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General Assembly Raised Bill No. 6655
January Session, 2021
LCO No. 5641
Referred to Committee on FINANCE, REVENUE AND
BONDING
Introduced by:
(FIN)
AN ACT CONCERNING MU NICIPAL TAXATION AND INCENTIVIZING
REGIONALIZATION.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. (NEW) (Effective July 1, 2022) (a) As used in this section: 1
(1) "Debt payment" means the payment of principal and interest on 2
bonds, notes or certificates of indebtedness, excluding revenue bonds, 3
issued by a municipality; 4
(2) "Legislative body" means (A) the board of selectmen in a town that 5
does not have a charter, special act or home rule ordinance relating to 6
its government, (B) the council, board of aldermen, representative town 7
meeting, board of selectmen or other elected legislative body described 8
in a charter, special act or home rule ordinance relating to government 9 Raised Bill No. 6655
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in a city, consolidated town and city, consolidated town and borough or 10
a town having a charter, special act, consolidation ordinance or home 11
rule ordinance relating to its government, (C) the board of burgesses or 12
other elected legislative body in a borough, or (D) the district committee 13
or other elected legislative body in a district or other municipal 14
corporation; 15
(3) "Municipality" means any town, city, borough, consolidated town 16
and city, consolidated town and borough, district as defined in section 17
7-324 of the general statutes and any other municipal corporation 18
having the power to levy a tax on property pursuant to chapter 204 of 19
the general statutes; 20
(4) "Total tax levied" means the total amount of property taxes a 21
municipality levies under chapter 204 of the general statutes with 22
respect to all real property, personal property and motor vehicles; and 23
(5) "Voter" means any person who is (A) an elector of a municipality, 24
or (B) a citizen of the United States of the age of eighteen years or more 25
who, jointly or severally, (i) is liable to the municipality for taxes against 26
such person on an assessment of not less than one thousand dollars on 27
the last-completed grand list of such municipality, or (ii) would be so 28
liable if not entitled to an exemption under subdivision (17), (19), (22), 29
(23), (25) or (26) of section 12-81 of the general statutes. 30
(b) (1) For each fiscal year commencing on or after July 1, 2022, the 31
total tax levied by a municipality shall not exceed two and one-half per 32
cent of the net grand list of such municipality. 33
(2) Any municipality in which the total tax levied exceeds the limit 34
set forth in subdivision (1) of this subsection shall be subject to the 35
provisions of subsection (c) of this section. 36
(c) (1) Any municipality in which the total tax levied exceeds the limit 37
allowed under subsection (b) of this section shall reduce such levy for 38
each successive fiscal year by not less than fifteen per cent of the total 39
tax levy for the preceding fiscal year, until such levy does not exceed the 40 Raised Bill No. 6655
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limit allowed under said subsection, except that no municipality shall 41
be required to reduce the total tax levied to below the limit allowed 42
under said subsection. The municipality may adjust any reductions 43
under this subsection in accordance with the provisions of subdivision 44
(2) of this subsection. 45
(2) Notwithstanding the provisions of any municipal charter, special 46
act or home rule ordinance, the legislative body of any municipality 47
subject to the provisions of subdivision (1) of this subsection may, by a 48
two-thirds vote of the members present and voting, hold a referendum 49
to seek voter approval of the levy of additional taxes by a specified 50
amount in excess of the amount allowed under subdivision (1) of this 51
subsection. Such referendum shall be by a "yes" or "no" vote on paper 52
ballots or on the voting machines of the municipality. The question 53
submitted to the voters shall be: "Shall the ____ (insert name of the 54
taxing entity) be allowed to levy an additional $____ (insert the amount) 55
in real and personal property taxes for the fiscal year commencing July 56
1, ____ (insert the year)?". 57
(3) If the amount specified in such question is not greater than one-58
half of the reduction required pursuant to subdivision (1) of this 59
subsection, the proposal shall be deemed approved if a majority of the 60
voters casting votes thereon cast "yes" votes. If the amount specified in 61
such question is greater than one-half of the reduction required 62
pursuant to subdivision (1) of this subsection, the proposal shall be 63
deemed approved if two-thirds of the voters casting votes thereon cast 64
"yes" votes. In no event shall the amount specified be greater than the 65
reduction required pursuant to subdivision (1) of this subsection. 66
(d) (1) In any municipality in which the total tax levied results in a 67
percentage that is less than or equal to the limit allowed under 68
subsection (b) of this section, the total tax levied for any fiscal year shall 69
not exceed an amount equal to one hundred two and one-half per cent 70
of the maximum levy limit for the preceding fiscal year, except that any 71
municipality may increase the total tax levied (A) in accordance with the 72
provisions of subdivision (2) of this subsection, and (B) for the then-73 Raised Bill No. 6655
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current fiscal year, by an amount equal to the tax rate for the preceding 74
fiscal year multiplied by the amount of increase in the assessed 75
valuation of any real or personal property over the assessed valuation 76
