LIMESTONE, Maine — Gov. Paul LePage recently selected four areas of Aroostook that encompass fourteen County communities, including Limestone, for “Opportunity Zone” designation, which promotes investments through tax breaks.
In total across the state, LePage picked 32 out 128 census tracts to receive federal tax benefits that aim to encourage new investment to lure businesses and jobs to economically depressed areas. The tax breaks are part of a Republican federal tax overhaul passed last year.
Once an area receives this designation, investors who put money into projects in the opportunity zones avoid taxes on the capital gains returned by their investments.
According to the Maine Department of Economic and Community Development, LePage selected the zones “based primarily on identified investment opportunities where such investments would likely be met with success.”
“Any time there is an incentive for business to locate in a particular area is an opportunity for increased economic growth,” said Limestone Town Manager Tom Stevens. “Generally, the town is pleased that it was recognized as one of those areas.”
Stevens added that Loring Development Authority has several prospective businesses looking at the former military installation, and that this designation is “an incentive for them to locate there.”
LDA CEO Carl Flora said Thursday that while some details about the designation remain to be worked out, he is optimistic that the program will provide the needed incentives to develop more projects on the former Air Force base.
“Nobody quite knows how it’s going to work,” he said. “The federal treasury still has to adopt the regulations. A lot more is unknown than known at this point.”
Flora added that he believes it will “create an incentive for significant investments in larger projects.”
“I talked to a couple of our existing and prospective project directors just to make sure they’re aware of it, to the extent that they can make use of it,” he said. “It would certainly be a subject for them to discuss with their tax advisors.”
Limestone Economic Development Coordinator Dennis McCartney said the designation is a “way to get people to invest in a region they might not otherwise invest in,” and that it is now up to Aroostook County to attract attention to the investment benefits in over a dozen municipalities.
In terms of McCartney’s position within the town, which primarily focuses on bringing in new businesses and economic opportunity, he said the recent news causes him to “step on the gas,” as he is now able to give prospective investors even better reasons for coming to northern Maine.
“Limestone is a good place with a nice school,” he said, “but now I can give an investor a business reason to invest here.”
Because business people will be able to keep more of their earnings through this program, McCartney said this is a “big tool to attract businesses to town.”
“It’s not just Loring, either” he said. “There has never been a better time to open a business in Limestone. Property values are low, the town is a safe, quiet, nice place to live, and now you have this super tax benefit on any investments made in town.”
Writer Darren Fishell of the Bangor Daily News contributed to this report.
