Skip to main content

The China Connection

Tweet This

This video series on foreign trade zones is very informative about foreign trade zones which are harbored in Maine at the two city states of MRRA and Lorring and other locations as well.

 I have been writing about how the Maine legislature sells its redistribution of wealth policies (from tax payers to private capitalists) to the public as "job creation". Notice that this is the way the selling of America to China is also being sold to the American public- its job creation.

Wikipedia on Foreign Trade Zones
A foreign-trade zone (FTZ) in the United States is a geographical area, in (or adjacent to) a United States Port of Entry, where commercial merchandise, both domestic and foreign receives the same Customs treatment it would if it were outside the commerce of the United States. Merchandise of every description may be held in the Zone without being subject to Customs duties and other ad valorem taxes >>>>>Wikipedia on Foreign Trade Zones

This is just a small part of the history of how Maine got from 1969 when the people voted the Home Rule Amendment into the Constitution to today's post-constitutional Maine which is largely governed by the Maine Development Corporation. I took this from the time line I had created in an attempt to make a living of sorts from doing this research and writing this blog. It was a terrible idea in that respect as there were few takers but as a result of doing the research I became more informed than most about what is taking place in this state- which comes in handy for online debates.The first goal is to spread the information but I am also in need of developing a larger revenue stream to save our own business from extinction- so if you find this information of value- you can still send a contribution to this blog to via paypal. - Or you can purchase a mug or set of mugs that you see on the side bar. Just to note that I have been spreading this information for years now and recently I am starting to see it reflected in online debates in comments made by others and so my first and most important goal is seeing signs of success

Article VIII.

Part Second.

Municipal Home Rule.

Section 1.  Power of municipalities to amend their charters.  The inhabitants of any municipality shall have the power to alter and amend their charters on all matters, not prohibited by Constitution or general law, which are local and municipal in character.  The Legislature shall prescribe the procedure by which the municipality may so act.
Section 2.  Construction of buildings for industrial use.  For the purposes of fostering, encouraging and assisting the physical location, settlement and resettlement of industrial and manufacturing enterprises within the physical boundaries of any municipality, the registered voters of that municipality may, by majority vote, authorize the issuance of notes or bonds in the name of the municipality for the purpose of purchasing land and interests therein or constructing buildings for industrial use, to be leased or sold by the municipality to any responsible industrial firm or corporation.


Legislature charters the Maine Development Foundation as a non-profit corporation to serve as an instrumentality of the state with the function of .

§916. Establishment

The Maine Development Foundation is hereby established to foster, support and assist economic growth and revitalization in Maine. The foundation shall carry out its purposes in complement to and in coordination with the economic development activities of the private sector, community and regional agencies and State Government. [1977, c. 548, §1 (NEW).]
The foundation shall exist as a not-for-profit corporation with a public purpose, and the exercise by the foundation of the powers conferred by this chapter shall be deemed and held to be an essential governmental function. [1977, c. 548, §1 (NEW).]

Notice that the state does not recognize municipalities as agents of economic development as provided for by the Home Rule Amendment of the Maine Constitution. It recognizes the private sector, community and regional agencies and STATE government- no mention of municipal authority, although the word "community" could be construed as such, it lacks recognition of a legal governing authority- further more in the next paragraph the ME legislature tells us that it must partner with private entities to ease the state's "solitary burden" for economic development" an arrangement which it decrees will never compromise the profit motive or public interest ! Why didn't they include the sale of the Brooklyn Bridge ?

§915. Legislative findings and intent: "There is a need to establish a new basis for a creative partnership of the private and public sectors ...but which does not compromise the public interest or the profit motive. The state's solitary burden to provide for development should lessen through involving the private sector in a leadership role....... The foundation shall exist as a not-for-profit corporation with a public purpose, and the exercise by the foundation of the powers conferred by this chapter shall be deemed and held to be an essential governmental function.   (emphasis mine)

1977 §5202-A.Small business investment companies exempt

Corporate small business investment companies, licensed under the United States Small Business Investment Act of 1958, as amended, and commercially domiciled in Maine and doing business primarily in Maine, shall be exempt from taxation under this Part. [1977, c. 640, §2 (NEW).]SECTION HISTORY1977, c. 640, §2 (NEW).

