More Money in ME Farmers Pockets – Millions in Savings from the 127th Legislative Session

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It took five years, but the vision of one Farm Bureau member has now resulted in potential savings for farmers all over the state.

In 2011, Maine Farm Bureau member Melvin Williams proposed a resolution at his county annual meeting that farmers receive a sales tax exemption for off-road diesel fuel. The others at the Knox-Lincoln Farm Bureau voted to support the resolution so that it would be sent to the State Farm Bureau Annual Meeting. At that session, the voting delegates, who are comprised of members from each county, also voted in favor of the resolution, making it become a Maine Farm Bureau policy.

Since that time, Maine Farm Bureau has worked tirelessly to help Maine farmers alleviate the burden of the 5.5% sales tax for off-road diesel fuel. Since 2011, Maine Farm Bureau has tried to pass a law five different times over the last three legislative sessions. Each time the bill built more and more support although failed to pass.

In the short session of the 127th, Farm Bureau tried again. Sen Paul Davis of Sangerville sponsored a bill on the Professional Logging Contractors and Farm Bureau’s behalf. The bill was LD 1481, An Act to Protect Maine’s Natural Resources Jobs by Exempting from Sales Tax Petroleum Products Used in Commercial Farming, Fishing and Forestry. A major concern of legislators has always been the cost (loss of revenue) to the state. This time Farm Bureau worked with the Maine Revenue Service, which resulted in the fiscal note attached to the bill being reduced by $4 million dollars to better reflect a more accurate impact of the bill on the state. The reduced fiscal note bettered the odds of the bill passing.

The Taxation Committee voted the bill out with a unanimous “Ought to Pass as Amended” recommendation, and it received strong bipartisan support in both the House and the Senate. Still, when the bill reached the appropriations table, the $9 million first-year price tag resulted in only three of the 13-members of the Appropriations Committee voting in favor of the bill. Sen. Davis, Farm Bureau, and the Professional Logging Contractors then managed to have the bill’s language included in an omnibus spending bill, LD 1606. The bill passed in the Legislature at 2 am on April 16 and is now public law. The sales tax exemption for farmers goes into effect on January 1, 2017.

The process by which Maine Farm Bureau policies are formulated is significant.

“This is just an example of a recent achievement made by our true grassroots organization, but there are dozens of other examples,” Maine Farm Bureau Executive Director Dr. Alicyn Smart said, “Thank you to all our members for their support to ensure that we are there for them in the Legislature as well as working to ensure Maine’s natural resource industries are sustainability and profitable.”

Smart encouraged those that are not members to become a member. Farm Bureau represents all farmers, friends of farmers, and land owners across the state.