OFFICE OF FISCAL ANALYSIS
Legislative Office Building, Room 5200
Hartford, CT 06106 (860) 240-0200
http://www.cga.ct.gov/ofa
sSB-626
AN ACT ESTABLISHING AN ENTERPRISE ZONE IN THE TOWN
OF PLYMOUTH.
Primary Analyst: DD 3/30/21
Contributing Analyst(s): MM, AN
OFA Fiscal Note
State Impact:
Agency Affected Fund-Effect FY 22 $ FY 23 $
Policy & Mgmt., Off. GF - Cost None See Below
Note: GF=General Fund
Municipal Impact:
Municipalities Effect FY 22 $ FY 23 $
Plymouth Grand List
Reduction
None See Below
Plymouth Revenue
Gain
None See Below
Explanation
The bill designates the Town of Plymouth as an Enterprise Zone,
which entitles certain businesses within the zone to certain corporate
and property tax breaks.
There is a potential grand list reduction to Plymouth due to
multiple five-year property tax breaks of between 40% and 80%,
depending on the type of business, and type of investment
undertaken. This potential grand list reduction results in a revenue
loss, given a constant mill rate. Due to the timing of grand list
assessments, any revenue loss would first occur in FY 23.
Any revenue loss to Plymouth resulting from these exemptions is
partially offset by the Distressed Municipalities grant program, which
reimburses municipalities for 50% of the tax loss resulting from these 2021SB-00626-R000232-FN.DOCX Page 2 of 2
exemptions, for a five-year period. The bill results in an increased cost
to OPM to fully fund the grant program, which will vary based on the
revenue loss claimed by the Town of Plymouth. While the grant is
proportionately reduced when the appropriation or bond
authorization is insufficient for full funding, the grant is currently fully
funded.
1
The Out Years
The annualized ongoing fiscal impact identified above would
continue into the future subject to any grand list reductions
experienced by the Town of Plymouth as a result of any Enterprise
Zone property tax exemptions.
1
FY 21 funding sources for the Distressed Municipalities grant program include 1) a
prior year bond authorization of $2.9 million, 2) a FY 21 bond authorization of $7
million, and 3) a $1.5 million General Fund appropriation. The cost to fully fund this
grant in FY 21 is $6.3 million.