PA 17-1, June 2017 Special Session—HB 7501 (VETOED)

Emergency Certification

AN ACT CONCERNING THE STATE BUDGET FOR THE BIENNIUM ENDING JUNE 30, 2019, APPROPRIATIONS AND IMPLEMENTING PROVISIONS THEREFOR AND AUTHORIZING AND ADJUSTING BONDS OF THE STATE FOR VARIOUS PURPOSES

TABLE OF CONTENTS:

1-9 — FY 18 AND FY 19 APPROPRIATIONS

Appropriates money for state agency operations and programs for FYs 18 and 19

10-12, 14 & 15 — SPENDING REDUCTIONS AND BUDGETED LAPSES

Authorizes the Office of Policy and Management (OPM) secretary to reduce allotments for state agencies and funds to achieve specified savings and budgeted lapses

13 — ALLOTMENT INCREASES ATTRIBUTED TO DELAY IN STATE BUDGET

Authorizes the OPM secretary to increase allotments to reflect costs associated with the delay in passing a state budget

16 — FEDERAL REIMBURSEMENT FOR DEPARTMENT OF SOCIAL SERVICES (DSS) AND DEPARTMENT OF CHILDREN AND FAMILIES (DCF) PROJECTS

Authorizes DSS and DCF to establish receivables for anticipated federal reimbursement

17 — APPROPRIATIONS FOR NONFUNCTIONAL – CHANGE TO ACCRUALS

Prohibits the OPM secretary from allotting funds to such line item accounts

18 — AUTHORITY TO TRANSFER FUNDS TO AND FROM THE RESERVE FOR SALARY ADJUSTMENTS ACCOUNT

Allows the OPM secretary to transfer specified funds to implement and account for adjustments to various personal services expenses

19 — COLLECTIVE BARGAINING AGREEMENT COSTS

Carries forward the unexpended portion of appropriated funds that relate to collective bargaining agreements and related costs and requires the funds to be used for the same purposes in FYs 18 and 19

20 & 21 — APPROPRIATION TRANSFERS AND ADJUSTMENTS TO MAXIMIZE FEDERAL MATCHING FUNDS

Authorizes the governor, subject to specified conditions, to transfer or adjust agency appropriations to maximize federal matching funds

22 & 24 — TRANSFERS TO MEDICAID ACCOUNT

Authorizes the OPM secretary to transfer certain funds to DSS's Medicaid account in order to maximize federal reimbursement

23 — DSS PAYMENTS TO DEPARTMENT OF MENTAL HEALTH AND ADDICTION SERVICES (DMHAS) HOSPITALS

Specifies how DSS must spend appropriations for certain DMHAS hospital payments and how DMHAS hospitals must use the funds

25 — BIRTH-TO-THREE PROGRAM

Requires the State Department of Education (SDE) to transfer certain federal special education funds to the Office of Early Childhood (OEC) for the Birth-to-Three Program

26 — PRIORITY SCHOOL DISTRICT (PSD) GRANTS

Distributes PSD grants for FYs 18 and FY 19 across three categories

27 — DCF-LICENSED PRIVATE RESIDENTIAL TREATMENT FACILITIES

Suspends rate adjustments for DCF-licensed private residential treatment facilities

28 — DEPARTMENT OF DEVELOPMENTAL SERVICES (DDS) AND DMHAS COST SETTLEMENTS WITH PRIVATE AND NONPROFIT PROVIDERS

Requires certain private and nonprofit providers to reimburse these agencies for the difference between actual costs and the amount received from the agencies

29-31 — FUNDS CARRIED FORWARD

Carries forward unspent balances from prior years' appropriations and requires them to be used for specified purposes in FYs 18 and 19

32 — STATE EMPLOYEE RETIREMENT FUND CONTRIBUTIONS

Requires certain funds to be deposited into the fund as additional contributions

33 — PROHIBITED SPENDING REDUCTIONS

Prohibits reduction of appropriations for specified social services

34 — PROBATE COURT ADMINISTRATION FUND

Requires that the fund's balance at the end of FY 17 remain in the fund

35 & 975 — ELIMINATION OF MOTOR VEHICLE PROPERTY TAX CAP

Eliminates the motor vehicle mill rate cap

36 — FRESH START PROGRAM

Authorizes the Department of Revenue Services (DRS) commissioner to establish a fresh start program for qualified taxpayers who owe Connecticut state taxes

37 — AMBULATORY SURGICAL CENTER (ASC) TAX

Changes the base for the ASC tax to the total net revenue received by each ASC for providing specified services, rather than gross receipts

38-42 — ESTATE AND GIFT TAX

Increases the estate and gift tax threshold over three years; modifies the tax rate schedule for estates and gifts over $5.1 million and makes minor and technical changes to the estate tax

43-45 & 47 — INSURANCE PREMIUMS TAX

Reduces, from 1.75% to 1.5%, the insurance premiums tax rate and makes the tax credit cap for insurance premiums taxpayers permanent

46 — FILM AND DIGITAL MEDIA PRODUCTION TAX CREDIT

Makes permanent the moratorium on issuing film and digital media production tax credits to certain motion pictures and allows them to be claimed against the sales and use tax, but at less than face value when transferred to another taxpayer

48 — CONNECTICUT TELEVISION NETWORK (CT-N) REDUCTION

Reduces by half the amount of specified tax revenue that must be reserved for CT-N

49 — INCOME TAX ON SOCIAL SECURITY, PENSION, AND ANNUITY INCOME

Increases the income thresholds for the 100% Social Security income tax deduction and phases out the income tax on pension and annuity income for taxpayers with incomes below a specified threshold

50 — ANGEL INVESTOR TAX CREDIT

Terminates the Angel Investor Tax Credit Program as of October 1, 2017

51 — EARNED INCOME TAX CREDIT

Replaces the 30% earned income tax credit (EITC) with a graduated credit schedule ranging from 5% to 25%

52 — UTILITY COMPANIES TAX EXEMPTION ELIMINATION

Eliminates the utility companies tax exemption for earnings from sales to certain natural gas-fueled power plants

53 — MUNICIPAL VIDEO COMPETITION TRUST ACCOUNT

Beginning in FY 18, increases by $2 million the annual transfer from the municipal video competition trust account to the General Fund

54 — PUBLIC, EDUCATIONAL, AND GOVERNMENTAL PROGRAMMING AND EDUCATION TECHNOLOGY INVESTMENT ACCOUNT

Beginning in FY 18, requires $3.5 million to be transferred to the General Fund each fiscal year from the Public, Educational, and Governmental Programming and Education Technology Investment Account (PEGPETIA)

55 — ADMISSIONS TAX

Eliminates certain admissions tax exemptions

56 — REDUCING CONNECTICUT LOTTERY CORPORATION (CLC) EXPENSES

Requires CLC to reduce its expenses for the next two fiscal years

57 — RECORD CHECK FEE INCREASES

Increases, by $25, fees for certain record searches

58 — DOCUMENT RECORDING FEE

Increases, from $3 to $10, the document recording fee charged to generate revenue for preserving historic documents and modifies the fee revenue distribution

59 & 60 — URGENT CARE CENTERS AND OUTPATIENT CLINICS

Requires urgent care centers to be licensed as outpatient clinics starting April 1, 2018 and authorizes DSS to establish payment rates for these centers; requires outpatient clinics to renew their license every three year instead of every four years

61 — PUBLIC WATER SYSTEM LICENSURE

Requires water companies to obtain a DPH license to operate a community public water system or non-transient non-community public water system

62 & 982 — NEWBORN SCREENING ACCOUNT

Eliminates, on July 1, 2018, the newborn screening account and transfers any money from it into the General Fund for DPH to use for newborn health screening services in FY 18

63 & 64 — REGIONAL PLANNING INCENTIVE ACCOUNT

Eliminates the revenue diversion to the Regional Planning Incentive Account

63 & 64 — MUNICIPAL REVENUE SHARING ACCOUNT (MRSA) DIVERSION

Eliminates the revenue diversion to MRSA

63 & 64 — SALES AND USE TAX REVENUE DIVERSION FROM CERTAIN MOTOR VEHICLE SALES

Beginning in FY 21, phases in, over five years, a revenue diversion to the STF of sales and use tax revenue from motor vehicle sales

63-67 — MARKETING, CULTURE, AND TOURISM FUNDING

Establishes an account to fund tourism-related visitor services, promote the arts, and preserve and promote historic resources

68 — CIVIL PENALTIES FOR NURSING AND RESIDENTIAL CARE HOMES

Increases the maximum civil penalties for nursing and residential care homes for class A and class B violations; changes the definition of a class B violation

69 & 70 — TOBACCO SETTLEMENT FUND DISTRIBUTIONS

Eliminates certain disbursements from the Tobacco Settlement Fund

71 — SMART START ACCOUNT TRANSFER

Transfers balance in the Smart Start Account to the General Fund

72, 75-77, 100-107 & 156 — TRANSFERS TO GENERAL FUND

Transfers funds from various sources to the General Fund for FYs 18 and 19

73 — FY 20 GAAP DEFICIT

Deems that $1 is appropriated in FY 20 to pay off the state's GAAP deficit for FYs 13 and 14

74 — PROPERTY TAX CREDIT

Limits eligibility for the property tax credit against the personal income tax to seniors and taxpayers with dependents

78 — HIGHWAY RIGHT-OF-WAY ENCROACHMENT FEES

Requires the DOT commissioner, by January 1, 2018, to set fees for certain applications for right-of-way encroachment permits to mirror the fees Massachusetts DOT charges for similar permits

79 — EMISSIONS ENTERPRISE FUND

Reduces, by $250,000, the amount of money the comptroller must transfer quarterly from the Special Transportation Fund to the Emissions Enterprise Fund

80 — CONNECTICUT AIRPORT AND AVIATION ACCOUNT

Creates the “Connecticut airport and aviation account” to fund airport and aviation related purposes and requires the DRS commissioner to deposit into it 75.3% of the amount the state receives from the petroleum products gross earnings tax on aviation fuel

81 — GREEN BUILDING TAX CREDIT

Sunsets the green building tax credit beginning October 1, 2017

82 — FY 19 GENERAL FUND REVENUE

Allows the comptroller to designate $37 million of FY 18 General Fund resources as FY 19 General Fund revenue

83 — REDUCTION OF THE ANNUAL AMOUNT OF TAX CREDITS AVAILABLE UNDER THE NEIGHBORHOOD ASSISTANCE ACT (NAA) PROGRAM

Reduces, from $10 million to $5 million, the annual cap on NAA tax credits

84, 975 & 978 — REPEAL OF MUNICIPAL SPENDING CAP, MUNICIPAL REVENUE SHARING ACCOUNT (MRSA), AND RELATED PROVISIONS

Eliminates the municipal spending cap and the Municipal Revenue Sharing Account and grant distributions from it

85 — GRANTS AND PAYMENTS IN LIEU OF TAXES FOR TIER 3 DISTRICTS AND MUNICIPALITIES

Prohibits, regardless of existing law, any tier three district or municipality from receiving a grant in lieu of taxes or the additional payment in lieu of taxes in either FY 18 or FY 19

86 — STATE AGENCIES TO REVIEW FEES

Requires (1) agency heads to determine whether the fees their agencies charge cover program administration costs and (2) OPM to recommend fee increases to the legislature

87 — HOSPITAL TAX

Phases out the hospital tax over five years, starting in FY 20; beginning in FY 18, authorizes a credit against the hospital tax in any fiscal year in which supplemental Medicaid payments to hospitals are reduced from the amount appropriated in the budget act for that fiscal year

88 & 89 — COMPTROLLER'S ANALYSIS OF OPM MONTHLY STATEMENTS

Requires the comptroller to analyze OPM's monthly revenue and expenditure statements

90 & 91 — CONSENSUS REVENUE ESTIMATES DEADLINE

Moves up the deadline by which OPM and the Office of Fiscal Analysis (OFA) must annually issue consensus revenue estimates

92-94 & 515-517 — CAP ON GENERAL OBLIGATION (GO) BOND ALLOCATIONS AND ISSUANCES

Places a $2 billion cap on the amount of GO bonds the (1) State Bond Commission may allocate each calendar year starting January 1, 2017 and (2) treasurer may issue each fiscal year starting July 1, 2018; requires both caps to be adjusted annually for inflation

92, 95, 515 & 519 — GO BONDS FOR TRANSPORTATION PROJECTS

Requires the State Bond Commission to authorize GO bonds each calendar year for transportation projects, subject to annual caps

96 & 97 —CSCU 2020 INFRASTRUCTURE PROGRAM

Defers $55 million in FY 18 bonding to FY 20 and authorizes an additional $11.7 million in bonding for FY 20 (but see 389 & 390)

98 & 99 — UCONN 2000 INFRASTRUCTURE PROGRAM

Reduces bond authorizations by $99.1 million and extends the program by two years (but see 393 & 394)

108 — PLAN TO TRANSFER JUVENILE JUSTICE PROGRAMS FROM DCF TO THE JUDICIAL BRANCH'S COURT SUPPORT SERVICES DIVISION (CSSD)

Requires DCF and CSSD to submit a plan to the legislature to transfer certain juvenile justice programs and services from DCF to CSSD

109-111 — 90-DAY TURNAROUND FOR CERTAIN PERMITS

Deems certain state agency permit applications approved if the relevant agency does not make a determination on them within 90 days after receiving them

112-114 — SCHOOL CONSTRUCTION PROGRAM AND PROTOTYPE SCHOOL DESIGNS (IDENTICAL TO 505-507)

Requires towns to choose between three design prototypes when seeking the highest level of state school cost reimbursement for new construction and makes other changes

115 — SCHOOL CONSTRUCTION APPLICATIONS AND DAS REPORT TO THE LEGISLATURE (IDENTICAL TO 508)

Requires school districts to indicate on their school construction applications whether they considered one of the prototype designs and adds additional enrollment reporting and other requirements for DAS when it submits the school construction list to the legislature

116 — EMERGENCY CONSTRUCTION GRANTS (IDENTICAL TO 509)

Expands the types of projects eligible for emergency school construction grants and makes other program changes

117 — FREQUENCY OF FACILITY, AIR QUALITY, AND GREEN CLEANING REPORTS (IDENTICAL TO 510)

Reduces frequency of certain required reports

118 & 121 — CONFORMING AND TECHNICAL CHANGES TO THE SCHOOL CONSTRUCTION PROGRAM (IDENTICAL TO 511 & 514)

Makes technical changes

119 — INCREASED GRANT WITHHOLDING PERCENTAGE (IDENTICAL TO 512)

Increases to 11% the amount of a reimbursement grant that DAS can withhold pending the final audit

120 — REGIONAL BOARDS OF EDUCATION AND SCHOOL CONSTRUCTION OBLIGATIONS (IDENTICAL TO 513)

Specifies that when a regional board of education dissolves, local member boards are still responsible for financial and other obligations

122-128 — SCHOOL CONSTRUCTION GRANT AUTHORIZATIONS (IDENTICAL TO 498-504)

Authorizes 50 new school construction projects totaling $515 million in grants, reauthorizes three previous projects due to cost or scope changes, and makes changes affecting six other projects

129-135 — REVISIONS TO EDUCATION COST SHARING (ECS) FORMULA

Revises ECS formula, the largest form of state aid to towns, by changing several major formula components including the base aid ratio, foundation dollar amount, weighting for need students; includes phase-in for aid increases and decreases until FY 28

136 — ECS FORMULA REVIEW TEAM

Creates an ECS formula review team to review and make recommendations on the ECS formula

137 — EDUCATION FUNDING REALLOCATION

Requires the education commissioner to redistribute increases in ECS and special education grants received by certain school districts over the past fiscal year among districts that received a grant decrease

138 & 139 — SPECIAL EDUCATION FUNDING

Eliminates and creates various special education cost grants, including those for state agency-placed students receiving special education services

140 — GRANTS TO BOARDS OF EDUCATION FOR STATE AGENCY PLACEMENTS IN RESIDENTIAL AND JUVENILE DETENTION FACILITIES

Eliminates grants for boards of education for students placed by state agencies in residential facilities and juvenile detention facilities

141 — UCONN PROFESSORS' COURSE LOAD

Requires the UConn board of trustees to increase each full-time professor's course load by one course during a school year

142 — SUPERINTENDENTS FOR SMALL TOWNS

Allows local boards of education that meet certain “small town” criteria to receive direction from another board of education's superintendent, rather than employ their own local superintendent

143 — SUPERINTENDENTS FOR MULTIPLE TOWNS

Allows boards of education that share a superintendent to adjust the frequency and format of their board meetings

144 & 145 — BOARD OF EDUCATION COOPERATIVE ARRANGEMENTS

Allows for cooperative arrangements to provide administrative and central office duties

146 — MINIMUM BUDGET REQUIREMENT (MBR) FOR ALLIANCE DISTRICTS

For FYs 18 and 19, extends the MBR only for alliance districts

147 — BOARD OF EDUCATION ADMINISTRATIVE PERSONNEL HIRING

Requires municipal legislative bodies to approve the hiring of administrative personnel by local boards of education absent a budgeted appropriation

148 — REGIONAL SCHOOL DISTRICT FINANCE COMMITTEE

Allows a regional board of education to establish a finance committee

149 & 150 — CHARTER SCHOOL GRANT PAYMENTS

Disburses state grants to charter schools directly to a charter school's fiscal authority and requires proportional grant reductions if the grant total exceeds the appropriated amount

151 — ROBERTA B. WILLIS SCHOLARSHIP

Closes the scholarship to new applicants but allows previously issued awards to be renewable

152 — UCONN AND UCONN HEALTH CENTER (UCHC) EMPLOYEE COMPENSATION

Requires UConn and UCHC to fund a portion of certain employees' compensation with funds from outside the General Fund

153 & 154 — TEACHER CONTRIBUTIONS TO THE TEACHERS RETIREMENT SYSTEM (TRS)

Increases teachers' contributions to TRS and requires funds from the increase to be credited to the General Fund

155 — NON-UNION STATE EMPLOYEE CONTRIBUTION TO RETIREE HEALTH INSURANCE

Requires 5% of non-union employees' base salary to be withheld from their base pay

156 — TRANSFERS FROM NONAPPROPRIATED ACCOUNTS

Allows the OPM secretary to transfer funds from certain nonappropriated accounts to the General Fund

157 — LEGISLATIVE APPROVAL OF STATE EMPLOYEE CONTRACTS AND ARBITRATION AWARDS

Requires the legislature to affirmatively vote to approve state employee union contracts and arbitration awards; revises the process that occurs if the legislature rejects an agreement or award

158 — APPLYING SEBAC 2017 TO NON-UNION STATE EMPLOYEES

Requires terms comparable to those in the 2017 SEBAC Agreement to be implemented for non-union state employees by October 1, 2017

159-161 — 2027 CHANGES TO THE STATE EMPLOYEES RETIREMENT SYSTEM (SERS)

Starting July 1, 2027, increases employee contributions to SERS and limits SEBAC agreements to four-year terms; changes pension calculations and limits cost of living adjustments (COLAs) for those who retire on or after that date

162 — CRIMINAL JUSTICE DIVISION'S COLD CASE UNIT AND SHOOTING TASK FORCE APPROPRIATIONS

Prohibits the Division of Criminal Justice from commingling funds appropriated to the Cold Case Unit with those appropriated to the Shooting Task Force

163 — REOPENING MUNICIPAL EMPLOYEE UNION CONTRACTS

For new contracts, establishes a process by which towns may (1) ask unions to reopen a union contract to negotiate revisions related to regionalization and (2) require unions to vote on a proposed contract revision

164 — MUNICIPAL EMPLOYEE BINDING ARBITRATION

Requires random appointment of neutral arbitrators in municipal binding arbitration cases; gives arbitrators more time to issue decisions; requires parties to meet certain procedural deadlines (which may be mutually waived) within one year

165 — EDUCATION ADMINISTRATIVE PERSONNEL CONTRACTS

Requires boards of education to file administrative personnel contracts with town clerks, who must then post them online

166 — MUNICIPAL BUDGET RESERVES IN ARBITRATION

Establishes an irrebuttable presumption that a portion of a municipality's budget reserve cannot be used to pay for arbitration awards

167 & 168 — PREVAILING WAGE

Increases prevailing wage thresholds for public works projects; exempts municipal elevator or roof work from prevailing wage requirements; temporarily exempts certain projects in New Haven County from prevailing wage requirements; and applies prevailing wage requirements to certain DECD-funded projects

169 — MEDICAID WAIVER AND AMENDMENT NOTIFICATION

Requires DSS to report annually on potential Medicaid waivers and changes to the Medicaid state plan that may result in cost savings, and narrows a legislative notification requirement

170 — SPECIAL TRANSPORTATION FUND (STF)

Removes the requirement that remaining STF funds, after first being used for other specified obligations, pay for DSS' transportation to work program

171-173 — BIRTH-TO-THREE

Transfers administration of the Birth-to-Three program from OEC to SDE

174 — MEDICARE PART D FOR DUALLY ELIGIBLE RECIPIENTS

Eliminates the requirement that DSS pay any Medicare Part D prescription drug copayments for beneficiaries who are dually eligible for Medicare and Medicaid

175 — MEDICAID PHARMACY REIMBURSEMENT

Eliminates statutory requirements and allows DSS to revise reimbursement methodology and professional dispensing fees

176-179 — MEDICAID AND SPECIAL EDUCATION

Requires each local and regional board of education to enroll as a Medicaid provider, participate in DSS's Medicaid School Based Child Health Program, and submit billable service information to DSS

180 — LIMIT ON NONEMERGENCY ADULT DENTAL SERVICES

Caps payment for nonemergency dental services for adults to $1,000 per fiscal year

181-204 & 975 — CITIZENS' ELECTION PROGRAM

Repeals the CEP; requires that CEF funds be transferred to the General Fund

205-213 — CONTRIBUTION LIMITS

Increases the limit on contributions to (1) legislative office candidates from legislative caucus and legislative leadership committees and (2) exploratory committees from various contributors

214-216 — 7/7 BROWNFIELD AND UNDERUTILIZED PROPERTY REDEVELOPMENT PROGRAM

Authorizes a package of state and local tax incentives available to eligible owners after remediating, redeveloping, and using formerly contaminated, abandoned, or underutilized properties

217-220 & 282 — JUDICIAL COMPENSATION

Delays by two years a 3% salary increase for judges and certain other judicial officials that took effect July 1, 2017 and requires the comptroller to recover the salary increase received by such officials from July 1, 2017 until the act's passage

221-224 – EDUCATION GRANT CAPS

Makes permanent the caps on four education grants to school districts and regional education service centers (RESCs)

225 — MAGNET SCHOOL GRANTS

Renews the prioritization for per-student grant payments for magnet school enrollment increases and allows RESC-operated magnets outside of the Sheff region to be eligible for a higher per student grant

226 — BAN ON SHEFF HOST MAGNET SCHOOLS CHARGING TUITION TO SENDING DISTRICTS

Continues the ban on a Sheff region host magnet school charging tuition

227 — DCF-LICENSED PRIVATE RESIDENTIAL TREATMENT FACILITIES

Suspends daily and other rate adjustments for FYs 18 and 19 for DCF-licensed private residential treatment facilities

228 — REDUCTIONS FOR MUNICIPAL HEALTH DEPARTMENTS AND HEALTH DISTRICTS

Requires pro rata payment reductions to municipal and district health departments

229 — FEDERAL REIMBURSEMENT FOR DCF AND DSS PROGRAMS

Allows DSS and DCF, with OPM's approval, to establish receivables for anticipated federal reimbursement

230 — TEMPORARY FAMILY ASSISTANCE (TFA) AND STATE ADMINISTERED GENERAL ASSISTANCE (SAGA) RATES

Extends the TFA and SAGA freeze for an additional two years, FYs 18 and 19

231 — STATE SUPPLEMENT PROGRAM (SSP)

Freezes SSP rates for an additional two years, FYs 18 and 19

232 — BOARDING HOME RATES

Freezes, with exceptions, rates paid by DSS to certain boarding homes

232-234 — RESIDENTIAL CARE HOMES, COMMUNITY LIVING ARRANGEMENTS, AND COMMUNITY COMPANION HOMES

Freezes rates for residential services at certain facilities through FY 19

235 — CAP ON RESIDENTIAL CARE HOME RATES

Caps residential care home rates with certain exceptions

236 & 237 — MEDICAID NURSING HOME RATES

Limits nursing home Medicaid rates with certain exceptions, reverses a recent rate decrease for certain homes, and lowers the minimum occupancy for purpose of calculating rates

238 — INTERMEDIATE CARE FACILITIES FOR INDIVIDUALS WITH INTELLECTUAL DISABILITIES (ICF-ID)

Freezes FY 18 and FY 19 rates for ICF-IDs, with certain exceptions

239 — PAYMENTS FOR RETIRED TEACHERS HEALTH INSURANCE

Authorizes a reduction in state payments for FYs 18 and 19 to the Teachers' Retirement Board (TRB) for costs of retiree health plans offered by (1) the TRB and (2) local or regional boards of education

240 & 520 —MEDICARE SAVINGS PROGRAM

Reduces income eligibility for the Medicare Savings Program

241 — OFFICE OF STATE BROADBAND

Eliminates the Office of State Broadband

242 — EVALUATING TRANSPORTATION PROJECTS

Exempts from certain evaluation requirements certain projects that the DOT commissioner determines are necessary to maintain the state's infrastructure

243 — DAS CANDIDATE LISTS

Allows DAS to extend candidate lists through the end of 2018

244 — OFFICE OF HEALTH STRATEGY

Establishes an Office of Health Strategy to oversee specified health policy initiatives

245 & 246 — DEFICIT MITIGATION PLAN THRESHOLD

Lowers the projected deficit threshold, from 1% to 0.5% of total General Fund appropriations, that triggers certain deficit mitigation actions by the governor

247 — MUNICIPAL VOLUNTEERS

Prohibits new municipal collective bargaining agreements from limiting a municipality's ability to have volunteers provide services for it

248 — SUPERMAJORITY VOTE REQUIRED FOR CERTAIN MANDATES

Prohibits the legislature from enacting a public act that imposes an unfunded state mandate on a political subdivision unless approved by a supermajority

249 — MUNICIPAL EDUCATION BUDGET REDUCTIONS

Allows a municipality to reduce its noneducational expenses by the same amount as its reduced municipal aid without holding a referendum

250 — PURCHASING PROCEDURES APPLICABLE TO LOCAL BOARDS OF EDUCATION

Requires school boards to use, and comply with, any local purchasing procedures

251 — MUNICIPAL COLLABORATION WITH BOARDS OF EDUCATION

Requires, when possible, local boards of education to collaborate with their municipalities to jointly purchase property, casualty, and workers' compensation insurance

252 — CONSULTATION CONCERNING SHARED MAINTENANCE RESPONSIBILITY

Requires school boards to consult with their local appropriating authority before authorizing the authority to share responsibility for certain maintenance tasks

253 — LOCAL BUDGET AND TAX ADJUSTMENTS

Requires municipalities and regional boards of education to amend adopted budgets and adjust tax levies to reflect inaccurate state aid projections

254 — EXECUTIVE BRANCH AGENCY SAVINGS

Requires the governor to achieve savings by (1) eliminating certain agency positions and (2) consolidating all agency human resource functions in DAS

255 — RESULTS FIRST PILOT PROGRAM

Requires the OPM secretary to create a pilot program that applies Pew-MacArthur Results First principles to at least 10 state-financed grant programs

256 — UCONN HEALTH CENTER PUBLIC-PRIVATE PARTNERSHIPS

Requires the UConn Health Center to seek to establish public-private partnerships and report to certain legislative committees by April 1, 2018

257 & 975 — STATE BUILDING ARTWORK

Eliminates the (1) requirement that the state bond commission, when allocating bond proceeds for state building construction, reconstruction, or remodeling, include funds for artwork and (2) state building works of art account within the General Fund and its maintenance subaccount

258 — PRISON HEALTH CARE

Requires the OPM secretary to (1) issue an RFP to provide health care and behavioral health care services to prison inmates and (2) contract with a new provider if he determines doing so would save the state money

259-264 — CONTRACTING EXEMPTIONS FOR UCONN AND UCONN HEALTH CENTER

Exempts UConn and the UConn Health Center from several state contracting requirements

265 & 266 — EDUCATION LEASING AND PURCHASING CONSULTATIONS

Requires local boards of education to consult with their legislative bodies before leasing or purchasing certain items

267 — JUDGE SALARY WITHHOLDING

Increases, from 5% to 8%, the amount that must be withheld from judges', family support magistrates', and compensation commissioners' salaries and deposited in the Judge's Retirement Fund

268 — STATE AGENCY AFFIRMATIVE ACTION PLANS

Allows agencies to use an alternative method to comply with affirmative action plan requirements

269-276 & 278-280 — CRUMBLING CONCRETE FOUNDATIONS

Creates a framework to assist homeowners with crumbling concrete foundations

277 — TOLLING OF CONTRACTUAL LIMITATIONS PERIOD FOR CERTAIN INSURANCE POLICIES

Extends the period of time for an insured to sue his or her homeowners insurer

281 — PUBLIC HEARINGS ON AUDITS

Requires legislative committees to hold public hearings on auditor reports of agencies under their cognizance

283-285 — PASSPORT TO THE STATE PARKS AND FORESTS

Establishes a supplemental fee on motor vehicle registrations to pay for DEEP's staff expenses to manage and operate state parks and forests and exempts individuals who pay this fee from paying to park at state parks

286-310 — MUNICIPAL ACCOUNTABILITY REVIEW BOARD

Provides an alternative process by which financially distressed municipalities may use statutory methods to issue deficit bonds if they submit to state fiscal oversight by the Municipal Accountability Review Board established by the act.

311 — MUNICIPAL APPROVAL OF COLLECTIVE BARGAINING AGREEMENTS AND ARBITRATION AWARDS

Requires municipal legislative bodies to affirmatively approve municipal employee union contracts; revises the process that occurs after a municipality rejects a contract

312 — TAX REVENUE FOR MUNICIPAL SERVICES TASK FORCE

Creates a task force to study spending tax revenue for municipal governments' services

313 — SEPARATION OF PURA FROM DEEP

Establishes the Department of Environmental Protection and the Public Utilities Regulatory Authority as separate agencies

314 — IMPAIRMENT OF STATE CONTRACTS

Specifies the circumstances in which state legislation may impair state contracts

315 — STATE EMPLOYEE ARBITRATION

Defines the state's “ability to pay” in arbitration proceedings

316 — LEGISLATIVE APPROVAL OF STATE EMPLOYEE CONTRACTS AND ARBITRATION AWARDS

Requires the legislature to affirmatively vote to approve state employee union contracts and arbitration awards; revises the process that occurs if the legislature rejects an agreement or award

317-321 — LIMITS ON FUTURE SEBAC CONTRACTS

Limits certain provisions of future SEBAC Agreements and requires the Retirement Commission to conduct an actuarial valuation to reflect the changes

322 — TEACHERS' RETIREMENT SYSTEM (TRS) VIABILITY COMMISSION

Establishes a commission and requires the state to contract with a consulting firm to develop and implement a plan to maintain TRS' financial viability

323 — TEACHERS' RETIREMENT SYSTEM (TRS) ACTUARIAL VALUATION

Requires an annual, rather than biennial, TRS actuarial valuation

324 — STATE SUSTAINABILITY PLAN

Requires OPM or OLM to contract with a professional services advisor to develop and implement a state Sustainability Plan

325 — BOND ALLOCATION CAP

Establishes a $2 billion GO bond allocation cap starting July 1, 2017

326 — COMPTROLLER REPORTS ON SEBAC SAVINGS

Requires the (1) comptroller to determine the savings realized through the 2017 SEBAC Agreement and its related contracts and (2) governor to take action if budgeted savings are unrealized

327 — LITCHFIELD COUNTY COURTHOUSE

Allows the state to retain use of the old Litchfield County Courthouse land and building unless certain conditions are met

328 & 329 — BRIDGE RENAMING

Renames “Detective Bruce Boisland Memorial Bridge” as “Detective Bruce Boislard Memorial Bridge” and the “Veterans of Foreign Wars Memorial Bridge” as the “American Legion Bridge”

330 — SPENDING CAP DEFINITIONS

Modifies definitions used to calculate the state's statutory spending cap

331-497, 976 & 977 — BOND AUTHORIZATIONS, ADJUSTMENTS, AND CANCELLATIONS

Authorizes up to $1.172 billion for FY 18 and $1.457 billion for FY 19 in new GO bonds for state projects and grant programs; authorizes up to $809.9 million in FY 18 and up to $745.1 million in FY 19 in new STO bonds for DOT projects; cancels, reduces, or restores bond authorizations for various projects and grants; adjusts the annual bond caps under the CSCU 2020 program and UConn 2000 programs, and extends both programs (but see 96-99); makes permanent the school security infrastructure grant program; allocates no LoCIP funds in 2017 and $55 million in 2018; and authorizes certain transportation funding agreements with the federal government, and the issuance of “federal transportation bonds”

518 — BOND LISTS

Requires the (1) treasurer to provide the governor with an annual list of unissued bonds and (2) governor to provide the treasurer with an annual list of GO bond expenditures that can be made in the next fiscal year

521-944, 978-981 — AGENCY CONSOLIDATIONS AND ELIMINATION OF COMMISSIONS

Consolidates the Department of Housing within the Department of Economic and Community Development, the Office of Early Childhood within the state Department of Education, and the state Department on Aging within the Department of Social Services; eliminates the state's two legislative commissions

945 — TECHNICAL CHANGES BY THE LEGISLATIVE COMMISSIONERS' OFFICE (LCO)

Requires that LCO, as part of its codification, make necessary technical, grammatical, and punctuation changes in the act's text

946-962 — HEALTH CARE PROVIDER TAX

Beginning July 1, 2017, sunsets the taxes on hospitals and ambulatory surgical centers and user fees on nursing homes and intermediate care facilities for individuals with intellectual disabilities and reestablishes the taxes and fees as part of a comprehensive and uniform health provider tax system

963-965 — HOSPITAL SUPPLEMENTAL PAYMENTS

Requires DSS to distribute supplemental hospital payments based on criteria developed in consultation with the Connecticut Hospital Association; establishes a schedule for payments; allows DSS to advance payments for distressed hospitals; and prohibits the governor from reducing any allotment to the supplemental payment account

966-974 — REVENUE ESTIMATES

Adopts revenue estimates for FYs 18 and 19 for appropriated state funds

975 — UCONN HEALTH CENTER (UCHC) FRINGE BENEFIT COST DIFFERENTIAL FUNDING

Repeals a requirement for the comptroller to fund the fringe benefit cost differential of UCHC employees (CGS 3-123i)

982 — KIRKLYN M. KERR GRANT PROGRAM

Repeals the program, which provides grants to veterinary medicine students

1-9 — FY 18 AND FY 19 APPROPRIATIONS

Appropriates money for state agency operations and programs for FYs 18 and 19

The act appropriates money for state agency operations and programs in FYs 18 and 19. Table 1 shows the net annual appropriations for each year from each appropriated fund.

