OFFICE OF FISCAL ANALYSIS
Legislative Office Building, Room 5200
Hartford, CT 06106 (860) 240-0200
http://www.cga.ct.gov/ofa
sHB-5476
AN ACT CONCERNING THE PROVISION OF PARTIAL FEE
REDUCTIONS BY MUNICIPAL STORMWATER AUTHORITIES
AND THE INCLUSION OF HEATING, VENTILATING AND AIR
CONDITIONING SYSTEMS IN SCHOOL BUILDING PROJECT
GRANT PAYMENTS.
Primary Analyst: DD 4/20/22
Contributing Analyst(s): EMG
OFA Fiscal Note
State Impact:
Agency Affected Fund-Effect FY 23 $ FY 24 $
Treasurer, Debt Serv. GF - Cost Significant Significant
Note: GF=General Fund
Municipal Impact:
Municipalities Effect FY 23 $ FY 24 $
Municipal Stormwater
Authorities
See Below See Below See Below
Local and Regional School
Districts
Potential
Cost/Revenue
See Below See Below
Explanation
The bill 1) expands the types of fee reductions that municipal
stormwater authorities must provide to properties in their districts and;
2) makes installing, replacing, or repairing heating, ventilation, or air
conditioning systems eligible for emergency school building project
grants.
The bill results in a significant cost to the state and potential cost and
revenue gain to municipalities. It does so by expanding allowable non-
priority list expenses for school building projects to include installation,
remediation, and replacement of HVAC systems.
The school construction program is funded using General Obligation 2022HB-05476-R000572-FN.DOCX Page 2 of 3
(GO) bonds, in two large tracts: priority list projects (i.e., larger projects
approved in legislation) and non-priority list projects. Non-priority list
projects currently include emergency items, such as fire or catastrophe
damage, leaking roofs, or code violations. The bill expands the non-
priority list projects to include HVAC installation, replacement, and
repair.
Non-priority list projects are allowed at the discretion of the
Commissioner of Administrative Services within available resources of
the program. As of April 1, 2022, the unallocated bond balance available
under the school construction authorization is $636 million, with
another $550 million effective under current law to start FY 23. The bill
is expected to result in an increase in the use of GO bond funds for non-
priority list reimbursable expenses, which would expedite anticipated
debt service from existing bond authorizations.
The bill does not change GO bond authorizations relevant to the
program. However, those funds are necessary to support both priority
list and non-priority list projects. The most recent estimate by DAS
indicated approximately $2.6 billion worth of outstanding long-term
liability for current grant commitments, to be paid over the next several
years.
1
The expanded use of current authorizations for HVAC upgrades
through the non-priority list program will necessitate increased bond
authorization for the program in the future, which will increase long-
term debt service costs.
To the extent local and regional school districts choose to pursue
additional HVAC projects allowed under the bill, there would be
increased costs and revenues to the same districts.
Specific costs from eligible projects, including the marginal increase
from expanded eligibility, can only be determined as project expenses
are incurred by municipalities and state reimbursements are sought and
1
Source: http://143ld24rzjx265ftv4dyehdx-wpengine.netdna-ssl.com/wp-
content/uploads/2021/12/CTState04a-FIN.pdf 2022HB-05476-R000572-FN.DOCX Page 3 of 3
offered.
The bill also results in a revenue loss to municipal stormwater
authorities. It is anticipated that such revenue loss would be offset by
increases in fees assessed to users who do not receive the credit under
the bill's provisions.
The Out Years
The annualized ongoing fiscal impact identified above would
continue into the future subject to inflation and the terms of any bonds
issued for the school construction program, and subject to the value of
any credits issued by municipal stormwater authorities.