Connecticut Senate Bill SB01108

Connecticut 2021 Regular Session

• Introduced: 4/14/21
• Refer: 4/14/21

Caption

An Act Concerning A Connecticut New Markets Tax Credit Program.

Impact

The introduction of SB01108 is likely to have significant implications for state laws surrounding tax credits and economic incentives. By creating a structured program for low-income community investments, the bill proposes a new framework to encourage private sector engagement in community improvement efforts. This approach presents an opportunity to align the financial interests of businesses with social goals, potentially fostering a more robust economy within struggling areas.

Summary

SB01108, also known as the Connecticut New Markets Tax Credit Program, aims to stimulate economic growth in low-income communities by establishing a tax credit system. This legislation allows taxpayers to make equity investments in community development entities designated by the CHEFA Community Development Corporation. The act is set to encourage investments over two calendar years, 2022 and 2023, with a total cap of $10 million in equity investments each year. The goal is to increase funds flowing into economically disadvantaged areas and to create jobs, improve access to goods and services, and enhance environmental conditions.

Contention

While the bill has garnered support from those advocating for economic growth and community development, it is also subject to scrutiny. Critics might raise concerns about the effectiveness of tax credits in generating sustainable economic impact. There may be debates around how defined 'low-income communities' are and whether tax incentives will truly translate into long-term benefits or merely serve as temporary financial relief for struggling businesses. Additionally, issues regarding the accountability of community development entities could also arise, with calls for transparency in how investments are utilized and the actual benefits delivered to communities.