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An Act To Correct Minor Technical Errors and Inconsistencies in the Unified Budget Bill
Emergency preamble. Whereas, acts and resolves of the Legislature do not become effective until 90 days after adjournment unless enacted as emergencies; and
Whereas,  this legislation corrects certain errors and inconsistencies that occurred in the unified budget bill; and
Whereas,  the unified budget bill is emergency legislation, which takes effect June 26, 2013; and
Whereas,  these errors and inconsistencies must be corrected as soon as possible in order to ensure the proper operation of State Government; and
Whereas,  in the judgment of the Legislature, these facts create an emergency within the meaning of the Constitution of Maine and require the following legislation as immediately necessary for the preservation of the public peace, health and safety; now, therefore,
Be it enacted by the People of the State of Maine as follows:
Sec. 1. 36 MRSA §1811, first ¶, as amended by PL 2013, c. 368, Pt. M, §2 and Pt. N, §2, is repealed and the following enacted in its place:
A tax is imposed on the value of all tangible personal property, products transferred electronically and taxable services sold at retail in this State. The rate of tax is 7% on the value of liquor sold in licensed establishments as defined in Title 28-A, section 2, subsection 15, in accordance with Title 28-A, chapter 43; 7% on the value of rental of living quarters in any hotel, rooming house or tourist or trailer camp; 10% on the value of rental for a period of less than one year of an automobile, of a pickup truck or van with a gross vehicle weight of less than 26,000 pounds rented from a person primarily engaged in the business of renting automobiles or of a loaner vehicle that is provided other than to a motor vehicle dealer's service customers pursuant to a manufacturer’s or dealer’s warranty; 7% on the value of prepared food; and 5% on the value of all other tangible personal property and taxable services and products transferred electronically. Notwithstanding the other provisions of this section, from October 1, 2013 to June 30, 2015, the rate of tax is 8% on the value of rental of living quarters in any hotel, rooming house or tourist or trailer camp; 8% on the value of prepared food; 8% on the value of liquor sold in licensed establishments as defined in Title 28-A, section 2, subsection 15, in accordance with Title 28-A, chapter 43; and 5.5% on the value of all other tangible personal property and taxable services. Value is measured by the sale price, except as otherwise provided. The value of rental for a period of less than one year of an automobile or of a pickup truck or van with a gross vehicle weight of less than 26,000 pounds rented from a person primarily engaged in the business of renting automobiles is the total rental charged to the lessee and includes, but is not limited to, maintenance and service contracts, drop-off or pick-up fees, airport surcharges, mileage fees and any separately itemized charges on the rental agreement to recover the owner’s estimated costs of the charges imposed by government authority for title fees, inspection fees, local excise tax and agent fees on all vehicles in its rental fleet registered in the State. All fees must be disclosed when an estimated quote is provided to the lessee.
Sec. 2. 36 MRSA §2552, sub-§1, as amended by PL 2011, c. 542, Pt. A, §139, is further amended to read:
 
1. Rate.   A tax at the rate of 5%, except that, from October 1, 2013 to June 30, 2015, a tax at the rate of 5.5%, is imposed on the value of the following services sold in this State:
 
A. Extended cable and satellite television services;
 
B. Fabrication services;
 
C. Rental of video media and video equipment;
 
D. Rental of furniture, audio media and audio equipment pursuant to a rental-purchase agreement as defined in Title 9-A, section 11-105;
 
E. Telecommunications services;
 
F. The installation, maintenance or repair of telecommunications equipment;
 
G. Private nonmedical institution services;
 
H. Community support services for persons with mental health diagnoses;
 
I. Community support services for persons with intellectual disabilities or autism;
 
J. Home support services; and
 
L. Ancillary services.
Sec. 3. 36 MRSA §5122, sub-§1, ¶HH, as enacted by PL 2013, c. 368, Pt. TT, §4, is amended to read:
 
HH. For taxable years beginning in 2013:
 
(1) An amount equal to the net increase in depreciation attributable to the depreciation deduction claimed by the taxpayer under the Code, Section 168(k) with respect to property placed in service in the State during the taxable year for which a credit is claimed under section 5219-II5219-JJ for that taxable year; and
 
(2) An amount equal to the net increase in depreciation attributable to the depreciation deduction claimed by the taxpayer under the Code, Section 168(k) with respect to property for which a credit is not claimed under section 5219-II5219-JJ.
Sec. 4. 36 MRSA §5200-A, sub-§1, ¶AA, as enacted by PL 2013, c. 368, Pt. TT, §14, is amended to read:
 
AA. For taxable years beginning in 2013:
 
(1) An amount equal to the net increase in depreciation attributable to the depreciation deduction claimed by the taxpayer under the Code, Section 168(k) with respect to property placed in service in the State during the taxable year for which a credit is claimed under section 5219-II5219-JJ for that taxable year; and
 
(2) An amount equal to the net increase in depreciation attributable to the depreciation deduction claimed by the taxpayer under the Code, Section 168(k) with respect to property for which a credit is not claimed under section 5219-II5219-JJ.
Sec. 5. 36 MRSA §5219-II, as enacted by PL 2013, c. 368, Pt. TT, §18, is reallocated to 36 MRSA §5219-JJ.
§ 5219-JJ. Maine capital investment credit for 2013
 
1.  Credit allowed.     A taxpayer that claims a depreciation deduction under the Code, Section 168(k) for property placed in service in the State during the taxable year beginning in 2013 is allowed a credit against the taxes imposed by this Part in an amount equal to 9% of the amount of the net increase in the depreciation deduction reported as an addition to income for the taxable year under section 5122, subsection 1, paragraph HH, subparagraph (1) or section 5200-A, subsection 1, paragraph AA, subparagraph (1) with respect to that property, except for excluded property under subsection 2.
 
