OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 (860) 240-0200

http://www.cga.ct.gov/ofa

HB-7297

AN ACT ESTABLISHING A PRIVATE RIGHT OF ACTION IN THE DUTY TO PROMOTE FAIR HOUSING AND REQUIRING A STUDY OF CONNECTICUT'S HOUSING INVENTORY AND CURRENT AND FUTURE HOUSING NEEDS.


OFA Fiscal Note

State Impact:

Agency Affected

Fund-Effect

FY 18 $

FY 19 $

Department of Housing

GF - Cost

Potential Significant

Potential Significant

CHFA

Resources of CHFA - Cost

Potential Significant

Potential Significant

Human Rights & Opportunities, Com.

GF - Cost

70,060

70,060

State Comptroller - Fringe Benefits1

GF - Cost

26,884

26,884

Note: GF=General Fund

Municipal Impact: None

Explanation

The bill results in the fiscal impact enumerated below by section.

Section 1 results in a potential cost, which could be significant, to the Department of Housing (DOH) and to the Connecticut Housing Finance Authority (CHFA) by allowing a private right of action, or right to sue in court, in the event that DOH or CHFA do not comply with C.G.S. 8-37cc.

To the extent that a lawsuit is filed against either agency for noncompliance of this statute, there would be cost to defending agency in legal expenses as well as for compensatory and/or punitive damages in the event that the agency loses the case. The cost in a given fiscal year would depend upon the number and scope of each case.2 At an estimated rate of $350 per hour for legal services, a case involving 100 hours of legal service would cost $35,000. A complex case involving significantly more hours could result in legal costs over $100,000.

Due to the complexity and time involved with litigating a cause of action, the Commission on Human Rights and Opportunities would need to hire one Human Rights Attorney position, with an annualized salary of $70,060 plus annualized fringe benefit costs of $26,884.

Section 2 results in a one-time cost of $50,000 to the CHFA by requiring the quasi-public state agency to conduct a study analyzing the gap between state-wide housing inventory and the state's current and projected needs over fifteen years.

The study requires CHFA to look at specific demographics outlined in the bill that are currently not collected or researched by the agency. CHFA would therefore require consulting services to assist in this research and complete the study by the January 1, 2018 report date. Based on a similar housing inventory study prepared for CHFA in 2013, it is anticipated that the consulting costs would amount to $50,000.

The Out Years

The annualized ongoing fiscal impact identified above would continue into the future subject to inflation. The cost associated with Section 2 impacts FY 18 only as study must be completed by January 1, 2018.

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 38.08% of payroll in FY 18 and FY 19.

2 In FY 16, 220 housing discrimination cases were filed with CHRO.