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General Assembly Substitute Bill No. 6655
January Session, 2021
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
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 Substitute Bill No. 6655
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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
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 subdivisions 44
(2) and (3) 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 Substitute Bill No. 6655
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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
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 Substitute Bill No. 6655
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(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 subdivision (1) of 103
subsection (d) of this section. Such vote shall be by a "yes" or "no" vote 104
on paper ballots or on the voting machines of the municipality. The 105
question submitted to the voters shall be: "Shall the ____ (insert name of 106
the taxing entity) be required to reduce the amount of real and personal 107
property taxes to be assessed for the fiscal year commencing July 1, ____ 108
(insert the year) by an amount equal to $____ (insert the amount)?". The 109
proposal shall be deemed approved if a majority of the voters casting 110
votes thereon cast "yes" votes and the tax levy shall be decreased 111
accordingly. 112
(f) (1) Notwithstanding the provisions of any municipal charter, 113
special act or home rule ordinance, the legislative body of any 114
municipality may, by a two-thirds vote of the members present and 115 Substitute Bill No. 6655
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voting, place a question on the ballot: 116
(A) At any regular or special state or municipal election held before 117
the setting of the annual tax rate, for voter approval to levy additional 118
taxes on real and personal property by a specified amount in excess of 119
the limit allowed under subsection (b) or subdivision (1) of subsection 120
(d) of this section for capital outlay expenditures, provided such 121
expenditures may only be authorized under this subdivision for a 122
municipal purpose for which the municipality would be authorized to 123
borrow money under the provisions of title 7 of the general statutes. 124
Such vote shall be by a "yes" or "no" vote on paper ballots or on the 125
voting machines of the municipality. The question submitted to the 126
voters shall be: "Shall the ____ (insert name of the taxing entity) be 127
allowed to levy an additional $____ (insert the amount) in real and 128
personal property taxes for the purposes of ____ (insert the intended 129
purpose or purposes for which the moneys from the levy will be used) 130
for the fiscal year commencing July 1, ____ (insert the year)?". The 131
proposal shall be deemed approved if a majority of the voters casting 132
votes thereon cast "yes" votes; 133
(B) At any regular or special state or municipal election, for voter 134
approval to levy additional taxes on real and personal property in excess 135
of the limit allowed under subsection (b) or subdivision (1) of subsection 136
(d) of this section for debt payments that are outstanding as of July 1, 137
2022. Such vote shall be by a "yes" or "no" vote on paper ballots or on the 138
voting machines of the municipality. The question submitted to the 139
voters shall be: "Shall ____ (insert the municipality) be allowed to 140
exempt from ____'s (insert municipality) levy limit the total amounts 141
required to pay for bonded indebtedness incurred prior to July 1, 2022?". 142
The proposal shall be deemed approved if a majority of the voters 143
casting votes thereon cast "yes" votes; and 144
(C) At any regular or special state or municipal election, for voter 145
approval to levy additional taxes on real and personal property in excess 146
of the limit allowed under subsection (b) or subdivision (1) of subsection 147
(d) of this section for debt payments incurred on or after July 1, 2022. 148 Substitute Bill No. 6655
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Such vote shall be by a "yes" or "no" vote on paper ballots or on the 149
voting machines of the municipality. The question submitted to the 150
voters shall be: "Shall ____ (insert the municipality) be allowed to 151
exempt from ____'s (insert municipality) levy limit the total amounts 152
required to pay for the bonds issued in order to ____ (insert the purpose 153
or purposes for which the moneys from the bonds issued will be used)?". 154
The proposal shall be deemed approved if a majority of the voters 155
casting votes thereon cast "yes" votes. 156
(2) The amounts exempted and additional taxes levied under 157
subdivision (1) of this subsection and subsection (h) of this section shall 158
be excluded from the calculation of the total tax levied under subsection 159
(b) of this section or the maximum levy amount under subdivision (1) 160
of subsection (d) of this section. 161
(g) The legislative body of any municipality may direct that the 162
question or questions authorized for a referendum under this section be 163
placed on the ballot at any regular or special state or municipal election 164
or may call a meeting in accordance with the provisions of section 7-7 of 165
the general statutes to submit such question or questions to voters. 166
