Contact your legislator today and urge them to reject LD 1129, An Act Relating to the Valuation of Improved Real Property

Formerly known as the “dark stores” bill, LD 1129, An Act Relating to the Valuation of Improved Real Property, was amended in the Taxation committee, the title was changed and the language broadened to include all improved real property in Maine. 

• This bill attempts to solve a litigation issue through legislation and would trample a taxpayer’s ability to challenge certain assessments.
  
• This legislation deviates substantially from judicial precedent because it prohibits an assessor from being able to consider issues like deed restrictions, easements, and encumbrances (potentially including zoning restrictions) when valuing similar property with no such restrictions. The law court has never addressed the constitutionality of disregarding specific components of property in determining valuation. The valuation of real property is a complex issue that is intricately woven with Maine’s constitutional mandate that all taxes be apportioned evenly according to just value. 
• This bill automatically favors the municipalities at the expense of the property taxpayer’s rights.
• The amendment to LD 1129 will impact all improved real property in Maine, including residential.
• By excluding deed restrictions from valuation for municipal tax purposes only, this amendment may depart from the universal application of tax valuation methodology to all properties as required by the Constitution.
• The amendment to LD 1129 attempts, but does not succeed, to codify judicial precedent from a recent law court case:
  • The limiting term “improved” property narrows the application of the three methodologies recently clarified by the law court, which did not distinguish between improved and unimproved land. This could raise questions as to the Legislature’s intent with respect to unimproved property.
  • The law court did not include “economic characteristics” in the scope of factors to be considered by an assessor in valuing real property. The addition of “economic characteristics” calls into question the constitutionality of the proposed amendment language.
• Assessors should not be receiving special treatment with respect to how certain properties are valued. Other marketplace participants will not be able to disregard deed restrictions or property encumbrances in valuing the sale or purchase price of property. Ultimately, this could impact an individual’s negotiating power. 
• Assessments are best left to the assessor for determining values of real property both improved and unimproved. 

 
If you have any questions about LD 1129, please contact Linda Caprara by calling (207) 623-4568, ext. 106, or by emailing [email protected].