Maine Pine Tree Zone amendments permit benefits throughout Saco

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A Newsletter by the City of Saco, Maine	August, 2009	Return to newsletter index

The State of Maine funnels many of its economic development programs through one program called Pine Tree Zones. Several areas of Saco have be designated Pine Tree Zones, and several businesses in the industrial districts have benefited from the state program. The Legislature acted in June to remove many of the geographic limitations on the program so qualified expanding businesses anywhere in the City can apply to the program. In general, the program can help when a company in a targeted sector is investing in new machinery or a new building or building improvements, and is expanding employment.

The City can sometimes assist business expansion efforts through other means, as well. These include financing with assistance of the Biddeford Saco Economic Development Corporation, and helping to find the right real estate, in either a city business park, or elsewhere in the city. Tax Increment Financing is also a possibility for larger expansions and relocations.

For the Pine Tree Zone program, the eligible sectors are:

Manufacturing, including precision manufacturing technology
Financial services
Biotechnology
Aquaculture and marine technology
Composite materials technology
Environmental technology
Advanced technologies for forestry and agriculture
Information technology

Pine Tree Development Zone (PTDZ) program offers eligible businesses the chance to greatly reduce or virtually eliminate state taxes for up to ten years. Depending on the level of new qualified business activity, the tax burden of qualified businesses may be reduced through exemptions, reimbursements, and credits:

Corporate Income Tax Credit (100%, Years 1-5; 50%, Years 6-10): the tax credit benefit derives from net new PTDZ payroll and property as a percentage of all Maine payroll and property;
Income Tax Reimbursement (80%, Years 1-10): the tax reimbursement benefit derives from income taxes withheld for net new jobs created, i.e. those qualified employees hired above the "old" employment baseline that existed in Maine prior to the expansion may be eligible for Employment Tax Increment Financing;
Sales and Use Tax (100% Real Property Reimbursement, Years 1-10): the tax reimbursement benefit derives from paying no tax on all new tangible property purchases that are to be physically incorporated in, and become a permanent part of, real property of a qualified business and used in its qualified business activity.

To learn about business development programs contact Peter Morelli, 282-3487, pmorelli@sacomaine.org.