Table 1: FYs 18 and 19 Net Appropriations by Fund

Fund

Net Appropriation

FY 18

FY 19

1

General Fund

$ 18,484,354,274

$ 18,596,876,587

2

Special Transportation Fund (STF)

1,512,169,702

1,625,701,530

3

Mashantucket Pequot and Mohegan Fund

58,076,612

58,076,612

4

Regional Market Operation Fund

1,067,306

1,067,306

5

Banking Fund

29,619,002

29,592,566

6

Insurance Fund

89,503,916

90,629,589

7

Consumer Counsel and Public Utility Control Fund

25,571,954

25,571,954

8

Worker's Compensation Fund

23,796,654

24,134,651

9

Criminal Injuries Compensation Fund

2,934,088

2,934,088

EFFECTIVE DATE: Upon passage

10-12, 14 & 15 — SPENDING REDUCTIONS AND BUDGETED LAPSES

Authorizes the Office of Policy and Management (OPM) secretary to reduce allotments for state agencies and funds to achieve specified savings and budgeted lapses

Labor-Management Savings (10)

The act requires a General Fund lapse in each year of the biennium for achieved labor concessions ($700 million in FY 18 and $867.6 million in FY 19) (see 1). In order to achieve these savings, the act allows the OPM secretary to reduce allotments in any budgeted state agency or fund to reduce labor-management spending by these same amounts. In doing so, the act supersedes laws that, among other things, (1) require the state budget act to specify budgeted reductions by branch of government (CGS 2-35); (2) require OPM, when preparing the governor's budget recommendations for submission to the legislature, to include the expenditure estimates for the legislative branch, Judicial Department, and Public Defenders Services Division submitted by each respective agency ( 4-73); and (3) authorize the higher education constituent units to establish and administer operating funds ( 10a-77, 10a-99, 10a-105, and 10a-143).

Under the act, any allotment reductions applied to the Connecticut State Colleges and Universities (CSCU), UConn, or the UConn Health Center must be credited to the General Fund.

Unallocated Budgeted Lapses by Branch ( 11)

For FYs 18 and 19, the act authorizes the OPM secretary to reduce allotments for each government branch in order to achieve unallocated lapses in the General Fund, (see Table 2). Under the act, the legislative reductions must be determined by the top six legislative leaders, and judicial reductions must be determined by the chief justice and chief public defender.

Table 2: FYs 18 and 19 General Fund Spending Reductions by Government Branch

Branch

FY 18

FY 19

Executive

$ 40,000,000*

$ 40,000,000

Legislative

500,000

500,000

Judicial

3,000,000

3,000,000

* The act includes an unallocated lapse of $42.25 million in executive

branch expenditures for FY 18 but only authorizes $40 million in

corresponding allotment reductions.

Other General Fund Lapses ( 12 & 14)

The act authorizes the OPM secretary to reduce spending in any budgeted state agency in order to achieve targeted budget savings in the General Fund (see Table 3). These amounts correspond to budgeted lapses designated as “Targeted Savings” and “Post-SEBAC” in 1 of the act.

Table 3: FY 18 and FY 19 Targeted Savings Lapses

Lapse

FY 18

FY 19

12

Targeted Savings

$ 56,972,184

$ 72,442,877

14

Post-SEBAC

144,016,000

177,771,000

Special Transportation Fund (STF) Unallocated Lapse ( 15)

For FYs 18 and 19, the act allows the OPM secretary to reduce allotments in any budgeted state agency in order to achieve STF savings of $12 million in each year.

EFFECTIVE DATE: Upon passage

13 — ALLOTMENT INCREASES ATTRIBUTED TO DELAY IN STATE BUDGET

Authorizes the OPM secretary to increase allotments to reflect costs associated with the delay in passing a state budget

The act authorizes the OPM secretary to increase FY 18 allotments from the General Fund to any budgeted agency, up to $20 million total, in order to reflect budget costs associated with the delay in passing a state budget.

EFFECTIVE DATE: Upon passage

16 — FEDERAL REIMBURSEMENT FOR DEPARTMENT OF SOCIAL SERVICES (DSS) AND DEPARTMENT OF CHILDREN AND FAMILIES (DCF) PROJECTS

Authorizes DSS and DCF to establish receivables for anticipated federal reimbursement

For FYs 18 and 19, the act authorizes DSS and DCF, with OPM's approval, to establish receivables for the anticipated reimbursement from approved projects.  The agencies must do so in compliance with any advanced planning documents approved by the federal Department of Health and Human Services.

EFFECTIVE DATE: Upon passage

17 — APPROPRIATIONS FOR NONFUNCTIONAL – CHANGE TO ACCRUALS

Prohibits the OPM secretary from allotting funds to such line item accounts

The act bars the OPM secretary from allotting funds for the Nonfunctional – Change to Accruals line item accounts in each of the state's nine appropriated funds, regardless of the law requiring the governor, through OPM, to allot appropriations before they can be spent. These line items represent the change to accruals in agency budgets due to the conversion to generally accepted accounting principles (GAAP)-based budgeting.

EFFECTIVE DATE: Upon passage

18 — AUTHORITY TO TRANSFER FUNDS TO AND FROM THE RESERVE FOR SALARY ADJUSTMENTS ACCOUNT

Allows the OPM secretary to transfer specified funds to implement and account for adjustments to various personal services expenses

The act authorizes the OPM secretary to transfer:

1.  personal services appropriations in any appropriated fund from agencies to the Reserve for Salary Adjustments account to reflect more accurately collective bargaining and related costs and

2.  General Fund appropriations for Reserve for Salary Adjustments to any agency in any appropriated fund to implement salary increases;  other employee benefits;  agency costs related to staff reductions, including accrual payments;   or any other authorized personal service adjustment.

EFFECTIVE DATE: Upon passage

19 — COLLECTIVE BARGAINING AGREEMENT COSTS

Carries forward the unexpended portion of appropriated funds that relate to collective bargaining agreements and related costs and requires the funds to be used for the same purposes in FYs 18 and 19

The act carries forward the unexpended funds appropriated for FY 17 that relate to collective bargaining agreements and related costs, as determined by the OPM secretary, and requires the funds to be used for the same purpose in FYs 18 and 19. It also carries forward the same unexpended funds appropriated for FY 18 and requires the funds to be used for the same purpose in FY 19.

EFFECTIVE DATE: Upon passage

20 & 21 — APPROPRIATION TRANSFERS AND ADJUSTMENTS TO MAXIMIZE FEDERAL MATCHING FUNDS

Authorizes the governor, subject to specified conditions, to transfer or adjust agency appropriations to maximize federal matching funds

The act allows the governor, with the Finance Advisory Committee's (FAC) approval, to transfer all or part of an agency's appropriation at the agency's request to another agency to take advantage of federal matching funds. Under the act, both agencies must certify that the receiving agency will spend the transferred appropriation for its original purpose.  Federal funds generated from such transfers can be used to reimburse General Fund spending, expand services, or both, as the governor, with FAC approval, determines.

The act also allows the governor, with FAC approval, to adjust agency appropriations to maximize federal funding to the state.  The governor must report on any adjustment to the Appropriations and Finance, Revenue and Bonding committees.

EFFECTIVE DATE: Upon passage

22 & 24 — TRANSFERS TO MEDICAID ACCOUNT

Authorizes the OPM secretary to transfer certain funds to DSS's Medicaid account in order to maximize federal reimbursement

The act allows the OPM secretary to transfer all or part of any General Fund appropriation for the UConn Health Center or the Department of Veterans Affairs to DSS's Medicaid account in order to maximize federal reimbursement.

EFFECTIVE DATE: Upon passage

23 — DSS PAYMENTS TO DEPARTMENT OF MENTAL HEALTH AND ADDICTION SERVICES (DMHAS) HOSPITALS

Specifies how DSS must spend appropriations for certain DMHAS hospital payments and how DMHAS hospitals must use the funds

The act requires DSS to (1) spend money appropriated to it for FYs 18 and 19 for DMHAS – Disproportionate Share payments when and in the amounts OPM specifies and (2) make disproportionate share payments to DMHAS hospitals for operating expenses and related fringe benefits.  It requires the hospitals to (1) use the funds they receive from DMHAS for fringe benefits to reimburse the comptroller and (2) deposit the other DMHAS funds they receive into “grants – other than federal accounts.” Unspent disproportionate share funds in these accounts lapse at the end of each fiscal year.

EFFECTIVE DATE: Upon passage

25 — BIRTH-TO-THREE PROGRAM

Requires the State Department of Education (SDE) to transfer certain federal special education funds to the Office of Early Childhood (OEC) for the Birth-to-Three Program

For FYs 18 and 19, the act requires the State Department of Education to transfer $1 million of the federal special education funds it receives each year to the Office of Early Childhood for the Birth-To-Three Program to carry out federally required special education responsibilities. 

EFFECTIVE DATE: Upon passage

26 — PRIORITY SCHOOL DISTRICT (PSD) GRANTS

Distributes PSD grants for FYs 18 and FY 19 across three categories

For FYs 18 and 19, the act requires PSD grants to be distributed for the purposes and in the amounts shown in Table 4. By law, the PSD program provides grants to districts with significant poverty for (1) early reading programs, (2) summer school, and (3) extended school building hours for enrichment and recreational activities.

Table 4: PSD Grant Distributions, FYs 18 and 19

Purpose

Amount

FY 18

FY 19

Priority school districts

$31,609,003

$15,804,502

Extended school building hours

2,994,752

2,994,752

School accountability

3,499,699

3,499,699

EFFECTIVE DATE: Upon passage

27 — DCF-LICENSED PRIVATE RESIDENTIAL TREATMENT FACILITIES

Suspends rate adjustments for DCF-licensed private residential treatment facilities

For FYs 18 and 19, the act suspends per diem and other rate adjustments for private residential treatment facilities licensed by DCF.

EFFECTIVE DATE: Upon passage

28 — DEPARTMENT OF DEVELOPMENTAL SERVICES (DDS) AND DMHAS COST SETTLEMENTS WITH PRIVATE AND NONPROFIT PROVIDERS

Requires certain private and nonprofit providers to reimburse these agencies for the difference between actual costs and the amount received from the agencies

During FYs 18 and 19, the act requires private and nonprofit organizations providing services under contract with DDS or DMHAS to reimburse these agencies at 100%, or an alternate amount identified by the DDS or DMHAS commissioners and approved by the OPM secretary, of the difference between the actual expenses incurred and the amount the organization received from these agencies under the contract.

EFFECTIVE DATE: Upon passage

29-31 — FUNDS CARRIED FORWARD

Carries forward unspent balances from prior years' appropriations and requires them to be used for specified purposes in FYs 18 and 19

The act carries forward various unspent balances from prior years' appropriations and requires them to be used for the same or different purposes in the same agency in FYs 18 and 19 (see Table 5).

Table 5: Funds Carried Forward

Agency

Prior Purpose

Purpose Under the Act

Amount

FY

29

Workers' Compensation Commission

Other Expenses

E-court migration project

$1,040,770

18

30

Department of Motor Vehicles (DMV)

Commercial Vehicle Information Systems and Networks Project

Same as prior purpose

Unspent balance

18 & 19

31 (a)

DMV

Upgrading registration and driver's license data processing systems

Prior purpose, including implementation of Passport to Parks program

Unspent balance

18 & 19

31 (b)

DMV

Upgrading registration and driver's license data processing systems

Prior purpose, including implementation of Passport to Parks program

Up to $7,000,000

18 & 19

31 (c)

DMV

Upgrading registration and driver's license data processing systems

Prior purpose, including implementation of Passport to Parks program

Up to $8,500,000

18 & 19

EFFECTIVE DATE: Upon passage

32 — STATE EMPLOYEE RETIREMENT FUND CONTRIBUTIONS

Requires certain funds to be deposited into the fund as additional contributions

The act requires any recovery of pension costs from sources other than the General Fund and STF that causes payments to the State Employees Retirement System to exceed the actuarially determined employer contribution for any fiscal year to be deposited into the State Employee Retirement Fund as an additional contribution at the end of the year.

EFFECTIVE DATE: Upon passage

33 — PROHIBITED SPENDING REDUCTIONS

Prohibits reduction of appropriations for specified social services

The act prohibits budget lapses, reductions, and rescissions (i.e., allotment reductions) from being achieved by reducing the FY 18 and FY 19 appropriations for (1) DDS employment opportunities and day services, (2) DSS community residential services, or (3) DMHAS grants for substance abuse and mental health services.

EFFECTIVE DATE: Upon passage

34 — PROBATE COURT ADMINISTRATION FUND

Requires that the fund's balance at the end of FY 17 remain in the fund

Under existing law, if there is a balance in the Probate Court Administration Fund on June 30 exceeding 15% of its authorized expenditures in the coming fiscal year that excess is transferred to the General Fund. The act overrides this provision for FY 17 by requiring any balance in the fund as of June 30, 2017 remain there.

EFFECTIVE DATE: Upon passage

35 & 975 — ELIMINATION OF MOTOR VEHICLE PROPERTY TAX CAP

Eliminates the motor vehicle mill rate cap

Prior law capped the mill rate municipalities and special districts could impose on motor vehicles and authorized state grants to mitigate the revenue loss attributed to the cap. The act eliminates the mill rate cap, which was previously set at 32 mills. It also makes conforming changes to eliminate (1) the statutory authority to set a mill rate for motor vehicles that is different from the mill rate for real and personal property and (2) motor vehicle property tax grants (see 84, 975 & 978).

EFFECTIVE DATE: Upon passage

36 — FRESH START PROGRAM

Authorizes the Department of Revenue Services (DRS) commissioner to establish a fresh start program for qualified taxpayers who owe Connecticut state taxes

The act authorizes the DRS commissioner to establish a fresh start program in which he may, at his discretion, enter into agreements with qualified taxpayers to waive all of the penalties and half of the interest due on delinquent state taxes (other than motor carrier road taxes). Under the act, a fresh start agreement for taxpayers who failed to file a tax return may also provide a limited look-back period (i.e., limiting the scope of DRS's review of prior year returns). In exchange, taxpayers must, among other things, disclose certain tax information to the commissioner, file any required returns or documents, and pay their liabilities. The program runs from the act's passage to October 31, 2018 and covers any tax returns due on or before December 31, 2016.

Qualified Taxpayers

Under the act, the program is open to taxpayers who apply for a fresh start agreement, in the form and manner the commissioner prescribes, and who:

1. failed to file a tax return, or failed to report the full amount of tax properly due on a previously filed return, that was due by December 31, 2016;

2. voluntarily come forward before receiving a billing notice or notice that DRS is conducting an audit for the tax type and taxable period for which the taxpayer is seeking a fresh start agreement;

3. are not parties to a closing agreement with the DRS commissioner for such taxes;

4. have not made an offer of compromise that has been accepted by the commissioner for such taxes;

5. have not protested an audit determination for such taxes; and

6. are not parties to litigation against the commissioner for such taxes.

Conditions

As part of any fresh start agreement, qualified taxpayers must:

1. voluntarily and fully disclose on the application all material facts relevant to their tax liability;

1. file any tax returns or documents that the commissioner requires;

2. pay in full the tax and interest as stated in the agreement in the form and manner the commissioner prescribes;

3. agree that for the three years after the agreement is signed they will timely file any required tax returns and pay any associated state taxes; and

4. waive all administrative and judicial rights of appeal that have not run or expired for the tax period or periods subject to the penalty and interest waiver.

The commissioner is not bound by the penalty and interest waivers in the act or any fresh start agreement if he finds that the qualified taxpayer:

1. misrepresented material facts in applying for or entering into the agreement;

1. failed to provide any information required for the applicable tax periods by the required due date;

2. failed to pay any tax, penalty, or interest due in the time, form, or manner prescribed;

3. understated by 10% or more the tax due for any taxable period covered by the agreement, including any amount shown on an amended tax return, and cannot demonstrate to the commissioner's satisfaction that a good faith effort was made to accurately compute the tax; or

4. failed to timely file any required tax returns or pay any associated state taxes in the three years following the agreement's signing.

The act prohibits any payment made by a qualified taxpayer for a tax period covered by an agreement to be refunded to the taxpayer or credited to any other tax period other than the one for which the payment was made.

EFFECTIVE DATE: Upon passage

37 — AMBULATORY SURGICAL CENTER (ASC) TAX

Changes the base for the ASC tax to the total net revenue received by each ASC for providing specified services, rather than gross receipts

Beginning October 1, 2017, the act changes the base for the 6% ASC tax from gross receipts to total net revenue received by each ASC for providing ASC services. In doing so, it eliminates the exclusion for the first $1 million of an ASC's gross receipts that applied under prior law. (However, 946-962 sunset the ASC tax as of July 1, 2017 and impose a new health provider tax similar to the net revenue tax imposed in 37.)

Under the act, “ASC services” are those services furnished in connection with covered surgical procedures performed in an ASC for which payment for the procedure is allowable under federal law. They include facility services only and exclude surgical procedures.

Under prior law, the ASC gross receipts tax applied to the Department of Public Health (DPH)-licensed outpatient surgical facilities and Medicare-certified ASCs included in the federal definition of an ASC (i.e., a distinct entity that operates exclusively to provide surgical services to patients not requiring hospitalization, where the services are not expected to take more than 24 hours). The act applies the net revenue tax to ASCs that (1) meet the federal definition described above and (2) have an agreement with the Centers for Medicare and Medicaid Services (CMS) to participate in Medicare as an ASC and meet federal requirements to do so.

The act also makes conforming changes to the quarterly remittance and payment requirements for the tax.

EFFECTIVE DATE: October 1, 2017

38-42 — ESTATE AND GIFT TAX

Increases the estate and gift tax threshold over three years; modifies the tax rate schedule for estates and gifts over $5.1 million and makes minor and technical changes to the estate tax

Tax Threshold

Beginning in 2018, the act increases the estate and gift tax threshold over three years, from $2 million to the federal estate and gift tax threshold (i.e., the “federal basic exclusion amount,” which the act defines as the amount published annually by the Internal Revenue Service (1) at which a decedent would be required to file a federal estate tax return based on the value of his or her gross estate and federal taxable gifts or, for the gift tax, (2) over which a donor would owe federal gift tax based on the value of the donor's lifetime federally taxable gifts). The federal estate and gift tax threshold is $5.49 million for 2017. The act also modifies the rate schedule for gifts and estates over $5.1 million, as shown in Table 6.

Table 6: Estate and Gift Tax Rates

Value of Taxable Estate or Gift

Rates

Prior Law

Act

2018

2019

2020 and after*

Up to $2,000,000

None

None

None

None

$2,000,001 to $2,600,000

7.2%

$2,600,001 to $3,600,000

7.2%

$3,600,001 to $4,100,000

7.8%

7.8%

7.8%

$4,100,001 to $5,100,000

8.4%

8.4%

8.4%

$5,100,001 to federal threshold

9.0%

10.0%

10.0%

Federal threshold to $6,100,000

10%

$6,100,001 to $7,100,000

9.6%

10.4%

10.4%

10.4%

$7,100,001 to $8,100,000

10.2%

10.8%

10.8%

10.8%

$8,100,001 to $9,100,000

10.8%

11.2%

11.2%

11.2%

$9,100,001 to $10,100,000

11.4%

11.6%

11.6%

11.6%

Over $10,100,000

12%

12%

12%

12%

*The act does not specify if the rates for 2020 and thereafter are marginal.

Filing Estate Tax Returns. The act makes conforming changes to requirements for filing tax returns with DRS and the probate court. By law, all estates, regardless of their gross value, must file an estate tax return. If the estate's value is more than the taxable threshold, the executor must file the return with DRS, with a copy to the probate court for the district where the decedent lived or, if the decedent was not a Connecticut resident, where the Connecticut property is located. If the estate's value is below the tax threshold, the return must be filed only with the appropriate probate court. The probate judge must review the return and issue a written opinion to the estate's representative if the judge determines the estate is not subject to the estate tax.

Under prior law, the threshold for filing an estate tax return only with the probate court from someone who died on or after January 1, 2011 was $2 million. The act increases that threshold to (1) $2.6 million for deaths on or after January 1, 2018, but before January 1, 2019; (2) $3.6 million for deaths on or after January 1, 2019, but before January 1, 2020; and (3) the federal estate tax threshold for deaths on or after January 1, 2020.

Release of Estate Tax Liens. The act also makes a conforming change in requirements for releasing estate tax liens.

By law, a person who does not owe, or who has paid, the estate tax receives a certificate releasing the lien on his or her interest in real property in the estate. The probate court is required to issue all lien release certificates for estates below the estate tax threshold. Prior law required probate courts to issue all lien release certificates for estates of $2 million or less, starting with deaths on or after January 1, 2011. The act instead requires the certificates to be issued either by the probate courts or the DRS commissioner, depending on to whom the tax return must be filed.

Person Responsible for Paying Estate Tax

By law, executors, administrators, trustees, grantees, donees, beneficiaries, and surviving joint owners are liable for the estate tax and any related interest and penalty on the tax, until it is paid, up to the value of the property they received from the estate. The act provides that this liability for the tax applies regardless of any provision of state probate laws concerning decedents' estates.

EFFECTIVE DATE: January 1, 2018, and applicable to estates of people who die on or after January 1, 2018 or gifts made on or after that date.

43-45 & 47 — INSURANCE PREMIUMS TAX

Rate Reduction ( 43-45)

Reduces, from 1.75% to 1.5%, the insurance premiums tax rate and makes the tax credit cap for insurance premiums taxpayers permanent

Beginning January 1, 2018, the act reduces, from 1.75% to 1.50%, the tax on total net direct (1) subscriber charges that health care centers (i.e., HMOs) impose on contracts they enter into or renew during the calendar year and (2) insurance premiums paid to domestic and foreign insurers on property or risks in Connecticut.

EFFECTIVE DATE: Upon passage

Insurance Premiums Tax Credit Cap ( 47)

The act restores and makes permanent the cap on the maximum amount of insurance premium tax liability that an insurer may reduce with tax credits. Under prior law, the cap expired December 31, 2016.

The cap is part of a structure that (1) classifies the tax credits into three types based on their purpose, (2) specifies the order in which insurers must apply each type to reduce their tax liability, and (3) establishes the maximum amount of liability that insurers can reduce by applying one or more of the types.

By law, (1) type one credits are film and digital media production, entertainment infrastructure, and digital animation credits; (2) type two credits are insurance reinvestment credits; and (3) type three credits are all other credits. Table 7 shows the order and reduction schedule.

Table 7: Order and Reduction Schedule for Claiming Insurance Premium Tax Credits

Credit Types Claimed

Order of Applying Credits

Maximum Reduction in Tax Liability

Type 3

Not Applicable

30%

Types 1 & 3

5. Type 3

6. Type 1

Type 3 = 30%

Sum of both types = 55%

Types 2 & 3

1. Type 3

2. Type 2

Type 3 = 30%

Sum of both types = 70%

Types 1, 2, & 3

1. Type 3

2. Type 1

3. Type 2

Type 3 = 30%

Types 1 & 3 = 55%

Sum of all types = 70%

Type 1 & 2

1. Type 1

2. Type 2

Type 1= 55%

Sum of both types = 70%

EFFECTIVE DATE: Upon passage

46 — FILM AND DIGITAL MEDIA PRODUCTION TAX CREDIT

Makes permanent the moratorium on issuing film and digital media production tax credits to certain motion pictures and allows them to be claimed against the sales and use tax, but at less than face value when transferred to another taxpayer

Moratorium

The act restores and makes permanent the moratorium on issuing film and digital media production tax credit vouchers for motion pictures that were not designated as state-certified qualified productions before July 1, 2013. Prior law lifted, on July 1, 2017, the temporary moratorium on issuing these credits.

As under existing law, other types of qualified productions, such as documentaries, specified television programming, relocated television productions, and video games, continue to be eligible for tax credits.

EFFECTIVE DATE: Upon passage

Claiming Credits

The law allows eligible production companies to (1) claim film and digital media production tax credits against specified taxes for production expenses incurred in Connecticut or (2) sell, assign, or transfer the credits to other taxpayers, who also claim them against the same taxes.

Beginning with the 2018 income year, the act allows these companies to claim the credits against the sales and use tax, as well as the corporation business and insurance premium tax as the law already allows. It also allows a taxpayer to whom a company sells, assigns, or transfers the tax credits to apply them against the sales use tax, but at less than their face value. The reduction in value depends on the taxpayer's relationship to the company from which it received the credit. The value is (1) 92% of the credit's face value if the taxpayer owns at least 50% of the production company that sold, assigned, or transferred the credit to it

and (2) 95% of its face value if it is transferred to any other taxpayer.

EFFECTIVE DATE: Upon passage

48 — CONNECTICUT TELEVISION NETWORK (CT-N) REDUCTION

Reduces by half the amount of specified tax revenue that must be reserved for CT-N

The act reduces by half, from $3.2 million to $1.6 million, the amount of funding reserved for CT-N. The funding comes from the gross receipts tax on cable, satellite, and competitive video service companies and is used to defray the costs of providing the state with CT-N coverage of state government deliberations and public policy events.

EFFECTIVE DATE: Upon passage

49 — INCOME TAX ON SOCIAL SECURITY, PENSION, AND ANNUITY INCOME

Increases the income thresholds for the 100% Social Security income tax deduction and phases out the income tax on pension and annuity income for taxpayers with incomes below a specified threshold

Social Security Income

Beginning with the 2018 tax year, the act increases the income thresholds at which taxpayers qualify for a 100% income tax exemption for their Social Security benefits. Prior law allowed a 100% exemption for single filers and married people filing separately with federal adjusted gross incomes (AGI) of less than $50,000 and joint filers and heads of household with federal AGIs of less than $60,000. The act increases these income thresholds to $75,000 and $100,000, respectively. Under the act, as under existing law, taxpayers with incomes equal to or greater than these thresholds qualify for a 75% exemption.

Pension and Annuity Income

From the 2019 through 2025 tax years, the act phases out the income tax on pension and annuity income for taxpayers with federal AGIs below (1) $75,000 for single filers, married people filing separately, and heads of households and (2) $100,000 for married people filing jointly. It does so by allowing taxpayers, when calculating Connecticut AGI for state income tax purposes, to deduct a percentage of any pension or annuity income, as shown in Table 8.

Table 8: Phase-In of Income Tax Exemption for Pension and Annuity Income

Tax Year

Percent of Pension and

Annuity Income Exempt

2019

14%

2020

28

2021

42

2022

56

2023

70

2024

84

2025

100

The act makes a conforming change to the existing income tax exemption for a portion of teachers' retirement system (TRS) income by allowing taxpayers to claim either the TRS exemption or the pension and annuity income exemption established by the act. By law, 50% of TRS income is exempt for tax years beginning in 2017.

EFFECTIVE DATE: Upon passage and applicable to income years beginning on or after January 1, 2017.

50 — ANGEL INVESTOR TAX CREDIT

Terminates the Angel Investor Tax Credit Program as of October 1, 2017

The act terminates the Angel Investor Tax Credit Program as of October 1, 2017, rather than July 1, 2019, by prohibiting Connecticut Innovations, Inc. (CI) from reserving any tax credits under the program on or after that date. Credits issued through the program apply to personal income tax and equal 25% of the amount taxpayers invest in businesses, up to $250,000.

EFFECTIVE DATE: October 1, 2017

51 — EARNED INCOME TAX CREDIT

Replaces the 30% earned income tax credit (EITC) with a graduated credit schedule ranging from 5% to 25%

The act replaces the 30% state EITC with a graduated credit schedule that depends on the number of dependent children a taxpayer claims.  Under the act, the EITC is (1) 5% for taxpayers with no dependent children, (2) 10% for taxpayers with one dependent child, (3) 15% for taxpayers with two dependent children, and (4) 25% for taxpayers with three or more dependent children.

The EITC is a refundable tax credit available to people who work and earn incomes below certain levels.

EFFECTIVE DATE: Upon passage and applicable to income years beginning on or after January 1, 2017.

52 — UTILITY COMPANIES TAX EXEMPTION ELIMINATION

Eliminates the utility companies tax exemption for earnings from sales to certain natural gas-fueled power plants

The act eliminates the utility companies gross earnings tax exemption for gross income a gas company earns by selling natural gas to an existing combined cycle plant that generates electricity using three gas turbines with a total capacity of 775 megawatts.

EFFECTIVE DATE: October 1, 2017

53 — MUNICIPAL VIDEO COMPETITION TRUST ACCOUNT

Beginning in FY 18, increases by $2 million the annual transfer from the municipal video competition trust account to the General Fund

Beginning in FY 18, the act increases, from $3 million to $5 million, the annual transfer from the municipal video competition trust account to the General Fund.

EFFECTIVE DATE: Upon passage

54 — PUBLIC, EDUCATIONAL, AND GOVERNMENTAL PROGRAMMING AND EDUCATION TECHNOLOGY INVESTMENT ACCOUNT

Beginning in FY 18, requires $3.5 million to be transferred to the General Fund each fiscal year from the Public, Educational, and Governmental Programming and Education Technology Investment Account (PEGPETIA)

Beginning in FY 18, the act requires $3.5 million to be transferred to the General Fund each year from the Public, Educational, and Governmental Programming and Education Technology Investment Account. The account provides grants to support public, educational, and government (i.e. community access) programming and education technology initiatives.

EFFECTIVE DATE: Upon passage

55 — ADMISSIONS TAX

Eliminates certain admissions tax exemptions

The act eliminates the 10% admissions tax exemption for events at the XL Center, Webster Bank Arena in Bridgeport, Dunkin Donuts Park in Hartford, and any athletic event held by a member team of the Atlantic League of Professional Baseball at the New Britain Stadium. It also makes a technical change by removing an expired exemption for athletic events held at the Ballpark at Harbor Yard in Bridgeport.

EFFECTIVE DATE: October 1, 2017

56 — REDUCING CONNECTICUT LOTTERY CORPORATION (CLC) EXPENSES

Requires CLC to reduce its expenses for the next two fiscal years

The act requires CLC to reduce its expenses from the amount of its FY 17 expenses by $1 million in FYs 18 and 19.

EFFECTIVE DATE: Upon passage

57 — RECORD CHECK FEE INCREASES

Increases, by $25, fees for certain record searches

The act increases, from $50 to $75, the fees for all of the following record searches: fingerprint, personal record, letters of good conduct, bar association, and criminal history record information. By law, federal, state, and municipal agencies do not pay these fees.

EFFECTIVE DATE: October 1, 2017 and applicable to record checks requested on or after that date.

58 — DOCUMENT RECORDING FEE

Increases, from $3 to $10, the document recording fee charged to generate revenue for preserving historic documents and modifies the fee revenue distribution

The act (1) increases, from $3 to $10, the recording fee municipalities charge on documents recorded in their land records to generate revenue for preserving historic documents and (2) changes the fee revenue distribution (see Table 9).

Table 9: Document Recording Fee Revenue Distribution Changes

Purpose

Share of Revenue

Prior Law ($3 fee)

Act ($10 fee)

State Historic Document Preservation

66% ($2)

40% ($4)

Municipal Historic Document Preservation

33% ($1)

20% ($2)

General Fund

0% ($0)

40% ($4)

EFFECTIVE DATE: October 1, 2017

59 & 60 — URGENT CARE CENTERS AND OUTPATIENT CLINICS

Requires urgent care centers to be licensed as outpatient clinics starting April 1, 2018 and authorizes DSS to establish payment rates for these centers; requires outpatient clinics to renew their license every three year instead of every four years

License Requirement

Starting April 1, 2018, the act requires a person who establishes, conducts, operates, or maintains an urgent care center to obtain an outpatient clinic license from the Department of Public Health (DPH). The act also requires outpatient clinics to renew their license every three years instead of every four years as under prior law. By law, outpatient clinics must pay a $1,000 license and inspection fee unless operated by municipal health departments or districts or licensed nonprofit nursing or community health agencies.

The act also authorizes the DPH commissioner to implement policies and procedures for the urgent care center licensure program while in the process of adopting them in regulations, provided he publishes notice of intent to adopt regulations on the state's eRegulations system.

Generally, if an urgent care center is part of a hospital, it is licensed as a satellite site of the hospital. Under prior law, if such a center was not part of a hospital and did not meet the definition of an outpatient clinic, it was considered a physician's office and DPH licensed the providers but not the center itself.

Department of Social Services (DSS) Payment Rates

The act allows the DSS commissioner to establish payment rates to providers practicing in urgent care centers. The commissioner may implement related policies and procedures while in the process of adopting them in regulations, provided he publishes notice of intent to adopt regulations within 20 days after the policy implementation date.

Definitions

The act defines an “urgent care center” as a free-standing facility, separate from an emergency department, that (1) treats medical conditions that do not require critical or emergent intervention for life-threatening or potentially permanently disabling conditions, (2) treats these conditions without requiring an appointment, and (3) provides services during times when primary care provider offices are not customarily open.

EFFECTIVE DATE: October 1, 2017

61 — PUBLIC WATER SYSTEM LICENSURE

Requires water companies to obtain a DPH license to operate a community public water system or non-transient non-community public water system

License Required to Operate Public Water Systems

Starting July 1, 2018, the act prohibits a community public water system or non-transient non-community public water system from providing drinking water to the public unless the water company that owns the system has obtained a license to operate from DPH. It exempts state agencies from the license requirement.

Under the act, a “public water system” is a water company that supplies drinking water to 15 or more consumers (e.g., place of business or industry) or 25 or more people daily at least 60 days per year. A “community public water system” is a public water system that regularly serves at least 25 year-round residents and a “non-transient non-community public water system” is a public water system that is not a community public water system and regularly serves at least 25 of the same people for at least six months per year.

The act allows the DPH commissioner to adopt regulations to implement this licensure requirement.

License Application for Public Water Systems

The act requires the DPH commissioner, in consultation with the OPM secretary, to establish a staggered license application system for the above public water systems.

The commissioner must issue a license to a water company that (1) files an application, (2) pays the application fee, and (3) meets licensure requirements. The application must include a notice that false statements made on the application are a Class A misdemeanor (see Table on Penalties) and be signed under oath by the water company's owner or authorized representative.

Licenses are renewable every two years, provided the water company files a renewal application and pays the required fee. If a licensed water system subsequently changes ownership, it must obtain a new DPH license.

License Suspension or Revocation

The act allows the commissioner to deny a public water system license application or suspend or revoke a company's license for:

1. failing to comply with applicable with federal or state laws and regulations;

2. material misstatement of fact made on the initial or renewal license application; or

3. imminent threat to public health, as determined by the commissioner.

Before suspending or revoking a license, the commissioner must hold an administrative hearing in accordance with the Uniform Administrative Procedures Act.

License Fees

Under the act, the DPH commissioner, in consultation with the OPM secretary, must publish the initial and renewal license fees on the DPH website. The license fee for community public water systems must be based on the number of service connections a system has. The act allows a water company operating a community public water system to collect the license fee from its consumers if it does so pro-rata, based on the amount of water each consumer uses.

Under the act, DPH must assess a civil penalty of up to $5,000 per day against a water company that fails to pay the license fee.

EFFECTIVE DATE: Upon passage

62 & 982 — NEWBORN SCREENING ACCOUNT

Eliminates, on July 1, 2018, the newborn screening account and transfers any money from it into the General Fund for DPH to use for newborn health screening services in FY 18

The act eliminates, on July 1, 2018, the newborn screening account, which DPH currently uses to pay for certain newborn health screening services. It also eliminates the associated annual $500,000 credit to the account from the General Fund.

Additionally, the act requires funds in the account as of June 30, 2017 to be credited to the General Fund for DPH to use for newborn health screening services in FY 18. (Prior law required unused funds to be carried forward into the next fiscal year).

By law, DPH operates a newborn screening program that tests infants for certain genetic, endocrine, and metabolic disorders; hearing loss; and critical congenital heart defects.

The act also makes a related conforming change.

EFFECTIVE DATE: Upon passage, except the repeal of the account is effective July 1, 2018.

63 & 64 — REGIONAL PLANNING INCENTIVE ACCOUNT

Eliminates the revenue diversion to the Regional Planning Incentive Account

Beginning October 1, 2017, the act eliminates the revenue diversion to the Regional Planning Incentive Account, thus redirecting this revenue to the General Fund. Prior law directed to the account 6.7% of the revenue generated by the room occupancy tax and 10.7% of the revenue generated by the rental car tax, on a quarterly basis.