during the preceding fiscal year, which real or personal property (i) shall 77
become subject to the tax under chapter 204 of the general statutes for 78
the first time or taxed as a separate parcel for the first time, during the 79
then-current fiscal year, or (ii) has had an increase in its assessed 80
valuation over the preceding fiscal year, provided such increase in 81
assessed valuation is not due to revaluation of the entire municipality. 82
(2) Notwithstanding the provisions of any municipal charter, special 83
act or home rule ordinance, the legislative body of any municipality 84
may, by a two-thirds vote of the members present and voting, hold a 85
referendum to seek voter approval to levy additional taxes on real and 86
personal property by a specified amount in excess of the limit allowed 87
under subdivision (1) of this subsection. Such vote shall be by a "yes" or 88
"no" vote on paper ballots or on the voting machines of the municipality. 89
The question submitted to the voters shall be: "Shall the ____ (insert 90
name of the taxing entity) be allowed to levy an additional $____ (insert 91
the amount) in real and personal property taxes for the purposes of ____ 92
(insert the intended purpose or purposes for which the moneys from the 93
levy will be used) for the fiscal year commencing July 1, ____ (insert the 94
year)?". The proposal shall be deemed approved if a majority of the 95
voters casting votes thereon cast "yes" votes. 96
(e) Notwithstanding the provisions of any municipal charter, special 97
act or home rule ordinance, if a majority of the legislative body of any 98
municipality shall so require or on application of at least fifty voters, 99
such legislative body shall call a meeting, in accordance with the 100
provisions of section 7-7 of the general statutes, to submit a question to 101
voters whether to require the municipality to reduce the taxes levied by 102
a specified amount below the limit allowed under subsection (d) of this 103
section. Such vote shall be by a "yes" or "no" vote on paper ballots or on 104
the voting machines of the municipality. The question submitted to the 105
voters shall be: "Shall the ____ (insert name of the taxing entity) be 106
required to reduce the amount of real and personal property taxes to be 107 Raised Bill No. 6655
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assessed for the fiscal year commencing July 1, ____ (insert the year) by 108
an amount equal to $____ (insert the amount)?". The proposal shall be 109
deemed approved if a majority of the voters casting votes thereon cast 110
"yes" votes and the tax levy shall be decreased accordingly. 111
(f) (1) Notwithstanding the provisions of any municipal charter, 112
special act or home rule ordinance, the legislative body of any 113
municipality may, by a two-thirds vote of the members present and 114
voting, place a question on the ballot: 115
(A) At any regular or special state or municipal election held before 116
the setting of the annual tax rate, for voter approval to levy additional 117
taxes on real and personal property by a specified amount in excess of 118
the limit allowed under subsection (b) or (d) of this section for capital 119
outlay expenditures, provided such expenditures may only be 120
authorized under this subdivision for a municipal purpose for which 121
the municipality would be authorized to borrow money under the 122
provisions of title 7 of the general statutes. Such vote shall be by a "yes" 123
or "no" vote on paper ballots or on the voting machines of the 124
municipality. The question submitted to the voters shall be: "Shall the 125
____ (insert name of the taxing entity) be allowed to levy an additional 126
$____ (insert the amount) in real and personal property taxes for the 127
purposes of ____ (insert the intended purpose or purposes for which the 128
moneys from the levy will be used) for the fiscal year commencing July 129
1, ____ (insert the year)?". The proposal shall be deemed approved if a 130
majority of the voters casting votes thereon cast "yes" votes; 131
(B) At any regular or special state or municipal election, for voter 132
approval to levy additional taxes on real and personal property in excess 133
of the limit allowed under subsection (b) or (d) of this section for debt 134
payments that are outstanding as of July 1, 2022. Such vote shall be by a 135
"yes" or "no" vote on paper ballots or on the voting machines of the 136
municipality. The question submitted to the voters shall be: "Shall ____ 137
(insert the municipality) be allowed to exempt from ____'s (insert 138
municipality) levy limit the total amounts required to pay for bonded 139
indebtedness incurred prior to July 1, 2022?". The proposal shall be 140 Raised Bill No. 6655
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deemed approved if a majority of the voters casting votes thereon cast 141
"yes" votes; and 142
(C) At any regular or special state or municipal election, for voter 143
approval to levy additional taxes on real and personal property in excess 144
of the limit allowed under subsection (b) or (d) of this section for debt 145
payments incurred on or after July 1, 2022. Such vote shall be by a "yes" 146
or "no" vote on paper ballots or on the voting machines of the 147
municipality. The question submitted to the voters shall be: "Shall ____ 148
(insert the municipality) be allowed to exempt from ____'s (insert 149
municipality) levy limit the total amounts required to pay for the bonds 150
issued in order to ____ (insert the purpose or purposes for which the 151
moneys from the bonds issued will be used)?". The proposal shall be 152
deemed approved if a majority of the voters casting votes thereon cast 153
"yes" votes. 154
