Time Running Short For Property Tax Relief Bill: NB Would Gain Up To $8.8 Million If “Tax Fairness” Plan Makes It

New Britain would be in line for an additional $8.8 million from the state for property tax relief if legislation advanced by State Senate Democrats and approved by a key committee wins approval of the Legislature and is signed by Governor Malloy.

An Act Concerning Tax Fairness and Economic Development (SB 1),  introduced by Senate President Martin Looney (D-New Haven), is one of the strongest measures introduced in many years to address the burdensome property tax.

“We are looking at trying to do something that is transformative,” Looney told the Connecticut Mirror. He said “fears about “overly opulent” municipal spending are as unfounded as “knee-jerk reactions” against increasing sales taxes.”

A key provision would change “the unfair and regressive car tax by establishing a permanent cap on the car tax in all towns. No car owner will pay more in car taxes, and no municipality will see a revenue loss as a result of this plan, ” according to Senate Democrats.

The legislation,  beginning with the 2015 assessment year (for taxes to be paid in FY 17), would  allow municipalities to tax motor vehicles at a different rate than other taxable property, and would  cap the motor vehicle rate at 29.36. Currently, New Britain taxpayers pay the 49 mill rate for both real and personal (car) taxes.

The tax reform bill would address the loss of revenue from car taxes and return more aid to municipalities with a major overhaul of how the state shares aid to localities. It would  “restructure the state’s payment in lieu of taxes (PILOT) programs by establishing minimum annual payments and a method for disbursing PILOT grants when appropriations are not enough to fund the full grant amounts. It establishes a mechanism for sharing state sales and use tax revenue in the Municipal Revenue Sharing Account (MRSA) with municipalities and the state’s nine regional councils of government (COGs).

The Legislature must send up a state budget to Governor Malloy by June 3rd when the session ends.   Absent a resolution of the new two-year state budget a special session is possible.