By law, the account funds (1) annual grants to councils of government (COGs) and (2) regional performance incentive program grants to municipalities, boards of education, COGs, economic development districts, and regional educational service centers.

EFFECTIVE DATE: October 1, 2017, and applicable to sales occurring on or after that date.

63 & 64 — MUNICIPAL REVENUE SHARING ACCOUNT (MRSA) DIVERSION

Eliminates the revenue diversion to MRSA

Beginning in FY 18, the act eliminates the sales and use tax revenue diversion to MRSA, thus redirecting this revenue to the General Fund ( 973 of the act eliminates MRSA). (Presumably, this applies to transfers made on or after October 1, 2017.) Prior law directed to the account 7.9% of sales and use tax revenue for each month.

EFFECTIVE DATE: October 1, 2017, and applicable to sales occurring on or after that date.

63 & 64 — SALES AND USE TAX REVENUE DIVERSION FROM CERTAIN MOTOR VEHICLE SALES

Beginning in FY 21, phases in, over five years, a revenue diversion to the STF of sales and use tax revenue from motor vehicle sales

From FYs 21 to 25, the act requires the DRS commissioner to divert to the STF a portion of revenue from motor vehicle sales and use tax (see Table 10). Under the act, the revenue diversion applies only to revenue from motor vehicle sales subject to the 6.35% tax rate, thus excluding revenue from motor vehicle sales subject to the 7.75% luxury tax rate (generally those vehicles costing more than $50,000). The required diversion ends after FY 25.

Table 10: Schedule of Motor Vehicle Sales and Use Tax Diversion to the STF

Fiscal Year

% of Revenue Diverted to the STF

21

20%

22

40

23

60

24

80

25

100

EFFECTIVE DATE: October 1, 2017, and applicable to sales occurring on or after that date.

63-67 — MARKETING, CULTURE, AND TOURISM FUNDING

Establishes an account to fund tourism-related visitor services, promote the arts, and preserve and promote historic resources

Account

The act establishes a dedicated mechanism to (1) market and promote tourism and the arts and (2) preserve and promote historic resources. It does this by establishing a separate, nonlapsing General Fund account (i.e., “marketing, culture, and tourism account”) ( 65-67) and capitalizes it with 10% of the revenue generated each quarter by the room occupancy tax ( 63 & 64).

Grants

The economic and community development commissioner, in consultation with the 28-member Culture and Tourism Advisory Committee, must use the account to make grants to private entities for:

1. marketing and promoting Connecticut as a place for leisure and business travelers, as specified in the state's strategic statewide marketing plan;

2. providing visitor services that enhance the tourism industry's economic impact;

3. promoting the arts; and

4. recognizing, protecting, preserving, and promoting the state's historic resources.

Before making these grants, the commissioner and the committee must jointly determine:

1. the eligibility requirements for making grants,

2. the limit on the number or amount of grants to be funded from the account,

3. how entities may apply for grants, and

4. any other grant administration requirements or procedures.

The committee must annually recommend to the commissioner the entities for grant awards and the grant amounts.

Reporting

By law, the commissioner must biennially submit to the governor and General Assembly a strategic marketing plan to implement the committee's marketing and tourism goals. The act requires the commissioner, beginning with the plan due on or before January 1, 2020, to include a report on any grant awards made in the previous two years, including the entities that received grants and the grant amounts.

EFFECTIVE DATE: October 1, 2017

68 — CIVIL PENALTIES FOR NURSING AND RESIDENTIAL CARE HOMES

Increases the maximum civil penalties for nursing and residential care homes for class A and class B violations; changes the definition of a class B violation

The act increases the maximum civil penalties on nursing home facilities and residential care homes that violate statutory or regulatory requirements from $5,000 to $20,000 for a Class A violation and from $3,000 to $10,000 for a Class B violation.

The act also changes the definition of Class B violations to actions that present a potential, instead of a probability, for death or serious harm to a patient in the reasonably foreseeable future. By law, unchanged by the act, Class A violations are actions that present an immediate danger of death or serious harm to a patient.

EFFECTIVE DATE: October 1, 2017

69 & 70 — TOBACCO SETTLEMENT FUND DISTRIBUTIONS

Eliminates certain disbursements from the Tobacco Settlement Fund

Beginning in FY 18, the act eliminates the following required annual disbursements from the Tobacco Settlement Fund:

1. $4 million to the General Fund,

2. $6 million to the Tobacco and Health Trust Fund (THTF), and

3. any remaining funds to the THTF.

The act also reduces, from $10 million to $1.5 million, the required annual disbursement from the Tobacco Settlement Fund to the Smart Start competitive operating grant account for FYs 18 through 25. It also makes a related conforming change.

EFFECTIVE DATE: Upon passage

71 — SMART START ACCOUNT TRANSFER

Transfers balance in the Smart Start Account to the General Fund

The act transfers the unexpended balance of funds in the smart start competitive operating grant account on June 30, 2017 to the General Fund for FY 18.

The Smart Start program provides competitive grants to school districts to establish or expand public preschool programs.

EFFECTIVE DATE: Upon passage

72, 75-77, 100-107 & 156 — TRANSFERS TO GENERAL FUND

Transfers funds from various sources to the General Fund for FYs 18 and 19

The act transfers money to the General Fund from various sources in FYs 18 and 19, as shown in Table 11.

Table 11: Transfers to the General Fund

Source

Amount

FY 18

FY 19

72

Community Investment Account

2,500,000

2,500,000

75

Clean Energy Fund

13,000,000

13,000,000

76

State of Connecticut Health and Educational Facilities Authority

900,000

900,000

77

Regional Greenhouse Gas Account

10,000,000

10,000,000

100

State Banking Fund

6,000,000

0

101

Technical Services Revolving Fund

3,000,000

0

102

School Bus Seat Belt Account

2,000,000

0

103

Correctional Commissaries Account, Department of Correction (DOC)

1,000,000

0

104

Correctional Industries Account, DOC

1,000,000

0

105

Ed-Net Account

1,000,000

0

106

Probation Trans-Tech Violence Unit Account, Judicial Department

4,000,000

0

107

Litigation/Settlement Account, OPM

5,000,000

0

EFFECTIVE DATE: Upon passage

73 — FY 20 GAAP DEFICIT

Deems that $1 is appropriated in FY 20 to pay off the state's GAAP deficit for FYs 13 and 14

The act deems that $1 is appropriated in FY 20 to pay off the General Fund's unassigned negative balances (i.e., GAAP deficits) for FYs 13 and 14, which reflect the negative balances that accumulated before the state adopted GAAP in FY 14. Existing law deems that $1 is appropriated to pay off such deficits in FYs 18 and 19.

By law, the OPM secretary must annually publish recommended schedules to fully amortize the deficits by FY 28.

EFFECTIVE DATE: Upon passage

74 — PROPERTY TAX CREDIT

Limits eligibility for the property tax credit against the personal income tax to seniors and taxpayers with dependents

The act limits eligibility for the property tax credit against the personal income tax to people who (1) are age 65 or older before the end of the tax year or (2) validly claim at least one dependent on their federal income tax return for that year. By law, taxpayers earn the credit for property taxes paid on their primary residences or motor vehicles and the amount of property taxes paid that can be taken as a credit declines as AGI increases, until it completely phases out. The maximum credit is $200 per tax return.

EFFECTIVE DATE: Upon passage and applicable to tax years beginning on or after January 1, 2017.

78 — HIGHWAY RIGHT-OF-WAY ENCROACHMENT FEES

Requires the DOT commissioner, by January 1, 2018, to set fees for certain applications for right-of-way encroachment permits to mirror the fees Massachusetts DOT charges for similar permits

The act requires the DOT commissioner, by January 1, 2018, to set application fees for state highway right-of-way encroachment permits for projects generating large volumes of traffic to reflect the fees Massachusetts DOT charges for such permits. It eliminates the commissioner's authority to adopt regulations setting fees for other state highway right-of-way encroachment permit applications.

Prior law required the commissioner to adopt regulations establishing a “reasonable fee” for all state highway right-of-way encroachment permit applications.

The fees required by the act apply to permit applications submitted to either DOT or its Office of State Traffic Administration for open air theaters, shopping centers, and other large volume traffic generators. As under existing law, the commissioner may adopt regulations setting reasonable fees for certificates of operation for these projects, provided the fees do not exceed 125% of the application's estimated administrative costs.

Existing law does not define what constitutes a major traffic generator, but state regulations specify that a development qualifies as such if it has (1) 200 or more parking spaces or (2) a gross floor area of at least 100,000 square feet (Conn. Agencies Regs. 14-312-1).

EFFECTIVE DATE: Upon passage

79 — EMISSIONS ENTERPRISE FUND

Reduces, by $250,000, the amount of money the comptroller must transfer quarterly from the Special Transportation Fund to the Emissions Enterprise Fund

The act reduces, from $1.625 million to $1.375 million, the amount of money the comptroller must transfer quarterly from the Special Transportation Fund to the Emissions Enterprise Fund. The funds to be transferred are those received from the $20 biennial emissions inspection fee, $20 emissions inspection late fee, and $40 inspection exemption fee for new vehicles and those less than four model years old (CGS 14-164c) and the $10 biennial or $5 annual federal Clean Air Act fee (CGS 14-49b). As under existing law, the fund transfers must be made on the first day of October, January, April, and July.

EFFECTIVE DATE: October 1, 2017

80 — CONNECTICUT AIRPORT AND AVIATION ACCOUNT

Creates the “Connecticut airport and aviation account” to fund airport and aviation related purposes and requires the DRS commissioner to deposit into it 75.3% of the amount the state receives from the petroleum products gross earnings tax on aviation fuel

The act creates the “Connecticut Airport and Aviation account” and requires the DRS commissioner to deposit into the account 75.3% of the amount the state receives from the petroleum products gross earnings tax from aviation fuel sources and any other money the law requires. The new account is a separate, nonlapsing account in the Grants and Restricted Accounts Fund.

The DOT commissioner, with the approval of the OPM secretary, must spend the money in the account on airport and aviation-related purposes.

Under prior law, all revenue from the petroleum products gross earnings tax was deposited in the Special Transportation Fund.

EFFECTIVE DATE: Upon passage

81 — GREEN BUILDING TAX CREDIT

Sunsets the green building tax credit beginning October 1, 2017

The act sunsets the green building tax credit for income years beginning on or after October 1, 2017. Under prior law, the credit was earned for certain costs related to the construction or renovation of projects meeting specific energy efficiency standards. Earned credits may be applies against the corporation business tax.

EFFECTIVE DATE: October 1, 2017

82 — FY 19 GENERAL FUND REVENUE

Allows the comptroller to designate $37 million of FY 18 General Fund resources as FY 19 General Fund revenue

The act allows the comptroller, before FY 19 begins, to designate up to $37 million of FY 18 General Fund resources as FY 19 General Fund revenue.

EFFECTIVE DATE: Upon passage

83 — REDUCTION OF THE ANNUAL AMOUNT OF TAX CREDITS AVAILABLE UNDER THE NEIGHBORHOOD ASSISTANCE ACT (NAA) PROGRAM

Reduces, from $10 million to $5 million, the annual cap on NAA tax credits

The act reduces, from $10 million to $5 million, the annual amount of tax credits available under the NAA program. (PA 15-5, June Special Session, 446 increased the annual amount of credits available under this program from $5 million to $10 million beginning FY 18.) By law, these credits are available to businesses that contribute or invest in municipally approved community projects and programs.

EFFECTIVE DATE: Upon passage

84, 975 & 978 — REPEAL OF MUNICIPAL SPENDING CAP, MUNICIPAL REVENUE SHARING ACCOUNT (MRSA), AND RELATED PROVISIONS

Eliminates the municipal spending cap and the Municipal Revenue Sharing Account and grant distributions from it

The act eliminates MRSA and the Municipal Revenue Sharing Fund (MRSF). It correspondingly eliminates the following grant distributions from MRSA: municipal revenue sharing grants, motor vehicle property tax grants, regional services grants, and additional payment in lieu of taxes (PILOT) grants to specified municipalities (i.e., select PILOT grants) ( 85 of the act retains the select PILOT grants, but limits the municipalities that receive them).

The act also eliminates the municipal spending cap, which is tied to municipal revenue-sharing grants. Under prior law, beginning in FY 18, revenue sharing grants had to be reduced for municipalities whose spending, with certain exceptions, exceeded the specified spending cap.

The act also makes conforming changes.

EFFECTIVE DATE: October 1, 2017, except the repeal of an obsolete provision concerning MRSF is effective upon passage.

85 — GRANTS AND PAYMENTS IN LIEU OF TAXES FOR TIER 3 DISTRICTS AND MUNICIPALITIES

Prohibits, regardless of existing law, any tier three district or municipality from receiving a grant in lieu of taxes or the additional payment in lieu of taxes in either FY 18 or FY 19

The act prohibits, regardless of existing law, any tier three district or municipality from receiving a grant in lieu of taxes (payment in lieu of taxes or PILOT) or the additional payment in lieu of taxes (supplemental PILOT) in either FY 18 or FY 19. By law, the state awards these grants to municipalities which have tax-exempt state-owned, college, or hospital property.

By law, tier one and tier two districts and municipalities are the 35 districts and municipalities with the highest percentage of tax-exempt property and a mill rate on real and personal property (other than motor vehicles) of at least 25. Tier three districts and municipalities include all other districts and municipalities (CGS 12-18b).

EFFECTIVE DATE: Upon passage

86 — STATE AGENCIES TO REVIEW FEES

Requires (1) agency heads to determine whether the fees their agencies charge cover program administration costs and (2) OPM to recommend fee increases to the legislature

The act requires all agency heads, except the OPM secretary, to determine whether the fees charged by their departments cover the cost of collecting the fee and administering the program for which the fee is collected. The agency heads must recommend any fee increases to the OPM secretary before December 1, 2017.

The OPM secretary must review agencies' submissions and submit, by February 7, 2018, a report on recommended fee increases to the Finance, Revenue and Bonding Committee. The act limits the fee recommendations submitted to the committee to those fees that are increased by no more than 50% and the aggregate fee increases may not exceed $20 million. (It is unclear under the act how this cap is measured.)

EFFECTIVE DATE: Upon passage

87 — HOSPITAL TAX

Phases out the hospital tax over five years, starting in FY 20; beginning in FY 18, authorizes a credit against the hospital tax in any fiscal year in which supplemental Medicaid payments to hospitals are reduced from the amount appropriated in the budget act for that fiscal year

From FY 20 to FY 25, the act phases out the tax on hospital net patient revenue over five years. It requires the DSS commissioner to reduce the tax over this period in equal increments and base the annual reduction on the taxes hospitals pay in FY 19. (However, 946-962 sunset the hospital tax as of July 1, 2017 and impose a new health care provider tax.)

The act authorizes the commissioner, in consultation with the OPM secretary and as federal law allows, to exempt a hospital from paying the tax on payments it earns for providing outpatient services, based on financial hardship. A similar provision applied under the prior hospital tax provision.

From FY 18 to FY 25, the act also authorizes a credit against the hospital tax in any fiscal year in which supplemental Medicaid payments are reduced from the amount appropriated in the budget act for that fiscal year. The credit equals the amount of the reduction in each hospital's supplemental payments.

EFFECTIVE DATE: Upon passage

88 & 89 — COMPTROLLER'S ANALYSIS OF OPM MONTHLY STATEMENTS

Requires the comptroller to analyze OPM's monthly revenue and expenditure statements

The law requires the OPM secretary to submit to the comptroller a cumulative monthly statement of revenue and expenditures, including a statement of (1) estimated revenue, by source, to the end of the fiscal year in at least as much detail as the budget act and (2) General Fund appropriation requirements to the end of the fiscal year, itemized as much as practical for each agency (CGS 4-66).

The act requires the comptroller, in his cumulative monthly financial statements, to include an analysis of OPM's monthly statements. As under existing law, the comptroller's statements must also include statements of (1) revenue and expenditures to the end of the last completed month and (2) estimated revenue by source and appropriations from the General Fund to the end of the fiscal year.

The act also makes a conforming change ( 89).

EFFECTIVE DATE: November 1, 2017 and applicable to cumulative monthly statements issued on or after December 1, 2017, except a conforming change is effective July 1, 2019.

90 & 91 — CONSENSUS REVENUE ESTIMATES DEADLINE

Moves up the deadline by which OPM and the Office of Fiscal Analysis (OFA) must annually issue consensus revenue estimates

The act moves up the deadline, from November 10 to October 31, by which OFA and OPM must annually issue the consensus revenue estimate for the current biennium and next three fiscal years. Correspondingly, it moves up the deadline, from November 20 to November 10, by which the comptroller must issue the consensus revenue estimates if OPM and OFA cannot agree on revenue estimates.

The act also makes a conforming change ( 91).

EFFECTIVE DATE: Upon passage, except a conforming change is effective July 1, 2019.

92-94 & 515-517 — CAP ON GENERAL OBLIGATION (GO) BOND ALLOCATIONS AND ISSUANCES

Places a $2 billion cap on the amount of GO bonds the (1) State Bond Commission may allocate each calendar year starting January 1, 2017 and (2) treasurer may issue each fiscal year starting July 1, 2018; requires both caps to be adjusted annually for inflation

Beginning January 1, 2017, the act imposes a $2 billion aggregate cap on the amount of GO bonds the State Bond Commission may authorize (i.e., allocate) in any calendar year. Beginning July 1, 2018, the act also imposes a $2 billion aggregate cap on the amount of GO bonds or notes the treasurer may issue in any fiscal year, with certain exclusions. It requires both caps to be annually adjusted for inflation (based on the change in the consumer price index for all urban consumers for the preceding calendar year, less food and energy), beginning January 1, 2018, and July 1, 2019, respectively. (Section 325 of the act also establishes a $2 billion cap on GO bond allocations, but on a fiscal year basis.)

The act excludes from the issuance cap GO bonds (1) issued as part of the Connecticut State University 2020 or UConn 2000 infrastructure programs or (2) allocated for transportation purposes.

Existing law limits the total amount of General Fund-supported state debt the legislature can authorize to 1.6 times the estimated net General Fund tax receipts for the fiscal year of the authorization (CGS 3-21).

EFFECTIVE DATE: Upon passage

92, 95, 515 & 519 — GO BONDS FOR TRANSPORTATION PROJECTS

Requires the State Bond Commission to authorize GO bonds each calendar year for transportation projects, subject to annual caps

The act requires the State Bond Commission to authorize GO bonds each calendar year for transportation projects, up to the amounts shown in Table 12. (Section 92 of the act refers to the annual caps in 100, but this appears to be an incorrect reference; 95 & 519 list the caps.) Under the act, the transportation GO bonds are subject to the $2 billion cap on GO bond allocations described above.

Table 12: Annual Caps on GO Bonds for Transportation Projects

Year

Up to (millions)

2017

$422.8

2018

419.6

2019

525.3

2020

551.3

2021

691.6

2022

796.3

2023

809.9

2024

809.2

2025

716.3

2026

728.5

2027 through 2046

728.5

EFFECTIVE DATE: Upon passage

96 & 97 —CSCU 2020 INFRASTRUCTURE PROGRAM

Defers $55 million in FY 18 bonding to FY 20 and authorizes an additional $11.7 million in bonding for FY 20 (but see 389 & 390)

The act extends the CSCU 2020 program by one year, from FY 19 to FY 20, and adjusts the program's annual bond caps, as shown in Table 13, by (1) deferring $55 million in bonds for FY 18 to FY 20 and (2) authorizing an additional $11.7 million in bonds for FY 20 ($66.7 million total).

Table 13: CSCU 2020 Annual Bond Limits (millions)

FY

Prior Limit

Act's Limit

Change

18

$150

$95

($55)

19

95

95

0

20

0

66.7

66.7

The act adds a new enumerated CSCU 2020 project, Other Projects Recommended by the Board of Regents, costing $11.7 million. (These provisions conflict with 389 & 390, which also extend the CSCU program to FY 20 but defer $110 million in bonds for FY 18 to FY 20 and do not add a new project.)

EFFECTIVE DATE: Upon passage, except that the provision on the new enumerated project takes effect October 1, 2017.

98 & 99 — UCONN 2000 INFRASTRUCTURE PROGRAM

Reduces bond authorizations by $99.1 million and extends the program by two years (but see 393 & 394)

The act extends the UConn 2000 program by two years, to FYs 25 and 26. It adjusts the program's annual bond caps, as shown in Table 14, by cancelling bonds authorized for FYs 18 to 24 by a total of $334.1 million and reallocating $235 million of them to FYs 25 and 26, resulting in a net reduction of $99.1 million. (These provisions conflict with 393 & 394, which extend the program by three years, to FY 27, and defer $54.6 million in bonds for FYs 18 and 19 to FYs 25 to 27.)

Table 14: UConn 2000 Annual Bond Limits (millions)

FY

Prior Limit

Act's Limit

Change

18

$295.5

$265.9

($55.1)

19

251.0

225.9

(25.1)

20

269.0

225.7

(43.3)

21

191.5

160.3

(31.2)

22

144.0

53.1

(90.9)

23

112.0

36.8

(75.2)

24

73.5

34.7

(38.8)

25

0

125

125

26

0

110

110

The act does not make conforming reductions to the program's aggregate bond limit or the limits for any of its named projects.

EFFECTIVE DATE: Upon passage

108 — PLAN TO TRANSFER JUVENILE JUSTICE PROGRAMS FROM DCF TO THE JUDICIAL BRANCH'S COURT SUPPORT SERVICES DIVISION (CSSD)

Requires DCF and CSSD to submit a plan to the legislature to transfer certain juvenile justice programs and services from DCF to CSSD

The act requires the DCF commissioner and CSSD executive director, by February 1, 2018, to submit a plan and recommendations for legislation to the Appropriations, Children's, and Judiciary committees on transferring juvenile justice programs and services, except programs and residential services at the Connecticut Juvenile Training School and the Pueblo Unit for girls, from DCF to CSSD.

EFFECTIVE DATE: Upon passage

109-111 — 90-DAY TURNAROUND FOR CERTAIN PERMITS

Deems certain state agency permit applications approved if the relevant agency does not make a determination on them within 90 days after receiving them

The act requires DOT, the Department of Energy and Environmental Protection (DEEP), and the Department of Agriculture (DoAg) to review and make final determinations on specified permit applications within 90 days after receiving them, otherwise, it deems the applications approved.

The act applies to the following DOT permit applications: encroachment, parkway, industrial truck, outdoor advertising, and specific information signs on limited access highways. It applies to DoAg's aquaculture permit applications and to the DEEP permit applications shown in Table 15.

Table 15: DEEP Permits with 90-Day Required Turnaround

Air permits for the temporary use of radiation DTX or RMI

Aquifer protection registration

Aquifer protection

Certificate of permission

Coastal management consistency review form for federal authorization

Emergency authorization to discharge to groundwater to remediate pollution

Property transfers

Disposal of special waste

Marine terminals

Pesticide application by aircraft

Pesticides in state waters

Waste transportation

E-waste: manufacturer

E-waste: covered recycler

Emergency discharge authorization

Online sportsman licensing system

State park passes and bus permits

State parks and forests special use licenses

Campground reservations

Other camping permits

Boating permits

Safe boating certifications

Marine event permits

Marine dealer certificates

Navigation marker permits

Regulatory marker permits

Water ski slalom course or jump permit

Fishing tournaments

Inland fishing licenses

Marine recreational and commercial licenses

Hunting and trapping

Non-shooting field trial

Private land shooting preserve permit

Regulated hunting dog training applications

Scientific collection permit for aquatic species, plants, and wildlife and educational mineral collection

Commercial arborist

Licensed environmental professional

Pesticide certification licensing and registration

Solid waste facility operator

Wastewater treatment facility operator certification

Commercial fishing licenses and permits

Forest practitioner

Nuisance wildlife control operator

Taxidermist

Wildlife rehabilitator

EFFECTIVE DATE: Upon passage

112-114 — SCHOOL CONSTRUCTION PROGRAM AND PROTOTYPE SCHOOL DESIGNS (IDENTICAL TO 505-507)

Requires towns to choose between three design prototypes when seeking the highest level of state school cost reimbursement for new construction and makes other changes

The act creates a two-tiered school construction grant reimbursement process for new construction projects, with a higher reimbursement rate for projects that use one of three prototypes school designs that the Department of Administrative Services' (DAS) School Building Projects Advisory Council must prepare. The council must submit, by April 1 2018, a report containing the blueprints for the prototypes to the Appropriations; Education; and Finance, Revenue and Bonding committees.

The prototype a town selects determines its reimbursement rate range. For school construction grant applications submitted on and after July 1, 2018, towns that pick one of the three prototypes for new construction will receive a state reimbursement rate of 10% to 70% of eligible costs. Towns that do not pick a prototype will receive a lower state reimbursement rate, which ranges from 0% to 60% of eligible costs, depending upon the wealth ranking of the town.

The act maintains existing reimbursement rates for renovations, alterations, extensions, code violations rates for other types of work remain unchanged at a range of 20% to 80%. The act narrows a provision that allows a new construction project to be reimbursed in the 20% to 80% range if the town can demonstrate that a new construction project is less expensive than a renovation, extension, or major alteration. Under the act, only new construction projects that use one of the prototypes can qualify for this reimbursement rate.

The act prohibits any reimbursement for architectural and engineering costs for new construction projects when towns do not choose one of the three prototypes, for applications on and after July 1, 2018.

Three Year Grand List Average

In a related matter, the act requires the DAS commissioner to use three years, rather than one, of adjusted equalized net grand list (AENGL) per capita when ranking all of the state's towns for school construction reimbursement rates. She must do this for grant applications made on or after July 1, 2018. AENGL per capita is a measure of property wealth in a town and a three-year average smooths significant peaks or valleys in the AENGL from one year to another.

EFFECTIVE DATE: Upon passage

115 — SCHOOL CONSTRUCTION APPLICATIONS AND DAS REPORT TO THE LEGISLATURE (IDENTICAL TO 508)

Requires school districts to indicate on their school construction applications whether they considered one of the prototype designs and adds additional enrollment reporting and other requirements for DAS when it submits the school construction list to the legislature

The act requires, for school construction program applications submitted on or after July 1, 2018, the superintendent of the applying school district to affirm that the district considered the blueprints for three different school design prototypes.

The act expands the information that must be provided to the legislature in the school construction project approval process. Under prior law, the commissioner had to provide a review of the student enrollment projections for each project on the school construction priority list she submits to the legislature every December. The act requires her to include the following more extensive information for each project instead:

1. a substantiation of the estimated total project costs;

1. the readiness of the project to begin construction;

2. an enrollment projection and school capacity;

3. efforts made by the board of education to redistrict, reconfigure, merge, or close schools under its jurisdiction before submitting the school construction application date;

4. enrollment and capacity information for all of the board's schools for the five years preceding the application and an enrollment projection and capacity information for all of the board's schools for the eight years following the application; and

5. the state's education priorities relating to reducing racial and economic isolation for the school district.

EFFECTIVE DATE: Upon passage

116 — EMERGENCY CONSTRUCTION GRANTS (IDENTICAL TO 509)

Expands the types of projects eligible for emergency school construction grants and makes other program changes

The act expands the types of projects eligible for emergency construction grants and requires school districts to follow certain procedures to receive the grants.

Project Types

By law, emergency grants can be made for correcting safety, health and other code violations; replacing roofs; and making repairs due to fire damage or other catastrophe. The act broadens the roof replacement provision to include skylight replacement or installation. It adds new grants for (1) installation of insulation for exterior walls and attics and (2) limited use or limited access elevators, windows, photovoltaic panels, wind generation systems, building management systems, and public school administrative or service facilities.

Procedures

Under the act, a superintendent must notify DAS of the need for an emergency grant in writing within seven calendar days of discovering a condition that could qualify for an emergency grant in order for the project to be eligible. The superintendent must submit a full application within six months of the notification in order to receive a grant.

EFFECTIVE DATE: Upon passage

117 — FREQUENCY OF FACILITY, AIR QUALITY, AND GREEN CLEANING REPORTS (IDENTICAL TO 510)

Reduces frequency of certain required reports

The act postpones the deadline for, and reduces the frequency of, reports local and regional boards of education must submit to the DAS commissioner on the following required programs: (1) facilities and long-term building, (2) air quality, and (3) green cleaning. Under prior law, the boards had to submit these reports triennially, beginning July 1, 2011. The act instead requires them to submit the reports once every five years and sets July 1, 2021 as the first reporting deadline.

It also makes the conforming change that the commissioner use the boards' reports once every five years, rather than once every three, to prepare a report on the same topics to submit to the Education Committee.

EFFECTIVE DATE: Upon passage

118 & 121 — CONFORMING AND TECHNICAL CHANGES TO THE SCHOOL CONSTRUCTION PROGRAM (IDENTICAL TO 511 & 514)

Makes technical changes

The act makes conforming and technical changes in these sections.

EFFECTIVE DATE: Upon passage

119 — INCREASED GRANT WITHHOLDING PERCENTAGE (IDENTICAL TO 512)

Increases to 11% the amount of a reimbursement grant that DAS can withhold pending the final audit

The act increases, from 5% to 11%, the amount of a project's reimbursement grant that DAS can withhold pending the completion of a final audit.

EFFECTIVE DATE: Upon passage

120 — REGIONAL BOARDS OF EDUCATION AND SCHOOL CONSTRUCTION OBLIGATIONS (IDENTICAL TO 513)

Specifies that when a regional board of education dissolves, local member boards are still responsible for financial and other obligations

The act specifies that when a regional board of education dissolves, the local boards of education or towns that participated in the regional board are not absolved from any school construction responsibilities or financial obligations incurred while part of the regional board. Under law, unchanged by the act, a town or district withdrawing from a regional district is not absolved from any indebtedness issued before the dissolution.

Further, the act specifies that any agreements reached as part of the dissolution cannot relieve a withdrawing town from its financial obligations related to a school building project.

EFFECTIVE DATE: Upon passage

122-128 — SCHOOL CONSTRUCTION GRANT AUTHORIZATIONS (IDENTICAL TO 498-504)

Authorizes 50 new school construction projects totaling $515 million in grants, reauthorizes three previous projects due to cost or scope changes, and makes changes affecting six other projects

The act authorizes the DAS commissioner to enter into grant commitments on behalf of the state for 50 new school construction projects. These grants total $515.2 million (total overall project costs of $846.3 million). It also reauthorizes and changes grant commitments, due to cost or scope changes, for three previously authorized local projects with a total increased grant commitment of $1.1 million.

The act exempts six school construction projects from various statutory and regulatory requirements. These exemptions are referred to as “notwithstanding” provisions.

Under the state school construction grant program, the state reimburses towns and local districts for a percentage of eligible school construction costs (with less wealthy towns receiving a higher reimbursement percentage).

New Authorizations and Changes for Previously Authorized Projects ( 122)

Table 16 shows the new school construction projects the act authorizes.

Table 16: New School Construction Projects Authorized

District

School

Project

Estimated

Project Costs

Estimated

Grant

State Reimbursement %

Branford

Francis Walsh Intermediate School

Extension and alteration

$85,933,000

$30,385,909

35.36%

Fairfield

Stratfield School

Alteration

36,793

9,592

26.07%

Fairfield

North Stratfield School

Alteration

41,410

10,796

26.07%

Fairfield

Riverfield School

Alteration

48,970

12,766

26.07%

Fairfield

Jennings School

Alteration

55,639

14,505

26.07%

Fairfield

Tomlinson Middle School

Alteration

46,403

12,097

26.07%

Fairfield

Fairfield Woods Middle School

Alteration

86,168

22,464

26.07%

Fairfield

Sherman School

Alteration

30,394

7,708

25.36%

Fairfield

Osborn Hill School

Alteration

72,704

18,438

25.36%

Fairfield

Dwight Elementary School

Alteration

62,275

15,793

25.36%

Fairfield

McKinley Elementary School

Alteration

69,666

17,667

25.36%

Fairfield

Mill Hill School

Alteration

87,550

22,203

25.36%

Fairfield

Burr Elementary School

Alteration

133,776

33,926

25.36%

Fairfield

Roger Ludlowe Middle School

Alteration

171,640

43,528

25.36%

Greenwich

New Lebanon School

Diversity school, new construction

37,309,000

29,847,200

80%

Hamden

West Woods Elementary School

New construction

26,180,000

15,147,748

57.86%

Ledyard

Ledyard Middle School

Renovation, extension, and alteration

35,652,092

22,410,905

62.86%

New Britain

Smalley Academy

Extension, alteration, and roof replacement

53,000,000

42,023,700

79.29%

New Canaan

Saxe Middle School

Extension, alteration, and code violation

18,600,000

3,786,960

20.36%

New London

New London High School - South Campus

Magnet school, alteration

49,462,274

39,569,819

80%

North Stonington

Wheeler High School

Extension, alteration, and roof replacement

23,820,500

10,974,104

46.07%

North Stonington

North Stonington Elementary School

Extension, alteration, and roof replacement

14,207,500

8,879,688

62.50%

West Hartford

Hall High School

Extension and alteration

12,800,000

5,393,920

42.14%

Regional District 1

Housatonic Valley Regional High School

Alteration and code violation

4,255,856

1,930,456

45.36%

Regional District 12

Shepaug Valley Regional Agriscience (STEM)

Vocational agricultural, new construction

29,957,408

23,965,926

80%

Groton

Cutler Elementary School (Carl C. Cutler Middle)

Diversity school and roof replacement

45,850,000

36,680,000

80%

Groton

Westside Elementary School (West Side Middle)

Extension, alteration, and roof replacement

48,480,000

27,876,000

57.50%

Groton

Consolidated Middle School

New construction and site purchase

90,090,000

42,792,750

47.50%

Hamden

Shepherd Glen School

Extension, alteration, and roof replacement

27,665,000

18,773,469

67.86%

Killingly

Killingly High School (Vo-Ag)

Vocational agricultural equipment

123,000

98,400

80%

Ledyard

Gallup Hill School

Renovation, extension, and alteration

28,612,104

17,985,569

62.86%

Manchester

Verplanck School

Extension, alteration, and roof replacement

29,172,000

19,691,100

67.50%

Newington

John Wallace Middle School

Alteration

1,300,000

742,820

57.14%

Rocky Hill

Rocky Hill Intermeditate School

New construction

48,345,097

16,577,534

34.29%

Shelton

Long Hill School

Alteration

382,060

150,111

39.29%

Shelton

Elizabeth Shelton School

Alteration

280,620

110,256

39.29%

Shelton

Mohegan School

Alteration

280,620

110,256

39.29%

Simsbury

Henry James Memorial School

Alteration and code violation

2,465,000

818,627

33.21%

Waterbury

Wendell L. Cross School

Extension, alteration, and roof replacement

46,213,083

36,309,619

78.57%

Regional District 12

Shepaug Valley High School

Alteration and energy conservation

2,914,565

957,726

32.86%

Regional District 14

Nonnewaug High School (Vo-Ag)

Vocational agricultural extension and alteration

662,000

529,600

80%

Regional District 14

Nonnewaug High School (Vo-Ag)

Vocational agricultural equipment

587,568

470,054

80%

Branford

Central Administration (Francis Walsh Intermediate)

Central administration, extension, and alteration

2,267,000

400,806

17.68%

Guilford

A. Baldwin Middle School

Energy conservation

2,351,115

713,799

30.36%

Milford

Harborside Middle School

Energy conservation

1,347,745

683,441

50.71%

Norwalk

West Rocks Middle School

Energy conservation

1,400,000

455,000

32.50%

Waterbury

Gilmartin School

Energy conservation

432,893

340,124

78.57%

West Haven

May V. Carrigan Middle School

Energy conservation

3,354,815

2,576,162

76.79%

Regional District 14

Region 14 Central Office (Nonnewaug High)

Central administration, alteration, and code violation

1,609,535

385,162

23.93%

Hartford

Martin Luther King School

Magnet school, alteration, roof replacement, code violation

68,000,000

54,400,000

80%

Total

50 projects

 

$846,306,848

$515,186,203

 

Table 17 lists changes in previously authorized school projects. In cases where the requested amount is the same, the new authorization is sought because of some change in the project scope, but the change does not result in a higher cost.

