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Good morning from Augusta,
This week, committees were focused on wrapping up their work for the first regular session and deciding which bills would be carried over to 2026. As a result, committees with remaining bills faced long days of work sessions, pushing through as many bills as possible ahead of Friday's deadline from leadership to report out 100% of their bills. Three of the PLC’s priority bills were caught in the midst of these marathon sessions.
On Wednesday, LD 195, An Act to Create the Small Business Capital Savings Account Program, underwent a review by the Taxation Committee to address concerns raised by the Housing and Economic Development Committee (HED). LD 195 is our bill to create a pilot program for businesses in the farming, fishing, and forestry industries to set aside revenue tax-free, up to $250,000 at one time in a savings account to be used in the future for capital expenditures. By creating these accounts, your business can save and later re-invest without paying state income taxes and not be forced to spend that money all in the same tax year. The PLC testimony can be found here.
Joint jurisdiction of legislation by committees is a new process for 2025 and the legislators on each committee were unsure of the process. This bill was worked by the HED Committee back in early March, but because of the new review process, it was lost between the Committees until the PLC forced staff to get it moving.
During the work session, Representative Traci Gere, House Chair of HED, along with the committee’s analyst, presented their questions and concerns to the Taxation Committee for discussion and potential solutions. Despite the detailed discussion by the Taxation Committee, it probably created more problems than it solved because the Taxation Committee never heard testimony and lacked the foundational understanding to deliberate the bill on its merits. Ultimately, the Taxation Committee summarized their perspectives in a letter, which was sent back to HED for further consideration.
On Thursday, LD 195 had its final work session in HED. The HED Committee went over the unfavorable letter from the Taxation Committee. I was provided an opportunity to answer questions and provide clarity to the committee. As a result, a bipartisan, majority of the HED committee voted ought to pass on the original bill but amended it to lower the size of the small business included in the policy from 99 employees down to 49 employees. While this is a positive step forward, there's still a significant amount of work ahead to get this bill across the finish line.
Most of the PLC’s committee work for the first regular session is nearly complete, with only a few final language reviews remaining. These are expected to take place next week in the HED and Taxation Committees for our last two priority bills:
LD 1313, An Act to Promote Equity in the Forest Products Industry by Allowing Commercial Wood Haulers to Be Eligible for Certain Sales Tax Exemptions and Refunds Sen. Brad Farrin (R-Somerset) – Taxation Committee (Support)
Passed Unanimously
LD 1733, An Act to Provide Reduced Interest Rates for Logging and Fishing Operations, Sen. Rick Bennett (R-Oxford) – Housing and Economic Development Committee (Support)
Passed Unanimously
With most committees having wrapped up their work, more bills are now advancing to the House and Senate for final consideration. With only one month to go in this year’s legislative session, we will continue to keep you informed as additional legislation moves through the final days of the session. We may reach out at a moment’s notice if we need your assistance so, please pay close attention to your email.
Have a great long weekend and let me know if you have any questions.
Best,
Dana
Bills we are tracking this session can be found here.
Last Week’s Legislative Activity – May 19 – May 23, 2025
Tuesday, May 20
LD 597, An Act Concerning Energy, Utilities and Technology, Sen. Mark Lawrence (D-York), Public Hearing – Energy, Utilities, and Technology Committee (Support)
This bill, originally a concept draft, had amended language very similar to LD 1868, which will be beneficial for the biomass industry when seeking competitive procurements.
The PLC testified in support of LD 597.
LD 1868, An Act to Advance a Clean Energy Economy by Updating Renewable and Clean Resource Procurement Laws, Sen. Mark Lawrence (D-York), Work Session – Energy, Utilities, and Technology Committee (Support)
This bill directs the Governor's Energy Office to conduct one or more competitive solicitations every 2 years beginning January 1, 2026 to procure energy or associated environmental attributes or a combination of both from renewable and clean resources through long-term contracts if the office determines procurement is necessary to achieve the emissions reduction and renewable and clean energy goals of the State and to meet reasonably expected growth in electricity demand and reliability needs. This bill amends the state goals for consumption of electricity from renewable resources so that by January 1, 2040, 90% of retail sales electricity in the State will come from renewable resources and 10% of retail sales electricity in the State will come from clean resources. This bill gives additional authority to the Public Utilities Commission to coordinate with other states to procure, through long-term contracts or other mechanisms, transmission capacity, capacity resources, energy, renewable energy credits or clean energy credits. This bill directs the Public Utilities Commission to initiate a competitive solicitation for energy or renewable energy credits from Class IA resources for the purpose of improving the long-term viability of an existing facility. This bill also establishes a regular schedule of competitive procurements for renewable and clean resources.
The PLC testified in support of LD 1868. It will be beneficial for the biomass industry when seeking competitive procurements. This bill was voted with a majority Ought to Pass as amended mostly along party lines. The Republicans and Senator Grohoski (D-Hancock) were not in support making the minority report ought not to pass.
