The Finance Authority of Maine (FAME)is administering the Maine New Markets Investment Program which permits income tax credits for investments in certain communities in Maine. The program is modeled after the federal New Markets Investment Program. Qualifying investments must be equity investments made in approved Community Development Entities (CDE). The funding for the program is being furnished by Maine Revenue Services and the Maine Department of Economic and Community Development.
There are several requirements for an investment to qualify. The Community Development Entity must be certified by the United States Secretary of the Treasury. The Entity must have an agreement with the Department of Treasury’s Community Financial Institution (CDFI) Fund not subject to cancellation or revocation. The agreement must have Maine in its service area. Finally, there are five qualifying questions of which four must be answered in the affirmative. A full list of the qualifying questions is available on the FAME website at the link below.
The Community Development Entity may also apply for allocation of tax credit authority. The maximum allocation is capped at $62,500,000.00 per Community Development Entity. If approved by FAME, the tax credit can be up to 39% of the eligible investment. The allocation is taken over a period of seven years. There are various conditions which must be met by the CDE in order to be able to utilize the allocation program. There are various rules regarding reporting requirements for a CDE which has been awarded an allocation. If the CDE violates any rule relating to the allocation including reporting requirements, 36 M.R.S.A. Section 5219-HH allows for the recapture of the tax credits already allocated.
Investors who are interested in participating in this program may obtain more information at the FAME website [http://www.famemaine.com/business/programs/equity-capital/maine-new-markets-investment-program/] or by contacting FAME directly. The website contains a complete listing of CDE’s which have been awarded tax credit allocation authority and contact information. There is also a link to the application for the Maine New Markets Capital Investment Program Certification on the website for investors.