OFFICE OF FISCAL ANALYSIS
Legislative Office Building, Room 5200
Hartford, CT 06106 (860) 240-0200
http://www.cga.ct.gov/ofa
sSB-456
AN ACT ESTABLISHING A PILOT PROGRAM FOR THE
DEVELOPMENT AND IMPLEMENTATION OF TEN -YEAR PLANS
TO ERADICATE CONCENTRATED POVERTY IN THE STATE.
Primary Analyst: EW 4/22/24
Contributing Analyst(s): LG, EMG, CR
Reviewer: MM
OFA Fiscal Note
State Impact:
Agency Affected Fund-Effect FY 25 $ FY 26 $
Department of Economic &
Community Development
GF - Cost 1.26 million 1.26 million
State Comptroller - Fringe
Benefits
1
GF - Cost 520,000 520,000
Treasurer, Debt Serv. GF - Potential
Cost
See Below See Below
Note: GF=General Fund
Municipal Impact:
Municipalities Effect FY 25 $ FY 26 $
Various Municipalities Potential
Revenue
Gain
See Below See Below
Various Municipalities Potential
Cost
See Below See Below
Explanation
The bill results in an annualized cost of $1.8 million to the state by
establishing a pilot program to eradicate concentrated poverty.
Specifically, the bill creates the Office of Neighborhood Investment and
Community Engagement in the Department of Economic and
1
The fringe benefit costs for most state employees are budgeted centrally in accounts
administered by the Comptroller. The estimated active employee fringe benefit cost
associated with most personnel changes is 41.25% of payroll in FY 25. 2024SB-00456-R000587-FN.DOCX Page 2 of 4
Community Development (DECD) to administer the pilot program and,
in effect, requires the formal establishment of the Office of Community
Economic Development Assistance in DECD which was enacted under
PA 22-118 but never created to date.
The bill also makes several changes to three DECD bond programs
which may result in future debt services costs being incurred more
rapidly than otherwise would have been.
The bill allows community development corporations (CDCs) to
bring action in court against a municipal official for not meeting the
requirements of the bill which results in a potential cost to
municipalities. The bill also prioritizes certain projects under existing
grant programs which may result in a potential revenue gain to
municipalities to the extent that they are awarded grants for qualifying
projects.
Office of Neighborhood Investment and Community Engagement
The bill creates the Office of Neighborhood Investment and
Community Engagement (ONICE) within DECD and requires ONICE
to develop 10-year plans in the pilot program to eradicate concentrated
poverty in the four municipalities with the highest number of
concentrated poverty census tracts (Bridgeport, Hartford, New Haven,
and Waterbury).
The establishment and administration of ONICE is anticipated to cost
DECD $1.1 million annually. This includes 8 positions at a total salary
cost of $770,000 plus $313,500 in fringe benefit costs and $10,000 in other
expenses to administer the 10-year plans under the pilot program. The
bill restricts the use of bond funds to support this cost, and no bonds are
authorized or proposed for this purpose. The bill is therefore anticipated
to impact DECD’s General Fund appropriations.
Office of Community Economic Development Assistance
DECD will also be required to formally create the Office of
Community Economic Development Assistance (OCEDA) in order to 2024SB-00456-R000587-FN.DOCX Page 3 of 4
implement the provisions of this bill. The bill requires any participating
municipality in the pilot program to have a Community Development
Corporation certified by OCEDA. Under the bill, OCEDA must also
provide consultation to ONICE in the development of the 10-year plans.
The establishment and administration of OCEDA is anticipated to
cost DECD $698,000 annually. This includes five positions at a total
salary cost of $494,000 plus $204,000 in fringe benefit costs. Current law
permits the use of funds from the bond authorization for OCEDA to
support the administration of OCEDA, however no funds have been
allocated to date.
2
GO Bond Program Impacts
In addition to the changes to OCEDA noted above, the bill also makes
changes to the Community Investment Fund and High Poverty-Low
Opportunity Census Tract programs, which are funded with General
Obligation (GO) bonds. As with OCEDA, future General Fund debt
service costs may be incurred sooner under the bill to the degree that it
causes authorized GO bond funds for these programs to be expended or
to be expended more rapidly than they otherwise would have been. The
bill does not change GO bond authorizations relevant to the programs.
Municipal Impact
The bill results in a potential cost to various municipalities to the
extent they are brought to court by a CDC for failure to carry out a
requirement. There is also a potential revenue gain to various
municipalities to the extent that they qualify for additional grants to
fund projects in poverty census tracts, public investment communities,
or alliance districts.
The Out Years
The annualized ongoing fiscal impact identified above would
2
The current available bond balance for the Office of Community Economic
Development Assistance is $50 million. 2024SB-00456-R000587-FN.DOCX Page 4 of 4
continue into the future subject to inflation and subject to the terms of
any bonds issued.