Table 17: Previously Authorized School Construction Projects with

Substantial Changes in Scope or Cost

District

School

Project

Previous Grant Authorization

Requested Grant Authorization

Change

Fairfield

Fairfield Ludlowe High School

Extension, alteration, energy conservation, and roof replacement

$3,073,994

$4,106,607

$1,032,613

Hartford

West Middle School

Extension, alteration, and roof replacement

43,680,000

43,680,000

0

New Fairfield

New Fairfield Middle/

High School

Alteration and code violation

132,300

155,274

22,974

Totals

Three projects

 

$46,886,294

$47,941,881

$1,055,587

School Construction Project Exemptions and Modifications ( 123-128)

The act exempts six school construction projects from various statutory and regulatory requirements to allow them to, among other things, qualify for (1) state reimbursement grants or (2) a higher level of reimbursement grant. These exemptions are referred to as “notwithstanding” provisions (see Table 18).

Table 18: School Construction Project Exemptions and Modifications

Act

Municipality/ Grantee

School & Project

Exemption, Waiver, or Other Change

123

Groton

Carl Cutler Middle School, extension, alteration, and roof replacement

Changes project designation from extension, alteration, and roof replacement to diversity school and roof replacement, thus triggering a higher state reimbursement level, provided the education commissioner finds the diversity school will assist Groton in addressing the existing racial disparity among students in the district; also explicitly prohibits the Claude Chester School from qualifying as a diversity school as of the act's effective date

124

Hartford

Martin Luther King School, alteration, roof replacement, and code violation

Changes project designation from alteration, roof replacement, and code violation to magnet school, alteration, roof replacement, and code violation, provided the education commissioner approves the school's magnet school plan

125

Brookfield

Brookfield High School, roof replacement

Waives the requirement that construction bid not be let out prior to DAS approval of the plans and specifications

126

New London

New London Magnet School for the Visual and Performing Arts, new magnet school construction approved in PA 14-90

Removes requirement that New London school board, the Garde Arts Center board of directors, and the DAS and education commissioners enter into a memorandum of understanding establishing the parameters under which the interdistrict magnet school must operate

127

Region 8 (Regional Hebron, Andover, and Marlborough (RHAM))

RHAM Middle and High School (no project number or specifics yet available)

Waives the project application deadline of June 30, 2017 for eligibility for the priority list considered in the 2018 legislative session and commitment of the local funding share of the project, provided (1) a local funding authorization referendum is held and results are submitted by November 15, 2017 and (2) a completed grant application with authorization for the local share of the project is filed by September 30, 2017

128

Norwich

Kelly Middle School, renovation

Increases the grant amount by an additional $1,032,000

EFFECTIVE DATE: Upon passage

129-135 — REVISIONS TO EDUCATION COST SHARING (ECS) FORMULA

Revises ECS formula, the largest form of state aid to towns, by changing several major formula components including the base aid ratio, foundation dollar amount, weighting for high need students; includes phase-in for aid increases and decreases until FY 28

The act revises the state education equalization formula, commonly referred to as the education cost sharing (ECS) formula. (The state has not used the formula since FY 14; instead it has set a specific aid amount in statute for each town.) The act makes changes to each of the three key factors in the formula and establishes a method to determine each town's aid amount for FY 18 and the following fiscal years.

The ECS formula has the following three key factors:

1. the foundation dollar amount (previously $11,525);

2. the student count with weightings for high need students, referred to as total need students; and

3. the base aid ratio, which is a measure of town wealth.

Under the formula, the foundation is multiplied by the number of need students, and the result is multiplied by the aid ratio, to produce the grant amount. A small bonus is added for regional schools (if applicable), and this results in a town's fully funded grant. For example, under prior law, a school district with no regional bonus and 1,000 need students that has a base aid ratio of .50 would receive a grant of $5.76 million (1,000 x .50 x $11,525 (the previous foundation amount)).

Formula Factors Modified

Beginning with the 2017-18 school year, the act modifies the foundation dollar amount and two aspects of student need weightings. Specifically, it:

1. decreases, from $11,525 to $9,638, the foundation dollar amount;

2. changes the student poverty weighting from 30% of students eligible for free or reduced priced meals or free milk (FRPM) to 30% of FRPM-eligible students plus an additional 5% of any FRPM-eligible students above 75% of the total number of resident students; and

3. adds a new 15% weighting for the number of students who are English language learners, as identified by the school district.

New Factor: Base Aid Ratio Adjustment

The act creates the base aid ratio adjustment factor, which is a bonus added to a town's base aid ratio, if the town is ranked in the top 19 Connecticut towns based on points awarded through the eligibility index for public investment communities (PIC).

The PIC eligibility index measures towns relative wealth and need by ranking them in descending order by their cumulative point allocations for five categories: (1) per capita income, (2) adjusted equalized net grand list per capita, (3) equalized mill rate, (4) per capita temporary family assistance, and (5) unemployment rate (CGS 7-545).

Under the act, the adjustment factor gives towns anywhere from 3 to 6 percentage points bonus in their base aid ratio if they rank in the top 19 of all towns in total eligibility index points as shown in Table 19 below.

Table 19: Base Aid Ratio Adjustment Factor Bonus

Town Rank Based on PIC Eligibility Index

Bonus % Points Added to Base Aid Ratio

1-5

6

6-10

5

11-15

4

16-19

3

Minimum Aid Ratios and Balance of Property and Income Wealth

The act maintains the minimum aid ratio for alliance districts at 10% and reduces the minimum aid ratio for all other districts from 2% to 1%. The minimum aid ratio guarantees that wealthier towns receive at least a minimum amount of ECS aid.

The act also modifies the proportion of property to income wealth that determines the town wealth measure (“wealth adjustment factor”). Under prior law, the wealth adjustment factor was calculated using 90% property wealth and 10% income wealth. Under the act, it is calculated using 70% property and 30% income, thus increasing the weight for income wealth in the aid ratio part of the formula.

Town Aid Determination for FYs 18 and 19

The act creates a new, lower base grant amount for each town as a starting point to calculate aid amounts. It requires the “base grant amount” to equal 78% of the aid a town was entitled to receive for FY 17, under the 2016 budget act (PA 16-2, May Special Session). (Due to authorized cuts that were implemented later, towns actually received less than the entitlement provided in the budget act.)

The act compares a town's new base grant amount to its fully funded grant. For some towns the fully funded grant is an amount greater than the aid they had received in the past. For other towns, especially those with declining student enrollments, the fully funded grant may be less than what the town is receiving. (This is primarily due to the past practice of keeping ECS aid at least level for all towns, even if student enrollment dropped.) Table 20 shows how aid increases or decreases are determined for FYs 18 and 19.

Table 20: ECS Aid Amount Calculation for FYs 18 and 19

New Base Aid*

FY 18 Aid

FY 19 Aid

If a town's fully funded amount is greater than its new base aid

New base aid plus 5% of the difference between the fully funded amount and the new base aid

New base aid plus 15% of the difference between the fully funded amount and the new base aid

If a town's fully funded amount is less than its new base aid

New base aid

New base aid minus 10% of the difference between its new base aid and its fully funded grant

*New Base Aid is 78% of FY 17 aid amount authorized under PA 16-2, May Special Session. This means all towns start with a lower base aid.

Town Aid Determination and for FYs 20 to 28

Under the act, for FYs 20 to 28, a town whose fully funded grant is greater than its new base grant will receive an aid amount that equals the aid received in the previous fiscal year plus 10% of the difference between its fully funded grant and its new base grant amount. A town whose fully funded grant is less than its base grant amount will receive an aid amount that equals the aid received in the previous fiscal year, minus 10% of the difference between its new base grant amount and its fully funded grant.

For FY 29 and all years following, towns will receive their fully funded amount.

EFFECTIVE DATE: Upon passage

136 — ECS FORMULA REVIEW TEAM

Creates an ECS formula review team to review and make recommendations on the ECS formula

The act creates an ECS formula review team to review the formula and make recommendations on possible formula changes to the Education and Appropriations committees by March 1, 2018.

The team consists of the chairpersons and ranking members of the Education Committee, the OPM secretary, and one representative from each of the following organizations: (1) Connecticut Association of Boards of Education, (2) Connecticut Association of Public School Superintendents, (3) Connecticut Education Association, and (4) American Federation of Teachers-Connecticut.

The Education Committee's administrative staff serves as the administrative staff of the review team. The team terminates on the date it submits its report or March 1, 2018, whichever is later.

EFFECTIVE DATE: Upon passage

137 — EDUCATION FUNDING REALLOCATION

Requires the education commissioner to redistribute increases in ECS and special education grants received by certain school districts over the past fiscal year among districts that received a grant decrease

For each school district that receives a combined ECS and special education grant increase in FY 18 of less than $1,550,000 more than its FY 17 allocation, the act requires the education commissioner to withhold an amount equal to that increase and deposit it in an “education funding reallocation account.” School districts that receive a combined increase equal to or greater than $1,550,000 for these fiscal years will not have their increase withheld by the commissioner.

The act requires the commissioner to use these account funds to give grants to each school district that receives less ECS and special education grant money in FY 18 than in FY 17. The grants must be equal to the amount of each district's reduction in funding.

EFFECTIVE DATE: Upon passage

138 & 139 — SPECIAL EDUCATION FUNDING

Eliminates and creates various special education cost grants, including those for state agency-placed students receiving special education services

Grants for State-Agency Placed Students ( 138 & 139)

The act requires boards of education to cover all special education costs in their entirety for children placed in their district by the Department of Children and Families and other state agencies, rather than the lesser of the (1) full costs or (2) average per pupil expenditure. It correspondingly eliminates the requirement that the State Board of Education pay the difference between the above costs and the board of education's average per pupil expenditure.

Excess Cost and Supplemental Grants ( 139)

The act eliminates special education excess cost grants to boards of education for all students (both agency-placed and non-agency-placed). Under prior law, school districts received the grant for students receiving special education services whose costs exceeded 4.5 times the per pupil cost for a board to education a student.

The act also eliminates a supplemental special education grant that is no longer funded in practice.

New Special Education Grant ( 139)

The act creates a new special education grant to reimburse boards of education for a percentage of net special education costs and allows the state to reduce this new grant proportionally when grant amounts exceed appropriations (i.e., it creates a grant cap). It establishes two different formulas for determining the reimbursement percentage: one for local boards of education and another for regional boards.

Local Board Formula. To calculate a local board's reimbursement percentage, towns are ranked highest to lowest by their adjusted equalized net grand list per capita. Based on these rankings, each town is placed on a continuous scale and given a percentage reimbursement of at least 2.5% and at most 52%.

Regional Board Formula. To calculate a regional board's reimbursement percentage, boards are ranked according to a multi-step formula. First, the total population of each member town in the regional school district is multiplied by each town's ranking in the above town rankings by adjusted equalized net grand list per capita. Then, the product for each town is added together and subsequently divided by the combined population of all member towns in the regional district. The quotient is rounded to the next higher whole number. Lastly, the rounded number is compared with the local board rankings for reimbursement percentages, and the regional board is assigned the same reimbursement percentage as the town that has that same rank.

Application and Disbursement Processes. The act allows local and regional boards of education to apply for this reimbursement grant on or before September 1 for costs from the prior fiscal year as reported to the education commissioner. Additional audited data must be submitted to the commissioner on or before December 31.

Under the act, for each estimated total grant of $500,000 or more, 50% of the grant must be paid in October based on the costs submitted for September 1. The adjusted balance must be paid in April based on the audited data submitted for December 31. For each estimated grant of less than $500,000, a single payment is made in April based on audited data submitted for December 31.

EFFECTIVE DATE: Upon passage

140 — GRANTS TO BOARDS OF EDUCATION FOR STATE AGENCY PLACEMENTS IN RESIDENTIAL AND JUVENILE DETENTION FACILITIES

Eliminates grants for boards of education for students placed by state agencies in residential facilities and juvenile detention facilities

When a student is placed by a state agency in a residential facility, the act requires boards of education to cover reasonable education costs in their entirety (excluding special education costs), rather than the lesser of (1) the full costs or (2) the prior year's average per pupil expenditure, as required under prior law. When a student is detained in a juvenile detention facility, the act requires boards of education to cover education costs in their entirety (including special education costs), rather than an amount equal to the prior year's average per pupil expenditure, as required under prior law.

According to existing law, unchanged by the act, for either placement type, the board of education that would otherwise be responsible for educating the student is responsible for the costs. If a student is detained in a juvenile detention facility and the board cannot be identified, however, then the school district where the facility is located is responsible for the costs.

The act correspondingly eliminates the requirement that the State Board of Education pay the difference between actual costs and the responsible board of education's portion.

EFFECTIVE DATE: Upon passage

141 — UCONN PROFESSORS' COURSE LOAD

Requires the UConn board of trustees to increase each full-time professor's course load by one course during a school year

The act requires the UConn board of trustees, by January 1, 2018, to increase each full-time professor's course load during a school year by one course.

EFFECTIVE DATE: Upon passage

142 — SUPERINTENDENTS FOR SMALL TOWNS

Allows local boards of education that meet certain “small town” criteria to receive direction from another board of education's superintendent, rather than employ their own local superintendent

For local boards of education whose towns have fewer than (1) 10,000 residents, (2) 2,000 resident students, or (3) three public schools, the act gives them the option to either employ a local superintendent or receive direction from another board of education's superintendent. The other board of education must authorize the use of its superintendent.

The act limits the requirement to employ a superintendent to (1) local boards of education that do not meet the above criteria and (2) regional boards of education. Existing law, unchanged by the act, allows boards of education to jointly employ a superintendent.

EFFECTIVE DATE: Upon passage

143 — SUPERINTENDENTS FOR MULTIPLE TOWNS

Allows boards of education that share a superintendent to adjust the frequency and format of their board meetings

The act allows boards of education that jointly employ the same superintendent to reduce the number of board meetings they hold, or to hold joint meetings at least quarterly, to reduce expenses and align their provision of education. This authority overrides any conflicting provisions in special acts, municipal charters, home rule ordinances or other ordinances, or state statutes governing boards of education or town management.

EFFECTIVE DATE: Upon passage

144 & 145 — BOARD OF EDUCATION COOPERATIVE ARRANGEMENTS

Allows for cooperative arrangements to provide administrative and central office duties

The act allows two or more boards of education, or a municipality and its own board of education, to enter into cooperative arrangements for administrative and central office duties.

EFFECTIVE DATE: Upon passage

146 — MINIMUM BUDGET REQUIREMENT (MBR) FOR ALLIANCE DISTRICTS

For FYs 18 and 19, extends the MBR only for alliance districts

The act renews, for FYs 18 and 19, the MBR for alliance districts (i.e., school districts with the lowest accountability index scores), thus requiring these districts to at least maintain their budgeted education appropriation at the same level as the previous year, plus any equalization grant increase provided in FY 17. Accountability index scores measure school district performance based on standardized tests, graduation rates, chronic absenteeism, and other factors.

The act does not renew the MBR for other non-alliance districts (the MBR expired for all districts at the end of FY 17). It also removes obsolete language.

EFFECTIVE DATE: Upon passage

147 — BOARD OF EDUCATION ADMINISTRATIVE PERSONNEL HIRING

Requires municipal legislative bodies to approve the hiring of administrative personnel by local boards of education absent a budgeted appropriation

The act prohibits local boards of education from hiring administrative personnel without approval from their respective municipal legislative body if the education budget does not provide funding for the position.

EFFECTIVE DATE: Upon passage

148 — REGIONAL SCHOOL DISTRICT FINANCE COMMITTEE

Allows a regional board of education to establish a finance committee

The act allows a regional board of education to establish a finance committee for the regional school district to (1) inform the board about member towns' local budget issues and (2) help prepare the district's budget proposal upon request. Member towns' legislative bodies must each appoint two representatives to the committee.

EFFECTIVE DATE: Upon passage

149 & 150 — CHARTER SCHOOL GRANT PAYMENTS

Disburses state grants to charter schools directly to a charter school's fiscal authority and requires proportional grant reductions if the grant total exceeds the appropriated amount

The act requires the state to send per-pupil grants for local charter schools and state charter schools directly to the respective charter schools' fiscal authorities, rather than to the towns where the schools are located. Under prior law, the payments went first to the towns which then sent them to the schools' fiscal authorities. The act eliminates the related language that set a timeline for the towns to send the grant funds to the charter schools.

The act also requires, for FYs 18 and 19, that per-pupil charter school grants be reduced proportionately if the grant total exceeds the appropriated amount.

It also makes various conforming changes.

EFFECTIVE DATE: Upon passage

151 — ROBERTA B. WILLIS SCHOLARSHIP

Closes the scholarship to new applicants but allows previously issued awards to be renewable

The act prohibits the Office of Higher Education from making new Roberta B. Willis scholarship awards to students. It allows awards made in FY 17 to be renewable for the life of the original award, however, if the student continues to meet need and academic standards.

The Willis Scholarship is the state's financial aid program for Connecticut residents who attend a public or independent higher education institution in the state.

EFFECTIVE DATE: Upon passage

152 — UCONN AND UCONN HEALTH CENTER (UCHC) EMPLOYEE COMPENSATION

Requires UConn and UCHC to fund a portion of certain employees' compensation with funds from outside the General Fund

The act requires UCONN and UCHC to use funds that are not appropriated from the General Fund to pay for the portion of any of their employees' salaries that exceeds $100,000 (excluding fringe benefits), and the cost of any fringe benefits associated with that portion.

EFFECTIVE DATE: Upon passage

153 & 154 — TEACHER CONTRIBUTIONS TO THE TEACHERS RETIREMENT SYSTEM (TRS)

Increases teachers' contributions to TRS and requires funds from the increase to be credited to the General Fund

The act increases teachers' “regular contributions” to TRS from 6% to 7% of their annual salary between January 1, 2018 and June 30, 2018 and from 7% to 8% on and after July 1, 2018. By law, teachers' mandatory contributions to TRS consist of their regular contributions plus a 1.25% health contribution.

For FY 18, the act requires 1% of the teachers' regular contributions withheld between January 1, 2018 and June 30, 2018 to be credited to the General Fund. And for FY 19, it requires 2% of their regular contributions withheld during the fiscal year to be credited to the General Fund.

EFFECTIVE DATE: Upon passage

155 — NON-UNION STATE EMPLOYEE CONTRIBUTION TO RETIREE HEALTH INSURANCE

Requires 5% of non-union employees' base salary to be withheld from their base pay

Starting July 1, 2017, the act requires 5% of base salary to be withheld from the compensation of any non-union state employee who is a member of a state-sponsored retirement system. Under the act, 3% of the withholding must constitute the employee's share of the costs of providing state-retiree health insurance and 2% of the withholding must be deposited in the General Fund to offset the state's share of providing state-retiree health insurance.

(To the extent the act's requirement is applied retroactively to July 1, 2017, it could be subject to litigation brought by employees claiming wage theft under CGS 31-71b and violations of the U.S. Constitution's Takings Clause, which prohibits state governments from taking private property for public use without just compensation.)

EFFECTIVE DATE: Upon passage

156 — TRANSFERS FROM NONAPPROPRIATED ACCOUNTS

Allows the OPM secretary to transfer funds from certain nonappropriated accounts to the General Fund

For FY 19, the act allows the OPM secretary to transfer up to $20 million to the General Fund from the fund's nonappropriated accounts that do not receive (1) gifts, grants, or donations from public or private sources or (2) other revenues from individuals to support a particular interest or purpose.

EFFECTIVE DATE: Upon passage

157 — LEGISLATIVE APPROVAL OF STATE EMPLOYEE CONTRACTS AND ARBITRATION AWARDS

Requires the legislature to affirmatively vote to approve state employee union contracts and arbitration awards; revises the process that occurs if the legislature rejects an agreement or award

The act requires the legislature to affirmatively vote to approve state employee union contracts and arbitration awards. Under prior law, such contracts and awards were deemed approved if the legislature failed to vote to approve or reject them within a specified time frame. Under the act, they will instead be deemed rejected if the legislature fails to vote to approve or reject them within the same time frame.

The act also revises the process that occurs after the legislature rejects a contract or arbitration award. Under prior law, when a contract or award was rejected, the matter was returned to the parties for further negotiating. The act instead establishes separate processes for rejected contracts and awards. Rejected arbitration awards must return to arbitration with the award from this subsequent arbitration automatically deemed approved by the legislature. Rejected contracts must go to arbitration under the state employee arbitration law and the subsequent arbitration award must be submitted to the legislature for approval. If the legislature rejects this award, the matter must return for further arbitration with any subsequent award from the further arbitration deemed approved by the legislature.

(The above provisions are repeated in 316.)

EFFECTIVE DATE: Upon passage

158 — APPLYING SEBAC 2017 TO NON-UNION STATE EMPLOYEES

Requires terms comparable to those in the 2017 SEBAC Agreement to be implemented for non-union state employees by October 1, 2017

The act requires the DAS commissioner and OPM secretary to apply terms comparable to those in the 2017 SEBAC Agreement to all non-union state employees. However, terms concerning wages for legislative employees must be applied by the Legislative Management Committee. SEBAC is the coalition of state employee unions that, by law, negotiates with the state over state employee pension and health insurance benefits. Among other things, the 2017 agreement (1) made numerous changes to state employee health and pension benefits, such as increasing employee contributions toward their pensions and healthcare, and (2) imposed various wage provisions, such as wage freezes and furlough day requirements in FYs 17 and 18.

The act requires the OPM secretary, by September 30, 2017, to submit a plan to the Appropriations Committee detailing how the SEBAC agreement's terms will apply to the non-union classified and unclassified employees. By the same date, the chief court administrator and the legislative management executive director must each also submit plans to the Appropriations Committee detailing how the SEBAC contract's terms will apply to non-union classified and unclassified officers and employees of the Judicial Department and legislative branch, respectively.

Wages

The act requires, by October 1, 2017, the DAS commissioner and OPM secretary, chief court administrator or Supreme Court judges, and Legislative Management Committee to consider and implement wage changes for non-union and unclassified officers and employees of the executive branch, constituent units of higher education, and Board of Regents; judicial department; and legislative branch, respectively, that are comparable to the SEBAC agreement's wage payment provisions. It specifies that the requirement to implement wage changes does not apply to judicial branch officers or employees whose wages are set in statute (e.g., judges, family support magistrates, and workers' compensation commissioners) or legislators.

EFFECTIVE DATE: Upon passage

159-161 — 2027 CHANGES TO THE STATE EMPLOYEES RETIREMENT SYSTEM (SERS)

Starting July 1, 2027, increases employee contributions to SERS and limits SEBAC agreements to four-year terms; changes pension calculations and limits cost of living adjustments (COLAs) for those who retire on or after that date

Starting July 1, 2027, the act requires a 7% salary contribution to SERS from all state employees in the executive branch, constituent units of higher education, Board of Regents for Higher Education, judicial branch, and legislative branch. Starting on June 30, 2027, it also prohibits any SEBAC agreement or arbitration award from having a term of more than four years (this provision is repeated in 318).

Furthermore, the act changes pension calculations and limits COLAs for those who retire on or after July 1, 2027, regardless of their hiring date. Specifically, it (1) requires their overtime contribution to their final average pay to be computed under the same terms that apply to Tier IV state employees under the 2017 SEBAC Agreement (i.e., 25-year overtime averaging); (2) prohibits them from receiving a COLA until SERS is 80% funded; and (3) requires their pension payments to be computed without a breakpoint (generally, a variable in the pension formula that boosts pensions for those with salaries that exceed the salary limit for Social Security tax).

Lastly, the act prohibits any SEBAC agreements negotiated after the act's effective date from including any provisions that conflict with or supersede 2 of the act (presumably, this refers to the above 2027 changes in SERS, 159, and not to 2's appropriations from the Special Transportation Fund).

EFFECTIVE DATE: Upon passage

162 — CRIMINAL JUSTICE DIVISION'S COLD CASE UNIT AND SHOOTING TASK FORCE APPROPRIATIONS

Prohibits the Division of Criminal Justice from commingling funds appropriated to the Cold Case Unit with those appropriated to the Shooting Task Force

The act requires the Division of Criminal Justice to (1) maintain the Cold Case Unit's appropriated funds separately from those of the Shooting Task Force and (2) spend the funds only for the purposes appropriated.

EFFECTIVE DATE: Upon passage

163 — REOPENING MUNICIPAL EMPLOYEE UNION CONTRACTS

For new contracts, establishes a process by which towns may (1) ask unions to reopen a union contract to negotiate revisions related to regionalization and (2) require unions to vote on a proposed contract revision

The act establishes a multi-step process by which municipalities may ask their employees' unions to reopen a contract to negotiate revisions related to regionalization. It allows municipalities, for any employee contract negotiated on or after the act's effective date, to present a proposed contract revision to enact regional consolidation or shared service agreements to the union and ask it to reopen the negotiation process. The union is deemed to have denied the request if it does not respond within five days.

If the union denies the request, the act requires the State Board of Labor Relations (SBLR), through its agent, to convene a meeting of the bargaining unit's membership within 30 days after the denial. The municipality must present its proposed revision at the meeting and the membership must vote on the proposal within five days after the meeting. SBLR must schedule the vote and post a notice of its date, time, and location.

If the union agrees to negotiate the municipality's proposal, the act gives the parties 14 days to negotiate, with an additional 14-day extension allowed if both parties agree. If the parties reach a contract agreement, it must be ratified according to the bargaining unit's ratification procedure. If the parties fail to reach an agreement, the municipality's last best offer on the proposal must be submitted to the bargaining unit's membership for a vote within five days after negotiations end. The union must schedule the vote and the municipality must have an opportunity to present its revisions to the members before the vote.

For all of the above bargaining unit membership votes, the act (1) requires an affirmative vote by a majority of the bargaining unit's membership for approval and (2) makes the vote the final action on a proposed revision. A failure to achieve an affirmative vote is a final rejection of the proposal and is not subject to further dispute resolution, leaving the existing contract in effect.

The act also specifies that the above requirements are not prohibited labor practices under the Municipal Employees Relations Act or the School Board Teacher Negotiations Act.

EFFECTIVE DATE: Upon passage

164 — MUNICIPAL EMPLOYEE BINDING ARBITRATION

Requires random appointment of neutral arbitrators in municipal binding arbitration cases; gives arbitrators more time to issue decisions; requires parties to meet certain procedural deadlines (which may be mutually waived) within one year

Prior law required municipal employee contract arbitration cases to be heard by a three-arbitrator panel, with the parties each choosing one arbitrator and then mutually agreeing on a third, neutral arbitrator. The act allows the parties to mutually agree to have their case heard by a single neutral arbitrator rather than a three-arbitrator panel. If the parties opt for a single arbitrator, (1) the parties must provide written notice to the State Board of Mediation and Arbitration within 10 days after receiving the board's notice that arbitration has been imposed, and (2) the board must randomly appoint a neutral arbitrator from the panel of neutral arbitrators within five days of the notice.

If the parties opt to have their case heard by a three-arbitrator panel, the act requires the board to randomly appoint the panel's neutral arbitrator from the panel of neutral arbitrators, rather than allowing the parties to mutually agree on a neutral arbitrator. The board must make the appointment within five days after the parties appoint the other two panel members. By law, unchanged by the act, if the parties fail to appoint their panel members, the board must appoint the members needed to complete the panel. The act requires the board to also do this if the parties fail to provide notice of their intent to have their case heard by a single, neutral arbitrator.

The act also requires (1) the parties to file their last best offer statements and briefs on unresolved issues (two procedural steps in the arbitration process) within one year after either party requested the board's arbitration services or the board imposed arbitration on them and (2) arbitrators to issue their decisions within 60, rather than 20, days after the parties file their briefs on unresolved issues.

The law, unchanged by the act, allows the parties to mutually agree to modify, defer, or waive any of the above requirements and deadlines.

EFFECTIVE DATE: Upon passage

165 — EDUCATION ADMINISTRATIVE PERSONNEL CONTRACTS

Requires boards of education to file administrative personnel contracts with town clerks, who must then post them online

The act requires local boards of education to immediately file with their town clerks a signed copy of any contract for administrative personnel. It also requires regional boards of education to file copies of such contracts with the town clerk in each member town. In both instances, the clerk must post a copy of the contracts on the town's website.

EFFECTIVE DATE: Upon passage

166 — MUNICIPAL BUDGET RESERVES IN ARBITRATION

Establishes an irrebuttable presumption that a portion of a municipality's budget reserve cannot be used to pay for arbitration awards

The act establishes an irrebuttable presumption that a municipality's budget reserve of 15% or less is not available to pay the costs of any item subject to municipal contract arbitration.

Under the municipal employee arbitration law, arbitrators must prioritize the public interest and the municipal employer's financial capacity, including other financial demands on the employer, when considering a union contract case. In effect, the act requires the panel to ignore a budget reserve of up to 15% (presumably of the municipality's budget) when considering the municipal employer's financial capacity. Under prior law, any budget reserve could be considered as part of that capacity. The act does not change the other factors a panel must consider (e.g., changes in the cost of living).

EFFECTIVE DATE: Upon passage

167 & 168 — PREVAILING WAGE

Increases prevailing wage thresholds for public works projects; exempts municipal elevator or roof work from prevailing wage requirements; temporarily exempts certain projects in New Haven County from prevailing wage requirements; and applies prevailing wage requirements to certain DECD-funded projects

The act makes several changes to the state's prevailing wage law. First, it increases the public works prevailing wage threshold from $400,000 to $1 million for new construction projects and from $100,000 to $500,000 for renovation projects (i.e., remodeling, refinishing, refurbishing, rehabilitation, alterations, or repairs). By law, employers on public works projects for the state or its political subdivisions whose total costs exceed the thresholds must pay their construction workers the prevailing wage (i.e., wages and benefits equal to those that are customary or prevailing for the same work, in the same trade or occupation, in the same town).

The act also exempts from the prevailing wage requirements any elevator or roof work for a political subdivision's public works project. It also temporarily exempts, from when the act is enacted until July 1, 2019, any public works projects that are (1) for a New Haven County municipality with a population between 12,000 and 13,000, as determined by the most recent DPH estimate, and (2) funded in whole or in part by a private bequest of between $9 million and $12 million.

The act also extends prevailing wage requirements to any new construction project by a business that receives a total of at least $1 million in financial assistance from the Department of Economic and Community Development (DECD) for the project on or after January 1, 2019 (“covered projects”). Financial assistance for a project includes loans, cash payments, credit extensions, guarantees, equity investments, tax abatements, or any other state financing.

Prevailing Wage for DECD-assisted Projects

Under the public works prevailing wage law, contracts with contractors and subcontractors on covered public works projects must provide that the contractors and subcontractors pay their construction workers the prevailing wage. Contractors who do not provide benefits at the same rate required under the prevailing wage must make up the difference in hourly wages.

The act requires a business that receives at least $1 million in DECD financial assistance on or after January 1, 2019 to include the same prevailing wage provision in its contracts for covered projects. DECD must impose this requirement as a condition of receiving assistance.

As under the public works prevailing wage law, the labor commissioner must determine the prevailing wage for each trade or occupation and location (in practice, the commissioner uses rates established by the U.S. Department of Labor). Unlike the public works prevailing wage law, the act does not require:

1. DECD to certify the total dollar amount of work to be done on the project,

2. the business to (a) obtain the applicable prevailing wage rates from the labor commissioner before advertising for the contracts or (b) include the prevailing wage rates in proposals for the contracts, or

3. contractors, upon award of a contract, to certify the pay scale they and their subcontractors will use on it.

Enforcement. Similar to the public works prevailing wage law, the act allows for fines of between $2,500 and $5,000 per offense for contractors or subcontractors on the business's covered project who knowingly or willfully fail to pay their employees the prevailing wage. In addition, a first-time violator must fully repay back wages and cannot bid on other covered projects until six months after it has done so. A contractor or subcontractor with subsequent violations must fully repay back wages and cannot bid on other covered projects until two years after it has done so.

Similar to the public works prevailing wage law, if a business finds that a contractor or subcontractor on its covered project is not paying the prevailing wages, the business can (1) by written or electronic notice terminate the contractor's right to continue working on the project and hold the contractor or its sureties liable for any excess costs to complete the work or (2) withhold payments to the contractor or subcontractor. If the business takes either of these steps it must notify the labor commissioner, within two days, of the contractor's or subcontractor's name, the project and its location, the violations involved, the date the contract was terminated, if applicable, and steps taken to collect the required wages. The labor commissioner may file a complaint about violations with the proper prosecuting authority.

Record Keeping Requirements. The act expands the public works prevailing wage law's record keeping requirements to include covered projects. Among other things, this requires contractors and subcontractors on a project to submit monthly certified payroll records to DECD. The records must contain the same information required under the public works prevailing wage law, including:

1. detailed payroll records for each employee; and

2. a signed statement that, among other things, (a) the records are correct, (b) the employer met the prevailing wage law's requirements, and (c) the employer understands the penalties for knowingly filing false payroll records.

The penalties for failing to comply with the certified payroll records requirement or knowingly filing false payroll records are the same as under the public works prevailing wage law (class D felonies, see Table on Penalties).

EFFECTIVE DATE: October 1, 2017

169 — MEDICAID WAIVER AND AMENDMENT NOTIFICATION

Requires DSS to report annually on potential Medicaid waivers and changes to the Medicaid state plan that may result in cost savings, and narrows a legislative notification requirement

The act requires the DSS commissioner, annually by December 15, to notify the Appropriations and Human Services committees of potential Medicaid waivers and amendments to the Medicaid state plan that may result in state cost savings. Under prior law, the commissioner had to notify the Appropriations and Human Services committees if, in developing the next fiscal year's budget, the commissioner considered applying for a federal waiver for any assistance program or submitting a proposed Medicaid state plan amendment to the federal government. Existing law, unchanged by the act, requires the commissioner to submit applications for waivers and waiver renewals to the Appropriations and Human Services committees for approval before submitting them to the federal government.

EFFECTIVE DATE: Upon passage

170 — SPECIAL TRANSPORTATION FUND (STF)

Removes the requirement that remaining STF funds, after first being used for other specified obligations, pay for DSS' transportation to work program

By law, money in the STF must be used first for debt service on special tax obligation bonds and to pay for certain transportation projects. The act eliminates a requirement that remaining STF funds pay for DSS' transportation for employment independence program. Existing law, unchanged by the act, requires that such funds also be appropriated to pay for (1) general obligation bonds issued for transportation projects, (2) DOT and DMV budget appropriations, and (3) DEEP boating regulation and enforcement.

EFFECTIVE DATE: Upon passage

171-173 — BIRTH-TO-THREE

Transfers administration of the Birth-to-Three program from OEC to SDE

The act transfers administration of the Birth-to-Three program, which provides mental health services to children eligible for early intervention services under the federal Individuals with Disabilities Education Act (IDEA), from OEC to SDE.