Commentary - This does not appear to have been changed since its creation begging the question why there is need for an Expanded and Improved Seed Capital Tax Credit- which is a refundable tax credit- meaning if no taxes are owed, the taxpayers of Maine owe the investor a cash pay out.

Is not the 1977 statute a blanket taxation exemption for business investment companies located in Maine? If this is as it appears to my layman's eyes- that means every use of the word "tax credit" by our legislature as applied to small business investment companies in Maine is just a cover for a direct transfer of wealth from tax payer pockets to private capitalist bank accounts

I searched Maine Statute Search to make sure I was looking at a current version; This is what I got: The blanket tax exemption for small business investment companies does not appeared to have been repealed:



Maine Department of Economic & Community Development:   Governor John R. McKernan, Jr. Charter for the DECD CORPORATION

§13051. Legislative findings ( a global capitalist philosophy !)

The Legislature finds that the State's economy is linked to the national and international economies. Economic changes and disruptions around the world and in the nation have a significantly impact upon the State's economy. The rise of 3rd-world and 4th-world countries as manufacturers of commodities for mass markets and the gradual evolution of the national economy to a technological, informational, specialty product-based economy have significantly more

2001 Statute establishing Municipal Tax Increment Financing (TIF) controlled by the DECD corporation3. Declaration of public purpose.  It is declared that the actions required to assist the implementation of development programs are a public purpose and that the execution and financing of these programs are a public purpose.[ 2001, c. 669, §1 (NEW) .] (emphasis mine


 Why is all of the authority granted below- not first granted by the Maine Constitution under the Home Rule Amendment ? This statute appears to be intended to transfer the authority described below to the state, which by 2001 has been transformed into the Maine Development Corporation- a public private relationship. Although written as though the statute is granting authority to the municipalities, it is arguable that it is actually claiming authority constitutionally granted to the municipalities for the state, which is now transformed into Maine State Inc.
Municipal Tax Increment Financing (TIF) 

§5221. Findings and declaration of necessity

1. Legislative finding.  The Legislature finds that there is a need for new development in areas of municipalities and plantations to:
A. Provide new employment opportunities; [2001, c. 669, §1 (NEW).]
B. Improve and broaden the tax base; and [2001, c. 669, §1 (NEW).]
C. Improve the general economy of the State. [2001, c. 669, §1 (NEW).]
2011, c. 101, §1 (AMD) .]
2. Authorization.  For the reasons set out in subsection 1, municipalities and plantations may develop a program for improving a district of the municipality or plantation:
A. To provide impetus for industrial, commercial, transit-oriented or arts district development, or any combination; [2009, c. 314, §1 (AMD).]
B. To increase employment; and [2001, c. 669, §1 (NEW).]
C. To provide the facilities outlined in the development program adopted by the legislative body of the municipality or plantation. [2011, c. 101, §2(AMD).]
2011, c. 101, §2 (AMD) .]
3. Declaration of public purpose.  It is declared that the actions required to assist the implementation of development programs are a public purpose and that the execution and financing of these programs are a public purpose.
2001, c. 669, §1 (NEW) .]
2001, c. 669, §1 (NEW)2007, c. 413, §1 (AMD)2009, c. 314, §1 (AMD)2011, c. 101, §§1, 2 (AMD).

2001 Chapter 383: ECONOMIC AND COMMUNITY DEVELOPMENT Subchapter 9: MAINE RURAL DEVELOPMENT AUTHORITY controlled by the DECD corporation  §13120-A. Authority established; purpose


An Act To Lower the Cost of State Government in the Departments under the Purview of the Joint Standing Committee on Natural Resources (A conflict of interests !)

