Average Property Tax in Maine

In the 2014-2015 tax year, the overall average effective property tax rate on all types of property in Maine was $14.72 per $1,000 of actual market value, a rate of less than 1.5%. Averages varied widely across counties and cities in Maine. Androscoggin County had the highest effective property tax rate at $19.47 per $1,000 of market value, followed by Penobscot County at $18.56 per $1,000 and Aroostook County at $18.28 per $1,000. At the low end of the scale, Lincoln County had an average effective rate of $10.06 per $1,000 of market value, followed by Hancock County at $10.26 per $1,000 and Franklin County at $12.86 per $1,000.

Maine Property Tax Basics

Property tax revenue is a primary source of funds for 220 school districts, 16 counties and 488 incorporated municipalities located across Maine. In the 2014-2015 fiscal year, local taxing districts collected a combined $2.2 billion in property tax in the state, more than the $1.8 billion in personal and corporate income taxes collected in the same year. Roughly 67% of property tax collected in the average Maine community is used to fund schools, while the remainder pays for public services delivered by city and county government. Property tax accounts for 55% of local government revenue, on average, which is supplemented by state-provided funds and other local taxes and fees. Property assessment and tax billing in Maine is administered at the municipal level.

Under the Maine Constitution, all real property in the state is assessed at its just value as determined by the municipal assessor on April 1 each year. A property's just value is understood to be its fair market value. However, given the challenging nature of maintaining annual property assessments at the municipal level, assessors focus primarily on assessing property fairly and equitably such that similar properties are assessed at similar values. Municipal assessors are, thus, given leeway to assess property within 70 and 110% of actual fair market value, as long as assessments are fair and equitable across properties. Each year the state of Maine conducts its own statewide property valuation based on fair market value, producing both county- and city-level figures. If a municipality is found to be outside the acceptable assessment range, the city must perform a comprehensive property-level revaluation to bring assessments back in line with fair market values.

To calculate a tax bill, the municipal assessor multiplies the tax rate covering a property by the assessed value of that property less any allowable exemptions. Property tax exemptions are available to certain taxpayers under an application process. The homestead exemption is available to all owner-occupants in Maine who have at least 12 months of permanent residence in a home as of April 1 each year. Beginning in 2016, the homestead exemption reduces the value of a home by $15,000 for property tax purposes. Other exemptions are available to wartime veterans, disabled veterans, paraplegic veterans and blind persons.

How Maine Compares to the Nation and to Nearby States

Given vast differences between state-level tax systems, it is useful to focus narrowly on owner-occupied properties when comparing rates across state lines. The overall effective property tax rate on the market value of owner-occupied property in Maine is 1.28% compared to a national average of 1.19%. However, while only 16 states in the country have higher average rates on owner-occupied property, Maine does compare favorably with many states in the Northeast United States.

New Jersey is home to the highest average rate in the Northeast and the entire U.S. at 2.38%, followed by New Hampshire at 2.15% and Connecticut at 1.98%. Vermont comes next at 1.71%, followed by Rhode Island at 1.67%, New York at 1.64% and Pennsylvania at 1.54%. With a rate of 1.21%, Massachusetts is the only state in the region to come in below Maine. The lowest rate in the nation is found in Hawaii at 0.28%.

Massachusetts Property Tax Guide

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