EFFECTIVE DATE: Upon passage

174 — MEDICARE PART D FOR DUALLY ELIGIBLE RECIPIENTS

Eliminates the requirement that DSS pay any Medicare Part D prescription drug copayments for beneficiaries who are dually eligible for Medicare and Medicaid

The act eliminates the requirement that DSS pay any Medicare Part D prescription drug copayments for Medicare beneficiaries who are also fully eligible for Medicaid. Under prior law, DSS paid any costs that exceeded $17 for any beneficiary in one month.

EFFECTIVE DATE: Upon passage

175 — MEDICAID PHARMACY REIMBURSEMENT

Eliminates statutory requirements and allows DSS to revise reimbursement methodology and professional dispensing fees

The act eliminates the Medicaid reimbursement methodology for prescription drugs and pharmacist professional fees that prior law required DSS to follow. It instead allows DSS, with OPM approval, to revise the Medicaid reimbursement methodology and dispensing fees for covered outpatient drugs on or after April 1, 2017. The act also eliminates a provision allowing DSS to provide an enhanced dispensing fee to a pharmacy enrolled in the federal Office of Pharmacy Affairs Section 340B drug discount program.

EFFECTIVE DATE: Upon passage

176-179 — MEDICAID AND SPECIAL EDUCATION

Requires each local and regional board of education to enroll as a Medicaid provider, participate in DSS's Medicaid School Based Child Health Program, and submit billable service information to DSS

The act requires each local and regional board of education, by July 1, 2017, to (1) enroll as a Medicaid provider, (2) participate in DSS' Medicaid School Based Child Health (SBCH) Program, and (3) submit billable service information electronically to DSS or its billing agent. It also makes technical changes.

Third-Party Vendors

The act allows any local or regional board of education to contract with a third-party vendor to comply with its requirements. It permits these agreements to provide that costs for the contracted services be paid from, and contingent on receipt of, sufficient funds from grants DSS makes by law to local and regional boards of education based on Medicaid claims for special education services provided to students in the school district.

SBCH Program

The act requires, rather than allows, local and regional boards of education to determine a child's Medicaid enrollment status. It also requires planning and placement teams to comply with federal parental consent and written notification requirements prior to billing for services under the SBCH Program. In addition, the act requires private schools, hospitals, and other institutions that provide special education instruction under an agreement with a local or regional board of education to submit to the board all documentation required to submit claims to the SBCH Program.

EFFECTIVE DATE: Upon passage

180 — LIMIT ON NONEMERGENCY ADULT DENTAL SERVICES

Caps payment for nonemergency dental services for adults to $1,000 per fiscal year

The act establishes a cap on DSS' payment for nonemergency dental services for adults at $1,000 per fiscal year per individual. By law, covered services are only those that are medically necessary.

EFFECTIVE DATE: Upon passage

181-204 & 975 — CITIZENS' ELECTION PROGRAM

Repeals the CEP; requires that CEF funds be transferred to the General Fund

The act repeals the state's public campaign financing program, known as the Citizens' Election Program (CEP). Under the program, legislative and statewide office candidates who received qualifying contributions ranging from $5 to $100, agreed to limit their spending, and complied with other requirements, were eligible to receive state grants to fund their campaigns.

In repealing the CEP, the act subjects all legislative and statewide office candidates to the limits on campaign contributions that previously applied only to candidates who did not participate in the program. It also removes the limits on campaign spending that previously applied only to those who participated.

The act makes numerous technical and conforming changes, including eliminating the State Elections Enforcement Commission's CEP-related duties, as well as references to “participating candidates” and “nonparticipating candidates.”

EFFECTIVE DATE: Upon passage

Citizens' Election Fund

The act makes another conforming change by eliminating the Citizens' Election Fund (CEF) from which grant payments to participating candidates were made. It requires that all CEF funds be transferred to the General Fund.

Under prior law, the CEF was funded mostly by proceeds from the sale of abandoned property that escheats (reverts) to the state. If there were not enough proceeds in a fiscal year to cover the required annual deposit, corporation business tax revenues were deposited in the fund to cover the shortfall. The fund also received voluntary contributions, surplus donations from candidate committees, and proceeds from its investment earnings.

205-213 — CONTRIBUTION LIMITS

Increases the limit on contributions to (1) legislative office candidates from legislative caucus and legislative leadership committees and (2) exploratory committees from various contributors

The act increases various contribution limits. Specifically, it increases the limit on contributions from legislative caucus and legislative leadership committees to candidates for (1) state senator, from $10,000 to $20,000, and (2) state representative, from $5,000 to $10,000. By law, unchanged by the act, these limits apply separately to primary and general election campaigns.

The act also increases, from $375 to $1,000, the limit on contributions to exploratory committees from the following sources:

1. business political committees (known as PACs),

2. labor PACs,

3. party committees (i.e., state central and town committees),

4. PACs organized for ongoing political purposes, and

5. PACs organized for a single primary or election.

Similarly, the act increases, from $375 to $1,000, the limit on contributions from individuals to exploratory committees, other than for those for state representative candidates. The act retains the $250 limit on individual contributions to exploratory committees for state representative candidates.

EFFECTIVE DATE: Upon passage

214-216 — 7/7 BROWNFIELD AND UNDERUTILIZED PROPERTY REDEVELOPMENT PROGRAM

Authorizes a package of state and local tax incentives available to eligible owners after remediating, redeveloping, and using formerly contaminated, abandoned, or underutilized properties

The act provides a package of tax incentives to property owners after they remediate, redevelop, and use property that was contaminated, abandoned, or underutilized. Owners must apply to DECD for these incentives and provide certain information, including a commitment to hire students to work at the redeveloped property.

The incentives are available in two seven-year stages, with the second stage available only to contaminated and remediated properties (i.e., brownfields).

During the first seven years after an owner redevelops an approved property, the owner qualifies for (1) corporation business or personal income tax credits against the income attributed to business operations at the redeveloped property and (2) a sales and use tax exemption applicable to items purchased for use at the property. Also during this period, the owner may have the redeveloped property's tax assessment frozen for five years at its predevelopment assessed value.

If the property was a brownfield, the owner qualifies for an additional seven-year benefit beginning in the eighth year after the property's redevelopment. The benefit is a business or personal income tax deduction of up to 8.57% of the eligible expenses the owner incurred in remediating the property.

The act requires the DECD commissioner, in consultation with the revenue services commissioner, to adopt regulations implementing the program.

EFFECTIVE DATE: Upon passage and applicable to taxable years and income years beginning on or after January 1, 2017.

Eligibility

The act establishes the “7/7 program” and opens it to any person, firm, limited liability company, nonprofit or for-profit corporation, or other business entity that owns (1) an abandoned or underutilized property (i.e., problem property) or (2) property where actual or potential pollution has discouraged the owner or other parties from redeveloping, reusing, or expanding it (i.e., brownfield).

An abandoned or underutilized property qualifies for 7/7 program benefits if its host municipality certifies that the property has been in that condition for at least 10 years. A brownfield qualifies if its owner (1) is not responsible for pollution or a source of pollution on the property and (2) did not establish, create, or maintain a source that polluted the state's water.

DECD Application

Contents. Eligible property owners seeking 7/7 program tax incentives must submit an application to DECD, providing:

1. a description of the property and its proposed reuse,

2. a written certification that the property is a brownfield or has been abandoned or underutilized for at least 10 years,

3. a plan of anticipated workforce needs and a commitment to hire trained students to work at the redeveloped property (see below),

4. a written certification from the property's host municipality stating that it supports the property's approval for 7/7 program incentives, and

5. any other information the DECD commissioner requests.

Under the act, the owner provides the certification that the property is a brownfield. The host municipality must provide the certification if the property has been abandoned or underutilized for at least 10 years.

The commissioner must approve an owner's application if it includes all of the required information and notify the DRS commissioner when she does so.

Worker Training and Hiring Requirements. A property owner applying to be a 7/7 program participant must include in his or her application a plan outlining anticipated workforce needs and a commitment to hire trained students. An owner must submit the plan to the area's high schools and the regional technical community colleges identifying the (1) types of jobs to be performed at the redeveloped property and (2) training requirements for the jobs so that the schools and colleges can prepare students for them. The owner must also commit to hiring at least 30% of the workers at the property from among the enrollees of the educational programs developed to train workers for jobs at the redeveloped property.

7/7 Program Incentives: Timing

The owners of brownfields approved for 7/7 incentives qualify for them only after they remediate the property, file the necessary documents verifying remediation, and notify the host municipality and the DRS and DECD commissioners to that effect. Neither owners of a remediated brownfield or a redeveloped problem property approved for 7/7 incentives can claim the incentives until they begin business operations on the property.

Brownfield and problem property owners qualify for the same types of benefits during the first seven years after they begin operations on the property (i.e., Stage 1 incentives). Brownfield owners qualify for an additional incentive over the next seven years (i.e., Stage 2 incentives).

Table 21 summarizes the schedule of 7/7 Program incentives.

Table 21: 7/7 Program Incentive Schedule

Stage

Eligible Property

Time Period

Incentives

1

Remediated and redeveloped former brownfields

Redeveloped and reused previously abandoned and underutilized property

First seven years after business operations begin at redeveloped property

Personal income or corporation business tax credit equal to 100% of the taxes attributable to business operations at the redeveloped property

Sales and use tax exemption for items purchased for use at redeveloped property

Five-year property tax assessment freeze

2

Remediated and redeveloped former brownfields

Years eight to 14 after business operations begin at redeveloped property

Maximum 8.57% deduction against personal income or corporation business taxes for eligible remediation expenses

7/7 Program Incentives: Stage One Incentives

Business and Personal Income Tax Credits. Brownfield and problem property owners are eligible for a tax credit for seven years against their annual personal income or corporation business taxes equal to 100% of the taxes attributable to business operations at the property during the taxable year, after deducting any other available credits.

The credit against the personal income tax is available to owners organized as “S” corporations, limited liability partnerships, or limited liability companies. These business entities do not pay corporation business taxes, but the owners and partners pay personal income taxes on the income they derive from the entity. (These entities are commonly referred to as “pass-through entities,” meaning that the income flows from the business to the owner where it is taxed as personal income.) Consequently, the act allows these members, shareholders, and partners to claim a credit equal to their share of the taxes attributable to the property's operation during the taxable year.

Sales and Use Tax Exemptions. Brownfield and problem property owners qualify for sales and use tax exemptions for any item they purchase and use at the redeveloped property in the ordinary course of business. Like the personal and corporation business tax credit, the sales tax exemption is available for seven calendar years from when business operations start at the property.

Owners may claim this exemption by presenting a certificate indicating that the purchased item is exempt from the tax. The certificate must be substantially in a form the DRS commissioner prescribes and bear the purchaser's name, address, and signature. If the purchaser does not use the item in the ordinary course of business at the property, the purchaser must pay the sales and use tax.

Property Tax Assessment Freeze. Property owners also receive a property tax incentive. Under the act, municipalities must freeze, for five assessment years after the owner receives a building permit to begin construction, the assessed value a property had at the time the DECD commissioner approved it for the program.

7/7 Program Incentives: Stage Two Incentives

Brownfield owners receive an additional incentive, which is available for seven years, beginning in the eighth year after business operations began at a remediated program property. The incentive is a deduction against the personal income or corporation business tax for up to 8.57% of the eligible expenses the owner incurred to remediate the property.

Eligible expenditures are those the owner incurred to investigate and assess the nature and extent of the contamination and to remediate it. They include:

1. investigating soil, groundwater, and infrastructure;

2. assessing the property's condition;

3. remediating soil, sediments, groundwater, or surface water;

4. abating contamination;

5. removing and disposing of hazardous materials or waste;

6. implementing long-term groundwater or natural attenuation monitoring;

7. implementing institutional controls, such as environmental land use restrictions or activity and use limitations;

8. paying reasonable attorneys' fees;

9. retaining planners, engineers, and environmental consultants; and

10. remediating building and structural issues, such as demolishing structures, abating asbestos, and removing PCBs, contaminated wood, or paint.

Expenditures funded under a DECD brownfield cleanup program do not qualify for the exemption.

217-220 & 282 — JUDICIAL COMPENSATION

Delays by two years a 3% salary increase for judges and certain other judicial officials that took effect July 1, 2017 and requires the comptroller to recover the salary increase received by such officials from July 1, 2017 until the act's passage

The act delays by two years a previously scheduled 3% increase in salaries for judges and family support magistrates and per diem rates for family support referees and judge trial referees. Under the act, the increases take effect July 1, 2019 instead of July 1, 2017.

It similarly delays an increase in the additional compensation that certain judges receive for performing administrative duties. And it delays an increase in the salary or per diem rate of certain officials (such as workers' compensation commissioners) whose compensation, by law, is determined in relation to a Superior Court judge's salary or state referee's per-diem rate.

The act requires the comptroller, in collaboration with the Chief Court Administrator, labor commissioner, and workers' compensation commission chairperson, to take such measures as he deems necessary to recover any salary increase received from July 1, 2017 through the act's passage by a judge, judge trial referee, family support magistrate, family support referee, or workers' compensation commissioner. It prohibits any such salary increase for such officials during that period from being included in the computation of their retirement salary.

EFFECTIVE DATE: Upon passage

Judicial Salaries

Table 22 shows salaries and per diem rates affected by the act.

Table 22: Judicial Salaries

Position

Salary until July 1, 2017 under Prior Law and Current Salary under the Act

Salary Starting July 1, 2017 under Prior Law; Delayed to July 1, 2019 by the Act

Supreme Court chief justice

$200,599

$206,617

Chief court administrator (if a judge)

192,763

198,545

Supreme Court associate justice

185,610

191,178

Appellate Court chief judge

183,556

189,063

Appellate Court judge

174,323

179,552

Deputy chief court administrator (if a Superior Court judge)

171,143

176,277

Superior Court judge

167,634

172,663

Chief family support magistrate

145,936

150,314

Family support magistrate

138,893

143,060

Family support referee

217/ day*

223/ day*

Judge trial referee

251/ day*

259/ day*

*Plus expenses, mileage, and retirement pay

Administrative Judges

In addition to their annual salaries, the law provides extra compensation to judges who take on certain administrative duties. These amounts were previously scheduled to increase from $1,142 to $1,177 starting July 1, 2017. The act delays the increase by two years, to July 1, 2019.

The judges who receive this additional amount are (1) the appellate system's administrative judge; (2) each judicial district's administrative judge; and (3) each chief administrative judge for (a) facilities, administrative appeals, the judicial marshal service, or judge trial referees and (b) the Superior Court's Family, Juvenile, Criminal, or Civil divisions.

Related Delayed Increases

The act's provisions also result in two-year delays for salary or rate increases for other officials or judges whose compensation is tied to those of Superior Court judges or judge trial referees. Specifically:

1. the salaries of workers' compensation commissioners vary depending on experience and are tied to those of Superior Court judges (CGS 31-277);

2. the salaries of probate court judges vary depending on probate district classification, and range from 45% to 75% of a Superior Court judge's salary (CGS 45a-95a);

3. senior judges receive the same per-diem rates as judge trial referees (CGS 51-47b & 52-434b); and

4. the probate court administrator's salary is the same as that of a Superior Court judge (CGS 45a-75).

221-224 – EDUCATION GRANT CAPS

Makes permanent the caps on four education grants to school districts and regional education service centers (RESCs)

The act permanently caps four state education grants to school districts and regional education service centers (RESCs). Grants for the following are affected:

1. health services for private school students (CGS 10-217a),

2. adult education programs (CGS 10-71),

3. bilingual education programs (CGS 10-17g), and

4. RESC operations (CGS 10-66j).

The act requires that these grants be proportionately reduced if the state budget appropriations do not cover the full amounts required by their statutory formulas. Under prior law, the caps expired on June 30, 2017. (The law, unchanged by the act, only authorizes boards of education to apply for bilingual education program grants for FYs 16 and 17.)

EFFECTIVE DATE: Upon passage

225 — MAGNET SCHOOL GRANTS

Renews the prioritization for per-student grant payments for magnet school enrollment increases and allows RESC-operated magnets outside of the Sheff region to be eligible for a higher per student grant

For FY 17, existing law authorizes SDE to consider a magnet school's enrollment as of October 1, 2013 or October 1, 2015, whichever is lower, as the base enrollment that SDE will fund. For FY 17, the law requires SDE to prioritize funding for additional magnet school seats based on enrollment increases due to (1) certain planned additions of new grade levels or (2) compliance with magnet school law requirements (e.g., racial and economic diversity).

For FYs 18 and 19, the act similarly authorizes SDE to consider a magnet school's enrollment as of October 1, 2013, October 1, 2015, or October 1, 2016, whichever is lower, as the base enrollment that SDE will fund (for FY 19, it is unclear whether enrollment in 2017 must be considered instead of 2016). The act requires SDE to prioritize funding approval, subject to the SDE commissioner's approval, for additional magnet school seats, including increases in enrollment due to planned and approved new grade levels.

It also extends, through FY 19, (1) the Sheff region host magnet school per student grant ($13,054) and (2) an authorization under which magnet school programs operating at less than full-time, but more than half-time, receive 65% of the normal per-student grant.

For FYs 18 and 19 it applies the Sheff region RESC magnet school per student grant amount ($10,443) to any RESC magnet school in the state that enrolls less than 60% of its students from Hartford. It also makes technical changes.

EFFECTIVE DATE: Upon passage

226 — BAN ON SHEFF HOST MAGNET SCHOOLS CHARGING TUITION TO SENDING DISTRICTS

Continues the ban on a Sheff region host magnet school charging tuition

For the school years beginning July 1, 2017 and July 1, 2018, the act prohibits Sheff host magnet school operators from charging school districts tuition for their students who attend the magnet school. The ban, which had been in place for years, expired with the end of the school year beginning July 1, 2016.

EFFECTIVE DATE: Upon passage

227 — DCF-LICENSED PRIVATE RESIDENTIAL TREATMENT FACILITIES

Suspends daily and other rate adjustments for FYs 18 and 19 for DCF-licensed private residential treatment facilities

The act suspends rate adjustments, including adjustments to allowable daily payments, for DCF-licensed private residential treatment facilities in FYs 18 and 19.

EFFECTIVE DATE: Upon passage

228 — REDUCTIONS FOR MUNICIPAL HEALTH DEPARTMENTS AND HEALTH DISTRICTS

Requires pro rata payment reductions to municipal and district health departments

The act requires the public health commissioner to reduce, on a pro rata basis, payments to municipal and district health departments by a total of $512,330 for FY 18. It requires the reduced payments to be made on or after October 15, 2017.

To receive state funding, existing law requires that, among other things, (1) a municipality have a full-time health department and a population of at least 50,000 and (2) health districts have a total population of at least 50,000 or serve three or more municipalities, regardless of their combined total population.

EFFECTIVE DATE: Upon passage

229 — FEDERAL REIMBURSEMENT FOR DCF AND DSS PROGRAMS

Allows DSS and DCF, with OPM's approval, to establish receivables for anticipated federal reimbursement

For FYs 18 and 19, the act allows DSS and DCF, with OPM's approval and in compliance with any advanced planning document approved by the federal Department of Health and Human Services, to establish receivables for anticipated reimbursement from approved projects. (A receivable is an amount due from another source or party.) This allows the agencies to make payments (e.g., to contractors) before being reimbursed.

EFFECTIVE DATE: Upon passage

230 — TEMPORARY FAMILY ASSISTANCE (TFA) AND STATE ADMINISTERED GENERAL ASSISTANCE (SAGA) RATES

Extends the TFA and SAGA freeze for an additional two years, FYs 18 and 19

The act extends for the next two fiscal years (FYs 18 and 19) a freeze on payment standards (i.e., benefits) for DSS' TFA and SAGA cash assistance programs at FY 15 rates. The law generally requires the DSS commissioner to raise the payment standards by the increase in the consumer price index for urban consumers (a measure of inflation) but changes to the law have frequently prohibited this increase.

TFA provides temporary cash assistance to families that meet certain income and asset limits. In general, SAGA provides cash assistance to single or married individuals without children, who have very low incomes, do not qualify for any other cash assistance program, and are considered “transitional” or “unemployable.”

EFFECTIVE DATE: Upon passage

231 — STATE SUPPLEMENT PROGRAM (SSP)

Freezes SSP rates for an additional two years, FYs 18 and 19

The law generally requires the DSS commissioner to annually increase SSP payment standards based on the consumer price index for urban consumers (a measure of inflation) within certain parameters. The act extends the current freeze on these payment standards for the next two fiscal years (FYs 18 and 19).

Generally, under SSP, DSS provides cash assistance to supplement federal Supplemental Security Income (SSI) payments. (An individual not receiving SSI may still qualify for SSP if his or her monthly Social Security, private pension, or veteran's benefit is low.)

EFFECTIVE DATE: Upon passage

232 — BOARDING HOME RATES

Freezes, with exceptions, rates paid by DSS to certain boarding homes

For FYs 18 and 19, the act generally freezes rates paid by DSS at FY 17 levels for room and board at private residential facilities and similar facilities operated by regional educational service centers that provide vocational or functional services for individuals with certain disabilities (non-ICF-ID boarding homes). Within available appropriations, the act allows these rates to exceed the FY 17 level only for capital improvements made in FY 18 or FY 19 and approved by DDS, in consultation with DSS, for residents' health and safety.

EFFECTIVE DATE: Upon passage

232-234 — RESIDENTIAL CARE HOMES, COMMUNITY LIVING ARRANGEMENTS, AND COMMUNITY COMPANION HOMES

Freezes rates for residential services at certain facilities through FY 19

Under the act, regardless of rate-setting laws or regulations to the contrary, the rates the state pays to residential care homes, community living arrangements, and community companion homes that received the flat rate for residential services in FY 16 remain in effect through FY 19. State regulations permit these facilities to have their rates determined based on a flat rate rather than submitted cost reports.

EFFECTIVE DATE: Upon passage

235 — CAP ON RESIDENTIAL CARE HOME RATES

Caps residential care home rates with certain exceptions

For FYs 18 and 19, the act caps rates for residential care homes at FY 17 and 18 levels, respectively, with an exception for homes that receive certain proportional fair rent increases. The act allows the DSS commissioner to provide such increases within available appropriations to homes with documented fair rent additions (1) placed in service in the cost report years ending September 30, 2016 or September 30, 2017, respectively, and (2) that are not otherwise included in the issued rates.

EFFECTIVE DATE: Upon passage

236 & 237 — MEDICAID NURSING HOME RATES

Limits nursing home Medicaid rates with certain exceptions, reverses a recent rate decrease for certain homes, and lowers the minimum occupancy for purpose of calculating rates

By law, the DSS commissioner must issue lower rates to facilities that would have been issued a lower rate due to their interim rate status or an agreement with DSS were it not for any rate freeze or other provisions in effect. The act eliminates a provision also requiring lower rates for facilities that experience a change in allowable fair rent.

For FY 18 and effective July 1, 2017, the act also reverses a rate decrease for facilities that received a rate decrease due to a 2015 fair rent asset expiring.

For FY 18, the act requires DSS to determine nursing facility rates based on 2016 cost reports but also limits any change in rates to no higher than, and not more than 2% less than, rates in effect at the end of calendar year 2016.

For FY 19, the act caps rates at FY 18 levels but allows the DSS commissioner to provide higher rates in the form of proportional fair rent increases, which may, at his discretion, include increases for facilities that have had a material change in circumstances related to fair rent additions or moveable equipment placed in service in the cost report year ending September 30, 2017 and not otherwise included in issued rates.

Generally, when DSS computes a facility's rates, it divides the facility's allowable costs by the facility occupancy at 95% of licensed capacity so that homes with more empty beds receive lower rates than higher occupancy homes. The act lowers the licensed capacity used for this calculation from 95 to 90% for FY 14 and succeeding fiscal years. (In practice, DSS has used a 90% occupancy rate since FY 14.)

EFFECTIVE DATE: Upon passage

238 — INTERMEDIATE CARE FACILITIES FOR INDIVIDUALS WITH INTELLECTUAL DISABILITIES (ICF-ID)

Freezes FY 18 and FY 19 rates for ICF-IDs, with certain exceptions

For FY 18 and FY 19, the act caps Medicaid rates for ICF-IDs at FY 17 levels, except that the state may pay a higher rate, within available appropriations, to facilities that have made a capital improvement, approved by DDS in consultation with DSS, for residents' health or safety during FY 18 or FY 19. The act also extends through FY 18 and FY 19 a provision allowing the DSS commissioner to provide fair rent increases to facilities that have an approved certificate of need and undergo a material change in circumstances related to fair rent.

EFFECTIVE DATE: Upon passage

239 — PAYMENTS FOR RETIRED TEACHERS HEALTH INSURANCE

Authorizes a reduction in state payments for FYs 18 and 19 to the Teachers' Retirement Board (TRB) for costs of retiree health plans offered by (1) the TRB and (2) local or regional boards of education

The act authorizes a reduction, for FYs 18 and 19, in state payments to the Teachers' Retirement Board (TRB) for costs of retiree health plans offered by (1) the TRB and (2) local or regional boards of education.

The act supersedes the law that requires the state to pay one-third of the premium for the basic TRB health plan for retired teachers enrolled in Medicare Parts A and B and instead requires the state to pay only the amount appropriated for FYs 18 and 19. Also, it supersedes the law that requires the state to pay one-third of the subsidy to local boards of education that provide retiree health insurance to those who are not enrolled in Medicare Parts A and B and instead requires the state to pay only the amount appropriated for FYs 18 and 19.

Under the superseded law, the annual premiums for the basic TRB health plan are split equally among the General Fund, the retired teacher, and the retired teachers' health insurance premium account (CGS 10-183t). As for the plans offered by local boards of education, the superseded law requires the TRB to provide a  subsidy to local school boards to offset retired teachers' local plan premiums (for the subsidy, one-third comes from the General Fund and the rest is paid by the retired teachers' health insurance premium account (CGS 10-183t).

The act requires the retired teachers' health insurance premium account to make up the difference for both of these health plans for FYs 18 and 19.

EFFECTIVE DATE: Upon passage

240 & 520 —MEDICARE SAVINGS PROGRAM

Reduces income eligibility for the Medicare Savings Program

The act reduces eligibility for each of the Medicare Savings Program (MSP) tiers (see below) by lowering income limits as a percentage of the federal poverty level (FPL), as shown in Table 23. The act also makes a conforming change to require that DSS post regulations on its website and on the eRegulations system rather than in the Connecticut Law Journal.

Table 23: MSP Income Limits

MSP

Program Tier

Cost-Sharing Payments Covered

Prior Law

Under the Act

Income Limit (% FPL)

Annual Income Limit* (Individual)

Income Limit (% FPL)

Annual Income Limit* (Individual)

Qualified Medicare Beneficiary Program (QMB)

Medicare Part B Premium

All Medicare deductibles

Co-insurance

Less than 211%

$25,447

Less than 100%

$12,060

Specified Low-Income Medicare Beneficiary Program (SLMB)

Medicare Part B Premium

211%-231%

$27,859

100% to 120%

$14,472

Qualified Individual (QI)

Medicare Part B Premium

231%-246%

$29,668

120% to 135%

$16,281


* Income limit calculations are based on 2017 FPL values. FPL values change annually.

The federal MSP consists of three separate program tiers: the Qualified Medicare Beneficiary (QMB), the Specified Low-Income Medicare Beneficiary (SLMB), and the Qualified Individual (QI). To qualify, individuals must be enrolled in Medicare Part A. Program participants get help from the state's Medicaid program with their Medicare cost sharing, including premiums and deductibles.

EFFECTIVE DATE: January 1, 2018

241 — OFFICE OF STATE BROADBAND

Eliminates the Office of State Broadband

The act eliminates the Office of State Broadband within the Office of Consumer Counsel (OCC). Prior law required the broadband office to (1) work to facilitate the availability of broadband access to every state citizen and increase access to ultra-high-speed gigabit capable broadband networks and (2) include a broadband policy coordinator and other staff as the consumer counsel deemed necessary to perform those duties.

The act also eliminates OCC's specific authority to (1) collaborate with public and nonprofit entities and state agencies and (2) provide advisory assistance, including help to procure grants, to municipalities, local authorities, and private corporations to expand broadband access in the state and foster innovative broadband approaches.

EFFECTIVE DATE: Upon passage

242 — EVALUATING TRANSPORTATION PROJECTS

Exempts from certain evaluation requirements certain projects that the DOT commissioner determines are necessary to maintain the state's infrastructure

PA 17-192 requires the transportation commissioner to develop, and obtain legislative approval for, a method to evaluate “transportation projects,” and to use this method to evaluate these projects before seeking funding for them from the legislature.

Under PA 17-192, a transportation project included a transportation planning or capital project, begun by the state on or after July 1, 2018, that (1) is estimated to cost $150 million or more or (2) expands capacity on a limited access highway, transit or railroad system, or parking facility.

This act specifically excludes from the definition of “transportation project” and therefore from PA 17-192's evaluation requirements, any project begun on or after July 1, 2018 that (1) the transportation commissioner finds necessary to maintain the state's infrastructure in good repair and (2) is estimated to cost less than $150 million.

EFFECTIVE DATE: Upon passage

243 — DAS CANDIDATE LISTS

Allows DAS to extend candidate lists through the end of 2018

The act allows the Department of Administrative Services (DAS) commissioner to continue or extend, through December 31, 2018, any candidate list scheduled to expire on or after June 7, 2017.

By law, positions in the state employee classified service must be filled from a list of qualified people, known as a candidate list. The lists must generally remain in force for at least three months, but not more than one year, unless the DAS commissioner grants an exception under certain circumstances.

EFFECTIVE DATE: Upon passage

244 — OFFICE OF HEALTH STRATEGY

Establishes an Office of Health Strategy to oversee specified health policy initiatives

The act establishes an Office of Health Strategy, headed by an executive director appointed by the governor with confirmation by the House or Senate. It places the office in DPH for administrative purposes only and makes it the successor to the:

1. Connecticut Health Insurance Exchange's responsibilities related to administering the all-payer claims database and

2. lieutenant governor's office related to (a) consulting with DPH to develop a statewide chronic disease plan; (b) housing, chairing, and staffing the Health Care Cabinet; and (c) appointing the state's health information technology officer and overseeing his or her duties.

Any order or regulation of the above entities in force on July 1, 2018 continues in force and effect until amended, repealed, or superseded by law.

Responsibilities

Under the act, the office is responsible for:

1. developing and implementing a comprehensive and cohesive health care vision for the state, including a coordinated state health care cost containment strategy;

2. directing and overseeing the (a) all-payers claim database program and (b) State Innovation Model Initiative and related successor initiatives;

3. coordinating the state's health information technology initiatives;

4. directing and overseeing the Office of Health Care Access and all of its duties and responsibilities; and

5. convening forums and meetings with state government and external stakeholders, including the Connecticut Health Insurance Exchange, to discuss health care issues designed to develop effective health care cost and quality strategies.

EFFECTIVE DATE: July 1, 2018

245 & 246 — DEFICIT MITIGATION PLAN THRESHOLD

Lowers the projected deficit threshold, from 1% to 0.5% of total General Fund appropriations, that triggers certain deficit mitigation actions by the governor

By law, the comptroller must issue a cumulative monthly financial statement on the status of the General Fund; if the budget deficit projection contained within the statement exceeds a statutory threshold, it triggers certain actions by the governor. The act lowers this threshold, from 1% to 0.5% of total General Fund appropriations.

By law, when the comptroller's cumulative monthly financial statement projects a current year deficit that exceeds the threshold, the governor (1) must, within 30 days after the issuance, submit a deficit mitigation plan to the Appropriations and Finance, Revenue and Bonding committees and (2) may reduce any allotments.

Similarly, effective July 1, 2019, as part of the required deficit mitigation plan, the act authorizes the governor to direct the treasurer to transfer money in the Restricted Grants Fund (RGF) to the General Fund when the cumulative monthly statement projects a budget deficit of 0.5%, rather than 1%, of General Fund appropriations.

EFFECTIVE DATE: Upon passage, except that the provision on transferring RGF funds is effective July 1, 2019.

247 — MUNICIPAL VOLUNTEERS

Prohibits new municipal collective bargaining agreements from limiting a municipality's ability to have volunteers provide services for it

The act prohibits any municipal employee union contract entered into on or after the act takes effect from limiting the municipality's ability to allow volunteer services for its benefit.

EFFECTIVE DATE: Upon passage

248 — SUPERMAJORITY VOTE REQUIRED FOR CERTAIN MANDATES

Prohibits the legislature from enacting a public act that imposes an unfunded state mandate on a political subdivision unless approved by a supermajority

The act prohibits the legislature from adopting a public act that imposes a mandate on a political subdivision that requires the subdivision to appropriate funds to comply unless the act receives the approval of at least two-thirds of the membership in each chamber.

Based on the principle of legislative entrenchment, it is unclear whether this provision is enforceable against future legislatures.

EFFECTIVE DATE: Upon passage

249 — MUNICIPAL EDUCATION BUDGET REDUCTIONS

Allows a municipality to reduce its noneducational expenses by the same amount as its reduced municipal aid without holding a referendum

The act allows a municipality that has adopted an FY 18 budget to reduce, without holding a referendum, the noneducational expenses component of its education budget by the amount of any reduction in municipal aid it received from all sources in FY 18 compared to FY 17. The act does not define “noneducational expenses.”

The authorization applies regardless of any conflicting special act, municipal charter, or home rule ordinance. Under the act, a “municipality” is any town, city, borough, consolidated town and city, or consolidated town and borough.

EFFECTIVE DATE: Upon passage

250 — PURCHASING PROCEDURES APPLICABLE TO LOCAL BOARDS OF EDUCATION

Requires school boards to use, and comply with, any local purchasing procedures

The act requires each local board of education to use, and comply with, all purchasing procedures used by the board's host municipality. This requirement applies regardless of any conflicting special act, municipal charter, or home rule ordinance. It is unclear how this requirement would apply in cases of conflicting state laws (e.g., competitive bidding requirements for school construction).

EFFECTIVE DATE: Upon passage

251 — MUNICIPAL COLLABORATION WITH BOARDS OF EDUCATION

Requires, when possible, local boards of education to collaborate with their municipalities to jointly purchase property, casualty, and workers' compensation insurance

The act requires local boards of education and their host municipalities to consult with each other, when possible, about consolidating to jointly purchase property, casualty, and workers' compensation insurance. For these purposes, municipalities are any town, city, borough, consolidated town and city, or consolidated town and borough.

EFFECTIVE DATE: Upon passage

252 — CONSULTATION CONCERNING SHARED MAINTENANCE RESPONSIBILITY

Requires school boards to consult with their local appropriating authority before authorizing the authority to share responsibility for certain maintenance tasks

The act requires each local board of education to consult with the local appropriating authority (e.g., the board of finance or board of selectmen) before authorizing that authority to share responsibility for the board's maintenance of buildings, grounds, equipment, or information technology. The requirement applies regardless of any conflicting special act, municipal charter, or home rule ordinance.

EFFECTIVE DATE: Upon passage

253 — LOCAL BUDGET AND TAX ADJUSTMENTS

Requires municipalities and regional boards of education to amend adopted budgets and adjust tax levies to reflect inaccurate state aid projections

The act requires municipalities and regional boards of education that adopted a budget or levied taxes for FY 18 before the state adopted its FY 18 budget to change their budgets and levies if the state's budget provides over $500,000 more in state aid than the board or municipality projected. Specifically:

1. municipalities and boards must amend their budgets in the same manner in which the budget was originally adopted, in an amount not exceeding the increase in state aid to the board or municipality, and

2. by January 1, 2018, municipalities and boards must adjust tax levies and any remaining tax installments.

Additionally, by January 1, 2018, municipalities that collect taxes in a single installment may also issue supplemental bills reflecting the repeal of the motor vehicle mill rate cap (i.e., adjustments reflecting an increased mill rate for motor vehicles and the termination of motor vehicle property tax grants, see 35 & 975).

