HP0381, LD 562, item 1, An Act Related to Service Charges in Lieu of Property Taxes on Tax-exempt Property

An Act Related to Service Charges in Lieu of Property Taxes on Tax-exempt Property

Be it enacted by the People of the State of Maine as follows:

Sec. 1. 36 MRSA §508, as enacted by PL 2007, c. 627, §12, is repealed.

Sec. 2. 36 MRSA §509 is enacted to read:

§ 509. Service charges

1. Imposition. A municipality may impose service charges on property that is exempt from taxation under section 652 except for:

A. Property that is exempt under section 652, subsection 1, paragraph G; and

B. Property owned by an educational institution exempt under section 652, subsection 1, paragraph B other than property that is rented for residential purposes to persons who are not students at that educational institution.

2. Determination of service charges. Service charges must be calculated according to the actual cost of providing municipal services to the exempt property and to the persons who use that property. Revenues derived from the service charges must be used to fund, to the extent possible, the costs of those services. Service charges must be calculated based on the square footage of building space occupied by the exempt property unless the municipality determines that a different measure more accurately represents the cost of services for which the service charges are imposed.

3. Imposition of service charges. The municipal legislative body shall identify the categories of institutions and organizations upon which service charges are to be imposed. A municipality that imposes service charges on any institution or organization must impose those service charges on every similarly situated institution or organization.

4. Municipal services for which charges may be imposed. Service charges may be imposed under this section for any services provided by a municipality other than education and general assistance.

5. Limitation. The total service charges levied by a municipality on any institution or organization under this section may not exceed 2% of the gross annual revenues of the institution or organization. In order to qualify for this limitation, the institution or organization must file with the municipality an audit of the revenues of the institution or organization for the year immediately prior to the year in which the service charge is imposed.

6. Administration. A municipality that chooses to impose service charges under this section shall adopt any ordinances necessary to carry out the provisions of this section. Determinations of service charges may be appealed in accordance with an appeals process provided by municipal ordinance. Unpaid service charges may be collected in the manner provided in Title 38, section 1208.

SUMMARY

This bill permits municipalities to impose service charges on tax-exempt property owned by nongovernmental institutions and organizations other than educational institutions, houses of worship and parsonages. Service charges must be calculated to cover the cost of services provided and be based on the square footage of building space occupied by the institution or organization unless the municipality determines that a different measure more accurately represents the cost of services for which the charge is imposed. Service charges may be imposed to cover the cost of any services provided by the municipality to the property other than education or general assistance. The bill repeals an existing service charge law that applies to a limited class of property that would be covered under this bill.

HP0381 LD 562	Session - 126th Maine Legislature		LR 316 Item 1
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