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An Act To Amend the Municipal Tree Growth Reimbursement Formula
Be it enacted by the People of the State of Maine as follows:
Sec. 1. 36 MRSA §578, sub-§1,  as amended by PL 2007, c. 438, §16, is further amended to read:
 
1. Organized areas.   The municipal assessors or chief assessor of a primary assessing area shall adjust the State Tax Assessor's 100% valuation per acre for each forest type of their county by whatever ratio, or percentage of current just value, is applied to other property within the municipality to obtain the assessed values. Forest land in the organized areas, subject to taxation under this subchapter, must be taxed at the property tax rate applicable to other property in the municipality.
 
The State Tax Assessor shall determine annually the amount of acreage in each municipality that is classified and taxed in accordance with this subchapter. Each municipality is entitled to annual payments distributed in accordance with this section from money appropriated by the Legislature if it submits an annual return in accordance with section 383 and if it achieves the minimum assessment ratio established in section 327. The State Tax Assessor shall pay any municipal claim found to be in satisfactory form by August 1st of the year following the submission of the annual return. The per acremunicipal reimbursement appropriation is calculated on the basis of 90% of the per acre tax revenue lost as a result of this subchapter. For purposes of this section, the tax lost is the tax that would have been assessed, but for this subchapter, on the classified forest lands if they were assessed according to the undeveloped acreage valuations used in the state valuation then in effect, or according to the current local valuation on undeveloped acreage, whichever is less, minus the tax that was actually assessed on the same lands in accordance with this subchapter, and adjusted for the aggregate municipal savings in required educational costs attributable to reduced state valuation. A municipality that fails to achieve the minimum assessment ratio established in section 327 loses 10% of the reimbursement provided by this section for each one percentage point the minimum assessment ratio falls below the ratio established in section 327.
 
A municipality may not receive a reimbursement payment under this section that would exceed an amount determined by calculating the tree growth tax loss less the municipal savings in educational costs attributable to reduced state valuation. The State Tax Assessor shall adopt rules necessary to implement the provisions of this section. Rules adopted pursuant to this subsection are routine technical rules for the purposes of Title 5, chapter 375, subchapter 2-A.
 
C.  The State Tax Assessor shall distribute reimbursement under this section to each municipality in proportion to the product of the reduced tree growth valuation of the municipality multiplied by the property tax burden of the municipality. For purposes of this paragraph, unless the context otherwise indicates, the following terms have the following meanings.
 
(1) "Property tax burden" means the total real and personal property taxes assessed in the most recently completed municipal fiscal year, except the taxes assessed on captured value within a tax increment financing district, divided by the latest state valuation certified to the Secretary of State.
 
(2) "Undeveloped land" means rear acreage and unimproved nonwaterfront acreage that is not:
 
(a) Classified under the laws governing current use valuation set forth in chapter 105, subchapter 2-A, 10 or 10-A;
 
(b) A base lot; or
 
(c) Waste land.
 
(3) "Average value of undeveloped land" means the per acre undeveloped land valuations used in the state valuation then in effect, or according to the current local valuation on undeveloped land as determined for state valuation purposes, whichever is less.
 
(4) "Reduced tree growth valuation" means the difference between the average value of undeveloped land times the total number of acres classified as forest land under this subchapter.
 
SUMMARY
This bill amends in 2 ways the law regarding the distribution of reimbursement to the municipalities to partially cover the property tax losses they experience as a result of the tree growth tax program. First, the bill adjusts the statewide appropriation for reimbursement purposes to reflect the education subsidy impacts of tree growth enrollments, rather than adjusting each municipality's individual reimbursement as is done under the current system. Second, the bill establishes each municipality's share of the total municipal reimbursement appropriation on the basis of 3 data inputs:
1. The number of acres enrolled in the program in the municipality;
2. The difference between the tree growth acreage rates and the local or regional undeveloped acreage; and
3. The municipality's full value mill rate.