These provisions apply regardless of conflicting (1) statutes affecting education and boards of education, municipalities, and property tax levy and collection (including the provisions concerning installments); (2) special acts; or (3) municipal charters or home rule ordinances. “Municipalities” covered by the act's authorization are any towns, cities, boroughs, consolidated towns and cities, and consolidated towns and boroughs.

EFFECTIVE DATE: Upon passage

254 — EXECUTIVE BRANCH AGENCY SAVINGS

Requires the governor to achieve savings by (1) eliminating certain agency positions and (2) consolidating all agency human resource functions in DAS

The act requires the governor to achieve General Fund savings of $19,472,184 in FY 18 and $24,042,877 in FY 19 by doing the following with respect to executive branch agencies:

1. eliminating agency deputy secretary positions,

2. consolidating human resource functions in DAS,

3. eliminating all filled executive assistant positions, and

4. reducing filled executive secretary communications positions.

EFFECTIVE DATE: Upon passage

255 — RESULTS FIRST PILOT PROGRAM

Requires the OPM secretary to create a pilot program that applies Pew-MacArthur Results First principles to at least 10 state-financed grant programs

The act requires the OPM secretary, by January 1, 2018, to promote cost-effective state policies and programming by creating a pilot program that applies Pew-MacArthur Results First principles (i.e., a cost-benefit analysis approach) to at least 10 state-financed grant programs he selects.

The grant programs must include those that provide services to families, employment programs, and at least one contracting program of a state agency with an annual budget of over $200 million.

The act also requires the OPM secretary, by April 1, 2018, to report to the Appropriations Committee on which grant programs the secretary included in the pilot program, the program's status, and any recommendations.

EFFECTIVE DATE: Upon passage

256 — UCONN HEALTH CENTER PUBLIC-PRIVATE PARTNERSHIPS

Requires the UConn Health Center to seek to establish public-private partnerships and report to certain legislative committees by April 1, 2018

The act requires the UConn Health Center board of directors to seek to enter into public-private partnerships with hospitals or other private entities the board selects. It requires the board to report, by April 1, 2018, to the Higher Education, Public Health, and Appropriations committees on the status of the partnerships and any recommended legislation.

EFFECTIVE DATE: Upon passage

257 & 975 — STATE BUILDING ARTWORK

Eliminates the (1) requirement that the state bond commission, when allocating bond proceeds for state building construction, reconstruction, or remodeling, include funds for artwork and (2) state building works of art account within the General Fund and its maintenance subaccount

Prior law required that the state bond commission allocate for the purchase of artwork at least 1% of bond proceeds for building, reconstructing, or remodeling any state building. The act repeals this requirement and several related provisions. Generally, it eliminates the:

1. Department of Economic and Community Development (DECD) authority to select or reimburse artists for artwork or design proposals,

1. DAS responsibility to contract with these artists,

2. state building works of art account within the General Fund and its maintenance subaccount, and

3. requirement that DECD and DAS adopt regulations to implement these provisions.

EFFECTIVE DATE: Upon passage

258 — PRISON HEALTH CARE

Requires the OPM secretary to (1) issue an RFP to provide health care and behavioral health care services to prison inmates and (2) contract with a new provider if he determines doing so would save the state money

The act requires the OPM secretary, by December 1, 2017, to issue a request for proposals to provide health care and behavioral health care services to DOC inmates. It requires any such proposals to be submitted to OPM by February 1, 2018.

Based on the proposals, if the secretary determines that the state would save money by contracting with a new provider, he must do so by July 1, 2018. Currently, UConn's Correctional Managed Health Care division provides these services to inmates, under a memorandum of agreement with DOC.

EFFECTIVE DATE: Upon passage

259-264 — CONTRACTING EXEMPTIONS FOR UCONN AND UCONN HEALTH CENTER

Exempts UConn and the UConn Health Center from several state contracting requirements

On and after January 1, 2018, the act exempts certain UConn and UConn Health Center (UCHC) contracts from competitive bidding and negotiation requirements, provided they comply with policies and guidelines the act requires. The exemption applies to contracts for (1) personal services; (2) purchasing equipment, supplies, or contractual services; and (3) personal property leases. The act also requires UConn and UCHC to create their own contracting standards and report on them to the legislature, while continuing to abide by UConn 2000 construction contract bidding laws.

The act eliminates public posting requirements for UConn contracting opportunities. It also removes UConn from the State Contracting Standards Board's (SCSB) oversight, the scope of which includes the law on privatizing services.

Lastly, the act makes conforming changes to existing laws that subject UConn and UCHC to competitive bidding and negotiation requirements.

EFFECTIVE DATE: Upon passage, except several sections that (1) make conforming changes to laws that currently subject UConn and UCHC to competitive bidding and negotiation requirements and (2) remove public posting requirements and SCSB jurisdiction are effective January 1, 2018 ( 260-263).

Competitive Bidding ( 259)

Public Act 17-130 exempts UConn purchase contracts from competitive bidding and negotiation requirements as long as the UConn board of trustees adopts policies for entering into or amending such contracts. Under this act, the board must establish more detailed policies, as described below.

Specifically, this act requires the UConn board of trustees and UCHC board of directors (“the boards”) to establish, by January 1, 2018, contracting policies and guidelines that establish (1) alternative competitive bidding and negotiation processes and (2) a cost-benefit analysis and contracting process that eliminates or transfers institutional activities to government or private entities. The act also requires the boards, when establishing the policies and guidelines, to consider the following: (1) anticipated contract value, (2) number and nature of potential sources, and (3) contract processes' time and cost. The boards must report to the Higher Education and Employment Advancement and Appropriations committees, by January 1, 2019, and annually thereafter, on the contracting policies and guidelines created and the resulting revenues and expenditures.

The act also specifies the following:

1. the policies and guidelines are not regulations but are subject to public comment and a petitioner's right to seek a declaratory judgment to determine their validity or applicability,

2. UConn and UCHC are subject to audit by the state auditors in accordance with these policies and guidelines (although it is unclear how this provision interacts with the auditors' existing authority to audit the books and accounts of all state agencies (CGS 2-90)),

3. the attorney general's authority is not affected by these provisions, and

4. the boards must still comply with the law that governs public bidding for UConn 2000 construction contracts.

State Contracting Portal ( 262)

The act eliminates a requirement that UConn post, on the State Contracting Portal, all of its bids, requests for proposals, and resulting contracts and agreements. As a conforming change, it also removes the requirement that DAS report to the governor and SCSB on UConn's progress toward electronically communicating with the portal.

State Contracting Standards Board's Jurisdiction and Regulations ( 259 & 263)

The act removes UConn from SCSB's jurisdiction as of January 1, 2018. Under prior law, the board had jurisdiction over UConn with respect to the law on privatizing services, which, among other things, requires state contracting agencies to develop a cost-benefit analysis and a business case before privatizing a state service.

Additionally, the act eliminates a requirement that SCSB adopt regulations applying the provisions of certain SCSB-related statutes to UConn. (In practice, SCSB has not yet developed these regulations.) Prior law required that any internal contracting policies adopted by UConn's board of trustees supersede SCSB regulations.

The act also extends the deadline by which SCSB must adopt regulations applicable to the Connecticut State College and Universities from January 1, 2011 to January 1, 2018.

265 & 266 — EDUCATION LEASING AND PURCHASING CONSULTATIONS

Requires local boards of education to consult with their legislative bodies before leasing or purchasing certain items

The act requires a local board of education to consult with its municipality's legislative body before:

1. leasing portable classrooms; motor vehicles; or equipment, including telephone systems, computers, and copiers; or

2. purchasing payroll processing or accounts payable software systems, to determine whether they may be purchased or shared regionally.

EFFECTIVE DATE: October 1, 2017

267 — JUDGE SALARY WITHHOLDING

Increases, from 5% to 8%, the amount that must be withheld from judges', family support magistrates', and compensation commissioners' salaries and deposited in the Judge's Retirement Fund

The act increases, from 5% to 8%, the amount deducted and withheld from salaries of judges, family support magistrates who elect to be covered by the judicial retirement system, and compensation commissioners. As under existing law, the deducted funds must be deposited in the Judge's Retirement Fund.

EFFECTIVE DATE: Upon passage

268 — STATE AGENCY AFFIRMATIVE ACTION PLANS

Allows agencies to use an alternative method to comply with affirmative action plan requirements

Existing law requires each state agency, department, board, and commission (i.e., “state agency”) with 25 or more full-time employees to submit an affirmative action plan to the Commission on Human Rights and Opportunities (CHRO).

Under prior law, agencies had to develop and implement a plan in cooperation with CHRO and pursuant to its regulations. As an alternative, the act allows agencies that are required to maintain a federal affirmative action or equal employment opportunity plan to submit the plan or report to CHRO to satisfy the state affirmative action plan requirement. Upon receiving the federal plan or report from the agency, CHRO must deem the plan or report approved for as long as it complies with the requirements of the federal agency that monitors the state agency's compliance.

The act also allows an agency to satisfy the state affirmative action plan requirement by submitting to CHRO an affirmative action plan that complies with, and uses a form prescribed by, federal regulations for federal affirmative action or equal employment plans submitted by certain federal goods and services contractors (41 C.F.R. 60-2). Such a plan's compliance with federal regulations is subject to the same CHRO review and approval procedure for affirmative action plans under existing law.

The act requires the CHRO executive director to establish a schedule for agencies to file their plans or reports, which must not be more frequent than the federal government requires. The executive director must take into account how often the agencies must submit their reports to the respective federal agencies.

EFFECTIVE DATE: Upon passage

269-276 & 278-280 — CRUMBLING CONCRETE FOUNDATIONS

Creates a framework to assist homeowners with crumbling concrete foundations

Among other things, the act (1) creates the Crumbling Foundations Assistance program to help owners of residential buildings (i.e., one- to four-family dwellings with a certificate of occupancy issued on or after January 1, 1983) with concrete foundations damaged by the presence of pyrrhotite (“crumbling concrete foundations”) and (2) establishes the Office of the Executive Administrator of the Crumbling Foundations Assistance program to administer it. Under the act, insurers who donate money to the program (through a fund the act creates) are indemnified against homeowners' claims related to crumbling concrete foundations up to the amount of the donation.

Among other things, the act also:

1. creates the Collapsing Foundations Interest Rate Reduction program to provide interest rate subsidies to homeowners who have difficulty obtaining loans to fix crumbling concrete foundations,

1. waives certain permit fees for repairing or replacing crumbling concrete foundations,

2. establishes an income tax deduction for individuals donating to the Voluntary Assistance Fund, and

3. prohibits the use of recycled concrete that contains pyrrhotite in new construction.

EFFECTIVE DATE: Upon passage

Crumbling Foundations Assistance Program ( 269)

The act creates the Crumbling Foundations Assistance program to provide grants to owners of residential buildings to repair or replace crumbling concrete foundations. The act also establishes within the governor's office the Office of the Executive Administrator of the Crumbling Foundations Assistance program (“Office”) to administer the program and two funds the program uses: the Crumbling Foundations Assistance Fund (“Assistance Fund”) and the Crumbling Foundations Voluntary Assistance Fund (“Voluntary Assistance Fund”).

Office of the Executive Administrator of the Crumbling Foundations Assistance Program. The Office must provide grants to owners of residential buildings to repair or replace crumbling concrete foundations. In doing so, the office must (1) create grant eligibility requirements and (2) contract with independent adjusters to adjudicate claims for the grant amount. Before receiving a grant, an owner must obtain a written evaluation from a licensed professional engineer indicating that the foundation is collapsing due to pyrrhotite. If the evaluation indicates pyrrhotite is the cause of the collapsing foundation, the evaluation's cost is reimbursed by the program. The act allows the Office to change the evaluation requirements if it identifies a more cost-effective way to determine if foundations are damaged by pyrrhotite. The act requires the Planning and Development committee to consider and approve or reject the eligibility requirements within 90 days of the Office's executive administrator taking office, and semi-annually thereafter. (It is unclear whether the Housing Committee must also consider and approve or reject the eligibility requirements).

The act also allows the Office to contract with the Connecticut Housing Finance Authority (CHFA) or any other lending institution to implement a long-term low-interest loan program to help homeowners obtain financing to repair or replace crumbling concrete foundations.

Under the act, the Office's operational costs, including payroll expenses and employee benefits, must be paid by the Assistance Fund.

Crumbling Foundations Assistance Fund and the Crumbling Foundations Voluntary Assistance Fund. These funds are established as separate, nonlapsing accounts in the General Fund.

The Assistance Fund must contain any money required by law to be deposited in it and any money that may be available from federal, state, or other sources, excluding the Federal Emergency Management Agency (FEMA). Money must be used by the Office to fund the Crumbling Foundations Assistance Program and the Collapsing Foundations Interest Rate Reduction Program (see below).

The Voluntary Assistance Fund may only be used for the Crumbling Foundations Assistance Program and must contain any money required by law to be deposited in it and any voluntary contributions.

Indemnification of Insurers. Under the act, a residential building owner who receives money from the Voluntary Assistance Fund to repair or replace a crumbling concrete foundation must indemnify and hold harmless any insurer that annually contributes to that fund. The act requires the owner to indemnify such an insurer in an amount equal to or greater than the total contribution made by the insurer to the Voluntary Assistance Fund.

Effect of Insurance Payouts. The act specifically allows owners of residential buildings with crumbling concrete foundations to receive financial assistance pursuant to a homeowners insurance policy, but requires any grant the owner receives from the Crumbling Foundations Assistance Program to be reduced by the amount of such financial assistance.

Income Tax Exemption for Grants. Under the act, grants from the Crumbling Foundations Assistance Program are not income for state income tax purposes.

Privacy Protections ( 269)

The act prohibits, with certain exceptions, owners of residential buildings with crumbling concrete foundations who provided information to the Crumbling Foundations Assistance Program and employees of public agencies (including executive, administrative, and legislative offices and political subdivisions) from soliciting, disclosing, using, or participating in the use of any information (including lists of names) concerning individuals applying for or receiving, assistance from the act's programs. The prohibition applies to information (1) directly or indirectly derived from the records, papers, files, or communications of the state or any political subdivision or agency or (2) acquired while performing official state or public duties.

The act exempts from this ban any use of the information (1) directly connected with the administration of Department of Housing (DOH) programs and in accordance with DOH regulations and (2) for research or investigatory purposes authorized by the housing commissioner or General Assembly that does not directly or indirectly identify individual program applicants or participants.

Collapsing Foundations Interest Rate Reduction Program ( 270)

The act creates the Collapsing Foundations Interest Rate Reduction program, administered by the Department of Consumer Protection (DCP), which provides interest rate subsidies for homeowners who have difficulty obtaining loans to fix crumbling concrete foundations due to the repair or replacement cost, the loan's underwriting criteria, the home's decreased market value, or other personal financial circumstances.

Under the act, to be an eligible borrower, one must own a residential building with a crumbling concrete foundation and:

1. (a) use the building as one's primary residence and have obtained an engineer's written evaluation under the Crumbling Concrete Foundation Assistance Program provisions or (b) for those who do not use the building as their primary residence, obtain two written evaluations from licensed professional structural engineers indicating the building is unsafe for human habitation and

1. complete and file a consumer statement regarding the concrete foundation with DCP. (The act does not define “consumer statement.”)

Under the act, the DCP commissioner must seek the participation of depository banks and credit unions to offer below market rate loans to eligible borrowers and, at least 30 days before the program is made available to borrowers, develop additional terms for the loans in consultation with the lieutenant governor and representatives from the banking and credit union industries. The commissioner must publish the terms, and any subsequent amendments, on DCP's website at least 15 days before the program is available to borrowers. Lenders may subject loans to additional underwriting standards.

(The act's definition of “residential building” does not apply to this section and as a result the scope of the program is unclear.)

Collapsing Foundations Interest Rate Reduction Account. The act establishes this account as a separate nonlapsing account in the General Fund and requires it to contain any money required by law to be deposited in it. DCP must use the account to provide interest rate subsidies for qualifying loans (i.e., loans made under the Collapsing Foundations Interest Rate Program).

Report on Determining Acceptable Pyrrhotite Levels ( 271)

The act requires the Department of Energy and Environmental Protection (DEEP) commissioner to report, by January 1, 2018, to the Planning and Development Committee on any methods used by government entities, including foreign entities, to determine acceptable pyrrhotite levels in natural aggregate used in residential concrete foundations.

Permit Fee Waivers for Repairing or Replacing Crumbling Concrete Foundations ( 272 & 273)

Under the act, a municipality must waive any building permit application fee to repair or replace a crumbling concrete foundation if the owner of a residential building submits a licensed professional engineer's written evaluation indicating that the foundation is crumbling due to pyrrhotite.

If the municipality waives the fee, the act requires the State Building Inspector to also waive the education fee on any building permit application to repair or replace a crumbling concrete foundation. (By law, the state-required education fee is used for building and fire code training and education programs for state and local officials and individuals in the construction industry (CGS 29-251c)).

Contractor Training Program ( 274)

The act requires the Office of the Executive Administrator of the Crumbling Foundations Assistance program, in consultation with the labor commissioner and within available appropriations, to establish a training program for contractors repairing or replacing crumbling concrete foundations.

Residential Disclosure Report ( 275)

Generally, individuals offering a one- to four-family residential property for sale, exchange, or lease with the option to buy must provide the prospective purchaser with a residential property condition disclosure report. The act requires the DCP commissioner to include in the residential property condition disclosure report the following:

1. a recommendation that the prospective purchaser have any foundation inspected by a state licensed professional engineer for deterioration and the presence of pyrrhotite and

1. a question on whether the seller knows of any testing or repairs performed on or related to the property's foundation.

Existing law requires the report to recommend that the prospective purchaser have the property inspected by a licensed home inspector. And under existing regulations, sellers must disclose in the report any known foundation, slab, or settling problems (Conn. Agencies Regs. 20-327b-1).

Notification of Insurance Policy Changes ( 276)

The act requires the insurance commissioner to adopt regulations requiring insurers, when issuing, renewing, amending, or endorsing a homeowners insurance policy, to provide a copy of the policy and all amendments, endorsements, and riders to a mortgage holder, if any.

Personal Income Tax Deduction ( 278)

The act allows taxpayers to reduce their Connecticut adjusted gross income by the amount of any contribution to the Crumbling Foundation Voluntary Assistance Fund in the taxable year in which the contribution is made.

Prohibition on Using Recycled Material Containing Pyrrhotite ( 279)

The act prohibits the use of recycled material known to contain pyrrhotite to produce structural concrete for residential or commercial construction. Under the act, doing so is an unfair or deceptive act or practice under the Connecticut Unfair Trade Practices Act.

Quarry Quality Control Working Group ( 280)

The act requires the DCP commissioner to establish a working group to develop a model quality control plan for quarries. The group must include representatives from the homebuilder and construction industries and submit its plan to the Planning and Development Committee by February 1, 2018.

277 — TOLLING OF CONTRACTUAL LIMITATIONS PERIOD FOR CERTAIN INSURANCE POLICIES

Extends the period of time for an insured to sue his or her homeowners insurer

By law, a person who wants to sue a homeowners insurer over a claim denial has 24 months from the inception of loss to file suit (CGS 38a-307). The act tolls (i.e., pauses) the contractual limitations period between the time an insurance claim is made and the time written denial is received for purposes of determining the deadline by which the insured may sue a personal risk or master policy (e.g., condominium) insurer. The act also requires insurers to include in the denial notice the specific date on which the limitation period expires or a reference to the relevant policy provisions. These provisions apply regardless of whether the claim concerns crumbling concrete foundations.  Under the act, “personal risk insurance” means homeowners, tenants, mobile home, and other property and casualty insurance for personal, family, or household needs, excluding workers' compensation insurance. The new tolling requirement applies to policies issued, renewed, amended, or endorsed after the act's effective date.

EFFECTIVE DATE: Upon passage

281 — PUBLIC HEARINGS ON AUDITS

Requires legislative committees to hold public hearings on auditor reports of agencies under their cognizance

The act generally requires each legislative joint standing committee with cognizance over a state agency that is subject to a state auditors' report to hold a joint public hearing with the General Administration and Elections Committee on the report within 180 days after the auditors submit it to the legislature.

But committee chairpersons may choose not to hold a hearing if (1) the report contains no statutory or regulatory violations by the agency, (2) the report has only minor or technical recommendations, or (3) they determine the report does not otherwise need a hearing.

EFFECTIVE DATE: October 1, 2017

283-285 — PASSPORT TO THE STATE PARKS AND FORESTS

Establishes a supplemental fee on motor vehicle registrations to pay for DEEP's staff expenses to manage and operate state parks and forests and exempts individuals who pay this fee from paying to park at state parks

The act establishes an additional fee on certain motor vehicle registrations, the revenue of which must be used by DEEP for personal service expenditures to manage and operate state parks and forests. It exempts individuals who pay the fee from paying for parking at Connecticut state parks.

Under the act, the motor vehicles commissioner must transfer the new fees to the revenue services commissioner for deposit in the “passport to the state parks and forests” account, which is a separate, nonlapsing General Fund account the act establishes. The act also requires certain revenue to be deposited to the new account, instead of to the General Fund, as under prior law. Specifically, it shifts the revenue derived from the following:

1. parking, admission, boat launching, and other uses of state parks, forests, boat launches, and other state recreational facilities;

1. services at the parks, forests, and facilities; and

2. entering into contracts with concession operators.

Additional Fee

The act requires the motor vehicles commissioner to collect the fee from the individual registering the vehicle. It sets the fee at $10 for a biennial registration and $5 for an annual one.

Under the act, the new fee applies to new registrations; registration renewals or transfers; supplemental or combination registrations; antique, rare, or special interest registrations; and modified antique registrations. It applies to passenger motor vehicles, motor homes, motorcycles, trucks, and passenger vans.

EFFECTIVE DATE: Upon passage

286-310 — MUNICIPAL ACCOUNTABILITY REVIEW BOARD

Provides an alternative process by which financially distressed municipalities may use statutory methods to issue deficit bonds if they submit to state fiscal oversight by the Municipal Accountability Review Board established by the act.

The act provides an alternative process by which financially distressed municipalities can access certain statutory methods to issue and secure deficit-financing bonds in return for submitting to state fiscal oversight and control. These methods include backing the bonds with a state-supported special capital reserve fund (SCRF), which provides more assurance to bondholders that they will be repaid on time.

The state fiscal oversight and control the act requires must be exercised by the Municipal Accountability Review Board (MARB), which the act creates. The board must have an equal number of municipal union representatives and state and local officials, but the act does not specify who appoints the members.

The act also makes technical changes to delete a misplaced statutory reference.

EFFECTIVE DATE: Upon passage

Certified and Designated Municipalities

Certified Municipalities. The act adds an alternative to the existing process by which financially distressed municipalities can access certain deficit-financing methods to secure their bonds. A municipality may access these methods based on statutory criteria that classify municipalities into two tiers, which the act labels “certified tier I” and “certified tier II.” As Table 24 shows, the certification criteria reflect a municipality's bond rating, and each tier subjects a municipality's finances to the Municipal Finance Advisory Commission's oversight (see Background).

Table 24: Criteria for Certified Tier I and Tier II Municipalities

Tier I

Tier II

Has a long-term investment grade or higher bond rating

Unable to obtain bond insurance on reasonable terms and conditions

Meets other OPM standards

Has a long-term investment grade or higher bond rating

Unable to obtain bond insurance on reasonable terms and conditions

Has not issued a deficit obligation within the last five years

Has no outstanding deficit obligations

Meets other standards established by OPM

The act eliminates the requirement that the OPM secretary establish other standards for tier I and II certification in regulations and instead requires him to do so only in writing and to post the standards on OPM's website.

Certified tier II municipalities are subject to more state fiscal oversight and control than certified tier I municipalities. The oversight and control is exercised by the Municipal Finance Advisory Commission, a state body authorized to oversee the finances and administration of financially distressed municipalities.

Designated Municipalities. The act's alternative process allows municipalities to request classification as a designated tier I, II, III, or IV municipality based on criteria the act establishes. Designated tier I municipalities, like certified tier I and certified tier II municipalities, are subject to oversight by the Municipal Finance Advisory Commission. Designated tier II, III, and IV municipalities are subject to increasingly greater degrees of state fiscal oversight and control as exercised by MARB. The increase in state oversight and control corresponds to a municipality's overall fiscal condition, as reflected in the designation criteria. The criteria include the capacity to issue based on standard industry ratings, the degree to which a municipality depends on state aid to fund its budget (i.e., state aid as a percentage of total revenue), the ability to operate efficiently and generate fund balances, the percentage of year-to-year revenue increases, and equalized mill rate.

As explained below, municipalities initiate the designation process by asking the OPM secretary to designate them as a tier I, II, III, or IV municipality. There are other circumstances in which the secretary must assign them a specified, designated tier. For example, he must designate any municipality that issues a bond to finance a general fund balance as a designated tier III municipality.

Designated Tier I Municipalities ( 297)

Designation Criteria. Under the act, a municipality's chief executive official (CEO) may apply to the secretary to have the municipality designated as a tier I municipality if it meets one of the three sets of criteria shown in Table 25.

Table 25: Tier I Designation Criteria

Designation Criterion

Set 1

Set 2

Set 3

Bond Rating

No rating or its highest rating is A or above, as long as all ratings are investment grade

No rating or its highest rating is A, as long as all ratings are investment grade

Highest bond rating is AA, as long as all ratings are investment grade

State aid as percentage of current year general fund budget

Less than 30%

Less than 30%

30% or more of current year general fund

Fund balance

Positive

Positive fund balance of less than 5%

Positive

FY 18 municipal revenue increase as a percentage of revenue

At least 2%

Not applicable

At least 2%

Mill Rate

Not applicable

Not applicable

Equalized mill rate less than 30 mills

State Oversight and Control. The OPM secretary must refer any municipality that requests a tier I designation to the Municipal Finance Advisory Commission, and the municipality must prepare and present a three-year financial plan to the commission for its review and approval.

The designation also places the municipality on the same footing as those the secretary refers to the commission under existing law. Thus, among other things, the commission can make recommendations to improve the municipality's financial conditions, and the CEO must submit a report on the status of those recommendations or any other remedial measures to improve those conditions. If the CEO fails to provide information or submit the report within 30 days, the commission may impose a civil penalty of between $1,000 and $10,000 on the municipality. At the CEO's request, the OPM secretary may waive some or all of the penalty if he determines the CEO had reasonable cause not to comply with the commission's request (CGS 7-394b).

Designated Tier II Municipalities ( 300)

Designation Criteria. Under the act, a municipality's CEO may apply to the OPM secretary to have the municipality designated as a tier II municipality if it meets one of the five sets of designation criteria shown in Table 26.

Table 26: Tier II Designation Criteria

Designation Criterion

Set 1

Set 2

Set 3

Set 4

Set 5

Bond Rating

No rating from a bond rating agency or its highest rating is A or above, as long as all of its ratings are investment grade

No rating from a bond rating agency or its highest rating is A, as long as all of its ratings are investment grade

Highest bond rating is AA or higher, as long as all ratings are investment grade

Highest bond rating is AA or higher, as long as all ratings are investment grade

Highest rating is Baa or BBB, as long as all of its ratings are investment grade

State aid as percent of current year general fund budget

30% or more

30% or more

30% or more

Not applicable

Not applicable

Fund balance

Positive fund balance of at least 5%

Positive fund balance of less than 5%

Not applicable

Negative

Positive

FY 18 municipal revenue increase as a percentage of revenue

At least 2%

Not applicable

Not applicable

Not applicable

Not applicable

Equalized Mill Rate

Less than 30 mills

Less than 30 mills

30 or more mills

Not applicable

Less than 30 mills

State Oversight and Control. The OPM secretary must refer any municipality that requests a tier II designation to MARB.

The tier II designation imposes certain conditions and restraints on the municipality's fiscal practices. In preparing and adopting its budget, the municipality must include only those assumptions about state and property tax revenue that the board approved. The board must approve or disapprove any multi-year SCRF-backed bond to fund an existing deficit, but may only approve it if, in the board's judgment, it will improve the municipality's financial condition.

Tier I & II Designation Changes ( 306)

Under the act, a municipality designated as tier I or II must generally retain such designation regardless of any positive changes in the factors that led to its current designation for at least two fiscal years after the most current designation.

Such a municipality's designation may change if:

1. there have been no annual operating budget deficits in the municipality's general fund for two consecutive fiscal years;

2. the municipality's bond rating has either improved or remained unchanged since its most recent designation;

3. the municipality has presented, and the Municipal Finance Advisory Commission for designated tier I or MARB for designated tier II has approved, a financial plan that projects a positive unreserved fund for the three succeeding consecutive fiscal years; and

4. the municipality's audits for such consecutive fiscal years have been completed and contain no general fund deficit.

Under the act, a municipality whose designation was removed must remain undesignated unless circumstances change that require it to be designated in a higher tier than its most recent designation.

Designated Tier III Municipalities ( 303)

Designation. Under the act, a municipality's CEO may apply to the OPM secretary to designate the municipality as a tier III municipality if it meets one of the following criteria:

1. the municipality has at least one bond rating from a bond rating agency that is below investment grade;

2. the municipality has no bond rating from a bond rating agency, or, its highest bond rating is A, Baa, or BBB, as long as all of its ratings are investment grade, and it has either (a) a negative fund balance percentage, or (b) an equalized mill rate of 30 or more and it receives 30% or more of its current fiscal year general fund budget revenues in state municipal aid;

3. the municipality issues a deficit obligation when it applies for the designation or has issued a deficit obligation in the five years since July 1, 2012; or

4. the OPM secretary, based on reports and findings of the Municipal Finance Advisory Commission, finds that the fiscal condition of the municipality warrants a tier III designation.

State Oversight and Control. The OPM secretary must refer any municipality designated as tier III to MARB.

Designated Tier IV Municipalities ( 305)

Under the act, the CEO of a designated tier III municipality may apply to the secretary to request designation as a tier IV municipality. The act allows the secretary to approve the request if the secretary determines that (1) the designation is necessary to ensure the municipality's fiscal sustainability and (2) it is in the state's best interest. If approved, the municipality must retain the tier IV designation after it issues a deficit obligation.

The act also allows MARB to designate a tier III municipality as a tier IV municipality if (1) at least two-thirds of the board members approve and (2) the board finds that the municipality's fiscal condition warrants it. This designation requires the governor's approval.

Municipal Accountability Review Board (MARB) ( 304)

Membership. The act establishes MARB within OPM for administrative purposes only. The board is composed of an equal number of (1) members or representatives of municipal employee collective bargaining units and (2) state and local government officials. (The act does not designate an appointing authority or specify the members' terms.) Board members do not receive compensation but are reimbursed for expenses related to performing their duties.

Operations. The board may charge tier III or IV municipalities for expenses it incurs related to working with the municipalities, including for staff and consultants. The board must consult with the municipalities before charging them, and the municipalities may pay the expenses with deficit obligation or debt restructuring bond proceeds.

Municipality Requirements. Under the act, any municipality referred to the board must supply it with any financial reports, data, audits, statements, and any other records or documentation the board needs to exercise its powers and perform its duties and functions. These reports may include:

1. proposed budgets,

2. monthly reports of the municipality's financial condition,

3. the status of the municipality's current annual budget and progress under its financial plan for the current fiscal year,

4. estimates of the operating results for all funds or accounts to the end of the fiscal year,

5. pension plan and debt projections,

6. statements and projections of general fund cash flow reserves,

7. the number of employees on the municipal payroll, and

8. debt service requirements on all of the municipality's bonds and notes for the following month.

The board must establish written procedures it deems necessary to carry out its responsibilities and meet the act's purposes.

MARB Powers with Respect to Designated Tier III Municipalities ( 304)

Under the act, each tier III municipality must work with the board and report to it as provided below. In overseeing these municipalities, the board has the same powers that it has with respect to designated or certified tier II municipalities (although the act gives MARB no oversight authority over certified tier II municipalities). MARB also has the budgetary power to:

1. review and comment on the municipality's annual budget before the municipality's legislative body adopts it,

2. monitor compliance with the municipality's three-year financial plan and annual budget and recommend that the municipality make any changes necessary to ensure budgetary balance, and

3. obtain information on the municipality's financial conditions and needs.

Under the act, when preparing their annual budgets, designated tier III municipalities may only include assumptions regarding state and property tax revenue and a mill rate the board approves.

With respect to debt obligations, MARB must:

1. for a municipality that is eligible to issue certain bonds (those with a term of more than one year supported by a SCRF, including general obligation bonds to fund a deficit), approve or disapprove any such obligation and only approve it if, in its judgment, the obligation will improve the municipality's financial condition and

2. review and comment on other proposed debt obligations.

With respect to collective bargaining agreements, MARB must review and comment on the impact on the municipality's financial plan and fiscal sustainability of any municipal employee collective bargaining agreement or arbitration awards before the municipality's or school district's legislative body, as applicable, acts on the proposed agreement or award.

The act also authorizes the MARB to:

1. recommend appropriate steps that the municipality can take related to the efficiency and productivity of its operations and management to reduce costs, improve services, and advance the act's purposes;

2. approve or disapprove any municipal contract over $200,000;

3. in consultation with the municipality, retain staff and hire consultants experienced in municipal finance and law, governmental operation and administration, or governmental accounting, as it deems necessary or desirable to accomplish its purposes; and

4. impose reasonable requirements necessary for the municipality to receive a budgeted increase in state assistance.

Municipal Accountability Review Board's Powers With Respect To Designated Tier IV Municipalities ( 305)

Under the act, with respect to a designated tier IV municipality, the board has the same powers and responsibilities as it has with respect to designated tier III municipalities. It also has additional or superseding authority and responsibility to:

1. review and approve or disapprove the municipality's annual budget, certain funds and fees (see below), bond ordinances, and bond resolutions;

2. monitor compliance with the municipality's three-year financial plan and annual budget and require the municipality to make any changes necessary to ensure balance in the plan and budget;

3. approve or reject certain collective bargaining agreements to be entered into by the municipality or any of its agencies or administrative units (see below);

4. serve as the binding arbitration panel for the collective bargaining agreements in, or subject to, binding arbitration (see below);

5. require its approval of proposed transfers of a municipality's appropriations above $50,000;

6. review, approve, disapprove, or modify the budget, on a line-item basis, for the municipality's board of education and require the board of education to submit to any budget transfers;

7. appoint the municipality's financial manager (see below); and

8. approve and authorize the issuance of general obligations and bonds by certain municipalities, including a designated tier IV municipality otherwise ineligible to issue such obligations.

Municipality's Annual Budget. The board has the authority and responsibility to review and approve or disapprove the municipality's annual budget, including the general fund, other governmental funds, enterprise funds, and internal service funds. A municipality's annual budget, annual tax levy, or user fee does not become operative until the board approves it.

If the board disapproves any annual budget, it must adopt an interim budget and establish a tax rate and user fees. The interim budget must take effect at the beginning of the fiscal year and remains in effect until the municipality submits, and the board approves, a modified budget.

Collective Bargaining Agreements. Regarding a municipality or any of its agencies or administrative units, including the board of education, the board may approve or reject (1) all proposed collective bargaining agreements for a new term and (2) modifications, amendments, or re-openings of existing agreements. The board may also indicate the total cost impact or savings that are acceptable in a new agreement or in an amendment to an existing agreement. If the board rejects an agreement or amendment, the board must indicate the specific provisions of the proposed agreement or amendment which caused the rejection, as well as its rationale for rejecting it.

