OFFICE OF FISCAL ANALYSIS
Legislative Office Building, Room 5200
Hartford, CT 06106 (860) 240-0200
http://www.cga.ct.gov/ofa
sHB-5272
AN ACT CONCERNING THE EXPIRATION OF CERTAIN LAND
USE APPROVALS AND THE NEW HOME CONSTRUCTION
GUARANTY FUND.
Primary Analyst: ME 4/10/24
Contributing Analyst(s): LG, JP
Reviewer: PR
OFA Fiscal Note
State Impact:
Agency Affected Fund-Effect FY 25 $ FY 26 $
Consumer Protection, Dept. New Home
Construction
Guaranty Fund -
Various
See Below See Below
Consumer Protection, Dept. Consumer
Protection
Enforcement
Account -
Potential
Revenue Gain
See Below See Below
Note: GF=General Fund
Municipal Impact:
Municipalities Effect FY 25 $ FY 26 $
All Municipalities Potential
Cost
See Below See Below
Explanation
The bill makes various changes regarding the expiration of land use
approvals and the New Home Construction Guaranty Fund resulting in
the impact described below.
Sections 1-7: (1) establish an approval process under which land use
boards may shorten the deadline for developers to complete certain
ongoing projects before seeking reapproval the local land use boards, 2024HB-05272-R000440-FN.DOCX Page 2 of 3
and (2) change date ranges specified in current law during which land
use approvals qualify for an extended timeframe.
The sections result in a potential cost to municipalities beginning in
FY 25 to the extent they go through the approval process to shorten the
deadline for developers to complete certain projects as they must hold a
public hearing as part of this process.
Section 8-9 makes various changes to the New Home Construction
Guaranty Fund and the Consumer Protection Enforcement account
resulting in the following impacts.
1. The cap on the New Home Construction Guaranty Fund
1
(NHCGF) is reduced from $750,000 to $650,000 resulting in a
potential revenue loss to the fund to the extent future revenues
exceed the cap.
2. The excess transfer from NHCGF to the Consumer Protection
Enforcement account is increased from $300,000 to $400,000
resulting in a potential revenue gain to the extent excess
funding is transferred.
2
3. The maximum payment per claim from the NHCGF is
increased from $30,000 to $50,000 and consumers are allowed
to make claims against the fund if a judgement is awarded
against a controlling participant
3
resulting in a potential cost
to the fund depending on the number and size of future
claims.
4. New home construction contractors and controlling
participants are held liable for the restitution payments made
1
The New Home Construction Guaranty Fund can reimburse consumers who are
unable to collect for losses resulting from work performed by a registered new home
builder. Homeowners may be eligible to receive up to $30,000 from the fund if certain
criteria are met.
2
In FY 23 there were two restitution claims paid from the fund totaling $60,000 and
$101,000 was transferred to the Consumer Protection Enforcement Account.
3
Current law only allows for payments from the fund for judgments against
construction companies. 2024HB-05272-R000440-FN.DOCX Page 3 of 3
to consumers, resulting in a potential revenue gain to the
NHCGF to the extent violations occur and contractors and
controlling participants repay the Fund.
The Out Years
The annualized ongoing fiscal impact identified above would
continue into the future subject to the number of claims paid by the
Fund.