(h) Notwithstanding the provisions of this section or any municipal 167
charter, special act or home rule ordinance, the legislative body of any 168
municipality may levy additional taxes in excess of the maximum limit 169
under subsection (b) or subdivision (1) of subsection (d) of this section 170
solely for the payment, in whole or in part, of water or sewer debt 171
charges, provided the aggregate amount of water and sewer charges are 172
reduced by the aggregate amount of any such additional taxes levied. In 173
the case of a municipality whose water and sewer service is provided by 174
an independent commission, authority or district that separately bills 175
water and sewer users, the municipality may enter into an agreement 176
with such commission, authority or district to effectuate the purposes of 177
this subsection. The tax collector or the treasurer of the municipality 178
shall immediately pay over the taxes collected pursuant to this 179
subsection, without appropriation by the municipality, to such 180
commission, authority or district, less any amounts agreed upon by the 181 Substitute Bill No. 6655
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parties for administrative costs incurred in carrying out the agreement. 182
Nothing in this subsection shall be construed to affect the eligibility of 183
such commission, authority or district to receive loans and grants for 184
water pollution control projects or eligible drinking water projects. 185
(i) Notwithstanding the provisions of this section, the legislative body 186
of any municipality may adjust the limit allowed under subsection (b) 187
or subdivision (1) of subsection (d) of this section to counterbalance the 188
effects of extraordinary, nonrecurring events that occurred during the 189
base year that were not within the purview of normal municipal 190
financial practices and would otherwise cause a limit to be set that 191
would be inconsistent with the limits intended under this section, 192
provided notice of any such adjustment is provided to voters, in writing, 193
and explained in detail. 194
Sec. 2. (NEW) (Effective from passage) Notwithstanding the provisions 195
of any municipal charter, special act or home rule ordinance, any 196
municipality may impose, by ordinance, a local tax on income, goods, 197
services or other tangible or intangible assets, or any combination 198
thereof, as determined by the legislative body of the municipality to be 199
desirable or necessary to meet the public services and other needs of the 200
municipality. No such tax shall be effective until notice has been 201
provided to the residents of the municipality and the general public 202
about the imposition of such tax, through the posting of information on 203
the municipality's Internet web page and other appropriate means, as 204
determined by the legislative body of the municipality. Such ordinance 205
shall include, but not be limited to, the specific items or amounts on 206
which such tax will be imposed, the rate and effective date of such tax, 207
the rate of interest and penalty imposed on the amount of such tax that 208
is delinquent, the method of collection and remittance of such tax and 209
the provisions for a taxpayer's right of appeal. 210
Sec. 3. (NEW) (Effective July 1, 2021) (a) (1) Each municipality that 211
enters into an interlocal agreement, on or after July 1, 2021, with one or 212
more municipalities pursuant to section 7-148cc of the general statutes, 213
for the provision of a service that each such municipality currently 214 Substitute Bill No. 6655
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provides separately shall be eligible for a grant in the following amounts 215
for each year such municipality remains a party to such agreement and 216
the applicable service is provided on a regional basis: 217
(A) For the provision of education, ten per cent of the amount 218
budgeted for education in the municipality's most recently approved 219
budget; 220
(B) For the provision of police services, fire-fighting services or 221
emergency medical services, five per cent of the amount budgeted in the 222
municipality's most recently approved budget and attributable to the 223
specific service being provided on a regional basis; and 224
(C) For the provision of any other service, two and one-half per cent 225
of the amount budgeted in the municipality's most recently approved 226
budget and attributable to the specific service being provided on a 227
regional basis. 228
(2) Any municipality eligible to receive a grant under subdivision (1) 229
of this subsection may receive more than one grant under said 230
subdivision. Any grant received under this section shall be in addition 231
to any other grants or funds such municipality is eligible to receive. 232
(b) Each municipality eligible to receive a grant under subsection (a) 233
of this section shall submit an application annually to the Secretary of 234
the Office of Policy and Management, in such form and manner as the 235
secretary prescribes. The application shall include, but not be limited to, 236
a description of the specific service being provided on a regional basis, 237
the other municipality or municipalities that are a party to the 238
agreement entered into under subsection (a) of this section and 239
documentation of the amount budgeted in the municipality's most 240
recently approved budget and attributable to the specific service being 241