SUMMARY 2009-10 (1.000} ($58,784) ($58,784) 2009-10 ($115,236) ($310,597) ($425,833) 2010-11 (1.000) ($79,960) ($79,960) 2010-11 ($156,572) ($420,577) ($?77,149) 19 This bill eliminates the Department. of Environmental ProteCtion, Off1ce of 20 Innovation and Assistance and transfers the duties of that office to the Department of 21 . Economic and Community Development, Office of Innovation. This bill also eliminates 22 funding for a total of 7 positions within the Department of Environmental ProteCtion, 5 of 23 which are associated with the Office of Innovation and Assistance and 2 whose duties. 24 include serving as legislatIve liaisons for the department.


McDonnell said banned topics and questions of academic freedom were never an issue in USM's negotiations with Hanban, and the university made no agreements about topics that could not be discussed."Our (program) is really designed with our school of education to teach Chinese language, so we're not confronted with those issues," he said.Hanban, which provides the instructors and materials, also gave USM $150,000 in startup funds, and will provide about $100,000 a year to administer the institute, depending on the level of programming it offers, McDonnell said There is no cost to USM, which has struggled with deep budget cuts in recent years that have led to the elimination of some programs and instructors. Maine leaders laud wisdom of Confucius Institute PPH

Pursuant to 1995  Part 1: GENERAL PROVISIONS Chapter 1: GENERAL PROVISIONS S10. Education Research Institute. The Joint Steering Committee has jurisdiction over educational matters.I can’t locate a steering committee, which is said to be a sub-committee of the standing committee.  Here is a list of members of the Joint Standing Committee for Education 126th Legislature 2013

Education and Cultural Affairs
Senate: Rebecca J. Millett, Chair (D-Cumberland)
Christopher K. Johnson (D-Lincoln)
Brian D. Langley (R-Hancock)
House: W. Bruce MacDonald, Chair (D-Boothbay)
Mary Pennell Nelson (D-Falmouth)
Helen Rankin (D-Hiram)
Matthea Elisabeth Larsen Daughtry (D-Brunswick)
Brian L. Hubbell (D-Bar Harbor)
Victoria P. Kornfield (D-Bangor)
Peter B. Johnson (R-Greenville)*
Joyce A. Maker (R-Calais)
Michael D. McClellan (R-Raymond)
Matthew G. Pouliot (R-Augusta)
Madonna M. Soctomah (Passamaquoddy Tribe)

Beginning with this statement:

WHEREAS,  the United States and the Republic of China, known as Taiwan, share a most important relationship supported by our common values of freedom, democracy, rule of law and commitment to a free market economy; and…….

Commentary: It goes on to list the economic reasons-and to establish that,  China is on board with “climate change” (actually “pollution”- which is not the same as climate change) -China, having  risen to the top of global economic status by offering companies cost-savings in the form of minimalist environmental and health considerations, is now changing its tune: 

Combating pollution has shot up the agenda of the ruling Communist Party, which for years pushed for rapid economic development with little concern about the environmental impact. Under public pressure to reduce the air pollution that blankets Beijing and cities across China, the country’s leaders are rebalancing their priorities. China Declares War on Pollution-NY POST

WHEREAS,  Taiwan is the 17th-largest trading economy in the world and is a member of the Asia-Pacific Economic Cooperation forum, which promotes free trade and economic cooperation throughout the Asia-Pacific region; and

WHEREAS,  the United Nations Framework Convention on Climate Change is the world's key instrument for responding to climate change, and a concerted global effort to combat the challenges posed by climate change requires that Taiwan also be included in the work of this convention, and Taiwan has expressed a keen interest to participate in the global effort to address climate change; and

WHEREAS,  it remains in the interest of the traveling public that Taiwan be included in the United Nations International Civil Aviation Organization, since Taiwan is a key transport hub in the Asia-Pacific region; the Taipei Flight Information Region, under Taiwan's jurisdiction, covers an area of 176,000 square nautical miles with 1,350,000 controlled flights passing through annually; now, therefore, be it