Wednesday, May 21
LD 1879, An Act to Support Maine's Agricultural Economy by Increasing Revenue from the Corporate Income Tax and Providing Property Tax Exemptions, Rep. Bill Pluecker (I-Warren), Work Session – Taxation Committee (Oppose)
This bill imposes an additional tax of 1.07% on annual corporate income of more than $3,500,000, bringing the top rate to a total of 10%.
The PLC testified in opposition to LD 1879. Adding another 1.07% to the corporate income tax would be detrimental to logging businesses as well as the mills that our contractors deliver wood to.
The bill was passed in committee by a majority vote of 8 – 5 (Minority ONTP) with amended language that changed the way the cascade of funds will flow after the collection of the increased corporate income tax. The designated funds will be directed first to the Dairy Stabilization Fund, then to the Maine Agriculture, Food and Forest Products Investment Fund, the Business Recovery and Resilience Fund, the Agricultural Marketing Loan Fund, and the Dairy Improvement Fund in that order. Each fund must be fully funded before funds will move to the next priority fund. The amendment also removed the Dirigo business incentives program and the provision to reimburse municipalities for a new 100% property tax exemption for agricultural buildings.
LD 1617, An Act to Lower the Exclusion Amount for the Estate Tax and Create an Exclusion for Family Farms and Aquaculture, Fishing and Wood Harvesting Businesses, Rep. Cheryl Golek (D-Harpswell) Work Session – Taxation Committee (Oppose)
This bill lowers the exclusion amount, below which the Maine estate tax does not apply, to $1,000,000 from the $5,600,000 in current law for estates of descendants dying on or after January 1, 2026. The bill also creates an additional exclusion amount from the estate tax for family farms and aquaculture, fishing and wood harvesting businesses of up to $3,800,000. This additional exclusion applies to farmland or depreciable machinery and equipment used in commercial agriculture, aquaculture, fishing or wood harvesting that is inherited by a family member and remains in commercial use for 5 years following transfer.
The PLC testified in opposition to LD 1617. It would place an undue burden on the middle-class families and small business owners that make up the majority of our membership who are likely succession planning and trying to determine if they could afford to pass their businesses along to a family member when they pass away. However, with changes that are proposed in this bill, it would make Maine an outlier, creating inconsistency with federal tax law, and likely forcing them to sell their business, rather than passing it along to the next generation.
The Taxation Committee did not spend a lot of time discussing LD 1617 and quickly voted unanimously ought not to pass.
LD 1761, An Act to Prohibit Indemnification Agreements, Rep. Josh Morris (R-Turner), Work Session – Health Coverage, Insurance and Financial Services Committee (Support)
The PLC testified in support of LD 1761. This bill prohibits contract agreements that indemnify or hold harmless the promisee from or against any negligence, claim or liability arising out of an intentional act or omission of the promisee or promisor. Parties to a contract are not prohibited from agreeing that the promisee must be included as an additional insured in an insurance contract. The bill does not affect the validity of workers' compensation or other insurance contracts.
The sponsor worked with stakeholders to craft an amendment for the work session. The new amended language, applies to agreements entered into or renewed on or after January 1, 2026, prohibits the transfer of negligence from the negligent party to any other party, and does not affect the validity of workers' compensation or other insurance policies.
The Committee voted unanimously Ought to Pass As Amended and we feel that this is an important victory for our members who are forced to sign contracts with indemnification clauses.
Thursday, May 22
LD 195, “An Act to Create the Small Business Capital Savings Account Program”, (Sen. Trey Stewart (R-Aroostook) Work Session, Housing and Economic Development. (Support)
More information on this bill is above.
LD 597, An Act Concerning Energy, Utilities and Technology, Sen. Mark Lawrence (D-York), Work Session – Energy, Utilities, and Technology Committee (Support)
This bill, originally a concept draft, had amended language very similar to LD 1868, which will be beneficial for the biomass industry when seeking competitive procurements.
The PLC testified in support of LD 597.
This bill was passed with a bipartisan majority vote of 10-1 of Ought to Pass as Amended using the sponsor’s amendment linked above. The only significant change that was made, added in by the PUC was extending the RFP timeframe from 7 days to 30 days. They needed more time to get the RFP established. Rep. Reagan Paul was the only committee member in opposition to the motion and her minority report recommended an ought not to pass.
Next Week’s Legislative Activity – May 26 – May 30, 2025
Priority Bills Awaiting Final Language Review - not yet officially scheduled.
LD 1313, An Act to Promote Equity in the Forest Products Industry by Allowing Commercial Wood Haulers to Be Eligible for Certain Sales Tax Exemptions and Refunds Sen. Brad Farrin (R-Somerset) – Taxation Committee (Support)
Passed Unanimously
LD 1733, An Act to Provide Reduced Interest Rates for Logging and Fishing Operations, Sen. Rick Bennett (R-Oxford) – Housing and Economic Development Committee (Support)
Passed Unanimously