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OLR Bill Analysis
HB 6671
Emergency Certification
AN ACT CONCERNING FUNDING FOR SCHOOL LUNCHES AND A
CENTER FOR SUSTAINABLE AVIATION, SPECIAL EDUCATION
FUNDING, CERTAIN BOTTLE DEPOSITS, CERTAIN STATE
POSITIONS AND THE POSTING OF STATE JOB OPENINGS AND
BOND COVENANT RESTRICTIONS AND THE BUDGET RESERVE
FUND.
TABLE OF CONTENTS:
SUMMARY
§ 1 — ARPA ALLOCATION ADJUSTMENTS
Reallocates $60 million in FY 23 ARPA funds allocated to OPM for Invest Connecticut to
SDE for free school meals for students
§§ 2-5 — CENTER FOR SUSTAINABLE AVIATION AT UCONN
Requires (1) UConn to participate in an application for federal funding under the U.S.
Department of Energy's Regional Clean Hydrogen Hubs program to create and operate a
center for sustainable aviation and (2) DECD to provide UConn with a maximum $20
million grant for this purpose if the university is awarded, and accepts, the federal
funding
§§ 6 & 7 — UCONN 2000 INFRASTRUCTURE PROGRAM
Reduces the bond authorization for UConn 2000 by $12 million
§§ 8-10 — DISTRIBUTION OF SPECIAL EDUCATION EXCESS COST
GRANT AND STATE-AGENCY PLACEMENT EXCESS COST GRANTS
Raises the state grant reimbursement for each of the three tiers for towns in the special
education excess cost grant; places two other grants related to state agency-placed
students under the same tiered method; and creates a method for distributing the special
education excess cost grant when the existing tier method is used but results in
unexpended appropriations
§ 11 — BOTTLE BILL EXEMPTIONS
Exempts certain beverage products from the state’s beverage container redemption law
§ 12 — LIMIT ON EXECUTIVE ASSISTANTS
Prohibits the appointment of more than two executive assistants per deputy department
head in departments that have at least two deputies
§ 13 — STATE EMPLOYEE CANDIDATE LISTS FOR THE CLASSIFIED
SERVICE 2023HB-06671-R00-BA.DOCX
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Allows the DAS commissioner, under certain circumstances, to place people on candidate
lists for state employee classified service positions regardless of statutory requirements
that might otherwise apply
§ 14 — BOND COVENANT TIED TO STATE FISCAL CONTROLS
Requires the state treasurer to include a pledge to bondholders in GO and credit revenue
bonds issued from July 1, 2023, to June 30, 2025, that the state will comply with specified
fiscal controls, except under limited circumstances; generally requires that the pledge
apply through FY 33 unless the General Assembly adopts a resolution by June 30, 2028,
not to continue it beyond FY 28
§ 15 — BUDGET RESERVE FUND
Beginning July 1, 2024, increases the BRF’s maximum balance from 15% to 18% of net
General Fund appropriations and specifies how surplus funds must be diverted when the
BRF’s balance is at least 15% but less than the 18% maximum
§ 16 — CAP ON GENERAL FUND AND STF APPROPRIATIONS
Freezes the cap on General Fund and STF appropriations at 98.75% of estimated revenues
(i.e., the “revenue cap”), beginning in FY 24
§§ 17 & 18 — BONDING CAPS
Beginning in FY 24, requires that the bond allocation cap be calculated on a fiscal year,
rather than calendar year, basis and sets the cap amount at $2.4 billion for FY 24; aligns
the bond issuance cap to the allocation cap by increasing it to $2.4 billion for FY 24;
eliminates the bond allotment cap but replaces it with a similar cap; excludes specified debt
from the state’s debt limit and certain bond cap calculations
§§ 17-19 — GO BONDS FOR TRANSPORTATION PROJECTS
Eliminates an obsolete law authorizing the State Bond Commission to allocate up to $500
million in state GO bonds for transportation projects in 2018 and 2019
SUMMARY
A section-by-section analysis follows.
EFFECTIVE DATE: Various effective dates; see below.