RESOLVED: That We, the Members of the One Hundred and Twenty-sixth Legislature now assembled in the First Regular Session, on behalf of the people we represent, take this opportunity to affirm the friendship between Maine and the Republic of China; and be it further

RESOLVED: That We support the signing of a United States-Taiwan bilateral investment agreement and a free trade agreement in order to further strengthen Maine-Taiwan trade relations, and We support Taiwan's participation in international organizations and agreements, including the United Nations Framework Convention on Climate Change, the United Nations International Civil Aviation Organization and the Trans-Pacific Partnership; and be it further

RESOLVED: That suitable copies of this resolution, duly authenticated by the Secretary of State, be transmitted to President Ma Ying-jeou of Taiwan and to the Director-General of the Taipei Economic and Cultural Office in Boston.

2013, May An Act To Implement the Recommendations of the Right To Know Advisory Committee Concerning Public Access to Records Relating to Public-private Partnerships

Sponsored by : Senator Millett
Co-Sponsored by: Senator Langley, and Representatives Daughtry, MacDonald, Malaby, Nelson, Parry, Pouliot, and Sirocki

This bill implements the majority recommendation of the Right To Know Advisory Committee.
Current law requires that the Department of Transportation submit to the Legislature a bill that authorizes the agreement that implements a public-private partnership for the development of a transportation facility. This bill requires the department to publish public notice on the department's publicly accessible website or in newspapers when it has determined that a public-private proposal and agreement meets the standards of the Maine Revised Statutes, Title 23, chapter 410, subchapter 5 and to wait at least 30 days after the public notice has been published to submit the bill.

This regards a conflict of interest between the communities right to know and freedom of access to
information concerning toxic and hazardous substances vs business advantages to the Department of Transportation and public-private relationships in attracting large corporations to the state by keeping the confidentiality provision on as it is - protected as a trade secret pursuant
to 1985  Part 3: 487, §11 Chapter 271: HEALTH PROGRAMS:Subchapter 2: COMMUNITY HEALTH INVESTIGATION AND INFORMATION§1696-F. Provision of information; trade secrets (1989 ) ( See David Hastings Testimony)
Maine ACLU

Right to Know Committee/7th Annual Right To Know Report

The Legislature determines that it is in the public interest for the State to examine its emergency response mechanisms and procedures for accidents involving hazardous materials, to establish a comprehensive program for the disclosure of information about hazardous substances in the community and to provide a procedure whereby residents of this State may gain access to this information.[1985, c. 494, §2 (NEW).]

There is a need to establish is a new basis for a creative partnership of the private and public sectors for economic development, a partnership which can capitalize on the interests, resources and efforts of each sector, but which does not compromise the public interest or the profit motive. The state's solitary burden to provide for development should lessen through involving the private sector in a leadership role. [1977, ( emphasis mine)

Current Status of Section on Confidentiality:

10-A. Confidential information.   Information submitted to the department relating to a public-private partnership proposal under this subchaptmunicipal revenuer is confidential and not a public record under Title 1, chapter 13, subchapter 1 if the private entity submitting the information designates the information as being only for the confidential use of the department and if:
A. The information is a trade secret as defined in Title 10, section 1542, subsection 4; or [2013, c. 208, §3 (NEW).]
B. Disclosure of the information would result in a business or competitive disadvantage, loss of business, invasion of privacy Ought Not to Pass Pursuant To Joint Rule 310, May 23, 2013or other significant detriment to the private entity to whom the record belongs or pertains. [2013, c. 208, §3 (NEW).]
If legal action is filed to gain access to the information designated as confidential under this subsection, the private entity must defend its designation and the department shall release the information in accordance with the order of the reviewing court. Failure to defend the designation under this subsection constitutes a waiver of confidentiality by the private entity and the department shall release the information.

[ 2013, c. 208, §3 (NEW) .]

