It provides for a one-time assumption by the State of 50% of the total general obligation debts of all municipalities that

join to form municipal service districts. The general obligations that the State will assume are those that were incurred before June 30, 2003 and that would otherwise have to be paid with local property tax revenue.

In order to encourage municipalities to form municipal service districts promptly, this Part provides that only those municipal service districts formed on or before January 1, 2009 are entitled to the financial incentives through the Municipal Service District Fund.

It authorizes the joint standing committee of the Legislature having jurisdiction over taxation matters, the joint standing committee of the Legislature having jurisdiction over appropriations and allocations matters and the joint standing committee of the Legislature having jurisdiction over state and local government matters to develop and report out legislation on specified topics in accordance with the intentions of and not inconsistent with the purposes and intents of the resolution.

PART C

Part C of this bill provides a package of tax law changes.

It requires a municipality that is a member of a municipal service district to pay to the Treasurer of State the amount received from the Treasurer of State pursuant to the Constitution of Maine, Article IV, Part Third, Section 23, which mandates reimbursement of 50% of the property tax revenue loss suffered by a municipality due to statutory property tax exemptions or credits enacted after April 1, 1978. The municipal service district is then paid by the Treasurer of State 50% of the property tax revenue loss in each of the municipalities in the municipal service district.

Part C establishes a property tax exemption for property that would have been first subject to property tax after April 1, 2003 in the absence of this exemption. Property placed in service on or before April 1, 2003 will remain eligible for the