§ 1 — ARPA ALLOCATION ADJUSTMENTS
Reallocates $60 million in FY 23 ARPA funds allocated to OPM for Invest Connecticut to
SDE for free school meals for students
The bill adjusts federal American Rescue Plan Act (ARPA) funding
allocations for FY 23 by reducing the allocation to the Office of Policy
and Management (OPM) for Invest Connecticut by $60 million and
allocating these funds to the State Department of Education (SDE) for
free school meals for students (increasing the current allocation from $30
million to $90 million). 2023HB-06671-R00-BA.DOCX
Researcher: SM Page 3 2/9/23
EFFECTIVE DATE: Upon passage
§§ 2-5 — CENTER FOR SUSTAINABLE AVIATION AT UCONN
Requires (1) UConn to participate in an application for federal funding under the U.S.
Department of Energy’s Regional Clean Hydrogen Hubs program to create and operate a
center for sustainable aviation and (2) DECD to provide UConn with a maximum $20
million grant for this purpose if the university is awarded, and accepts, the federal
funding
Application for Federal Funding
The bill requires the University of Connecticut (UConn) to submit, or
participate in submitting, a proposal for federal funding under the U.S.
Department of Energy’s (DOE’s) Regional Clean Hydrogen Hubs
program (see Background) to establish, develop, and operate a center
for sustainable aviation. If UConn is awarded, and accepts, this funding,
the bill requires it to (1) notify the Department of Community and
Economic Development (DECD) and (2) establish the center, including
at least one facility on the Storrs campus. The bill requires UConn to
consult with DECD in completing these requirements.
DECD Funding
The bill reduces the Department of Social Service’s FY 23 Medicaid
appropriation by $12 million, from $3,036,265,362 to $3,024,265,362, and
correspondingly increases DECD’s FY 23 appropriation for “other
expenses” by $12 million, from $721,676 to $12,721,676. Under the bill,
DECD must make the additional $12 million available for UConn’s
center for sustainable aviation. The bill specifies that any unexpended
balance of this funding will not lapse at the end of FY 23 and must be
available for expenditure toward the center during FY 24. Additionally,
the bill earmarks $8 million in previously authorized Manufacturing
Assistance Act bond funds for a DECD grant to UConn for establishing,
developing, and operating the center.
Under the bill, DECD must provide a grant to UConn within 90 days
after receiving notice from the university that it was awarded, and has
accepted, federal funding to establish the center for sustainable aviation.
The grant must be equal to the lesser of (1) the state’s share of the
center’s capital costs, as determined by the DECD commissioner and
pursuant to the proposal and final award, or (2) $20 million. 2023HB-06671-R00-BA.DOCX
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EFFECTIVE DATE: Upon passage
Background — Regional Clean Hydrogen Hubs Program
DOE’s Office of Clean Energy Demonstrations’ Regional Clean
Hydrogen Hubs program will provide up to $7 billion to establish six to
10 regional clean hydrogen hubs across the United States. The funding
will go to projects that demonstrate the production, processing,
delivery, storage, and end-use of clean hydrogen through regional clean
hydrogen hubs.
§§ 6 & 7 — UCONN 2000 INFRASTRUCTURE PRO GRAM
Reduces the bond authorization for UConn 2000 by $12 million
The bill reduces the total bond authorization for the UConn 2000
infrastructure program by $12 million, from $3.295 billion to $3.283
billion. It makes a corresponding change to reduce the FY 25 bond cap
by the same amount (from $56 million to $44 million).
EFFECTIVE DATE: Upon passage
§§ 8-10 — DISTRIBUTION OF SPECIAL EDUCAT ION EXCESS COST
GRANT AND STATE -AGENCY PLACEMENT EXCESS COST
GRANTS
Raises the state grant reimbursement for each of the three tiers for towns in the special
education excess cost grant; places two other grants related to state agency-placed
students under the same tiered method; and creates a method for distributing the special
education excess cost grant when the existing tier method is used but results in
unexpended appropriations
By law, local and regional boards of education may apply to the state
for a special education “excess cost grant.” This grant reimburses the
board for the cost of special education services that exceed four-and-a-
half times the average cost of educating a student in the district during
the prior fiscal year. When the state’s fiscal year appropriation for the
special education excess cost grant is less than the amount necessary to
completely fund the payable grants as required by law, it triggers a
reduced excess cost grant reimbursement formula.