2013  §152. Ratification of bond issue; signed statement

I have written about recently this on this blog. This bill is repugnant to the Maine Constitution, which requires that a short paragraph of fiscal information accompany bond questions on the ballot in order for the bonds to be ratified. This bill moves that very short paragraph off the voting ballot and instructs it to be placed somewhere out side the guard rail which separates the voting area from the rest of the world.
Links to posts on this issue

CIVIL UPDATE2013, January Joint Order, Establishing the Task Force To Study the Creation of a State of Maine Partnership Bank or Other Maine Financial Structures
Presented by Representative Pringle of Windham

There is an ongoing attempt to establish a Maine Bank- another notch for  the Corporate State of Maine's control over the distribution of investment capital in this state. 


Presented by Senator THOMAS of Somerset.Co Sponsored by Representative BOLAND of Sanford andSenators: SAVIELLO of Franklin, WHITTEMORE of Somerset, Representatives: BENNETT of Kennebunk, BLACK of Wilton, SIROCKI of Scarborough, STANLEY of Medway, WOOD of Sabattus.

is enacted to read:4.Advance payment permitted. The commissioner, under extraordinary circumstances, may provide an advance payment in anticipation of reimbursement under subsection 1 to a qualified business using a net present value calculation, determined by the commissioner and the State Tax Assessor, based on an estimate of future employment tax increment financing benefits. The payment must be made in the form of a loan from the Maine Rural Development Authority pursuant to applicable requirements in Title 5,chapter 383, subchapter 9. The commissioner and the State Tax Assessor shall establish procedures for determining any variations between advance payments and final benefits due and for repayment of loans from the Maine Rural Development Authority under this subsection

Submitted by the Department of Economic and Community Development pursuant to Joint Rule 204.Reference to the Committee on Taxation suggested and ordered printed

Commentary This refers to the (up to) 80%payroll  tax credit that the state provides to its targeted sector- or in other words that the state requires the tax-paying sector (employees , retail sector, other businesses in the UN-targeted sector) to pay on the targeted sector’s payroll taxes. This statute says that the targeted sector business can collect those payouts (from the UN-targeted sector) in advance- the owner of the means of production can now get his re-reimbursement before he hires the employees. The amount of money that the capitalist gets is a function of the employees that he is anticipated to hire and the financing of the payout comes from other workers and other businesses, which the state dis-qualifies from offering “quality jobs”pursuant to the definition of quality jobs as providing higher than average (taxable) employee  income. The fact that the UN-targeted business has to pay its fair share of the targeted sector’s payroll tax makes it affordable for the targeted sector to create those “quality jobs ( jobs that pay higher than average) as it increases the burden on the UN-targeted sector designated by the state as creators of  “UN-quality jobs” ( jobs that pay an average wage or below-in other words middle class jobs) making it all the harder for the tax-paying sector to rise to the level where they can offer “quality jobs” and thus enter the strata where in others pay most of their payroll taxes- although they might have to move to a different state to get in on the deal!

This bill creates a presumption that a seller of goods or services is engaged in business in this State and therefore required to register with the State Tax Assessor as a retailer and collect and remit sales and use tax on purchases made by persons in the State, if a person affiliated with the seller has a substantial presence in the State or a person who has a substantial presence in the State engages in certain activities, such as selling a line of products similar to that of the seller or maintaining an office or distribution center in the State to facilitate the delivery of the seller's products. Alternatively, a seller is presumed to be required to register with the State and collect and remit sales and use tax if the seller has an agreement with a person to refer potential customers to the seller and the seller generates more than $10,000 in sales in the State annually. Both presumptions may be rebutted. This bill also requires any agreement or ruling by the Governor or an executive branch department or agency that allows a seller to avoid registering as a seller to be approved by both Houses of the Legislature.

Enacted, Jun 5, 2013
Governor's Action: Signed, Jun 5, 2013 

Commentary This is an example of how far removed from the relationship of taxation to representation, the state has become. The state plays no role in the revenue produced from internet sales. It cost the state nothing except as the state interprets the consumers as it's own instrumentalities, serving state purposes. In numerous statutes the retail sector is excluded from the benefits provided by the states economic development policies- including the statute that chartered the DECD corporation- so the state is not creating a tax here based on representation- it is charging a use tax on the inhabitants of the state to out of state retailers. The inhabitants represent the state’s revenue stream. Marx was more than right when he described the workers as commodities, In the lexicon of the contemporary corporate state we can substitute the word “commodity” with “instrumentalities of the state”.

