Planning and Development Committee

JOINT FAVORABLE REPORT

Bill No.:

HB-7185

Title:

AN ACT EXEMPTING LEASED MUNICIPAL PROPERTY FROM TAXATION.

Vote Date:

3/17/2017

Vote Action:

Joint Favorable

PH Date:

3/3/2017

File No.:

396

SPONSORS OF BILL:

Planning and Development Committee

REASONS FOR BILL:

To exempt leased municipal property from taxation. As municipalities rely more and more on leased property as a cost saving mechanism to upkeep, they find that they must cut checks to their contracted companies for municipal property taxes only to then receive this money back from the company. Some argue this is a waste of time and effort for municipal employees and ultimately a drain of resources on the taxpayer.

RESPONSE FROM ADMINISTRATION/AGENCY:

None expressed

NATURE AND SOURCES OF SUPPORT:

Town of Windham:

The town of Windham stated support for the bill. They lease a fleet of electric motor vehicles. Each year the assessor values them and adds them to the Grand List, out Tax Collector must create and issue bills, collect and post the payments, after having paid the bills to the town, the leasing company bills our finance department and the town of Windham cuts a check to the leasing company in the exact amount that they paid us. The town loses money on this current system because of these expenses.

The Connecticut Conference of Municipalities (CCM):

This bill is common sense solution that will save towns and cities time and money, by exempting real and personal property that is leased to a town and used for a public service from taxation. The payment of these taxes are built into the contract entered into by a municipality and thus towns and cities are losing money through the assessing, billing and processing these tax payments which are then reimbursed to the lessor.

Jennifer Sullivan, Legislative Committee Member (CCMA, CAAO):

Jennifer Sullivan submitted testimony in support of HB 7185. She stated that public property that is used for public use is not taxable, but leased property that is used for public use is. She states that this bureaucratic anomaly should be fixed.

Town of Mansfield, Hart Matt Town Manager:

This bill is a simple and common sense solution that would save towns and cities time and money, with no revenue loss. It would cut red tape by exempting real and personal property that is leased to a town and used for a public service.

John Chaponis, David Dietsch, Connecticut Association of Assessing Officers(CAAO):

CT Association of Assessing Officers supports this bill. They state that the municipalities are paying taxes to itself if they have leased properties.

Town of Colchester Maggie Cosgrove, CFO:

This bill will reduce cost of town (bill processing, postage/mailing, cost of using the property). It will free up cost of employee resources so they may better serve the public.

Other Sources of Support:

Connecticut Council of Small Towns, (COST) Dube, Kathryn

Town of Andover Robert Burbank, First Selectman

Town of Trumbull, Paul Gormon Assistant Assessor

Town of Bethel, Ann Marie Heering, Assessor

Town of Watertown, Donna Murphy, Assessor

Town of Colchester, Art Shilosky, First Selectman

Town of Middlefield, Retired Assessor, Steven Hodgetts

CCMA, Melinda Kronfield

NATURE AND SOURCES OF OPPOSITION:

None Expressed

Reported by: Rita Okyere Darko

Date: 04/04/2017