Under current law, this formula groups towns in three tiers
depending upon their respective adjusted equalized net grand list per
capita (AENGLPC). Generally speaking, the formula calculates reduced 2023HB-06671-R00-BA.DOCX
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grants for local boards of education using these three tiers as follows:
boards from towns in the group that have (1) the lowest AENGLPC
receive a higher percentage of their full excess cost grant, (2) a mid-range
AENGLPC receive a slightly lower percentage, and (3) the highest
AENGLPC receive the lowest percentage.
The bill increases the reimbursement percentage for each of the tiers,
bringing each board’s excess cost grant amount closer to the fully
funded amount required by law.
The bill also expands the tiered grant formula to apply to two
additional grants when state appropriations are insufficient: (1) excess
special education costs for state agency-placed students under a
temporary custody order (CGS § 10-76d(e)(2)) and (2) excess regular
education costs for state-placed children educated at private residential
facilities (CGS § 10-253(b)(3)).
Finally, it creates an additional method for distributing the special
education excess cost grant when there are excess state-appropriated
funds remaining after the tiered formula is used. The bill also applies
this new excess fund distribution method to the two categories of grants
for state-agency placed students identified above.
The bill also makes technical and conforming changes.
EFFECTIVE DATE: Upon passage
Excess Cost Grants
Current law establishes, beginning with FY 23, the reimbursement
formula for boards of education when the state appropriation does not
fully fund the excess cost grants as they are determined under statute.
It creates three reimbursement tiers based on each town’s AENGLPC.
(Prior to FY 23, the law proportionately reduced the grant for all towns.)
The law requires the State Board of Education (SBE) to rank the towns
in descending order from one to 169 according to each town’s
AENGLPC. It then groups the ranked towns into three tiers by highest,
lower, and lowest AENGLPC. SBE must pay the grants to each eligible 2023HB-06671-R00-BA.DOCX
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town’s operating local school district based on the reimbursement
percentage assigned to its respective tier.
Tiered Reimbursement Percentages Increased. The bill increases
each tier’s reimbursement percentage to provide school boards at each
tier with a larger grant. The current law’s and the bill’s percentages are
shown in the table below.
Table: Excess Cost Grant Reimbursement Rates for Three Tiers of Towns by
AENGLPC
Tier Group Based on
AENGLPC Ranking
Town’s Eligible Excess Cost Reimbursement Percentage
Current Law (%) (Bill %)
1 to 58 highest 70.00 85.00
59 to 114 middle 73.00 88.00
115 to 169 lowest 76.25 91.00
Additionally, if the grants payable to school boards calculated under
the tiered formula still exceed the state-appropriated amount available,
then the bill requires the payable amount to be reduced proportionally.
By law and unchanged by the bill, the ranking for regional boards of
education is determined by a process that considers the total population
of each town in the regional district and each member town’s
AENGLPC ranking.
Additional Grants Brought Under Tiered Reimbursement
Formula. The bill also expands the tiered method to apply to two
additional grants: (1) special education costs for state agency-placed
students under a temporary custody order and (2) excess regular
education costs for state-placed children educated at private residential
facilities. Under current law, if the appropriation for these grants is not
enough to meet the amount payable to school boards by law, then the
grant amounts are reduced proportionately.
New Grant Mechanism. The bill creates an additional four-step
formula when the fiscal year appropriation exceeds the total grant
amount payable under the three-tiered system. Once the three-tiered
formula is used to distribute grants, any amount remaining would be 2023HB-06671-R00-BA.DOCX
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distributed using the bill’s four-step formula. Under the bill, the
remaining state-appropriated funds are distributed to school boards
through the following steps:
1. Subtract the sum of all the grants paid to school boards in the
fiscal year under the three-tiered method from the sum of all the
following grants calculated by law for (a) special education
excess cost, (b) state agency-placed students under a temporary
custody order, (c) excess regular education costs for state-placed
children educated at private residential facilities, and (d)
students receiving special education services from a private
residential institution for whom no responsible school board can
be determined by law (i.e., “no-nexus students”).