Governor LePage presented the Internet sales tax as his sudden new found concern for Main Street but this statute caused many who were deriving an income from online affiliate programs to lose that source of income as free market companies stopped offering that opportunity to Maine residence- to which Governor Lepage and the profiteering corporation, Maine State Inc turned an icy shoulder.

2013 Sales Tax Rate Changes Effective October 1, 2013

Sales tax rate increases recently passed by the legislature take effect on October 1, 2013.Sales tax rates  have been temporarily increased from October 1, 2013 through June 30, 2015.  The general sales tax rate of 5% will increase to 5.5%.  The 7% tax rate on the rental of living quarters, sales of prepared food, and sales of liquor sold on premises will  increase to 8%.   The 10% tax rate on short term rentals of automobiles remains unchanged. ( in 2015  Governor LePage is calling for increasing and expanding the sales tax even further)

Commentary The retail sector is a mainstay of the taxed sector which is an instrumentality of the state’s revenue stream! Is there a connection between this temporary increase in sales tax and the agreement to give the owners of the means of production the payout on their payroll tax credit in advance of actually hiring the employees on which the handout is calculated? Taxes on the employees that have not yet been hired are part of the revenue stream that is needed to underwrite the transfer of wealth from the taxpayers to the owners of the means of production. Since that money isn’t yet in the states hands then a temporary increase in sales tax will cover the added benefit to the owners of the means of production of the tax-exempt sector.- just a little extra burden on the taxed sector- Not to worry!

2013 §3304. Industry partnerships Strengthens the power of the state to manage the state workforce utilizing multiple corporate subsidiaries of Maine State Inc and creating an "Industry Collaborative" in which private business relations with other private businesses will be organized in a collaborative way by the state.  Governor Paul LePage

An Act To Strengthen Maine's Workforce and Economic Future
Fiscal Note

In light of the 1977 statute which appears to still be on the books and which grants blanket tax exemption to small business investment corporations- the "refundable Seed Capital Tax Credit" becomes non other than a direct transfer of money from the pockets of the people to the bank accounts of investment corporations. A refundable tax credit means if no taxes are owed- as is the case pursuant to the 1977 statute, then the taxpayers owe the investors a cash payout refund of a percentage of their investment. That percentage started as 30% when the Seed Capital Tax credit was first created in 1987 and became 60% in 2011, Given that the 1977 statute exempts investment corporations from taxation, calling this bill a tax credit amounts to a willful deception of the people by the Maine State legislature.

Bill Sponsors Presented by Senator Valentino of York.
Cosponsored by Representative Hobbins of Saco and
President Alfond of Cumberland, Senators Cain of Penobscot, Dutremble of York, Goodall of Sagadahoc, Woodbury of Cumberland, Representatives Bennett of Kennebunk, Berry of Bowdoinham, Knight of Livermore Falls.

One suggestion we would offer concerns private venture funds in Section 3 of the bill. The proposed language would modify existing I0 M.R.S.A.§ 1100-T(2—C) paragraph (D) to increase the limit on tax credits for private venture capital funds from $500,000 to $4 million. This is a rather larger increase from the current limit.We think a more modest increase of $1 million is preferable and would better limit the fiscal impact of the bill. Testimony by Elizabeth L Bordowitz,Chief Executive Officer Finance Authority of Maine 

Time line of Incrementalism

1987 Seed Capital Tax Credit established 30 % of capitalist investment covered by taxpayers spread out over 2 years.

2001 chunk of investment paid by taxpayers goes from 30-40%. Rate of transfer from people to owners of the means of production escalated by 50%- spread out over 7 years

2011 Maine Seed Capital Tax Credit Amended to increase the amount paid by taxpayers to 60% of capitalist's investment

2013 Taxpayer now pays 60% of capitalists investment spread out over four years- rate of transfer of wealth from taxpayers to the owners of the means of production escalated eight fold. The legislature calls the bill “The Expanded and Improved Seed Capital tax Credit” Expanded indeed! Improved? Only for the capitalists!