Following any rejection of a proposed collective bargaining agreement or amendment, the parties to the agreement have 10 days from the date of the board's rejection to consider the board's concerns and propose a modified agreement. After the 10-day period, the board must approve or reject any modified agreement or amendment. If the parties have been unable to reach an agreement or the board rejects the modified agreement, the board must detail the terms of the agreement or amendment, which must be binding on the parties. But its authority with respect to an amendment is strictly limited to its purpose.

In establishing the terms of an agreement or an amendment, as well as in making a determination to reject a proposed agreement or amendment, the board must give the parties an opportunity to make a presentation. For the terms of a new agreement, the board may consider or include matters not raised or negotiated by the parties. However, for the terms of an amendment to an existing agreement, the board is limited to the subject of the proposed amendment.

Binding Arbitration. The board may serve as the binding arbitration panel regarding collective bargaining agreements that are in, or are subject to, binding arbitration. The board has the power to (1) impose binding arbitration on the parties any time after the 75th day after negotiations begin or (2) reject any arbitration award pending potential municipal or board of education legislative action. If, on the date of a municipality's designation as a tier IV municipality, the parties are in binding arbitration, the board must immediately replace any established binding arbitration panel.

The board may reduce, by one-half, the binding arbitration time limits in any applicable provisions of the general statutes or any public or special acts. Regarding the terms of the collective bargaining agreement, the board must not be limited to consideration and inclusion of the last best offers or the matters raised or negotiated by the parties.

Municipality's Financial Manager. The board may appoint a financial manager and delegate to him or her, in writing, certain review, comment, and investigatory powers it deems necessary or appropriate to manage the municipality's financial and administrative affairs during the time that the municipality is subject to the board's powers, but may override any action he or she takes at any time.

The board may specifically delegate to the manager the power to monitor compliance with the municipality's three-year financial plan and annual budget and require the municipality to make any changes necessary to ensure balance in the plan and budget. But it may not delegate any of the other powers or superseding authority it has with respect to designated tier IV municipalities. The act also prohibits the board from delegating to a financial manager certain powers and responsibilities it has with respect to designated tier III municipalities, even though the act does not authorize the board to designate financial managers for designated tier III municipalities. Specifically, the board may delegate the power or responsibility to:

1. review and comment on the municipality's annual budget prior to its adoption by the legislative body,

2. review and comment on proposed multi-year debt obligations that are not backed by a SCRF prior to their issuance,

3. monitor a municipality's compliance with the three-year financial plan and annual budget and recommend that the municipality make such changes as are necessary to ensure balance in the plan and budget,

4. recommend that the municipality implement efficiency and productivity measures, and

5. obtain information on the municipality's financial condition and needs.

Issuance of Obligations and Bonds. The board may approve and authorize the issuance of obligations, including, with regard to a designated tier IV municipality otherwise ineligible to issue such obligations, for deficit financing, addressing pension liabilities, debt restructuring, and other statutorily authorized purposes.

The board may authorize a designated tier IV municipality to issue refunding bonds regardless of existing law's limitations on the forms of municipal bonds and any statutory net present value savings requirement. The board must approve the issue of such refunding bonds only if it determines that, in its judgment, the bonds will improve the municipality's financial condition.

The board may authorize a designated tier IV municipality to issue bonds for which the last installment of any series of such bonds must mature, or the last sinking fund payment for such series of bonds must be due, within 30 years after the issuance of such bonds. The board must approve the issuance of such bonds only if it determines that the bond will improve the municipality's financial condition.

Retaining Tier III or Tier IV Designation ( 307)

Under the act, a municipality designated as a tier III municipality or tier IV municipality retains its designation for a minimum of the three fiscal years after its most current designation, regardless of any positive changes in the factors leading to its current designation, or until:

1. there have been no annual operating budget deficits in the municipality's general fund for three consecutive fiscal years;

2. the municipality's bond rating has either improved or remained unchanged since its most current designation, provided it has no bond ratings that are below investment grade;

3. the municipality has presented and the board has approved a financial plan that projects a positive unreserved fund balance for the three succeeding consecutive fiscal years covered by the financial plan; and

4. the audits for such consecutive fiscal years have been completed and contain no general fund deficit.

A municipality must remain undesignated unless it (1) has an annual operating budget deficit in its general fund equal to 1% or more of its most recently completed annual general fund budget, (2) experiences an annual operating budget deficit in its general fund in consecutive years, and (3) has one or more bond ratings that are below investment grade.

Court Action ( 308)

The act authorizes the attorney general to apply for a writ of mandamus on the board's behalf for the same reasons existing law allows him to do so on the Municipal Finance Advisory Commission's behalf. These include requiring a (1) municipal official or agent to implement the board's orders and (2) municipality to repay the state any funds it paid into the municipality's SCRF (see below) or comply with the terms of any agreement or indenture pertaining to the SCRF and other methods the law provides for securing bonds.

It also authorizes the Hartford judicial district, upon the board's application, to enforce the board's statutory powers, an authorization that currently applies to the OPM secretary, Municipal Finance Advisory Commission, and attorney general with respect to the municipal deficit financing statutes.

Deficit Financing ( 292-296, 298, 299, 301 & 302)

As discussed below, the law authorizes several methods certified tier I and tier II municipalities may use to secure bonds issued to finance deficits. The act extends this authorization to designated tier I-IV municipalities.

Deficit Financing ( 292)

Existing law provides a process any municipality may use to issue bonds to finance general fund deficits. The act requires the OPM secretary to designate any municipality that uses such process a designated tier III municipality, subject to the state oversight and control described above. It also requires him to impose the designation on any municipality that issued a deficit financing bond between July 1, 2012 and June 30, 2017.

By law, the process is available only to a municipality that has not issued a deficit-funding bond within the previous five years and has no outstanding debt obligations. Before the municipality can issue the bond, it must notify the OPM secretary of its intent to do so, provide the documents he requires, and establish a procedure to intercept and deposit property tax payments in a fund dedicated only to repay the bond (i.e., property intercept procedure (CGS 7-561)).

The act eliminates the requirement that the secretary refer the municipality to the Municipal Finance Advisory Commission.

SCRF ( 293-296, 298, 299, 301 & 302)

A SCRF is a fiscal tool designed to ensure that funds are available when necessary to repay bondholders. Prior law allowed only certified tier I and tier II municipalities to issue bonds to capitalize an SCRF established to cover the cost of issuing these bonds and fund the outstanding bonds. The act also allows designated tier I – IV municipalities to issue bonds supported by an SCRF.

Local Approvals. Under the act, designated tier I – IV municipalities must follow the same local approval process certified tier I and II municipalities must follow if they issue additional bonds to capitalize a SCRF. That process supersedes all other state and local laws pertaining to bond issuances, including those for holding public hearings and referenda and sale of bonds. A majority of the members of a municipality's legislative body must approve a resolution authorizing these SCRF capitalization bonds. The state treasurer determines the terms and conditions under which the bonds are sold (CGS 7-570).

State Supported SCRF. SCRFs may be backed by the state, but if they are, the municipality must first comply with specific statutory requirements, including the treasurer's approval of the indenture agreement creating the SCRF (CGS 7-571). The act allows designated tier I-IV municipalities to establish SCRFs under the same procedural rules that apply to certified tier I and II municipalities.

Designated tier I-IV municipalities must also comply with the statutory requirements for establishing and maintaining SCRFs. By law, an SCRF must contain the greatest amount of principal and interest payments due in any succeeding fiscal year, excluding sinking fund installments payable in the preceding fiscal year. Every December 1, the state must, if necessary, pay into the fund enough to ensure that the succeeding fiscal year's total debt service can be paid from it.

By law, that amount must be certified by the CEO of a certified municipality to the OPM secretary, treasurer, and Municipal Finance Advisory Commission. The act requires (1) the CEO of a designated tier I municipality to certify the amount to these officials and the commission and (2) MARB to certify the amounts for designated tier II, III, and IV municipalities. By law, the municipalities establishing state-backed SCRFs must repay the state as soon as possible.

As she must by law for certified municipalities, the treasurer, under the act, must approve the agreement created between a designated municipality and the bondholders' trustee (i.e. indenture of trust) for any SCRF that is backed by the state ( 293). Among other things, she must base her approval on whether:

1. the municipality is current on its bond repayments,

2. it has funded or made arrangements to fund the SCRF,

3. the bonds issued to fund the SCRF are in the public interest, and

4. she and the OPM secretary approved the municipality's property tax intercept procedure.

Under prior law, she also had to base her approval on whether the OPM secretary certified the municipality and the Municipal Finance Advisory Commission approved the bond. The act changes these requirements to reflect its tier designation. Consequently, the treasurer must base her approval on whether the municipality requested the OPM secretary to classify it as a designated tier I, II, or III municipality, or whether he classified it as a designated tier III or IV municipality when the act requires him to do so.

The treasurer must also base her approval on whether the bond authorization was approved by the (1) Municipal Finance Advisory Commission for a designated tier I or certified tier I or II municipality and (2) MARB for a designated tier III or IV municipality.

Limitations on Designated Tier I Municipalities. The act allows designated tier I municipalities to issue SCRF-backed general obligation bonds under some of the conditions that currently apply to certified tier I municipalities. Specifically, the municipality must (1) have a long-term investment grade or higher bond rating, (2) be unable to obtain bond insurance on reasonable terms and conditions, and (3) meet the secretary's other standards. As under existing law, a designated tier I municipality may not issue these bonds to finance a projected budget deficit.

Before issuing a SCRF-backed bond, a municipality must notify the OPM secretary that it intends to issue bonds, provide him with any documentation the law requires to issue such bonds, establish a property tax intercept procedure and debt service payment plan, and comply with the laws for issuing SCRF-backed deficit-financing bonds.

Limitations on Designated Tier II, III, and IV Municipalities. The act allows designated tier II, III, and IV municipalities to issue SCRF-backed bonds, including bonds issued to fund a deficit, if they meet the eligibility criteria for certified tier II municipalities. The term of these bonds can be for more than one year, except for those issued to finance a projected fiscal year deficit.

Under the act, designated tier II, III, and IV municipalities may issue SCRF-backed bonds if they:

1. have a long-term bond rating that is investment grade or higher,

2. are unable to obtain bond insurance,

3. have not issued a deficit obligation bond within the past five years,

4. have no outstanding deficit obligations, and

5. meet other standards the OPM secretary prescribes.

A designated tier IV municipality that does not meet these criteria may also issue the bond if MARB approves the issuance.

Designated tier II, III, and IV municipalities that meet these criteria and plan to issue SCRF-backed bonds must first consult with the treasurer and, before issuing the bonds, complete the following tasks:

1. notify the OPM secretary that they intend to issue bonds and provide him with any documentation they must, by law prepare;

2. establish a property intercept procedure and debt service payment plan; and

3. comply with the laws for issuing SCRF-backed bonds.

The act automatically designates as tier III a tier II or IV municipality that issues these bonds.

Background

Municipal Finance Advisory Commission. The Municipal Finance Advisory Commission oversees the two-tier certification system that predates the act's four-tier designation system (CGS 7-394b). As under prior law, it oversees certified tier I and II municipalities. Under the act, it also oversees designated tier I municipalities.

The commission's oversight is tied to the OPM secretary's statutory duty to review municipal audit reports. By law, he must refer any municipality to the commission if the audit report was not prepared as the statute requires or contains evidence of unsound or irregular practices based on commonly accepted municipal finance standards. He must also refer certified tier I and II municipalities.

The commission's powers apply to all referred municipalities. It may require a municipality's CEO to report on the status of any remedial actions it recommended and assess a civil penalty if the municipality fails to comply.

Certified tier II municipalities must prepare a three-year financial plan and monthly financial reports for the commission's approval. These municipalities must use the commission's assumptions about state and local tax revenue when they prepare and adopt their budgets. The commission must also approve all of the municipality's bond issuances, but only if it determines that they will improve the municipality's fiscal condition.

311 — MUNICIPAL APPROVAL OF COLLECTIVE BARGAINING AGREEMENTS AND ARBITRATION AWARDS

Requires municipal legislative bodies to affirmatively approve municipal employee union contracts; revises the process that occurs after a municipality rejects a contract

The act requires municipal legislative bodies to affirmatively vote to approve requests for (1) the funds needed to implement municipal employee collective bargaining agreements and (2) approval of any provisions in the agreements that conflict with charters, special acts, ordinances, municipal rules or regulations, or certain state statutes (e.g., those regulating the work hours of police or firefighters). By law, the legislative bodies may reject these requests by a majority vote of those present and voting on the matter, but under prior law, the requests were deemed approved if the legislative body failed to timely approve or reject them.

If a legislative body rejects a request, the act requires the matter to be returned to the parties for arbitration, rather than for further negotiations as under prior law. Under the act, the resulting arbitration award may be submitted to the municipality for approval and if the legislative body rejects this award, the matter must be returned to the parties for further arbitration. Any award issued through such arbitration is automatically deemed approved by the legislative body.

The act also specifies that when a legislative body rejects arbitration awards issued through other procedures (e.g., contract negotiations that proceed to arbitration after the parties reach an impasse in negotiations) the matter must be returned to the parties for further arbitration. Any award issued from this further arbitration is automatically deemed approved by the legislative body. (This provision overlaps with a similar, but more detailed, process in existing law, unchanged by the act (CGS 7-473c).)

EFFECTIVE DATE: October 1, 2017

312 — TAX REVENUE FOR MUNICIPAL SERVICES TASK FORCE

Creates a task force to study spending tax revenue for municipal governments' services

The act creates a 14-member task force to study the spending of tax revenue to provide local services by municipal governments. The task force members include (1) the Finance, Revenue and Bonding and Planning and Development committee chairpersons and ranking members, or their designees, and (2) six legislative appointees, as shown in Table 27.

Table 27: Legislative Appointments to Task Force

Appointing Authority

Qualifications of Appointee

House speaker

Connecticut Council of Small Towns representative

Senate president pro tempore

Connecticut Conference of Municipalities representative

House majority leader

Economics expert

Senate majority leader

Municipal official

House minority leader

Economics expert

Senate minority leader

Municipal official

The members appointed by the majority or minority leaders, and members serving as designees of the committee chairpersons or ranking members, may be legislators. All task force appointments must be made within 30 days after the act's passage. The appointing authority must fill any vacancy.

The act requires the House speaker and Senate president pro tempore to select the task force chairpersons from among its members. The chairpersons must schedule the first meeting of the task force, to be held within 60 days after the act's passage.

The act requires the Planning and Development Committee's administrative staff to serve in that capacity for the task force.

By April 1, 2018, the task force must report its findings and recommendations to the Planning and Development and Finance, Revenue and Bonding committees. The task force terminates on the date that it submits the report or April 1, 2018, whichever is later.

EFFECTIVE DATE: Upon passage

313 — SEPARATION OF PURA FROM DEEP

Establishes the Department of Environmental Protection and the Public Utilities Regulatory Authority as separate agencies

The act renames the Department of Energy and Environmental Protection (DEEP) as the Department of Environmental Protection (DEP) and establishes the Public Utilities Regulatory Authority (PURA) as its own agency separate from DEP. Under current law, PURA is part of DEEP.

The act assigns DEEP's energy policy goals to PURA. These include:

1. reducing rates and decreasing costs for Connecticut ratepayers,

1. ensuring the reliability and safety of the state's energy supply,

2. increasing the use of clean energy and technologies that support its use, and

3. developing the state's energy-related economy.

Under the act, DEP retains DEEP's jurisdiction over preserving and protecting the state's air, water, and other natural resources. The act also appears to preserve some of DEP's regulatory authority in the fields of energy and telecommunications advancement.

The act makes the DEEP commissioner the DEP commissioner and the chairperson of PURA under DEEP the head of the separate PURA. It also authorizes the legislative commissioners' office to make any conforming, technical, grammatical, and punctuation changes necessary to carry out the agency separation during codification.

EFFECTIVE DATE: Upon passage

314 — IMPAIRMENT OF STATE CONTRACTS

Specifies the circumstances in which state legislation may impair state contracts

The act specifies that the state, through legislation, may modify a contract to which it is a party if (1) any impairment to the contract is not substantial or (2) if the impairment to the contract is substantial, the legislation serves a legitimate public purpose, such as remedying a general social or economic problem, and the means to accomplish the purpose are reasonable and necessary.

The act further specifies that an impairment may be considered reasonable and necessary if (1) the state considered it along with other policy alternatives, (2) the state reasonably determined that it could not serve its purposes equally well with an evident and more moderate course of action, and (3) the state's action is not unreasonable in light of the surrounding circumstances.

(It appears that the above provisions have no legal effect. Although they generally codify federal court decisions regarding when a state may enact laws impairing its contracts, these decisions are the federal courts' interpretations of the U.S. Constitution's Contracts Clause, and state laws cannot dictate how courts must interpret the Constitution.)

EFFECTIVE DATE: Upon passage

315 — STATE EMPLOYEE ARBITRATION

Defines the state's “ability to pay” in arbitration proceedings

The law requires arbitrators in state employee contract arbitration proceedings to consider various factors, such as the state's ability to pay, changes in the cost of living, and prevailing fringe benefit and working conditions in the labor market. The act requires arbitrators, when determining the state's ability to pay, to consider the state's:

1. fiscal health;

2. Budget Reserve Fund balance;

3. long- and short-term liabilities, including its ability to meet minimum funding levels required by law, contract, or court order;

4. initial budgeted revenue compared to actual revenue received for the previous five fiscal years;

5. revenue projections for the fiscal years during the term of the proposed collective bargaining agreement;

6. economic outlook; and

7. access to capital markets.

The act specifies that the state's financial capability does not include its ability to raise revenue through new or increased taxes.

It also specifies that (1) the above provisions preempt any conflicting provisions in state employee collective bargaining agreements or arbitration awards and (2) if this preemption requires any agreement or award to be returned to the parties for further bargaining, only the provisions that have changed from those previously approved by the legislature must be resubmitted for legislative approval.

The act requires a two-thirds majority vote of each legislative chamber to modify the above provisions. (It is unclear whether this requirement is enforceable on future legislatures under the concept of “legislative entrenchment.”) It also specifies that such a vote is not needed to modify any provision of any such agreement or award.

EFFECTIVE DATE: Upon passage and applicable to negotiations then in progress.

316 — LEGISLATIVE APPROVAL OF STATE EMPLOYEE CONTRACTS AND ARBITRATION AWARDS

Requires the legislature to affirmatively vote to approve state employee union contracts and arbitration awards; revises the process that occurs if the legislature rejects an agreement or award

The act requires the legislature to affirmatively vote to approve state employee union contracts and arbitration awards. Under prior law, such contracts and awards were deemed approved if the legislature failed to vote to approve or reject them within a certain time frame. Under the act, they will instead be deemed rejected if the legislature fails to vote to approve or reject them within the same time frame. The act requires a two-thirds majority vote of each legislative chamber to modify the above provision. (It is unclear whether this requirement is enforceable against future legislatures under the concept of “legislative entrenchment.”)

The act also revises the process that occurs after the legislature rejects a contract or arbitration award. Under prior law, when a contract or award was rejected the matter was returned to the parties for further negotiations. The act instead establishes separate procedures for rejected contracts and awards. Rejected arbitration awards must return to arbitration with the award from this subsequent arbitration automatically deemed approved by the legislature. Rejected contracts must go to arbitration under the state employee arbitration law and the subsequent arbitration award must be submitted to the legislature for approval. If the legislature rejects this award, the matter must return for further arbitration with any subsequent award from the further arbitration deemed approved by the legislature.

(The above provisions, except for the two-thirds vote requirement, are repeated in 157.)

EFFECTIVE DATE: Upon passage

317-321 — LIMITS ON FUTURE SEBAC CONTRACTS

Limits certain provisions of future SEBAC Agreements and requires the Retirement Commission to conduct an actuarial valuation to reflect the changes

Starting on June 30, 2027, the act prohibits SEBAC agreements and state employee arbitration awards from (1) lasting for more than four years (this provision is repeated in 161), (2) including any provisions for cost of living adjustments to state employee pensions, or (3) including any provisions that include overtime pay in the calculation of an employee's pension. The act requires a two-thirds majority vote of each legislative chamber to modify the above provisions. (It is unclear whether this requirement is enforceable on future legislatures under the concept of “legislative entrenchment.”)

It also specifies that, starting June 30, 2027, (1) the above provisions preempt any conflicting state employee collective bargaining agreement or arbitration award and (2) if this preemption requires any agreement or award to be returned to the parties for further bargaining, only the provisions that have changed from those previously approved by the legislature must be resubmitted for legislative approval.

The act requires the Retirement Commission, by November 1, 2017, to prepare an actuarial valuation of the State Employees Retirement System's assets and liabilities that reflects, to the greatest extent possible, the immediate effect of (presumably) the above provisions. Based on the valuation, the commission must (1) re-determine the system's normal contribution rate and, until it is amortized, the unfunded past service liability and (2) include the valuation's results when it must certify to the legislature, by December 1, 2017, the amount needed to maintain the pension system.

The act also makes conforming changes.

EFFECTIVE DATE: Upon passage

322 — TEACHERS' RETIREMENT SYSTEM (TRS) VIABILITY COMMISSION

Establishes a commission and requires the state to contract with a consulting firm to develop and implement a plan to maintain TRS' financial viability

The act establishes the TRS Viability Commission, consisting of Teachers' Retirement Board members and a global consulting firm with significant experience and expertise in human resources, talent development, and health and retirement benefits and investments.

The commission must develop and implement a plan to maintain TRS' financial viability. In developing the plan, the commission must hold at least one public hearing and solicit the input of TRS members (i.e., participating Connecticut teachers). It must also consider the state's financial capability, including the state's:

1. fiscal health;

2. Budget Reserve Fund balance;

3. long- and short-term liabilities, including its ability to meet minimum funding levels required by law, contract, or court order;

4. initial budgeted revenue compared to actual revenue received for the previous five fiscal years;

5. revenue projections for the fiscal years during the proposed plan's term;

6. economic outlook; and

7. access to capital markets.

The act specifies that the state's financial capability does not include its ability to raise revenue through new or increased taxes.

The commission must submit the plan and any proposed legislation for implementing it to the Education and Appropriations committees within 90 days after contracting with a consulting firm (see below). The commission must terminate within one year after it submits the plan.

Contracting with a Consulting Firm

The act establishes a process for selecting and contracting with a consulting firm for the commission. Within 60 days after the act becomes effective, the OPM secretary must, within available appropriations, contract with a global consulting firm with significant experience and expertise in human resources, talent development, and health and retirement benefits and investments. If he does not do so within 60 days, then the Office of Legislative Management (OLM) must do so.

The OPM secretary or OLM executive director, as applicable, must identify candidates with significant experience to undertake the act's required duties through the solicitation of qualifications and any other factors that may bear on the ability to perform the duties. Each solicitation and response must be written. The secretary or executive director must select a contractor from at least four eligible candidates (the act does not specify what happens if fewer than four contractors respond to the solicitation). Under the act, any resulting contract (1) is not subject to the state law on state consultants and personal services agreements and (2) is not subject to state purchasing laws or laws under the State Contracting Standards Board's jurisdiction.

If the OPM secretary contracts with a firm, the act requires the governor, with the Finance Advisory Committee's approval, to transfer to OPM any funds appropriated to OLM for the contract. If OLM contracts with a firm, then OLM must retain the funds appropriated for the contract. The act also allows the state to accept gifts, grants, and donations for purposes of contracting with the consulting firm. However, it may not accept these from any candidate that also submits a bid for the contract.

EFFECTIVE DATE: Upon passage

323 — TEACHERS' RETIREMENT SYSTEM (TRS) ACTUARIAL VALUATION

Requires an annual, rather than biennial, TRS actuarial valuation

The act requires the Teachers' Retirement Board to arrange for an actuarial valuation of the TRS's assets and liabilities to be conducted once the act takes effect, and annually, rather than biennially, after that.

EFFECTIVE DATE: Upon passage

324 — STATE SUSTAINABILITY PLAN

Requires OPM or OLM to contract with a professional services advisor to develop and implement a state Sustainability Plan

The act requires the OPM secretary, within available appropriations, to contract with an independent financial and operational global professional services advisor to help (1) him develop and implement a long-term fiscal and operational plan for the state (the “Sustainability Plan”) and (2) the legislature develop guidelines for authorizing budget expenditures, which may include recommendations for legislation. The secretary must contract with the advisor in consultation with the House speaker and minority leader and the Senate president pro tempore and Republican president pro tempore. If the secretary fails to do so within 60 days after the act takes effect, OLM's executive director must contract with the advisor, within available appropriations, but the advisor must be under the secretary's direction.

Contracting with an Advisor

The act requires the OPM secretary or OLM executive director, as applicable, to identify candidates with significant experience and expertise in restructuring and turnaround work in the private and public sectors by soliciting qualifications and any other factors that may show the ability to perform the advisor's duties under the act. Each solicitation and response must be written. The secretary or executive director must select the advisor from at least four eligible candidates. Under the act, any resulting contract is not (1) a personal service agreement under the state law for state consultants and (2) subject to state purchasing laws or laws under the State Contracting Standards Board's jurisdiction.

If the OPM secretary contracts with the advisor, the act requires the governor, with the Finance Advisory Committee's approval, to transfer to OPM any funds appropriated to OLM for the contract. OLM keeps the appropriated funds if it contracts with the advisor. The act also allows the state to accept gifts, grants, and donations for purposes of contracting with the advisor. However, it prohibits accepting them from a candidate that bids on the contract.

Plan Goals and Requirements

Under the act, the goals of the Sustainability Plan and legislative guidelines are to (1) ensure the state's continued ability to provide essential services, (2) promote economic growth, and (3) meet long-term obligations. The plan must be based on five-year projections of state revenues and expenses under existing law and contractual commitments, including collective bargaining agreements. It must include a comprehensive capital budget based on an inventory of all capital assets owned by the state or any state agency, department, authority, or instrumentality.

Regardless of any other state laws, the plan may include establishing a public-private partnership to (1) ensure the financial viability of John Dempsey Hospital and the UConn Health Center (UCHC) and (2) address identified concerns to ensure that UCHC's clinical operations are self-sustaining assets. The act specifies that it does not prohibit UCHC from developing and implementing such a plan on its own.

Legislative Approval

The act requires the advisor, within 90 days after it contracts for the task, to complete the plan and file a written copy with the House and Senate clerks. Within 30 days after the plan is filed, the legislature may approve it as a whole by a majority vote of each chamber, or reject it by a majority vote of either chamber. If the legislature fails to act within the 30 days, the plan is deemed approved. If the legislature rejects the plan, the advisor must develop a revised plan and file the revision with the House and Senate clerks within the next 30 days. The legislature has 30 days after the revision is filed to vote to approve or reject the revised plan under the same procedure as above.

Once the legislature approves a plan, the act requires the OPM secretary to submit quarterly reports to the Appropriations and Finance, Revenue and Bonding committees on (1) the status of implementing it and (2) any recommendations for legislation or necessary funding. The committees must hold joint meetings when the first two reports are submitted to update the public on implementing the plan.

EFFECTIVE DATE: Upon passage

325 — BOND ALLOCATION CAP

Establishes a $2 billion GO bond allocation cap starting July 1, 2017

Beginning July 1, 2017, the act imposes a $2 billion cap on the amount of state general obligation (GO) bonds the State Bond Commission may authorize to be issued (i.e., allocate) each fiscal year. (Sections 92 & 515 of the act establish a similar bond allocation cap, but on a calendar year basis.)

EFFECTIVE DATE: Upon passage

326 — COMPTROLLER REPORTS ON SEBAC SAVINGS

Requires the (1) comptroller to determine the savings realized through the 2017 SEBAC Agreement and its related contracts and (2) governor to take action if budgeted savings are unrealized

The act requires the comptroller to determine the amount of labor-management savings realized by the state for each fiscal year from 2018 through 2027 under:

1. the 2017 SEBAC Agreement, including all of its attachments and appended agreements and any agreement reached through negotiations between the state and SEBAC on wages, hours, and other conditions of employment;

2. any other agreements between the state and the individual state employee collective bargaining units to achieve labor-management savings specified in the state budget act for FYs 18 & 19;

3. adjustments or revisions made to the budget act for FY 19; and

4. each successive state budget act thereafter and any even-numbered year adjustments or revisions made to them, through FYs 26 and 27.

Starting by December 1, 2018, and by each December 1 after that through 2027, the comptroller must report to the governor and the legislature the amount of labor-management savings realized for the previous fiscal year under the above agreements. If the comptroller's reported amount of savings is less than the labor-management savings specified in the state budget or any even-numbered year adjustments to it, the act requires the governor to immediately act to recover the unrealized savings and ensure that savings specified in the budget act are realized in the second year of the biennium, if applicable. By January 1 each year, the governor must report to the Appropriations Committee on any actions he took or will take.

EFFECTIVE DATE: Upon passage

327 — LITCHFIELD COUNTY COURTHOUSE

Allows the state to retain use of the old Litchfield County Courthouse land and building unless certain conditions are met

The act allows the state to retain use of the old Litchfield County Courthouse and associated land, unless the holder of the reversionary interest (i.e., heir of the lease holders) preserved that interest by recording certain documents in the Litchfield land records within the last 40 years. The act specifies that the reversionary interest is terminated unless the holder recorded a notice, deed, probate certificate, or other instrument of conveyance describing the interest within that time frame.

Previously, because the land is not being used as a courthouse, ownership of the property would revert to the holder of the reversionary interest (based on deeds from the early 19th century).

EFFECTIVE DATE: Upon passage

328 & 329 — BRIDGE RENAMING

Renames “Detective Bruce Boisland Memorial Bridge” as “Detective Bruce Boislard Memorial Bridge” and the “Veterans of Foreign Wars Memorial Bridge” as the “American Legion Bridge”

Detective Bruce Boislard Memorial Bridge ( 328)

The act renames the “Detective Bruce Boisland Memorial Bridge” as the “Detective Bruce Boislard Memorial Bridge” (PA 17-230 designated the bridge on Route 229 in Southington, passing over I-84, as the “Detective Bruce Boisland Memorial Bridge”).

American Legion Bridge ( 329)

The act renames the “Veterans of Foreign Wars Memorial Bridge” as the “American Legion Bridge” (PA 17-230 designated bridge number 01592, carrying Maple Street over the Naugatuck River in Ansonia, the “Veterans of Foreign Wars Memorial Bridge”).

EFFECTIVE DATE: Upon passage

330 — SPENDING CAP DEFINITIONS

Modifies definitions used to calculate the state's statutory spending cap

The state's statutory spending cap bars the legislature from authorizing an increase in “general budget expenditures” for any fiscal year that exceeds the greater of the percentage “increase in personal income” or “increase in inflation,” unless (1) the governor declares an emergency or the existence of extraordinary circumstances and (2) at least three-fifths of each house of the legislature approves the extra expenditure for those purposes (CGS 2-33a).

Increase in Personal Income

By law, the “increase in personal income” is the state's average annual increase in personal income for the preceding five years, based on U. S. Bureau of Economic Analysis data. The act requires this average annual increase to be calculated on a calendar year basis, as existing law required for FY 15 through 17.

Increase in Inflation

The act modifies the definition of “increase in inflation” by excluding food and energy items from the consumer price index for urban consumers (CPI-U) used to calculate the increase and requiring the increase to be calculated on a December over December basis.

General Budget Expenditures

The act expands the types of “general budget expenditures” included under the spending cap to include:

1. any expenditure authorized by a public or special act of the legislature for a program or purpose that, in the preceding fiscal year, was made from an appropriated fund, regardless of how it was previously identified, if the program or purpose is (a) essentially the same as the one funded in the previous fiscal year and (b) being funded by state bonding, a revenue intercept, or a non-appropriated account, and

2. statutory grants to distressed municipalities if the grants were in effect on July 1, 1991.

It also expands the types of expenditures excluded from the cap to include expenditures of federal funds granted to the state or its agencies.

EFFECTIVE DATE: Upon passage

331-497, 976 & 977 — BOND AUTHORIZATIONS, ADJUSTMENTS, AND CANCELLATIONS

Authorizes up to $1.172 billion for FY 18 and $1.457 billion for FY 19 in new GO bonds for state projects and grant programs; authorizes up to $809.9 million in FY 18 and up to $745.1 million in FY 19 in new STO bonds for DOT projects; cancels, reduces, or restores bond authorizations for various projects and grants; adjusts the annual bond caps under the CSCU 2020 program and UConn 2000 programs, and extends both programs (but see 96-99); makes permanent the school security infrastructure grant program; allocates no LoCIP funds in 2017 and $55 million in 2018; and authorizes certain transportation funding agreements with the federal government, and the issuance of “federal transportation bonds”

The act authorizes up to $1.172 billion for FY 18 and $1.457 billion for FY 19 in state general obligation (GO) bonds for state capital projects and grant programs, including school construction, economic development, municipal capital improvement grants, and housing development and rehabilitation programs. It cancels or reduces approximately $305.4 million in GO bond authorizations. And it restores $24 million in bonds cancelled or reduced in the 2016 bond act (PA 16-4, May Special Session).

The act authorizes $809.9 million for FY 18 and $745.1 million for FY 19 in special tax obligation (STO) bonds for transportation projects, including $482.3 million over the two years for bus and rail facilities and equipment.

The act also makes various other changes, including (1) adjusting the annual bond caps under the CSCU 2020 and UConn 2000 infrastructure programs and extending the programs, by one and three years respectively; (2) expanding the purposes of funds in the Bioscience Innovation Fund to include funding regenerative medicine research; (3) making the school security infrastructure competitive grant program permanent; and (4) authorizing the state to enter into loan or other credit agreements with the federal government to help finance transportation-related construction projects and the issuance of “federal transportation bonds”.

EFFECTIVE DATE: Upon passage for FY 18 bond authorizations and July 1, 2018 for FY 19 authorizations, except that one STO bonding provision for FY 19 is effective upon passage ( 374); other sections are effective upon passage unless otherwise noted below.

New Bond Authorizations for State Agency Projects and Grants ( 331-367 & 384)

The act authorizes new GO bonds in amounts up to $426.2 million in FY 18 and $459.9 million in FY 19 for the state projects and grant programs listed in Table 28. The bonds are subject to standard issuance procedures and have a maximum term of 20 years.

The act includes a standard provision requiring that, as a condition of bond authorizations for grants to private entities, each granting agency (except OPM) include repayment provisions in its grant contract in case the facility for which the grant is made ceases to be used for the grant purpose within 10 years of the grantee receiving it. The required repayment is reduced by 10% for each full year that the facility is used for the grant purpose.