2. Subtract the sum of all grants paid to school boards in the fiscal
year under the excess cost grant from the total amount
appropriated for the same grant.
3. Divide the amount calculated under step (2) by the amount
calculated under step (1).
4. To determine the amount of the excess to distribute to each school
board, multiply the amount calculated under step (1) that is
attributable to the school board by the percentage calculated
under step (3).
The bill specifies that any grant paid in accordance with a no-nexus
student in a public agency placement does not count toward this
calculation (conforming with the excess cost grant that also does not
count grants for those placements). Generally, the state pays for all of
the special education costs for these students.
§ 11 — BOTTLE BILL EXEMPTIONS
Exempts certain beverage products from the state’s beverage container redemption law
The bill exempts certain beverage products from the state’s beverage
container redemption law (“bottle bill”). The state’s bottle bill generally
requires a deposit to be charged on each covered beverage container at
the time of purchase, which is then refunded to the consumer when 2023HB-06671-R00-BA.DOCX
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returning the empty container to the retailer or a redemption center.
Under the bill, the following beverage products are exempt from the
bottle bill: (1) carbonated and non-carbonated products with wine or
spirits and (2) non-carbonated food for special dietary use and medical
food, as defined under federal law.
Under federal law, “food for special dietary use” includes food that
supplies (1) a special dietary need due to a physical, physiological,
pathological, or other condition (e.g., disease, convalescence,
pregnancy, infancy, weight); (2) a vitamin, mineral, or other ingredient
to supplement a person’s diet; or (3) a special dietary need due to a food
being the only item of the diet (21 U.S.C. § 350(c)(3)). “Medical food” is
food that is (1) formulated to be consumed or administered enterally
(i.e., via the gastrointestinal tract) under a doctor’s supervision and (2)
intended for the specific dietary management of a disease or condition
(21 U.S.C. § 360ee(b)(3)).
EFFECTIVE DATE: Upon passage
§ 12 — LIMIT ON EXECUTIVE ASSISTANTS
Prohibits the appointment of more than two executive assistants per deputy department
head in departments that have at least two deputies
The bill prohibits the Department of Administrative Services (DAS)
commissioner and OPM secretary from approving more than two
executive assistants for each deputy (presumably, deputy department
head) for any department that has at least two deputies. By law,
unchanged by the bill, executive assistants to department heads are
exempt from the state classified service (i.e., not subject to various civil
service procedures and requirements).
EFFECTIVE DATE: Upon passage
§ 13 — STATE EMPLOYE E CANDIDATE LISTS FO R THE
CLASSIFIED SERVICE
Allows the DAS commissioner, under certain circumstances, to place people on candidate
lists for state employee classified service positions regardless of statutory requirements
that might otherwise apply
The law generally requires the DAS commissioner to hold civil 2023HB-06671-R00-BA.DOCX
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service exams to establish candidate lists of people qualified for
positions in the state employee classified service. Regardless of this or
any other state statutes, the bill allows the commissioner to place people
on a candidate list for the various classified service position classes if
she finds that posting job openings is warranted to provide regular,
updated candidate pools for specific examined and non-examined
positions.
EFFECTIVE DATE: Upon passage
§ 14 — BOND COVENANT TIED TO STATE FISCAL CONTROLS
Requires the state treasurer to include a pledge to bondholders in GO and credit revenue
bonds issued from July 1, 2023, to June 30, 2025, that the state will comply with specified
fiscal controls, except under limited circumstances; generally requires that the pledge
apply through FY 33 unless the General Assembly adopts a resolution by June 30, 2028,
not to continue it beyond FY 28
The bill requires the state treasurer to include a pledge to
bondholders in general obligation (GO) and credit revenue bonds
issued from July 1, 2023, to June 30, 2025 (i.e., FYs 24 and 25), that the
state will comply with specified fiscal controls, except under limited
circumstances. Under the bill, this pledge applies through FY 33 unless
the General Assembly adopts a resolution by June 30, 2028, not to
continue it beyond FY 28. The bill’s pledge does not apply to refunding
bonds issued to pay the original bonds.
By law, a similar five-year pledge (i.e., “bond lock”) applies to bonds
issued from May 15, 2018, to June 30, 2020 (see Background).
