§3, as amended by PL 2019, c. 343, Pt. H, §3, is further
30 amended to read:
31 3. Effect on state valuation. For property tax years beginning before April 1, 2018,
32 50% of the just value of all the homestead exemptions under this subchapter must be
33 included in the annual determination of state valuation under sections 208 and 305. For
34 property tax years beginning on April 1, 2018 and April 1, 2019, 62.5% of the just value
35 of all the homestead exemptions under this subchapter must be included in the annual
36 determination of state valuation under sections 208 and 305. For property tax years
37 beginning on or after April 1, 2020, 70% of the just value of all the homestead exemptions
38 under this subchapter must be included in the annual determination of state valuation under
39 sections 208 and 305, except as provided in subsection 3-A.
40 Sec. 4. 36 MRSA §683, sub-§3-A is enacted to read:
41 3-A. Effect on state valuation for reimbursement made first year of eligibility.
42 For property tax years beginning on or after April 1, 2022, 100% of the just value of all the
43 homestead exemptions under this subchapter provided for the first year a homestead is
44 eligible under this subchapter must be included in the annual determination of state
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1 valuation under sections 208 and 305; after the first year, the percentage of reimbursement
46
2 is that specified in subsection 3.
3 Sec. 5. 36 MRSA §683, sub-§4, as amended by PL 2019, c. 343, Pt. H, §3, is further
4 amended to read:
5 4. Property tax rate. For property tax years beginning before April 1, 2018, 50% of
6 the just value of all the homestead exemptions under this subchapter must be included in
7 the total municipal valuation used to determine the municipal tax rate. For property tax
8 years beginning on April 1, 2018 and April 1, 2019, 62.5% of the just value of all the
9 homestead exemptions under this subchapter must be included in the total municipal
10 valuation used to determine the municipal tax rate. For Except as provided in subsection
11 4-A, for property tax years beginning on or after April 1, 2020, 70% of the just value of all
12 the homestead exemptions under this subchapter must be included in the total municipal
13 valuation used to determine the municipal tax rate. The municipal tax rate as finally
14 determined may be applied to only the taxable portion of each homestead qualified for that
15 tax year.
16 Sec. 6. 36 MRSA §683, sub-§4-A is enacted to read:
17 4-A. Property tax rate including reimbursement made first year of eligibility. For
18 property tax years beginning on or after April 1, 2022, 100% of the just value of all the
19 homestead exemptions under this subchapter provided for the first year a homestead is
20 eligible under this subchapter must be included in the total municipal valuation used to
21 determine the municipal tax rate; after the first year, the percentage of just value is that
22 specified in subsection 4.
23 Sec. 7. 36 MRSA §685, sub-§2, as amended by PL 2019, c. 343, Pt. H, §4, is further
24 amended to read:
25 2. Entitlement to reimbursement by the State; calculation. A municipality that has
26 approved homestead exemptions under this subchapter may recover from the State:
27 A. For property tax years beginning before April 1, 2018, 50% of the taxes lost by
28 reason of the exemptions under section 683, subsections 1 and 1-B;
29 B. For property tax years beginning on April 1, 2018 and April 1, 2019, 62.5% of the
30 taxes lost by reason of the exemptions under section 683, subsections 1 and 1-B; and
31 C. For Except as provided in paragraph D, for property tax years beginning on or after
32 April 1, 2020, 70% of the taxes lost by reason of the exemptions under section 683,
33 subsections 1 and 1‑B.; and
34 D. Notwithstanding paragraph C, for property tax years beginning on or after April 1,
35 2022, 100% of the taxes lost by reason of the exemptions provided to permanent
36 residents of this State who claim and receive the exemption for the first year for which
37 their homesteads are eligible.
38 The municipality must provide proof in a form satisfactory to the bureau. The bureau shall
39 reimburse the Unorganized Territory Education and Services Fund in the same manner for
40 taxes lost by reason of the exemptions.
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1 SUMMARY
2 This bill removes the requirement that a person own a homestead in this State for 12
3 months before being eligible for the homestead property tax exemption. This bill also
4 requires the State to provide reimbursement of 100% of the revenue lost by a municipality
5 due to removing that 12-month requirement, but only for the first year of eligibility. If a
6 resident is eligible for the homestead exemption but does not take it until after the first year
7 of eligibility, that exemption is eligible only for 70% reimbursement by the State. After
8 the first year of eligibility, the state reimbursement rate drops to the current rate of 70%.
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Statutes affected:
Bill Text LD 1482, HP 1097: 36.681, 36.683, 36.685