Commentary: I haven't read every testimony which are all given by representatives of private corporations and investment firms or other corporations in Maine's economic development network, i.e F.A.M.E, The S.E.G.F, The D.E.C.D, and the Maine State Legislature, which prioritizes the interests of the "targeted sector" over the interests of the general public. All who testified stand to gain from the Seed Capital Tax Credit. Although Beth Bordowitz testified in favor of the Seed Capital Tax Credit, she stands as a lone voice representing the interests of those burdened with the cost- ie. Maine's UN-targeted sector and the employees within the targeted sector.

The media failed to report on Ms Bordowitz recommendation giving preference to articles on how the Seed Capital Tax Credit benefits the recipients of the refundable tax credit. A refundable tax credit means that if no taxes are owed, the taxpayers owe the investor a cash payout. If the investors first visit the Maine Technology Institute an agency which advises the targeted sector on the availability of other support services, the investor will know that it is to his advantage to acquire Pine Tree Zone tax incentives prior to applying for a Seed Capital Tax Credit. The Pine Tree Zone tax incentives can provide 100% tax exemption from personal and corporate income tax and an 80% tax credit on payroll tax. If the Investor's gets a charity donation from the Maine Technology Institute of a 100% matching fund of his original investment before applying for a Seed Capital Tax Credit- that means he is due a refundable tax credit of up to 120 % of his original investment ( pre-MTI matching fund) from Maine taxpayers who are also covering up to 80% of the investors payroll tax and are part of the source of MTI's funding. If the investor travels the right route through Maine's corporate welfare system, the investor will in the end invest nothing- more or less- and will still be able to retain all the profits of his business investment. I qualify this as unconfirmed speculation on my part-to allow for the possibility that I have not yet discovered the place where Maine's economic development policies restrict using multiple tax incentives- which I have not yet found after four years of researching the statutes.

The Maine media  failed to report on what is in the "Expanded and Improved Seed Capital Tax Credit and So on Preserving The American Political Philosophy Blog- I published this breakdown of the bill:

In Maine, the new extension of the Seed Capital Tax Credit  will accelerate the transference of wealth to the wealthy in the following ways:

  1. ·Removing limits on the life of a capital fund ( after following the references back to the original statutes, the limit that I found is to the length of time that the investor has to collect his tax credit pursuant to the limitation imposed that it must not be greater than 50% of his total tax due. There has been a 15 year limit imposed on the investor in which  his tax credit can be applied....until now.
  2. The following sentence is added to the definition of a venture capital fund: An entity that otherwise qualifies as a private venture capital fund may elect not to be treated as a private venture capital fund for purposes of this section with respect to any proposed investment.
  3. The amount of annual gross sales for the business receiving the investment has been changed from $3,000,000 or less to $5,000,000 or less.
  4. The requirement that the operation of the business must be the full-time activity of the owner has been changed to  a substantial professional activity of at least one of the principal owners, as determined by the authority
  5. The requirement that the eligible business bring capital to the state has been struck out.
  6. In section D  in which limitations on the investment to  which any entity is applying are discussed, the word "entity" is struck out and replaced with "private venture capital fund"
  7. Section D changes the aggregate limit for a private venture capital fund from $500,000 to $4,000,000 and strikes out the individual limit within the aggregate for entities treated as a flow-through entity for tax purposes.
  8. Changes the annual gross sales allowed for eligible businesses from $3,000,000 to $5,000,000
  9. Changes the requirement that the operation of the business must be the full-time activity  of the principal owner to substantial professional activity of one or more individuals who are not managers of the private venture capital fund, as determined by the authority.
  10. Changes the prohibition against a tax credit certificate being issued to a private venture capital fund if an investor in the fund is a principal owner of the eligible business or a family member of the investor has any existing ownership interest in the business. by striking out "investor" and replacing it with "manager of the fund".
  11. Increases the amount of that the tax credit is not allowed to exceed , which was  $2,000,000 in 1996 and becomes $5,000,000 in 2015-