EFFECTIVE DATE: July 1, 2023
Applicable Laws
The bill expressly requires the state to comply with the following
laws for each fiscal year during which the pledge applies:
1. Budget Reserve Fund (BRF) law, as amended by the bill (see §
15), including the volatility cap (see Background);
2. statutory spending cap (see Background); 2023HB-06671-R00-BA.DOCX
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3. cap on General Fund and Special Transportation Fund
appropriations, as amended by the bill (i.e., the “revenue cap”)
(see § 16);
4. bond allocation cap, as amended by the bill (see § 17);
5. specified procedural requirements under the GO bond act (see
Background);
6. the debt limit law, as amended by the bill, including provisions
requiring that bond bills and Bond Commission resolutions have
debt certifications attached to them certifying that the bonds will
not cause the state to exceed the debt limit (see § 18);
7. the bond issuance cap, as amended by the bill (see § 18); and
8. the bill’s bond allotment limit (see § 18).
Pledge and Exceptions
For GO and credit revenue bonds issued in FYs 24 and 25, the bill
pledges to bondholders that the state will not enact any laws taking
effect from (1) July 1, 2023, to June 30, 2028, and (2) except as described
below, July 1, 2028, to June 30, 2033, that change the state’s obligation to
comply with the above laws unless the following requirements are met:
1. bondholders are protected in another way or
2. (a) the governor declares an emergency or the existence of
extraordinary circumstances in which he invokes his statutory
authority to reduce appropriated accounts (CGS § 4-85); (b) at
least three-fifths of the members of each house of the General
Assembly approve the change in compliance; and (c) the change
is limited to the fiscal year in progress.
With respect to the second five-year period described above (i.e., July
1, 2028, to June 30, 2033), the pledge applies to laws taking effect during
this timeframe unless the General Assembly adopts a resolution by June
30, 2028, not to continue the pledge beyond that date. 2023HB-06671-R00-BA.DOCX
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Background
Bond Lock. For state GO or credit revenue bonds issued from May
15, 2018, to June 30, 2020, the state treasurer has pledged to bondholders
that the state will not enact any laws taking effect from May 15, 2018, to
June 30, 2023, that change the state’s obligation to comply with the (1)
BRF law, including the volatility cap; (2) revenue cap; (3) statutory
spending cap; (4) debt limit law; (5) caps on GO and credit revenue bond
allocations, issuances, and allotments; and (6) specified procedural
requirements under the GO bond act. The pledge applies for five years
from the bonds’ first issuance date but not to refunding bonds issued to
pay the original bonds (CGS § 3-20(aa)).
Volatility Cap. The law requires the treasurer to transfer to the BRF
any revenue the state receives each fiscal year in excess of $3.15 billion
(annually adjusted for the five-year average growth in personal income)
from personal income tax estimated and final payments (generated from
taxpayers who make estimated income tax payments on a quarterly
basis) and the pass-through entity tax. For FY 23, the adjusted threshold
is $3.63 billion.
The legislature may amend the threshold amount, by a vote of three-
fifths of the members of each house, due to changes in state or federal
tax law or policy or significant adjustments to economic growth or tax
collections (CGS § 4-30a(a)).
Spending Cap. The statutory spending cap prohibits the legislature
from authorizing an increase in “general budget expenditures” for any
fiscal year that exceeds the greater of the percentage increase in (1)
personal income over the preceding five calendar years or (2) inflation
over the previous calendar year, unless the governor declares an
emergency or the existence of extraordinary circumstances and at least
three-fifths of the members of each house approve the extra expenditure
for those purposes
GO Bond Act. The GO Bond Act sets various procedural
requirements for the state’s issuance of GO bonds. The pledge that the
state treasurer must issue under the bill applies to requirements that, 2023HB-06671-R00-BA.DOCX
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among other things, (1) the State Bond Commission authorize bonds by
resolutions adopted by a majority vote, (2) these bond resolutions be
accompanied by specified information and filings and not exceed the
allocation cap, (3) Bond Commission agendas be made available to
members at least five days in advance, and (4) bonds allocated by the
Bond Commission be deemed an appropriation and allocation of the
amount authorized and subject to allotment by the governor and any
authorization otherwise required (CGS § 3-20(g)).