provided on a regional basis. The secretary shall review each application 242
to verify the provision of the service claimed in such application and 243
calculate the amount of the grant or grants due to a municipality under 244
this section. Payment of such grants shall be made from the municipal 245 Substitute Bill No. 6655
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revenue sharing account established under section 4-66l of the general 246
statutes, as amended by this act. 247
(c) Any municipality that terminates or withdraws from an 248
agreement entered into under subsection (a) of this section or otherwise 249
ceases to provide a service on a regional basis shall be ineligible to 250
receive a grant under this section commencing with the fiscal year in 251
which such termination or withdrawal occurred. 252
(d) Any provision of a municipal charter, special act or home rule 253
ordinance that prohibits or limits a municipality from sharing services 254
with other municipalities is hereby repealed, revoked and rescinded. 255
(e) Any collective bargaining unit may enter into an agreement with 256
one or more collective bargaining units to establish a coalition 257
bargaining unit to negotiate with municipalities for the provision of 258
public services on a regional basis, including, but not limited to, 259
education, police services, fire-fighting services and emergency medical 260
services. 261
Sec. 4. Subsection (b) of section 4-66l of the general statutes, as 262
amended by section 6 of public act 21-3, is repealed and the following is 263
substituted in lieu thereof (Effective July 1, 2021): 264
(b) There is established an account to be known as the "municipal 265
revenue sharing account" which shall be a separate, nonlapsing account 266
within the General Fund. The account shall contain any moneys 267
required by law to be deposited in the account. The secretary shall set 268
aside and ensure availability of moneys in the account in the following 269
order of priority and shall transfer or disburse such moneys as follows: 270
(1) Ten million dollars for the fiscal year ending June 30, 2016, shall 271
be transferred not later than April fifteenth for the purposes of grants 272
under section 10-262h; 273
(2) For the fiscal year ending June 30, 2018, and each fiscal year 274
thereafter, moneys sufficient to make motor vehicle property tax grants 275 Substitute Bill No. 6655
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payable to municipalities pursuant to subsection (c) of this section shall 276
be expended not later than August first annually by the secretary; 277
(3) For the fiscal year ending June 30, 2022, and each fiscal year 278
thereafter, moneys sufficient to make the grants payable pursuant to 279
subsection (d) of section 12-18b, as amended by [this act] public act 21-280
3, shall be expended by the secretary; 281
(4) For the fiscal years ending June 30, 2018, and June 30, 2019, 282
moneys sufficient to make the municipal revenue sharing grants 283
payable to municipalities pursuant to subdivision (2) of subsection (d) 284
of this section shall be expended not later than October thirty-first 285
annually by the secretary; 286
(5) For the fiscal year ending June 30, 2018, and each fiscal year 287
thereafter, seven million dollars shall be expended for the purposes of 288
the regional services grants pursuant to subsection (e) of this section to 289
the regional councils of governments; 290
(6) For the fiscal year ending June 30, 2018, and each fiscal year 291
thereafter, moneys may be expended for the purpose of supplemental 292
motor vehicle property tax grants pursuant to subsection (c) of this 293
section; [and] 294
(7) For the fiscal year ending June 30, 2022, and each fiscal year 295
thereafter, moneys sufficient to make the grants payable to 296
municipalities pursuant to subsection (b) of section 3 of this act; and 297
[(7)] (8) For the fiscal year ending June 30, 2020, and each fiscal year 298
thereafter, moneys in the account remaining shall be expended annually 299
by the secretary for the purposes of the municipal revenue sharing 300
grants established pursuant to subsection (f) of this section. Any such 301
moneys deposited in the account for municipal revenue sharing grants 302
between October first and June thirtieth shall be distributed to 303
municipalities on the following October first and any such moneys 304
deposited in the account between July first and September thirtieth shall 305
be distributed to municipalities on the following January thirty-first. 306 Substitute Bill No. 6655
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Any municipality may apply to the Office of Policy and Management 307
on or after July first for early disbursement of a portion of such grant. 308
The Office of Policy and Management may approve such an application 309
if it finds that early disbursement is required in order for a municipality 310
to meet its cash flow needs. No early disbursement approved by said 311
office may be issued later than September thirtieth. 312
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 Legislative Commissioners:
Throughout Section 1, references to subsection (d) were changed to
"subdivision (1) of subsection (d)" for clarity; in Section 1 (c)(1),
"subdivision (2)" was changed to "subdivisions (2) and (3)" for accuracy;
and in Section 4(b)(7), "(c)" was changed to "(b)" for accuracy.
FIN Joint Favorable Subst. -LCO