Commentary unlike the treatment of the general taxpayer in the Chained Consumer Price Index that this same legislature will be adopting, the legislature is insuring that the investor is generously compensated for the shrinking of the dollar, due in part to the activities of the Maine state legislature in redistributed worthless paper money distributed by the federal government into the whole economy via its "targeted sector" recipients.

It was passed by the House- no roll call available.

Governor Paul LePage refused to sign the bill saying that it isn't "impactful" enough ! Shedding some light on this response is LePage's failed 2014 jobs bill designed exclusively for the two municipalities of the state where in municipal government has been replaced by board appointed by states- MRRA and Lorring and expands the Pine Tree Zone tax Incentives to big businesses hiring 1500 employees or more. The way the Seed Capital tax Credit is currently written, it excludes businesses of  the size that Lepage's jobs bill targeted,


Related blog posts:

Globalization and The Maine Department of Economic And Community Development  

Monday, May 27, 2013

Saturday, October 25, 2014


Popular posts from this blog

An Incomplete Theory of Inflation Made to Order for Mass Consumption.

M oney is not what it used to be, so must our ways of thinking about it adapt. jaakko-kemppainen-unsplash The message treads across the media terrain, beating louder and louder as if to drown out the beat of the distant drummer. W arning! The only thing the stimulus will stimulate is inflation. The people will pay as the wealthy elite invests their windfalls in financial assets. Doom and gloom set to march across the land to the beat of the distribution of stimulus funds. In recent years as past predictions of fiscal disaster following stimulus spending failed to materialize and so the thinking about national debt and deficits has evolved, most noticeably with the development of  Modern Monetary Theory . In the   fall of 2020,  National Affairs  published a story,  Does the Debt Matter ? by Peter Wehner & Ian Tufts. Peter Wehner is vice president and senior fellow at the Ethics and Public Policy Center and served in the last three Republican administrations. Ian Tufts is a recent g

Why are social impact investors trying so hard to defeat smaller shelters for the homeless?

  "Social Impact” developers in Portland, Maine seek to squelch a referendum for smaller shelters called for by qualified practitioners with concrete experience in the field. A large sign says Vote C to support the Homeless, small handmade sign next to it says Untrue! That sign is paid for by developers who want / Photo by Jess Falero In   the 1970s under Governor Longley , Maine became a centrally managed economy that expanded Maine’s wealth gap and merged, almost seamlessly, the public and private and the non-profit and for-profit economic sectors into one mutually beneficial wealth-concentration & distribution system. Currently, mutually benefitting factions are coming together once again in hopes of building a mega-shelter for the homeless in a Portland, Maine industrial development district. In addition to beds for the homeless, the project will include, dining, and locker facilities, as well as offices and an attached health clinic. The promotion  describes the facility

JECD Group Holds Master Plan Pow Wow for Boothbay Peninsula

The most honest statement to come out of the ringleaders of the Joint Economic Community Development Group in their first workshop program was "none of us are experts on economic development", which in my most humble opinion is evident in the fact that the JECD begins with the premise that economic development can be master minded by central management. The article in the Boothbay Register begins with this paragraph: The Joint Economic Development Committee master plan workshop on Thursday, Oct. 12 discuss findings from stakeholder interviews conducted early last month. The interviews centered around building an overall economic development strategy for Edgecomb, Boothbay, Boothbay Harbor and Southport. Who are the stakeholders?  A search for articles in the Boothbay Register comes up short. Why is the public not told who the stakeholders are. Since the taxpayers of Boothbay and Boothbay Harbor footed the bill for the JECD's consultants, why are they not the stakeh