Could Maine subtract the full veterans property-tax exemption from each town's assessed value without adjusting for local assessment ratios?

Plain-English summary

In 1987, the Maine Attorney General concluded that the Legislature could not apply the full veterans property-tax exemption directly against every municipality's locally assessed value. Towns used different ratios between assessed value and fair market value, so the proposal would give veterans owning property of the same market value different proportional exemptions.

The existing method multiplied the exemption by the local assessment ratio. That calculation preserved the same exempt share across towns. Applying the full dollar amount after a town used a lower assessment ratio would reduce one veteran's taxable share more than another's.

The proposed amendment would therefore violate article 9, section 8 of the Maine Constitution, which required property taxes to be apportioned and assessed equally according to just value.

Currency note

This opinion was issued in 1987. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

Why did local assessment ratios matter?

Municipalities assessed property at different percentages of fair market value. Adjusting the exemption by the same ratio kept the effective tax burden equal for veterans with equally valuable property.

What would the proposed amendment have changed?

It would have subtracted the full statutory exemption from local assessed value, without reducing the exemption to match the town's assessment ratio.

What constitutional problem did the AG identify?

Veterans with property of the same fair market value could owe tax on different percentages of that value solely because their towns used different assessment ratios.

Background and statutory framework

Representative Norman O. Racine asked whether section 653 could be amended to let local assessors subtract the full available veterans exemption from locally assessed value. The opinion used an example comparing towns with 100 percent and 70 percent assessment ratios.

At the time, 36 M.R.S.A. section 653 exempted up to $4,000 of a veteran's property value, and the exemption was adjusted by the local ratio. Article 9, section 8 required statewide equality according to just value.

Citations and references

• 36 M.R.S.A. § 653
• 36 M.R.S.A. § 551
• 36 M.R.S.A. § 601
• Me. Const. art. 9, § 8
• Kittery Electric Light Co. v. Assessors of Town of Kittery, 219 A.2d 728 (Me. 1966)

Source

• Landing page: https://www.maine.gov/legis/lawlib/lldl/agops/agops.htm
• Original PDF: https://lldc.mainelegislature.org/Open/AG/Opinions/1987/ag_19870120b.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain — the linked PDF is authoritative.

JAMES E. TIERNEY
ATTORNEY GENERAL
87-2

STATE OF MAINE
DEPARTMENT OF THE ATTORNEY GENERAL
STATE HOUSE STATION 6
AUGUSTA, MAINE 04333

January 20, 1987

Honorable Norman O. Racine
43 Highland Street
Biddeford, ME 04005

Dear Representative Racine:
I am responding to your letter of January 7, 1987, in which you request an Opinion of this Department concerning the following question: Would amendment of 36 M.R.S.A. § 653 to authorize local assessors to calculate a veteran's taxable estate by reducing the locally assessed valuation of that estate by the full amount of the available statutory exemption
be constitutionally permissible?
·
For the reasons discussed below, it is the opinion of this Department that the proposed amendment would create a disparity in taxation of veterans estates of like value and would, therefore, be violative of Article 9, § 8 of the Constitution of Maine .
. Under the provisions of 36 M.R.S.A. §§ 551 and 601, real estate and certain enumerated classes of personal property are taxable to the owner of the property by the locality in which the property is located. This tax is commonly known as the property tax. Property taxes are apportioned equally among property owners according to the fair market value of their properties. This apportionment of property tax according to fair market value, or "just value," is mandated by the Maine Constitution which provides in pertinent part: "All taxes upon real and personal estate, assessed by authority of this State, shall be apportioned and assessed equally according to just value. " Me. Const. art. 9, § 8.
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Based upon various factors not relevant here, each municipality in Maine develops an assessment ratio for itself which represents the ratio of the locally assessed valuation of property to the actual· fair market value of that property. Typically, that local assessment ratio varies from 70 percent to 100 percent. Assuming that all property within a particular municipality is valued consistently with the prevailing local assessment ratio, the tax burden on al 1 taxpayer.s within that locality will be equally apportioned according to the fair -market value of their property. Further, because the same methodology is applied uniformly by all municipalities in the State, equal apportionment of local tax burdens on property owners according to the actual value of property is accomplished on a statewide basis as required by the Maine Constitution. Id.; and see 36 M.R.S.A. § 208 (1978), Under existing law, a veteran's property up to a fair market value of $4,000 is exempt.from property tax. 36 M.R.S.A. § 653(l)(C). This statute also provides that the local assessed value of the exemption shall be determined by multiplying the available exemption by the local assessment ratio. -36 M.R.S.A. § 658(l)(k). Thus, under the present law, a veteran owning property located in Town A with a $10,000 fair market value and a 100 percent assessment ratio will be required to pay tax on $6,000 or 60% of.the assessed value of his property. A veteran owning property of the same fair market value· living in Town B with, say, a 70 per.cent assessment ratio, will be allowed an exemption of 70 percent of the $4,000 exemption, $2,800, and will thus be taxed on an estate valued at $4,200 ($7,000 less $2,800), or, again, 60% of the assessed value of his property. Thus, the tax burdens of the two veterans are equally apportioned by the fair market value of their properties despite the differences in local assessment ratios.
Were the present statute amended to allow the full $4,000 exemption to be applied against a town's assessed value of property, then the veteran in Town B would be paying tax on $3,000 ($7,000 assessed value less $4,000 exemption) which represents approximately 43 percent of the total assessed value of his property. It is, therefore, clear that a veteran in Town B would bear a smaller proportion of his Town's tax burden than a veteran owning property of the same value would bear in Town A, despite the equal value of their properties. This is the very result which the Constitution forbids. See Kittery Electric Light Co. v. Assessors of Town of Kittery, 219 A.2d 728 (Me. 1966). Accordingly, it is the Opinion of this Department that amendment 36 M.R.S.A. § 653 in the manner I

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  suggested would be violative of Article 9, section 8 of the Constitution of Maine. ·
  In summary, the Maine Constitution has mandated that the property taxes of Maine be apportioned equally. An amendment to 36 M.R.S.A. § 653 such as the one about which you ipquire would treat some Maine veterans better than others and thus violate that constitutional requirement.
  I hope this answers your questions. Please feel free to reinquire if further clarification is necessary.
  Sinc;rely,

&I--£ .1=-
JAMES E. TIERNEY
P.ttorney General
JET/ec