2.  Certain property excluded.     The following property is not eligible for the credit under this section:
 
A.  Property owned by a public utility as defined by Title 35-A, section 102, subsection 13;
 
B.  Property owned by a person that provides radio paging services as defined by Title 35-A, section 102, subsection 15;
 
C.  Property owned by a person that provides mobile telecommunications services as defined by Title 35-A, section 102, subsection 9-A;
 
D.  Property owned by a cable television company as defined by Title 30-A, section 2001, subsection 2;
 
E.  Property owned by a person that provides satellite-based direct television broadcast services;
 
F.  Property owned by a person that provides multichannel, multipoint television distribution services; and
 
G.  Property that is not in service in the State for the entire 12-month period following the date it is placed in service in the State.
 
3.  Limitations; carry-forward.     The credit allowed under subsection 1 may not reduce the tax otherwise due under this Part to less than zero. Any unused portion of the credit may be carried forward to the following year or years for a period not to exceed 20 years.
 
4.  Recapture.     The credit allowed under this section must be fully recaptured to the extent claimed by the taxpayer if the property forming the basis of the credit is not used in the State for the entire 12-month period following the date it is placed in service in the State. The credit must be recaptured by filing an amended return in accordance with section 5227-A for the tax year in which that property was used to calculate the credit under this section. The amended return must reflect the credit disallowed and the income modifications required by section 5122, subsection 1, paragraph HH and section 5200-A, subsection 1, paragraph AA with respect to that property.
Sec. 6. 36 MRSA §5403, as amended by PL 2013, c. 368, Pt. Q, §11 and affected by §12 and amended by Pt. TT, §19, is repealed and the following enacted in its place:
§ 5403. Annual adjustments for inflation
The income tax rate brackets and itemized deduction limitation amount must be adjusted for the cost of living as provided in this section.
 
1.  Income tax rate brackets.     Beginning in 2015, and each subsequent calendar year thereafter, on or about September 15th, the State Tax Assessor shall multiply the cost-of-living adjustment for taxable years beginning in the succeeding calendar year by the dollar amounts of the tax rate tables specified in section 5111, subsections 1-D, 2-D and 3-D.
 
2.  Itemized deduction limitation amount.     Beginning in 2013, and each subsequent calendar year thereafter, on or about September 15th, the State Tax Assessor shall multiply the cost-of-living adjustment for taxable years beginning in the succeeding calendar year by the dollar amount of the itemized deduction limitation amount in section 5125, subsection 4.
 
3.  Rounding.     If the dollar amounts of each rate bracket or the itemized deduction limitation amount, adjusted by application of the cost-of-living adjustment, is not a multiple of $50, any increase must be rounded to the next lowest multiple of $50. If the cost-of-living adjustment for any taxable year would be less than the cost-of-living adjustment for the preceding calendar year, the cost-of-living adjustment is the same as for the preceding calendar year. The assessor shall incorporate such changes into the income tax forms, instructions and withholding tables for the taxable year.
Sec. 7.  PL 2013, c. 368, Pt. A, §34, 8th occurrence of Medical Care - Payments to Providers 0147  is amended by amending the initiative to read:
 
Initiative: Reduces funding by limiting reimbursement for behavioral health services, as defined in the MaineCare Benefits Manual, Section 65, provided to dually eligible members to licensed clinical social workers or other Medicare-approved providers.
Sec. 8. Appropriations and allocations. The following appropriations and allocations are made.
 
ADMINISTRATIVE AND FINANCIAL SERVICES, DEPARTMENT OF
 
Mandate BETE - Reimburse Municipalities Z065
 
Initiative: Deappropriates funding for an initiative that was not intended to be included in Public Law 2013, c. 368. The related statutory changes were not included in the final enacted version of the Act.

GENERAL FUND	2013-14	2014-15	
All Other	($726)	($2,320)	
			
GENERAL FUND TOTAL	($726)	($2,320)	
 
Sec. 9. Retroactivity. This Act applies retroactively to June 26, 2013.
Emergency clause.  In view of the emergency cited in the preamble, this legislation takes effect when approved.
 
SUMMARY
This bill corrects minor technical errors and inconsistencies in Public Law 2013, chapter 368, the so-called unified budget bill, including:
1. Correcting a technical conflict created when 2 sections of the public law amended the same section of law;
2. Clarifying that the temporary increase in the sales tax to 5.5% applies to the services currently subject to the 5% sales tax;
3. Correcting a numbering error created when 2 different provisions of law were enacted with the same title and section number by reallocating the provision establishing the Maine capital investment credit for 2013;
4. Resolving a conflict created when 2 sections amended the provision of law that provides for an annual adjustment for inflation of the income tax rate brackets in different ways, one by delaying the annual adjustment of the income tax rate brackets and the other by providing for an annual adjustment of the itemized deduction limitation amount. Both provisions are maintained;
5. Correcting an initiative to reflect that the MaineCare reimbursement is limited to behavioral health services; and
6. Deappropriating funds to offset an appropriation in an initiative in the committee amendment that should have been eliminated when statutory changes were made in the enacted version of the unified budget bill.