(2) The amounts exempted and additional taxes levied under 155
subdivision (1) of this subsection and subsection (h) of this section shall 156
be excluded from the calculation of the total tax levied under subsection 157
(b) of this section or the maximum levy amount under subsection (d) of 158
this section. 159
(g) The legislative body of any municipality may direct that the 160
question or questions authorized for a referendum under this section be 161
placed on the ballot at any regular or special state or municipal election 162
or may call a meeting in accordance with the provisions of section 7-7 of 163
the general statutes to submit such question or questions to voters. 164
(h) Notwithstanding the provisions of this section or any municipal 165
charter, special act or home rule ordinance, the legislative body of any 166
municipality may levy additional taxes in excess of the maximum limit 167
under subsection (b) or (d) of this section solely for the payment, in 168
whole or in part, of water or sewer debt charges, provided the aggregate 169
amount of water and sewer charges are reduced by the aggregate 170
amount of any such additional taxes levied. In the case of a municipality 171
whose water and sewer service is provided by an independent 172 Raised Bill No. 6655
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commission, authority or district that separately bills water and sewer 173
users, the municipality may enter into an agreement with such 174
commission, authority or district to effectuate the purposes of this 175
subsection. The tax collector or the treasurer of the municipality shall 176
immediately pay over the taxes collected pursuant to this subsection, 177
without appropriation by the municipality, to such commission, 178
authority or district, less any amounts agreed upon by the parties for 179
administrative costs incurred in carrying out the agreement. Nothing in 180
this subsection shall be construed to affect the eligibility of such 181
commission, authority or district to receive loans and grants for water 182
pollution control projects or eligible drinking water projects. 183
(i) Notwithstanding the provisions of this section, the legislative body 184
of any municipality may adjust the limit allowed under subsection (b) 185
or (d) of this section to counterbalance the effects of extraordinary, 186
nonrecurring events that occurred during the base year that were not 187
within the purview of normal municipal financial practices and would 188
otherwise cause a limit to be set that would be inconsistent with the 189
limits intended under this section, provided notice of any such 190
adjustment is provided to voters, in writing, and explained in detail. 191
Sec. 2. (NEW) (Effective from passage) Notwithstanding the provisions 192
of any municipal charter, special act or home rule ordinance, any 193
municipality may impose, by ordinance, a local tax on income, goods, 194
services or other tangible or intangible assets, or any combination 195
thereof, as determined by the legislative body of the municipality to be 196
desirable or necessary to meet the public services and other needs of the 197
municipality. No such tax shall be effective until notice has been 198
provided to the residents of the municipality and the general public 199
about the imposition of such tax, through the posting of information on 200
the municipality's Internet web page and other appropriate means, as 201
determined by the legislative body of the municipality. Such ordinance 202
shall include, but not be limited to, the specific items or amounts on 203
which such tax will be imposed, the rate and effective date of such tax, 204
the rate of interest and penalty imposed on the amount of such tax that 205
is delinquent, the method of collection and remittance of such tax and 206 Raised Bill No. 6655
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the provisions for a taxpayer's right of appeal. 207
Sec. 3. (NEW) (Effective July 1, 2021) (a) (1) Each municipality that 208
enters into an interlocal agreement, on or after July 1, 2021, with one or 209
more municipalities pursuant to section 7-148cc of the general statutes, 210
for the provision of a service that each such municipality currently 211
provides separately shall be eligible for a grant in the following amounts 212
for each year such municipality remains a party to such agreement and 213
the applicable service is provided on a regional basis: 214
(A) For the provision of education, ten per cent of the amount 215
budgeted for education in the municipality's most recently approved 216
budget; 217
(B) For the provision of police services, fire-fighting services or 218
emergency medical services, five per cent of the amount budgeted in the 219
municipality's most recently approved budget and attributable to the 220
specific service being provided on a regional basis; and 221
(C) For the provision of any other service, two and one-half per cent 222
of the amount budgeted in the municipality's most recently approved 223
budget and attributable to the specific service being provided on a 224
regional basis. 225
(2) Any municipality eligible to receive a grant under subdivision (1) 226
of this subsection may receive more than one grant under said 227
subdivision. Any grant received under this section shall be in addition 228
to any other grants or funds such municipality is eligible to receive. 229
(b) Each municipality eligible to receive a grant under subsection (a) 230
of this section shall submit an application annually to the Secretary of 231
the Office of Policy and Management, in such form and manner as the 232
secretary prescribes. The application shall include, but not be limited to, 233
a description of the specific service being provided on a regional basis, 234
