Budget & Taxes (Audits & Accountability)

LD 1178 prevents Maine municipalities from illegally moving people between towns to avoid paying for general assistance support. It requires the Department of Health and Human Services to make a decision on residency disputes within 15 working days (down from 30), and mandates that the municipality causing the dispute reimburse the assisting town within 10 days, plus 6% annual interest if late. Repeat violations within 12 months trigger a $10,000 penalty and a required compliance audit. The bill also creates a rebuttable presumption that moving a person implies an attempt to avoid responsibility, and requires an annual public report listing violations and enforcement actions.

This bill changes how Maine municipalities calculate service charges for tax-exempt organizations (like non-profits, religious groups, or hospitals) that own property. It replaces a previous limit of 2% of an organization’s gross revenue with a new limit of 20% of the property’s assessed value (the tax-based value of the land/building). The charge must reflect the actual cost of municipal services provided to the property (such as trash collection or road maintenance), and revenue must fund those services. Municipalities must apply the charge equally to all similar organizations and require an audit of the organization’s prior year revenues to qualify for the new limit. The changes take effect on January 1, 2027.