§ 15 — BUDGET RESERV E FUND
Beginning July 1, 2024, increases the BRF’s maximum balance from 15% to 18% of net
General Fund appropriations and specifies how surplus funds must be diverted when the
BRF’s balance is at least 15% but less than the 18% maximum
Existing law establishes the BRF and requires that it contain any (1)
unappropriated General Fund surplus at the end of each fiscal year and
(2) revenue exceeding the volatility cap (described above).
Current law caps the BRF’s maximum balance at 15% of net General
Fund appropriations for the current fiscal year and requires the state
treasurer to transfer any remaining General Fund surplus, as he
determines to be in the state’s best interests, to reduce either the State
Employee Retirement System’s (SERS) or Teachers’ Retirement System’s
(TRS) unfunded liability by up to 5%. Beginning July 1, 2024, the bill (1)
increases the BRF’s maximum balance to 18% of net General Fund
appropriations for the current fiscal year and (2) requires that surplus
funds be transferred as follows when the BRF’s balance equals or
exceeds 15% but is less than the 18% cap:
1. half must be transferred to the BRF, up to the 18% cap, and
2. half must be deemed appropriated to SERS or TRS, as described
above.
Under the bill, once the BRF reaches the 18% cap, any remaining
General Fund surplus is deemed appropriated to SERS and TRS, as
under current law. By law, unchanged by the bill, any surplus that
remains after the maximum appropriation to SERS and TRS (i.e., 5% of
each system’s unfunded liability) is deemed appropriated, as the 2023HB-06671-R00-BA.DOCX
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treasurer determines to be in the state’s best interests, for additional
payments to either retirement system or to paying off other specified
forms of outstanding state debt.
EFFECTIVE DATE: July 1, 2023
§ 16 — CAP ON GENERAL FUND AND STF APPROPR IATIONS
Freezes the cap on General Fund and STF appropriations at 98.75% of estimated revenues
(i.e., the “revenue cap”), beginning in FY 24
Existing law prohibits the legislature from authorizing General Fund
and Special Transportation Fund (STF) appropriations for any fiscal
year that, in the aggregate, exceed a specified percentage of the
estimated revenues included in the budget act (i.e., the statement of
estimated revenues, supplied by the Finance, Revenue and Bonding
Committee, that is based on the most recent consensus revenue
estimates). Under current law, the percentage decreases in steps of 0.25
percentage points from 99.5% in FY 20 to 98% in FY 26 and thereafter
(for FY 23, it is 98.75%). The bill freezes the percentage at 98.75%
beginning in FY 24.
By law, unchanged by the bill, the legislature may authorize
appropriations that exceed the applicable percentage if either of the
following conditions is met:
1. the governor declares an emergency or the existence of
extraordinary circumstances, at least three-fifths of the members
of each legislative chamber vote to exceed the percentage, and the
appropriation is limited to the fiscal year in progress or
2. the General Assembly approves the appropriation, by majority
vote, for an adjusted appropriation and revenue plan.
EFFECTIVE DATE: July 1, 2023
§§ 17 & 18 — BONDING CAPS
Beginning in FY 24, requires that the bond allocation cap be calculated on a fiscal year,
rather than calendar year, basis and sets the cap amount at $2.4 billion for FY 24; aligns
the bond issuance cap to the allocation cap by increasing it to $2.4 billion for FY 24;
eliminates the bond allotment cap but replaces it with a similar cap; excludes specified debt
from the state’s debt limit and certain bond cap calculations 2023HB-06671-R00-BA.DOCX
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Bond Allocation Cap (§ 17)
Current law caps the amount of GO and credit revenue bonds the
State Bond Commission may authorize (i.e., allocate) in any calendar
year at $2 billion, annually adjusted for inflation (the inflation-adjusted
cap is currently estimated at $2.379 billion for 2023). The bill instead (1)
requires that the cap be calculated on a fiscal year basis, beginning in FY
24; (2) sets the cap at $2.4 billion for FY 24; and (3) specifies that current
law’s calendar year cap applies through June 30, 2023. As under current
law, the bill requires that the cap be annually adjusted for inflation
based on the change in the Bureau of Labor Statistics’ consumer price
index for all urban consumers for the preceding calendar year, less food
and energy.
