Curtis Picard is president and CEO of the Retail Association of Maine.

The Maine Legislature is considering a proposal buried in the supplemental budget (Part O) that would repeal the Business Equipment Tax Reimbursement (BETR) program. If enacted, the program would be capped at 50% for 2025 taxes, and eliminated entirely after 2026.

For Maine’s retailers, this is not a technical tax adjustment. It is a direct tax increase.

During a recent Taxation Committee work session (Feb. 26), it was suggested that retail businesses do not warrant continued participation in BETR because retail location decisions are “market-driven” and that retail receives an “unnecessary subsidy” for certain retail property. That argument fundamentally misunderstands how modern retail operates.

Retailers are capital-intensive employers. A modern retail store is not simply shelves and inventory. It is a network of sophisticated systems requiring constant investment.

Retailers invest heavily in point-of-sale systems, payment processing technology, inventory management hardware and software, security systems, information technology, energy-efficient lighting, HVAC and refrigeration equipment. Grocery stores, in particular, carry millions of dollars in cooling units, compressors, energy management systems and backup power generation.

Many of these investments are not optional. The Maine Legislature has repeatedly enacted environmental and energy mandates requiring grocers to upgrade to more energy-efficient refrigeration systems. These upgrades are costly, and often tens and hundreds of thousands of dollars for each location. During COVID, many retailers installed sophisticated air handling systems and also took other measures to help protect employees and customers. 

Unlike manufacturers, retailers cannot access the Business Equipment Tax Exemption (BETE) program for store equipment. BETR is the only mechanism available to help offset the significant property taxes on these essential investments.

Eliminating BETR without offering a replacement incentive removes the only remaining property tax relief mechanism for retail equipment.

Maine’s retail industry does not operate in a vacuum. It operates in a high-cost state that only becomes costlier. 

Property taxes in Maine are high. Energy costs are high. Labor costs and health insurance costs continue to rise. Retailers have absorbed significant tariff increases over the last year as well. 

When costs rise, businesses do not simply absorb them indefinitely. They delay capital upgrades. They postpone modernization. They reconsider expansion and, in some cases, they reduce staff or close underperforming stores. 

There is also a fairness issue at stake. 

Prior legislatures extended BETR eligibility beyond its original 12-year limit. Companies made long-term investments under the expectation that eligible equipment would receive reimbursement for the life of the asset. Now that relief is proposed for elimination without any transition mechanism or replacement incentive. 

Past reforms in Maine’s economic development programs have paired sunset provisions with new incentives. That is not what is happening here.

Retailers are not asking for special treatment. They are asking for equal treatment. 

Maine’s retail sector employs more than 82,000 Mainers. These are grocery stores, hardware stores, pharmacies, convenience stores, clothing shops and local businesses that anchor our communities. They provide essential goods, generate substantial tax revenue and give back to the community significantly. 

Eliminating BETR for retail equipment is not modernization. It’s a tax increase on Maine’s stores. 

At a time when policymakers say they are focused on affordability, and economic competitiveness, increasing property taxes on businesses that invest in Maine communities moves us in the wrong direction.

Policymakers should strongly reject Part O of the supplemental budget and preserve BETR. Maine’s retailers deserve a tax policy that reflects economic reality, not outdated assumptions.