An Act to Provide an Income Tax Credit for Certain Disaster Mitigation Projects for Working Waterfront Property

Printed on recycled paper
132nd MAINE LEGISLATURE
FIRST SPECIAL SESSION-2025
Legislative Document No. 1694
H.P. 1129 House of Representatives, April 17, 2025
An Act to Provide an Income Tax Credit for Certain Disaster
Mitigation Projects for Working Waterfront Property
Reference to the Committee on Taxation suggested and ordered printed.
ROBERT B. HUNT
Clerk
Presented by Representative RIELLY of Westbrook.
Cosponsored by Senator MOORE of Washington and
Representatives: EATON of Deer Isle, FAULKINGHAM of Winter Harbor, GOLEK of
Harpswell, MATHIESON of Kittery, MATLACK of St. George, STOVER of Boothbay,
STROUT of Harrington, Senator: President DAUGHTRY of Cumberland.

Page 1 - 132LR0072(01)
1Be it enacted by the People of the State of Maine as follows:
2Sec. 1. 36 MRSA §5219-CCC is enacted to read:
3§5219-CCC. Working waterfront disaster mitigation tax credit
41. Definitions. As used in this section, unless the context otherwise indicates, the
5 following terms have the following meanings.
6 A. "Eligible property" means tangible property for which depreciation or amortization
7 in lieu of depreciation is allowable that is:
8 (1) Constructed, reconstructed or erected by the taxpayer; or
9 (2) Acquired by the taxpayer if the first use of such property commences with the
10 taxpayer.
11 B. "Qualifying working waterfront disaster mitigation project" means a project that:
12 (1) Is substantially designed in compliance with:
13 (a) In the case of a project placed in service before January 1, 2032, the 2021
14 International Building Code published by the International Code Council; or
15 (b) In the case of a project placed in service on or after January 1, 2032, the
16 most recent applicable International Code Council model code as long as that
17 code was published not later than 5 years before the date such project is placed
18 in service; and
19 (2) Is designed to prevent or mitigate damage to working waterfront property from
20 natural hazards using one or more of the following:
21 (a) The elevation of continuous foundation walls; the elevation of structures
22 on open foundations, such as piles, piers, posts or columns; the elevation of
23 structures on fill; the conversion of the 2nd story; and other methods involving
24 structural elevation as established by rule;
25 (b) Storm water management, including the construction, installation or
26 modification of culverts, drainage pipes, pumping stations, floodgates,
27 bioswales, detention and retention basins and other storm water management
28 facilities; flood diversion and storage measures; slope stabilization or grading
29 to direct flood waters away from businesses; flood protection measures for
30 water and sanitary sewer systems or other utility systems; vegetation
31 management for shoreline stabilization, including coastal, riverine, riparian
32 and other littoral zones; flood protection and stabilization measures for roads
33 and bridges; and such other flood risk reduction methods as determined by
34 rule;
35 (c) Reducing the risk to structures or infrastructure from erosion and
36 landslides, including through the installation of geosynthetics; surface and
37 subsurface drainage, stabilizing sod and vegetative buffer strips; preserving
38 mature vegetation; decreasing slope angles; stabilizing with riprap and other
39 means of slope anchoring; and other shoreline stabilization methods as
40 determined by rule;
Page 2 - 132LR0072(01)
1 (d) Creating a space that is protected by walls that are substantially
2 impermeable and resistant to flood loads, the use of materials and construction
3 techniques that are resistant to flood damage to minimize flood damage to
4 areas below the flood protection level of a structure;
5 (e) Changes made to an existing structure to reduce or eliminate the possibility
6 of damage to that structure from flooding, erosion, extreme temperatures, high
7 winds or other hazards; and
8 (f) Equipment and systems to warn residents of impending hazards, including
9 enhanced 9-1-1 services, as defined in Title 25, section 2921, subsection 6,
10 weather stations, rain gauges, flood alarms and such other warning systems as
11 determined by rule.
12 C. "Working waterfront property" means real property located in the State that is used
13 by the taxpayer to carry on an active trade or business that meets the gross receipts test
14 of subsection 2 and:
15 (1) Provides access to navigable waters to persons engaged in commercial fishing,
16 recreational fishing and boating, boat building, aquaculture, dredging or other
17 water-dependent activities; and
18 (2) Is used for or supports activities described in subparagraph (1).
192. Gross receipts test. A trade or business meets the gross receipts test for a taxable
20 year if the average annual gross receipts of that trade or business for a period of 3 taxable
21 years preceding a taxable year does not exceed $47,000,000. All trades or business of a
22 taxpayer that are treated as a single employer under Section 52(a) or Section 52(b) of the
23 Code or Section 414(m) or Section 414(o) of the Code must be treated as one trade or
24 business for purposes of this subsection.
253. Tax credit; limitation. For tax years beginning on or after January 1, 2025, a
26 taxpayer that undertakes a qualifying working waterfront disaster mitigation project is
27 allowed a tax credit against the tax otherwise due under this Part equal to 30% of cost of
28 that disaster mitigation project. The credit provided pursuant to this subsection may not
29 exceed $300,000.
304. Determination of taxable year. For purposes of this section, the qualified
31 investment for a taxable year is the basis of eligible property placed in service by the
32 taxpayer during the taxable year that is part of a qualifying working waterfront disaster
33 mitigation project.
345. Limitations; carry-forward. The credit allowed under subsection 3 may not
35 reduce the tax otherwise due under this Part to less than zero. Any unused portion of the
36 credit may be carried forward to the following year or years for a period not to exceed 10
37 years.
386. Relation to other tax credits. A taxpayer eligible for a credit pursuant to this
39 section may not claim a tax credit under this Part for the same or a similar project.
407. Inflation adjustment. Beginning in 2026, the limit on annual gross receipts
41 specified in subsection 2 and the total credit amount specified in subsection 3 must be
42 multiplied by the cost-of-living adjustment for taxable years beginning in the succeeding
43 calendar year. For purposes of this subsection, the "cost-of-living adjustment" is the
Page 3 - 132LR0072(01)
44 Chained Consumer Price Index for the 12-month period ending June 30th of the preceding
45 calendar year divided by the Chained Consumer Price Index for the 12-month period
46 ending June 30, 2025 and "Chained Consumer Price Index" has the same meaning as in
47 section 5402, subsection 1. If the amount for subsection 2 as increased pursuant to this
48 subsection is not a multiple of $1,000,000, that amount must be rounded to the nearest
49 multiple of $1,000,000. If the amount for subsection 3 as increased pursuant to this
50 subsection is not a multiple of $1,000, that amount must be rounded to the nearest multiple
51 of $1,000.
98. Rules. The assessor may adopt rules to implement this section, including, but not
10 limited to, rules for determining and certifying eligibility and for determining what
11 additional projects designed to prevent or mitigate damage to working waterfront property
12 from natural hazards qualify. Rules adopted pursuant to this subsection are routine
13 technical rules as defined in Title 5, chapter 375, subchapter 2‑A.
14SUMMARY
15 This bill provides a tax credit for taxpayers that undertake working waterfront disaster
16 mitigation projects, such as the elevation of foundation walls, flood risk protection,
17 shoreline stabilization and warning systems. The credit is equal to 30% of the cost of the
18 qualifying working waterfront disaster mitigation project but may not exceed $300,000. A
19 business qualifies if it has $47,000,000 or less in average annual gross receipts.
1
2
3
4
5
6
7
8
15
16
17
18
19