OFFICE OF FISCAL ANALYSIS
Legislative Office Building, Room 5200
Hartford, CT 06106 (860) 240-0200
http://www.cga.ct.gov/ofa
EMERGENCY CERTIFICATION
SB-501
AN ACT CONCERNING MOTOR VEHICLE ASSESSMENTS FOR
PROPERTY TAXATION, INNOVATION BANKS, THE INTEREST ON
CERTAIN TAX UNDERPAYMENTS, THE ASSESSMENT ON
INSURERS, SCHOOL BUILDING PROJECTS, THE SOUTH CENTRAL
CONNECTICUT REGIONAL WATER AUTHORITY CHARTER AND
CERTAIN STATE HISTORIC PRESERV ATION OFFICER
PROCEDURES.
Primary Analyst: MM 6/26/24
Contributing Analyst(s): JP, RP, JS
OFA Fiscal Note
State Impact: See Below
Municipal Impact: See Below
Explanation
Sections 1-12 make various changes to the valuation and taxation of
motor vehicles described below.
The bill increases the depreciation schedule for motor vehicles by five
percentage points for each year starting at 85% instead of 80%. This
results in a grand list increase to municipalities beginning in FY 26.
The bill also changes the minimum from $500 valued to $500 assessed
under the depreciation schedule. A vehicle valued at $500 is
approximately $350 assessed. This results in a grand list increase
beginning in FY 26 as no vehicles will have a taxable (assessed) value of
less than $500.
Under this bill, assessors must determine the method for (1) valuing
modifications and attachments to commercial vehicles and (2) the
vehicles to which these are attached. Any impact is dependent on how 2024SB-00501-R00-FN.DOCX Page 2 of 3
these modifications, attachments, and vehicles would have otherwise
been valued.
The bill also eliminates certain deadlines for the supplemental motor
vehicle tax bill. To the extent this results in some motor vehicles being
added to a different town's grand list at different points in time, there is
a potential shift of grand lists between towns. This also results in a
potential revenue gain to various municipalities associated with
increased interest charged as the due date for supplemental tax bills will
be moved up.
Certain deadlines for motor vehicle tax credits are also eliminated.
This may result in a savings to municipalities beginning in FY 25 to the
extent fewer claims are made due to the shorter deadline and less tax
credits are issued.
These sections make various other changes that do not result in a
municipal impact.
Section 13 allows municipalities to establish a mill rate for motor
vehicles (MV) equal to or lower than 32.46 mills, including zero
beginning in FY 26. This will result in a revenue loss to municipalities
that elect to lower their MV mill rate to as low as zero. However, it is
anticipated that these municipalities would adjust the mill rate for other
classes of property to make up for any revenue loss they experience
because of the lowered MV mill rate.
Sections 14-29 result in no fiscal impact by changing the name of the
uninsured bank charter to “innovation bank charter” and making
related clarifying and conforming changes to the banking statutes.
Section 30 exempts taxpayers from paying interest on
underpayments of certain taxes if the underpayment was due to an
amended return filing necessitated by Internal Revenue Service (IRS)
guidance on the federal employee retention credit. This results in a
minimal General Fund revenue loss as early as FY 25.
2024SB-00501-R00-FN.DOCX Page 3 of 3
Section 31 alters the basis for the assessment that funds the Insurance
Department and various other agencies, which has no fiscal impact
because it does not change the total amount of revenue to be collected.
Sections 32-33 make a change to school construction contracting
requirements that may impact future project costs, which in turn would
affect levels of state reimbursement and municipal revenue gain. The
impact of changes to costs for future projects on the school construction
priority list will be reflected when such projects are considered by the
legislature in the future.
Sections 34–42 allow the South Central Connecticut Regional Water
Authority (the Authority) to acquire property and assets outside their
service area, which is not anticipated to result in a municipal impact. To
the extent that the Authority acquires property or assets that are outside
said service area, it is assumed that municipalities where such property
is located will receive payments in lieu of taxes from the Authority
pursuant to CGS Sec. 12-75.
Section 43 makes modifications to procedures relating to the State
Historic Preservation Officer’s project reviews which have no fiscal
impact.
The Out Years
The potential out-years fiscal impacts are indicated in the write ups
above, as applicable.
The preceding Fiscal Impact statement is prepared for the benefit of the members of the General Assembly, solely
for the purposes of information, summarization and explanation and does not represent the intent of the General
Assembly or either chamber thereof for any purpose. In general, fiscal impacts are based upon a variety of
informational sources, including the analyst’s professional knowledge. Whenever applicable, agency data is
consulted as part of the analysis, however final products do not necessarily reflect an assessment from any
specific department.