Sec. 5. 36 MRSA §1507 is enacted to read:

§1507.__Adjustment of state valuation

For each municipality collecting a tax under this chapter, the State Tax Assessor shall compute a property tax base equivalent.__The property tax base equivalent is computed by dividing the revenue collected by the municipality under this chapter by the full value mill rate for the municipality.__The property tax base equivalent must be added to the state valuation for the municipality when making the distributions required under Title 20-A, Part 7 and Title 30-A, section 5681.

Sec. 6. 36 MRSA c. 216 is enacted to read:

CHAPTER 216

LIMITED LOCAL OPTION SALES TAX

§1871.__Local option sales tax authority

1.__Authority.__Beginning January 1, 2004, the legislative body of a municipality, subject to the requirements of this chapter, may elect to adopt within the municipality a limited sales tax of 1% or 2% of the value of prepared food and lodging sold in the municipality.

2.__Definitions.__As used in this chapter, unless the context otherwise indicates, the following terms have the following meanings.

A.__"Lodging" means the rental of living quarters in any hotel, rooming house or tourist or trailer camp.

B.__"Prepared food" has the same meaning as in section 1752, subsection 8-A.

§1872.__Referendum required

1.__Adoption.__The adoption of a limited sales tax in a municipality must be approved by the legal voters of a municipality that seeks to adopt the tax.__The petition process