the other municipality or municipalities that are a party to the 235
agreement entered into under subsection (a) of this section and 236
documentation of the amount budgeted in the municipality's most 237 Raised Bill No. 6655
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recently approved budget and attributable to the specific service being 238
provided on a regional basis. The secretary shall review each application 239
to verify the provision of the service claimed in such application and 240
calculate the amount of the grant or grants due to a municipality under 241
this section. Payment of such grants shall be made from the municipal 242
revenue sharing account established under section 4-66l of the general 243
statutes, as amended by this act. 244
(c) Any municipality that terminates or withdraws from an 245
agreement entered into under subsection (a) of this section or otherwise 246
ceases to provide a service on a regional basis shall be ineligible to 247
receive a grant under this section commencing with the fiscal year in 248
which such termination or withdrawal occurred. 249
(d) Any provision of a municipal charter, special act or home rule 250
ordinance that prohibits or limits a municipality from sharing services 251
with other municipalities are hereby repealed, revoked and rescinded. 252
(e) Any collective bargaining unit may enter into an agreement with 253
one or more collective bargaining units to establish a coalition 254
bargaining unit to negotiate with municipalities for the provision of 255
public services on a regional basis, including, but not limited to, 256
education, police services, fire-fighting services and emergency medical 257
services. 258
Sec. 4. Subsection (b) of section 4-66l of the general statutes, as 259
amended by section 6 of public act 21-3, is repealed and the following is 260
substituted in lieu thereof (Effective July 1, 2021): 261
(b) There is established an account to be known as the "municipal 262
revenue sharing account" which shall be a separate, nonlapsing account 263
within the General Fund. The account shall contain any moneys 264
required by law to be deposited in the account. The secretary shall set 265
aside and ensure availability of moneys in the account in the following 266
order of priority and shall transfer or disburse such moneys as follows: 267
(1) Ten million dollars for the fiscal year ending June 30, 2016, shall 268 Raised Bill No. 6655
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be transferred not later than April fifteenth for the purposes of grants 269
under section 10-262h; 270
(2) For the fiscal year ending June 30, 2018, and each fiscal year 271
thereafter, moneys sufficient to make motor vehicle property tax grants 272
payable to municipalities pursuant to subsection (c) of this section shall 273
be expended not later than August first annually by the secretary; 274
(3) For the fiscal year ending June 30, 2022, and each fiscal year 275
thereafter, moneys sufficient to make the grants payable pursuant to 276
subsection (d) of section 12-18b, as amended by [this act] public act 21-277
3, shall be expended by the secretary; 278
(4) For the fiscal years ending June 30, 2018, and June 30, 2019, 279
moneys sufficient to make the municipal revenue sharing grants 280
payable to municipalities pursuant to subdivision (2) of subsection (d) 281
of this section shall be expended not later than October thirty-first 282
annually by the secretary; 283
(5) For the fiscal year ending June 30, 2018, and each fiscal year 284
thereafter, seven million dollars shall be expended for the purposes of 285
the regional services grants pursuant to subsection (e) of this section to 286
the regional councils of governments; 287
(6) For the fiscal year ending June 30, 2018, and each fiscal year 288
thereafter, moneys may be expended for the purpose of supplemental 289
motor vehicle property tax grants pursuant to subsection (c) of this 290
section; [and] 291
(7) For the fiscal year ending June 30, 2022, and each fiscal year 292
thereafter, moneys sufficient to make the grants payable to 293
municipalities pursuant to subsection (c) of section 3 of this act; and 294
[(7)] (8) For the fiscal year ending June 30, 2020, and each fiscal year 295
thereafter, moneys in the account remaining shall be expended annually 296
by the secretary for the purposes of the municipal revenue sharing 297
grants established pursuant to subsection (f) of this section. Any such 298 Raised Bill No. 6655
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moneys deposited in the account for municipal revenue sharing grants 299
between October first and June thirtieth shall be distributed to 300
municipalities on the following October first and any such moneys 301
deposited in the account between July first and September thirtieth shall 302
be distributed to municipalities on the following January thirty-first. 303
Any municipality may apply to the Office of Policy and Management 304
on or after July first for early disbursement of a portion of such grant. 305
The Office of Policy and Management may approve such an application 306
if it finds that early disbursement is required in order for a municipality 307
to meet its cash flow needs. No early disbursement approved by said 308
office may be issued later than September thirtieth. 309
This act shall take effect as follows and shall amend the following
sections:
Section 1 July 1, 2022 New section
Sec. 2 from passage New section
Sec. 3 July 1, 2021 New section
Sec. 4 July 1, 2021 4-66l(b)
Statement of Purpose:
To limit property tax increases, authorize municipalities to impose local
taxes and incentivize municipal regionalization of services.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
underlined.]