Bond Issuance Cap (§ 18)
Current law caps the amount of GO and credit revenue bonds the
state treasurer may issue in any fiscal year at $1.9 billion, annually
adjusted for inflation (the inflation-adjusted cap is currently estimated
at $2.09 billion for FY 23). The bill increases the cap to $2.4 billion
beginning in FY 24, aligning it with the $2.4 billion allocation cap set by
the bill (see above). As under current law, the bill requires that the cap
be annually adjusted for inflation using the same index described above
for the allocation cap.
Additionally, the bill excludes from the issuance cap calculation any
debt issued to fund state budget deficits for any fiscal year. By law,
unchanged by the bill, the calculation already excludes specified debt
(e.g., bonds issued as part of the CSCU 2020 (Connecticut State Colleges
and Universities) or UConn 2000 infrastructure programs and
refunding bonds), as well as debt issued to meet cash flow needs or
cover natural disaster emergencies.
Bond Allotment Cap (§ 18)
The bill eliminates the cap on the amount of GO and credit revenue
bonds for which the governor may approve allotment requisitions (i.e.,
expenditures) in any fiscal year. Instead, it prohibits the governor from
approving GO or credit revenue bond allotments that exceed the bill’s
$2.4 billion issuance cap described above. The bill excludes from the 2023HB-06671-R00-BA.DOCX
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allotment calculation any debt issued to fund state budget deficits for
any fiscal year. Under current law, the cap is $1.9 billion, annually
adjusted for inflation, with the same exclusions as the issuance cap.
The bill also eliminates related provisions requiring the:
1. state treasurer to annually provide the governor with a list of
allocated but unissued bonds (i.e., bonds authorized by the
legislature and allocated by the State Bond Commission but not
yet issued by the treasurer);
2. governor to annually provide the treasurer with a list of GO and
credit revenue bond expenditures of up to $1.9 billion, annually
adjusted for inflation, that may be made on the following July 1;
and
3. governor to post both lists on his office’s website.
Debt Limit (§ 18)
The law prohibits the legislature from authorizing General Fund-
supported debt that exceeds 1.6 times the estimated net General Fund
tax receipts for the fiscal year of authorization, with certain exclusions.
The bill additionally excludes the following from the state’s debt limit
calculation:
1. any debt authorized and issued to fund any state budget deficits
for any fiscal year;
2. any accumulated deficit determined on the basis of generally
accepting accounting principles (GAAP), prescribed by the
Governmental Accounting Standards Board;
3. debt authorized under any statute or public or special act that, by
its terms, is not effective until a future date (but it must be
included once the applicable provisions take effect); and
4. debt authorized and issued under an emergency or extraordinary
circumstances declaration issued by the Governor if at least
three-fifths of the members of each legislative chamber vote to 2023HB-06671-R00-BA.DOCX
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authorize the debt.
Under current law, debt issued to finance specified budget deficits
(e.g., the 2009 Economic Recovery Notes) is already excluded from the
debt limit calculation. The bill eliminates these specific exclusions to
conform with the broader exclusion described above.
By law, the debt limit calculation already excludes certain types of
debt, including debt incurred in anticipation of receiving revenue and
bonds issued for the Teachers’ Retirement System’s unfunded liability.
The bill also makes technical changes.
EFFECTIVE DATE: July 1, 2023
§§ 17-19 — GO BONDS FOR TRANSPORTATION PROJECTS
Eliminates an obsolete law authorizing the State Bond Commission to allocate up to $500
million in state GO bonds for transportation projects in 2018 and 2019
The bill eliminates an obsolete law authorizing the State Bond
Commission to allocate up to $500 million in state GO bonds for
transportation projects in 2018 and 2019. (The Bond Commission never
allocated these bonds.) It also eliminates related provisions (1)
exempting these transportation GO bonds from the state’s debt limit
and bond allocation and issuance cap calculations and (2) deeming any
bond authorizations for GO or special tax obligation (STO) bonds to
have authorized these bonds to be issued as either GO or STO bonds.
EFFECTIVE DATE: July 1, 2023