You asked us to summarize the bills the Commerce Committee referred to the Finance, Revenue and Bonding Committee.

SB 203 AAC Bonds Issued by the Connecticut Development Authority and its Subsidiaries on Behalf of Municipalities for Remediation Projects

This bill makes projects involving the clean-up and productive reuse of contaminated sites eligible for bonds the Connecticut Development Authority (CDA) issues on behalf of towns. The law already allows CDA or its subsidiaries to issue these bonds for projects that develop or redevelop contaminated sites or that involve the use of information technologies.

The bill also makes it easier to finance the clean-up of property-tax-delinquent property containing vacant, underused, or deteriorated buildings. Currently, towns can tap the incremental property tax revenue the completed project generates to repay the bonds that were sold to finance the project. The law specifies how towns must calculate the additional tax revenue. The bill allows towns to reduce the amount of

taxes owed on the unimproved property, thus increasing the incremental tax revenue the improved property generates. Towns can do this only if their legislative bodies approve.

Effective Date: Upon passage

sSB 204 AAC the Small Town Economic Assistance Program

This bill increases the bond authorization for the Small Town Economic Assistance Program from $ 40 million to $ 50 million, but makes the authorization for the $ 10 million increase effective July 1, 2005.

Effective Date: July 1, 2004

sSB 207 AA Establishing a Seed Capital Fund for Early Stage Companies in the Biosciences and Software and Information Technology Industries

This bill establishes a fund to help start and develop new bioscience and information technology companies, but provides no money to it. It requires the economic and community development commissioner, by June 1, 2004, to prepare a plan for developing the fund. (The deadline for preparing the plan falls before the bill’s July 1, 2004 effective date. ) Connecticut Innovations, Inc. and one or more private managers must manage the fund, which must be established by December 31, 2004.

The fund mangers must submit annual financial reports to the legislature and the Office of Policy and Management. The first report is due March 1, 2005.

Effective Date: July 1, 2004

SSB 257 AAC the Urban and Industrial Sites Reinvestment Program

This bill makes several changes to the Urban and Industrial Sites Reinvestment Program, which provides corporate business tax credits to businesses that build, expand, or rehabilitate facilities. Businesses qualify for up to $ 100 million in credits if they plan to spend at least $ 20 million on the facility. The law caps the total amount of credits available under this program at $ 500 million.

The bill:

Effective Date: upon passage

sSB 502 AA Creating a Sales Tax Exemption for Fuel Cells and all Hydrogen and Hydrocarbon Fuel Utilizing Machinery

This bill exempts from the sales tax the sale of fuel cells and other machinery using fuel cell technology, and all related service contracts and replacement parts. The law currently exempts fuel cell manufacturers from paying sales taxes on materials, tools, fuel, machinery, and equipment they use in a facility where they make the cells.

The bill also extends, from July 1, 2004 to July 1, 2005, the expiration of a sales tax exemption for alternative fuel vehicles and related equipment.

Effective Date: Upon passage

sSB 506 AAC the Cluster and CONNSTEP Initiatives

This bill increases, from $ 4 million to $ 5 million, the bond authorization for the CONNSTEP program, which helps small manufactures adopt new, cost-saving manufacturing technologies and techniques. The bill allows CONNSTEP to use at least $ 100,000 from the proceeds to hire a national consultant to analyze the program and recommend how it can help manufacturers “become next generation manufacturers. ” The consultant must report his findings to the governor and the Commerce Committee by January 1, 2006.

Effective Date: July 1, 2004

The bill requires the Governor’s Council on Economic Competitiveness and Technology to annually forecast the needs of the state’s industry clusters and recommend policies to address those needs. The first annual forecast is due January 1, 2005. The council must consider the forecast when recommending legislative changes to the Commerce Committee.

Effective Date: Upon passage.

The bill also requires the economic and community development commissioner to show how much money he is budgeting for the industry clusters. He must submit that budget, along with recommended changes, to the Appropriations, Commerce, and Finance committees. The first budget is due December 31, 2004.

Effective Date: Upon passage

HB 5245 AAC the Research and Development Tax Credit Exchange

This bill makes permanent the law under which businesses can cash-in research and development tax credits they could not use. The law allows them to exchange the credit for cash equal to 65% of the credit’s value.

Effective Date: Upon passage and applicable to income years starting on or after January 1, 2002.

sHB 5258 AAC Authorization of Bonds of the State for Streetscape Improvements in the Town of Essex and the Morris Foundation of Waterbury

This bill authorizes $ 900,000 in bonds for streetscape improvements in Essex and $ 2. 5 million in bonds for a grant to the Morris Foundation of Waterbury. The bill does not specify how the latter may use the grant.

Effective Date: July 1, 2004

sHB 5538 AA Creating a Microloan Program for MicroEnterprises

This bill authorizes $ 100,000 in bonds for small business loans. It does so by increasing the existing bond authorization for the Manufacturing Assistance Act by $ 100,000 and allocating these funds to the program, which must be administered by the Department of Economic and Community Development (DECD).

The bill allows CEDF to lend up to $ 50,000 to new and existing businesses that employ 10 or fewer people and gross less than $ 500,000 annually. DECD can market the loans directly or through community-based nonprofit organizations. It can use the funds the bill authorizes to make up to $ 25,000 grants to these organizations for this purpose.

Effective Date: October 1, 2004

sHB 5539 AAC the Sales Tax on Hotel Occupancy

This bill requires the revenue services commissioner to segregate about 16% of the gross receipts from the sales tax collected from each lodging and to return that amount to the town where the lodging is located.

Effective Date: Upon passage

JR: nf