Table 28: GO Bond Authorizations for State Projects and

Grant Programs for FYs 18 and 19

Agency

Purpose

FY 18

FY 19

State Projects and Programs

332(a), 350(a)

Office of Policy and Management (OPM)

Transit-oriented development and predevelopment activities

$4,000,000

$4,000,000

Information technology capital investment program

10,000,000

20,000,000

Assisting owners of residential buildings who have qualified test results indicating that the building's foundation is deteriorating due to pyrrhotite

20,000,000

20,000,000

332(b), 350(b)

Department of Administrative Services (DAS)

Alterations and improvements in compliance with the Americans with Disabilities Act (ADA)

1,000,000

1,000,000

Infrastructure repairs and improvements, including (1) fire, safety, and ADA compliance; (2) improvements to state-owned buildings and grounds, including energy conservation and off-site improvements; and (3) preservation of unoccupied buildings and grounds, including office development, acquisition, renovations for additional parking, and security

10,000,000

10,000,000

Removing or encapsulating asbestos and hazardous material in state buildings

5,000,000

5,000,000

Upgrading and replacing technology infrastructure for the Connecticut Education Network

1,500,000

1,500,000

350(c)

Military Department

Acquiring property for development of readiness centers in Litchfield county

0

2,000,000

332(c), 350(d)

Department of Energy and Environmental Protection (DEEP)

Dam repairs, including for state-owned dams

4,000,000

0

Energy services projects in state buildings resulting in increased efficiency measures or renewable energy or combined heat and power projects

20,000,000

20,000,000

332(d), 350(e)

Department of Developmental Services (DDS)

(1) Fire, safety, and environmental improvements to regional facilities and intermediate care facilities for client and staff needs, including compliance with current codes, and (2) site improvements, handicapped access improvements, utilities, repair or replacement of roofs, air conditioning, and other building renovations and additions at all state-owned facilities

2,500,000

2,500,000

332(e), 350(f)

Department of Mental Health and Addiction Services (DMHAS)

(1) Fire, safety, and environmental improvements to regional facilities and intermediate care facilities for client and staff needs, including compliance with current codes, and (2) site improvements, handicapped access improvements, utilities, repair or replacement of roofs, air conditioning, and other building renovations and additions at all state-owned facilities

2,000,000

2,000,000

332(f), 350(g)

Connecticut State Colleges and Universities (CSCU)

All colleges and universities: system telecommunications infrastructure upgrades, improvements, and expansions

2,000,000

2,000,000

All colleges and universities: advanced manufacturing and emerging technology programs

2,750,000

2,875,000

All colleges and universities: security improvements

3,000,000

5,000,000

All community colleges: deferred maintenance, code compliance, and infrastructure improvements

20,000,000

30,000,000

All universities: deferred maintenance, code compliance, and infrastructure improvements

12,500,000

7,000,000

Naugatuck Valley Community College (NVCC): upgrades to mechanical systems

6,000,000

0

NVCC: ADA alterations and improvements

5,000,000

5,000,000

332(g)

Department of Children and Families (DCF)

Alterations, renovations, and improvements to buildings and grounds, including new or revised juvenile justice facilities

5,000,000

0

332(h), 350(h)

Judicial Department

Alterations, renovations, and improvements to buildings and grounds at state-owned and maintained facilities

5,000,000

5,000,000

Implementation of the Technology Strategic Plan Project

0

3,000,000

Exterior renovations and improvements at New Haven Superior Courthouse

0

2,000,000

350(i)

Department of Corrections (DOC)

Renovations and improvements to state-owned buildings for inmate housing, programming, staff training space, and additional inmate capacity; support facilities; and off-site improvements

0

10,000,000

338-340

None

None

100,000,000

0

356

Department of Housing (DOH)

Housing development and rehabilitation for various kinds of state-assisted affordable housing and housing-related financial assistance programs; authorizes DOH to use up to $30 million to revitalize moderate rental housing units in the Connecticut Housing Finance Authority's state housing portfolio

0

100,000,000

Grants

342(a), 361(a), 384

OPM

Responsible Growth Incentive Fund

2,000,000

2,000,000

Grants to municipalities for municipal purposes and projects

60,000,000

60,000,000

342(b)

DEEP

Program to establish energy microgrids to support critical municipal infrastructure

5,000,000

0

Grants to municipalities to improve incinerators and landfills, including bulky waste landfills

1,450,000

0

Grants for containment, removal, or mitigation of identified hazardous waste disposal sites

2,500,000

0

361(b)

DOH

Grants to private nonprofits for supportive housing for individuals with intellectual disabilities, autism spectrum disorder, or both

0

10,000,000

342(c), 361(c)

Connecticut Innovations, Inc. (CI)

Recapitalizing CI's statutory programs

7,000,000

23,000,000

342(d), 361(d)

Capital Region Development Authority (CRDA)

Encouraging development according to CRDA's statutory purposes

40,000,000

40,000,000

342(e), 361(e)

State Department of Education (SDE)

Grants to assist targeted local and regional school districts for alterations, repairs, improvements, technology, and equipment in low-performing schools

2,000,000

20,000,000

342(f), 361(f)

Department of Transportation (DOT)

Grants to municipalities for the Town-Aid-Road program

30,000,000

30,000,000

342(g), 361(g)

DAS

Grants to municipalities for a regional school district incentive grant

5,000,000

5,000,000

342(h), 361(h)

Department of Economic and Community Development (DECD)

Targeted brownfield remediation

30,000,000

10,000,000

Transportation Bonds ( 368-379)

The act authorizes up to $809.9 million in new STO bonds in FY 18 and up to $745.1 million in FY 19 for DOT projects, as shown in Table 29.

Table 29: STO Bond Authorizations for DOT Projects

Authorized Program Areas

FY 18

FY 19

Bureau of Engineering and Highway Operations

Interstate highway program

$13,000,000

$13,000,000

Urban systems projects

14,776,250

16,217,392

Intrastate highway program

44,000,000

44,000,000

Environmental compliance, soil and groundwater remediation, hazardous material abatement, demolition, salt shed construction and renovation, storage tank replacement, and environmental emergency response at or near state-owned properties or related to DOT operations

17,660,000

15,000,000

State bridge improvement, rehabilitation, and replacement

33,000,000

33,000,000

Capital resurfacing and related reconstruction

75,000,000

75,000,000

Fix-it-First bridge repair program (up to $10.9 million must be used in FY 18 for the Stratford Bridge carrying US 1 over the Metro North Rail Line)

111,115,000

88,850,000

Fix-it-First road repair program

55,000,000

55,000,000

Local transportation capital program

62,000,000

64,000,000

Grants to municipalities for the Town Aid Road program

30,000,000

30,000,000

Local bridge program

0

10,000,000

Bureau of Public Transportation

Bus and rail facilities and equipment, including rights-of-way, other property acquisition, and related projects (In FYs 18 and 19, up to $10 million each year must be used for service and equipment improvements to the Danbury Rail Line. In FY 18 only, up to $250,000 must be used for a feasibility study to explore possibilities for a new passenger rail station at the Wall Street location on the Danbury Rail Line in Norwalk.)

236,250,000

246,000,000

Bureau of Administration

Department facilities

63,132,500

0

STO bonds: cost of issuance and debt service reserve

55,000,000

55,000,000

Bond Authorizations for Statutory Programs and Grants ( 380, 382-383, 385-387 & 398-399)

The act increases bond authorization limits for various statutory grants and purposes and allocates new bonds for these purposes for FYs 18 and 19, as shown in Table 30.

Table 30: Statutory Bond Authorizations for FYs 18 and 19

Agency

Purpose/Fund

FY 18

FY 19

380

OPM

Urban Action (economic and community development project grants)

$30,000,000

$30,000,000

382

OPM

Capital Equipment Purchase Fund

15,000,000

15,000,000

383

OPM

Local Capital Improvement Program (LoCIP)

90,000,000

35,000,000

385

DOH

Housing Trust Fund

0

30,000,000

386

DAS

School construction projects

450,000,000

450,000,000

387

SDE

School construction interest subsidy grants

3,000,000

2,100,000

398

DEEP

Clean Water Fund grants

0

85,000,000

399

DEEP

Clean Water Fund loans (revenue bonds)

158,200,000

350,300,000

GO Bond Cancellations and Reductions ( 381, 388, 396-397, 400, 409-441, 443-461, 463-470, 472-476, 478-482, 484-492, 497 & 976-977)

The act cancels or reduces, by a total of approximately $245.4 million, all or part of prior bond authorizations for the projects and grants shown in Table 31. Authorizations are listed alphabetically by agency. Except where noted in the table, the act also makes conforming changes to the bond supertotals that correspond to these authorizations.

Table 31: Cancellations and Reductions in GO Bond Authorizations

Purpose

Prior Authorization

Amount Cancelled

Board of Regents for Higher Education

427

Establish or expand manufacturing technology programs at four community colleges

$17,800,000

$970,500

444

Quinebaug Valley Community College (QVCC): parking and site improvements

2,189,622

225,275

445

QVCC: heating, ventilating, and air conditioning system improvements

1,750,000

145,000

456

Housatonic Community College: parking garage improvements

3,907,258

233,281

457

Middlesex Community College: new academic building planning, design, and construction

35,200,000

35,200,000

473

Capital Community College: alterations, renovations, and improvements to optimize space utilizations

5,000,000

5,000,000

Capital Region Development Authority

453

Alterations, renovations, and improvements to the Connecticut Convention Center and Rentschler Field

3,727,500

18,500

Connecticut Green Bank

397

Energy Conservation Loan Fund and Green Connecticut Loan Guaranty Fund

(also eliminates a requirement that $5 million authorized for FY 11 be used for the guaranty fund)

5,000,000

4,000,000

Connecticut Port Authority

487

Grants for port, harbor, and marina improvements, including dredging and navigational improvements

13,500,000

6,750,000

Department of Agriculture

448

Farm Reinvestment Program

500,000

500,000

460

Farm Reinvestment Program

500,000

500,000

Department of Children and Families

433*

Grants for construction, alteration, repairs, and improvements to residential facilities, group homes, shelters, and permanent family residences

5,000,000

2,839,842

441

Grants to private, nonprofit mental health clinics for fire, safety, and environmental improvements, including expansion

1,000,000

460,550

Department of Developmental Services

435

(1) Fire, safety, and environmental improvements to regional facilities and intermediate care facilities, including improvements in compliance with current codes and (2) site improvements, handicapped access improvements, utilities, roof repair or replacement, air conditioning, and other building renovations and additions at all state-owned facilities

5,000,000

428,000

454

(1) Fire, safety, and environmental improvements to regional facilities and intermediate care facilities, including improvements in compliance with current codes and (2) site improvements, handicapped access improvements, utilities, repair or replacement of roofs, air conditioning, and other building renovations and additions at all state-owned facilities

5,000,000

253,248

Department of Economic and Community Development (DECD)

413, 977

Killingworth: Old Town Hall restoration and renovations

250,000

250,000

416, 976, 977

University of New Haven: establish and build Henry Lee Institute

1,500,000

1,500,000

Department of Emergency Services and Public Protection (DESPP)

400

Buy-out program for storm-damaged properties

2,800,000

800,000

421, 976

Upgrades to the statewide telecommunications system, including site development and related equipment

2,200,000

2,200,000

437

Design and construction of a firearms training facility and vehicle operations training center, including land acquisition

6,576,000

3,000,000

472

Alterations, renovations, and improvements to the Forensic Science Laboratory in Meriden

2,500,000

2,500,000

Department of Energy and Environmental Protection (DEEP)

412

East Lyme: purchase Oswegatchie Hills for open space

2,000,000

1,800,000

415, 977

Stamford: Holly Pond Tidal Restoration project

500,000

500,000

418, 976

Norwalk: flood control system improvements

500,000

500,000

419

Fairfield: Rooster River flood control project

2,030,000

2,000,000

449

Grants to municipalities for open space acquisition and development for conservation or recreational purposes

10,000,000

10,000,000

452

Recreation and Natural Heritage Trust Program for recreation, open space, resource protection, and resource management

8,000,000

8,000,000

475

Long Island Sound stewardship and resiliency program to protect coastal marshes and other natural buffer areas and for grants to increase the resiliency of wastewater treatment facilities

15,000,000

15,000,000

476

Grants to municipalities, in consultation with OPM, to encourage low-impact design of green municipal infrastructure to reduce nonpoint source pollution

10,000,000

10,000,000

Department of Housing

478

Main Street Investment Fund

5,000,000

5,000,000

485

Main Street Investment Fund

3,000,000

3,000,000

Department of Mental Health and Addiction Services (DMHAS)

410

Alterations, renovations, additions, and improvements, including new construction, in accordance with the DMHAS master campus plan

886,593

722,090

432*

Grants to nonprofits for community-based residential and outpatient facilities for purchases, repairs, alterations, and improvements

5,000,000

1,043,836

Department of Public Health

431*

Grants to community health centers, primary care organizations, and municipalities for the purchase of equipment, renovations, improvements, and expansion of facilities

2,000,000

1,750,000

Department of Rehabilitation Services (DORS)

468

Grants for programs providing home modifications and assistive technology devices related to aging in place, which may be run by a nonprofit under contract with DORS

6,000,000

6,000,000

Department of Transportation

396

Commercial rail freight line competitive grant program

10,000,000

2,500,000

Department of Veterans Affairs

465

Planning and feasibility study for additional veterans' housing at the Rocky Hill campus, including vacant building demolition

500,000

500,000

Judicial Department

429

Alterations, renovations, and improvements to buildings and grounds at state-owned and maintained facilities

5,000,000

223,817

438

Development of a juvenile court building in Meriden or Middletown

1,000,000

1,000,000

446

Development of a juvenile court building in Meriden or Middletown

2,000,000

2,000,000

458

Development of a juvenile court building in Meriden or Middletown

9,000,000

9,000,000

Multiple Agencies

423

Bridgeport economic development projects (for DECD or DEEP, as designated by the Bond Commission)

2,200,000

950,000

425

Hartford infrastructure projects and programs (for DECD, DEEP, DESPP, or the Department of Social Services (DSS), as designated by the Bond Commission)

10,600,000

6,100,000

426

Bridgeport infrastructure projects and programs (for DECD, DEEP, DESPP, or DSS, as designated by the Bond Commission)

12,700,000

7,500,000

Office of Early Childhood

450

Grants to towns and tax-exempt organizations for facility improvements and minor capital repairs to school readiness programs and state-funded day care centers

11,500,000

5,641,832

461

Grants to towns and nonprofits for facility improvements and minor capital repairs to facilities that house school readiness programs and state-funded day care centers

5,000,000

5,000,000

Office of Governmental Accountability

482

Information technology improvements

500,000

500,000

Office of Legislative Management

464

Production and studio equipment for the Connecticut Network

3,230,000

2,230,000

Office of Policy and Management

381

Intertown Capital Equipment Purchase Incentive Program

5,000,000

62,851

488

Regional dog pound grant program

10,000,000

10,000,000

490

West Harford: improvements to the Trout Brook Canal area

1,200,000

700,000

492

Waterbury: property acquisition, construction, reconstruction, renovation, or improvements for an urban development project

7,000,000

7,000,000

492

West Hartford: wireless fidelity and broadband network initiative for West Hartford Center

500,000

500,000

497

Small Town Economic Assistance Program (STEAP)

280,000,000

19,000,000

State Comptroller

467

Connecticut Public Broadcasting Network: transmission, broadcast, production, and information technology equipment

1,300,000

1,300,000

State Department of Education

440

Grants for expanding the availability of high-quality school models and assisting in implementing common CORE state standards and assessments: alteration, repair, improvements, technology, equipment, acquisition, and capital start-up costs

24,888,946

6,334,200

455

Technical high school system: alterations, renovations, and improvements to buildings and grounds, including equipment, tools, and supplies necessary to update curricula, vehicles, and technology

15,500,000

11,000,000

479

Grants for Sheff magnet school program capital start-up costs

20,000,000

5,000,000

480

American School for the Deaf: alterations, renovations, and improvements to buildings and grounds

5,000,000

2,507,950

486

Grants for Sheff magnet school program capital start-up costs

5,750,000

5,750,000

*The aggregate cancellation for these authorizations is $5.63 million, but the act reduces the corresponding bond super total in PA 11-57 by only $3.63 million.

Smart Start Competitive Grant Program ( 388). The act cancels $28,480,851 in GO bonds authorized for FYs 17 through 19 ($8,480,851 in FY 17 and $10 million each in FYs 18 and 19) for the Smart Start competitive grant program, which provides grants to local and regional boards of education for establishing or expanding preschool programs.

Technical High School Pilot Program ( 469). The act reduces, by $3,066,000, funding for the technical high school system's pilot program to provide expanded educational opportunities for academic enrichment and trades training for secondary and adult learners by extending hours at technical high schools in Hamden, Hartford, New Britain, and Waterbury. Prior law assigned $3.5 million for this purpose; the act provides $434,000. (The act does not correspondingly reduce the bond allocation super total related to this funding.)

Changes to CSCU 2020 Bond Program ( 389 & 390)

The act adjusts the annual bond caps under the CSCU 2020 program, as shown in Table 32, by cancelling $110 million in bonds for FY 18 and reallocating them to FY 20. The act correspondingly extends Phase III of the program by one year, from FY 19 to FY 20.

Table 32: CSCU 2020 Annual Bond Limits (millions)

FY

Prior Limit

Act's Limit

Change

18

$150

$40

($110)

19

95

95

0

20

0

110

110

These provisions conflict with 96 & 97 of the act, which also extend the CSCU program to FY 20, but defer $55 million in bonds from FY 18 to FY 20, authorize an additional $11.7 million in bonds for FY 20, and add a new $11.7 million project to the program.

UConn 2000 ( 391-395)

Bond Schedule. The act extends the UConn 2000 program by three years, from 2024 to 2027. It cancels $55.1 million in bonds previously authorized for FY 18; reallocates them among FYs 19 and 24 to 27; and adjusts the annual bond caps for the program, as shown in Table 33. It results in a net bond cancellation of $0.5 million. (These provisions conflict with 98 & 99, which extend the program by two years and reduce total authorizations by $99.1 million.)

Table 33: UConn 2000 Annual Bond Limits (millions)

FY

Prior Limit

Act's Limit

Change

18

$295.5

$240.4

($55.1)

19

251.0

265.9

14.9

20

269.0

269.0

0

21

191.5

191.5

0

22

144.0

144.0

0

23

112.0

112.0

0

24

73.5

73.5

0

25

0

20.0

20.0

26

0

10.0

10.0

27

0

9.7

9.7

Project Authorizations. The act expands two existing Phase III projects for deferred maintenance and other infrastructure improvements at the university and health center, respectively, to include utility, infrastructure, administrative, and support facilities. Under the act, utility, infrastructure, administrative, and support facilities include any eligible UConn 2000 project at the Storrs or regional campuses or health center, including any building or structure that is essential, necessary, or useful for such facilities. It includes (1) new construction, expansion, extension, addition, renovation, restoration, replacement, repair, and deferred maintenance of such facilities; (2) accessories and facilities located on, above, or underground used in connection with the facilities; and (3) anything else that relates to or supports the facilities. The act also makes a conforming change.

Connecticut Bioscience Innovation and Regenerative Medicine Funds ( 401-404)

Bond Authorizations. Prior law authorized $200 million in bonds over 11 years, from FY 13 to FY 23, for the Connecticut Bioscience Innovation Fund (CBIF). The act:

1. extends the program by one year to FY 24;

2. cancels $25 million in bonds authorized for FYs 18 and 19, deferring $24 million of them to FY 24 (see Table 34); and

3. reduces the aggregate authorization for the program by $1 million.

Table 34: CBIF Authorizations (millions)

Fiscal Year

Prior

Authorization

Act's

Authorization

Change

18

$25

$10

($15)

19

25

15

(10)

20

25

25

0

21

25

25

0

22

25

25

0

23

25

25

0

24

0

24

24

The act also cancels $30 million in bonds authorized for FYs 17 through 19 for the Regenerative Medicine Research Fund (REGEN) and eliminates, beginning October 1, 2017, the requirement that at least $10 million be available each year until FY 19 to provide financial assistance to conduct regenerative medicine research.

CBIF's Purposes. The act allows CBIF resources to provide financial assistance to institutions eligible for funding under the existing REGEN program (CGS 32-41jj to 32-41mm). Such assistance must be provided pursuant to existing REGEN requirements. (Because the CBIF and REGEN programs are overseen by different committees and are awarded through different processes, it is unclear how this change will be applied in practice.)

Regenerative medicine research involves examining the process for creating living, functional tissue to repair or replace tissue or organ function lost due to aging, disease, damage, or congenital defects. The Bioscience Innovation Fund finances projects to improve health care delivery, lower health care costs, and create bioscience jobs.

Adjustments and Technical Corrections to 2016 Bond Act ( 405-408, 462, 471, 477, 483 & 493-494)

The act restores several GO bond authorizations cancelled or reduced in the 2016 Bond Act (PA 16-4, May Special Session), as shown in Table 35. It also makes various technical corrections related to provisions in the 2016 act ( 405-406, 483 & 493-494).

Table 35: Restored Bond Authorizations

Agency

For

Prior Authorization

Amount Cancelled in PA 16-4

Act's Authorization

408

SDE

American School for the Deaf: alteration, renovation, and improvements to buildings and grounds, including new construction

$4,405,709

$5,000,000

$9,405,709

462

CI

Regenerative Medicine Research Fund

0

10,000,000

10,000,000

471

DAS

Removal or encapsulation of asbestos and hazardous material in state-owned buildings

5,000,000

5,000,000

10,000,000

477

DECD

Brownfield Remediation and Revitalization program

16,000,000

4,000,000

20,000,000

School Security Infrastructure Competitive Grant Program ( 442)

The act makes permanent the school security infrastructure competitive grant program, which under prior law ended in FY 17. The program is jointly administered by DESPP, DAS, and SDE and provides grants to develop or improve security infrastructure in schools, based on the results of school building security assessments conducted under the supervision of local law enforcement agencies.

By law, if there is not enough money to reimburse every applicant for its full grant amount in FYs 15 through 17, first priority is given to applicants with schools that have the greatest need for security infrastructure. The act does not extend these priority requirements beyond FY 17.

Local Capital Improvement Program (LOCIP) ( 495)

Existing law requires the OPM secretary to allocate LoCIP funds to municipalities on February 1 of each year, up to the amount the legislature authorized for the fiscal year. For 2017 and 2018, the act instead requires the OPM secretary to allocate no LoCIP funds on February 1, 2017 and $55 million to municipalities on February 1, 2018.

Under LoCIP, the OPM secretary allocates a share of available state funds to each municipality based on miles of road, population density, and population factors, and credits the amount to each town's LoCIP account. A town may use its LoCIP credits to reimburse local spending for approved qualified projects.

Federal Transportation Loan Program Assistance and STO Bonds ( 496)

Federal Loan Program Agreements. The act authorizes the state treasurer, OPM secretary, and DOT commissioner (i.e., “state officials”) to enter into loan agreements or other credit agreements with the U.S. Department of Transportation (U.S. DOT), including agreements under the federal Transportation Infrastructure Finance and Innovation Act (TIFIA) and Railroad Rehabilitation and Improvement Financing (RRIF) programs. It allows such loan agreements to be backed by STO bonds (see below).

Under the act, the state officials:

1. may execute and deliver any documents, certificates, and instruments related to the agreements and obligations issued under them;

1. must determine the agreements' terms, conditions, covenants, and other provisions in the state's best interest; and

2. may take all other actions necessary to enter into these agreements or receive other financial assistance under any U.S. DOT program, including preparing, executing, and submitting applications.

Securing Federal Loans with STO Bonds. The act authorizes the issuance of “federal transportation bonds,” which are state STO bonds issued to evidence and secure U.S. DOT loans or other financial assistance made to the state under federal programs, including TIFIA and RRIF. Federal law generally requires that U.S. DOT loans be backed by revenue sources, such as tolls, user fees, or other dedicated revenue sources that secure the financed project's other obligations (23 U.S.C. 602 (a)(6); 45 U.S.C. 822 (f)(3)). TIFIA and RRIF loans have longer repayment periods (35 years) than STO bonds (20 years) and flexible repayment schedules (e.g., repayment does not have to begin until five years after completion of the financed project).

Under the act, federal transportation bonds are generally subject to the requirements, covenants, and conditions that apply to STO bonds issued under the transportation STO bond program, and they may be secured by a trust indenture between the state and a corporate trustee under the same provisions that apply to the STO bond program under existing law. Regardless of STO program provisions regarding tax exemption, the act allows federal transportation bonds to be issued as taxable bonds.

The act provides that the bonds' debt service requirements and other obligations must be secured by a lien on “pledged revenues,” which is the revenue credited to the Special Transportation Fund (STF) in any year. The lien is subordinate and junior to every lien securing bonds issued under the STO bond program.

Whenever the General Assembly authorizes STO bonds, those authorizations are deemed to have authorized federal transportation bonds, including STO bond authorizations that are already in effect.

TIFIA and RRIF. Under federal law, the TIFIA program provides credit assistance, including direct loans, loan guarantees, and standby lines of credit, for qualified transportation projects of regional and national significance. In general, states may receive federal credit assistance in amounts of up to 33% of total reasonably anticipated eligible project costs (23 U.S.C. 601 et seq.).

 The RRIF program provides direct loans and loan guarantees to finance development of railroad infrastructure. Under the program, states can receive direct loans to fund up to 100% of a railroad project with repayment periods of up to 35 years (45 U.S.C. 821 et seq.).

518 — BOND LISTS

Requires the (1) treasurer to provide the governor with an annual list of unissued bonds and (2) governor to provide the treasurer with an annual list of GO bond expenditures that can be made in the next fiscal year

Beginning by January 1, 2018, the act requires the state treasurer to annually provide the governor with a list of allocated but unissued bonds (i.e., bonds authorized by the legislature and allocated by the State Bond Commission, but not yet issued by the treasurer).

Beginning by April 1, 2018, the act requires the governor to annually provide the treasurer with a list of GO bond expenditures of up to $2 million total that can be made on the following July 1.

EFFECTIVE DATE: Upon passage

521-944, 978-981 — AGENCY CONSOLIDATIONS AND ELIMINATION OF COMMISSIONS

Consolidates the Department of Housing within the Department of Economic and Community Development, the Office of Early Childhood within the state Department of Education, and the state Department on Aging within the Department of Social Services; eliminates the state's two legislative commissions

The act consolidates three state agencies and eliminates the state's two legislative commissions. Specifically, it:

1. consolidates the state Department on Aging (SDA) in the Department of Social Services (DSS);

2. consolidates the Department of Housing (DOH) in the Department of Economic and Community Development (DECD);

3. consolidates the Office of Early Childhood (OEC) in the State Department of Education (SDE);

4. eliminates the Commission on Women, Children, and Seniors and moves the Trafficking in Persons Council from the commission to OPM for administrative purposes only; and

5. eliminates the Commission on Equity and Opportunity.

The act revises the membership of numerous boards and commissions to conform to these legislative changes, principally removing the DOH, OEC, and SDA commissioners, or their designees, and legislative commission members from their positions on these bodies.

In general, under the act, any order or regulation in force on October 1, 2017 remains in effect until amended, repealed, or superseded by law.

Additionally, the act authorizes the Legislative Commissioners' Office to make technical changes to codify these changes in statute.

EFFECTIVE DATE: October 1, 2017, except for certain conforming changes ( 522 & 788), which are effective July 1, 2019.

State Department on Aging

The act consolidates SDA within DSS and authorizes the governor, with the Finance Advisory Committee's approval, to transfer funds between the departments. Additionally, the act transfers to DSS all SDA functions, powers, duties, and personnel. Specifically, it transfers to DSS authority over the following functions, among others:

1. serving as the designated “state unit on aging” under the federal Older Americans Act (OAA) and administering related programs;

2. allocating OAA funding to the state's five area agencies on aging;

3. overseeing municipal agents for the elderly;

4. awarding state grants for elderly community services and programs and using up to 5% of funds appropriated for these grants for related administrative expenses;

5. establishing and overseeing a fall prevention program, within available appropriations;

6. operating the CHOICES Medicare counseling, Statewide Respite, Community Choices, and elderly nutrition programs;

7. establishing an outreach program to educate consumers on long-term care, including financing, asset protection, and insurance;

8. providing information to help people choose appropriate long-term care insurance; and

9. housing the Long-Term Care Ombudsman Office.

Department of Housing

The act consolidates DOH within DECD, generally transferring responsibility for DOH programs to DECD. These include programs concerning affordable housing development and financing, individual and group housing, rent subsidies, eviction and foreclosure prevention, shelter provision and transitional living, and home ownership. Among other things, the act transfers to DECD, DOH's responsibilities concerning:

1. working with and providing financial assistance to the Connecticut Housing Finance Authority to achieve the state's housing and community development goals;

2. the state supplier diversity programs (formerly called the set-aside program);

3. the affordable housing land use appeals procedure, including maintenance of the assisted housing inventory;

4. the state's consolidated plan for housing and community development;

5. congregate housing for the elderly;

6. independent living for low- and moderate-income individuals with disabilities;

7. the federal Housing Choice Voucher and Section 8 programs;

8. the community housing land bank and land trust programs;

9. the Main Street Investment Fund;

10. the Housing for Economic Growth Program (i.e., incentive housing zone program);

11. the Rental Assistance Program, including transitional and emergency rental assistance programs; and

12. homelessness prevention programs, including emergency shelter services, transitional housing services, and on-site social services.

The act directs the interagency council on affordable housing to (1) meet on or by July 1, 2018 to develop recommendations for DECD on housing matters and (2) report to the governor and certain legislative committees by January 15, 2019.

Additionally, the act designates the Department of Children and Families (DCF) the successor agency to itself for purposes of administering the state's homeless youth program (presumably, it designates DCF as the successor to DOH for this purpose) ( 757).

Office of Early Childhood Education

The act consolidates OEC in SDE and designates the department as the lead agency for providing early childhood services and education. It makes SDE responsible for administering the early childhood programs previously administered by OEC, including, among others:

1. school readiness;

2. the Head Start grant program;

3. the Nurturing Families Network;

4. Connecticut Charts-a-Course;

5. state- and federally-funded child day care subsidies;

6. child day care services management, evaluation, and professional development;

7. the Connecticut Smart Start Competitive Grant Program;

8. the Even Start Literacy Program;

9. the Birth-to-Three Program;

10. child day care facilities licensing, inspection, and regulation; and

11. youth camp licensing and oversight.

The act moves the Early Childhood Cabinet from OEC to SDE for administrative purposes only. It also directs SDE, beginning by July 1, 2018, to annually develop report cards containing the indicators and performance measures identified in the early childhood accountability plan previously developed by OEC.

Elimination of Legislative Commissions

The act eliminates the Commission on Equity and Opportunity and the Commission on Women, Children, and Seniors. Under prior law, the former focused on issues affecting the following underrepresented and underserved populations: African-Americans, Asian Pacific Americans, and Latinos and Puerto Ricans. The latter focused on issues affecting women, children, families, and older adults. Among other things, the commissions advised the General Assembly on coordinating and administering state programs affecting their constituencies, reviewed and commented on proposed state legislation, and conducted educational and outreach activities to raise awareness of and address critical issues for their constituencies.

Additionally, the act moves the Trafficking in Persons Council from the Commission on Women, Children, and Seniors to OPM for administrative purposes only. The OPM secretary or his designee replaces the commission's chairperson on the council.

The act also eliminates training programs on human trafficking, which the commission developed under prior law with the Police Officer Standards and Training Council.

Lastly, the act requires the Commission on Women, Children, and Seniors, by October 1, 2017, to electronically transfer to DSS training resources and materials that help financial institutions and financial agents detect potential fraud, exploitation, and financial abuse. DSS must post this information on its website by November 1, 2017.

945 — TECHNICAL CHANGES BY THE LEGISLATIVE COMMISSIONERS' OFFICE (LCO)

Requires that LCO, as part of its codification, make necessary technical, grammatical, and punctuation changes in the act's text

The act requires LCO, when codifying the act's provisions, to make the technical, grammatical, and punctuation changes necessary to carry out the act's purposes. Among other things, these changes may include correcting inaccurate internal references.

EFFECTIVE DATE: Upon passage

946-962 — HEALTH CARE PROVIDER TAX

Beginning July 1, 2017, sunsets the taxes on hospitals and ambulatory surgical centers and user fees on nursing homes and intermediate care facilities for individuals with intellectual disabilities and reestablishes the taxes and fees as part of a comprehensive and uniform health provider tax system

Beginning July 1, 2017, the act sunsets the taxes on hospitals and ambulatory surgical centers (ASCs) and user fees on nursing homes and intermediate care facilities for individuals with intellectual disabilities (ICF-IDs) and reestablishes the taxes and fees as part of a comprehensive and uniform health provider tax system. It establishes administrative, record keeping, and penalty provisions for the provider taxes and fees that generally parallel those in existing law for other taxes.

Tax on ASC and Hospital Services

Overview. Prior law imposed separate taxes on hospital net revenue and ASC gross receipts. The hospital tax was based on a hospital's net patient revenue (defined as the amount of accrued payments earned by a hospital for the provision of inpatient and outpatient services) for a base year determined by the DSS commissioner in accordance with the state budget. The ASC tax was based on an ASC's gross receipts for each quarter, excluding the first $1 million in the applicable fiscal year and any portion of a center's gross receipts that constituted net patient revenue of a hospital subject to the hospital tax. Under prior law, the ASC tax rate was 6% and the hospital tax rate was set up to the maximum allowed by federal law (6% as of October 1, 2011) and in conformance with the state budget.

Beginning July 1, 2017, the act sunsets these two taxes and instead imposes a net revenue tax on both hospitals and ASCs as part of a comprehensive health provider tax system. The new tax is based on the total net revenue (see “Definition of Net Revenue,” below) that hospitals and ASCs receive for providing inpatient and outpatient hospital services and ASC services. The tax on inpatient and outpatient hospital services is based on the net revenue received for FY 16, while the tax on ASC services is based on the total net revenue ASCs receive each calendar quarter for such services, excluding revenue from Medicaid payments.

For ASC services, the act sets the rate at 6%. For inpatient and outpatient hospital services, the act establishes a formula for calculating the tax rate. The formula's numerator is a specified amount (effectively the amount of revenue to be generated by the tax for the fiscal year) and the denominator is the total “FY 16 Audited Net Revenue,” as described below, for all health care providers subject to the tax. The numerator is $900 million in FYs 18 and 19 and $384 million in FY 20 and thereafter.

Payment Requirements for Tax on Hospital Services.  For each fiscal year, beginning with FY 18, each health care provider required to pay tax on inpatient and outpatient hospital services must calculate the amount of tax due, on forms prescribed by the DRS commissioner, by multiplying the applicable rate described above by the its audited net revenue (described below) for FY 16. With the exception of FY 18, providers must pay the total amount due in four quarterly payments according to the standard filing and payment requirements the act establishes (described further below).

For FY 18, the act requires health care providers to make an estimated tax payment on October 31, 2017 that equals 133% of the tax that was due for FY 17 under the prior hospital tax. If a provider was not required to pay the tax on either inpatient or outpatient hospital services, it must make its estimated payment based on its unaudited net patient revenue. Providers must pay the remaining balance due for FY 18 in two equal payments, due April 30, 2018, and July 31, 2018, respectively.

The act requires health care providers to make these required payments according to procedures established by the commissioner, on forms he provides.

Hospitals and ASCs Subject to the Tax. Under prior law, the hospital tax applied to all short-term general hospitals except children's hospitals and hospitals operated exclusively by the state, other than those the state operates as a receiver (i.e., Connecticut Children's Medical Center and John Dempsey Hospital). Under the act, the tax applies to the net revenue tax of any health care facility that (1) is licensed by DPH as a short-term general hospital; (2) is maintained primarily for the care and treatment of patients with disorders other than mental diseases; (3) meets the requirements for participation in Medicare as a hospital; and (4) has a utilization review plan in effect, applicable to all Medicaid patients, that meets federal requirements, or has been granted a federal waiver.

Under prior law, the ASC gross receipts tax applied to DPH-licensed outpatient surgical facilities and Medicare-certified ASCs that are included in the federal definition of an ASC (i.e., a distinct entity that operates exclusively to provide surgical services to patients not requiring hospitalization, where the services are not expected to take more than 24 hours). The act applies the net revenue tax to ASCs that (1) meet the federal definition described above and (2) have an agreement with the Centers for Medicare and Medicaid Services (CMS) to participate in Medicare as an ASC and meet federal requirements to do so.

Request for Federal Waiver to Exempt Certain Hospitals. The act requires the DSS commissioner to seek CMS approval to exempt from the tax (1) specialty hospitals; (2) children's general hospitals; and (3) hospitals operated exclusively by the state, other than those the state operates as a receiver. (However, specialty hospitals do not appear to be subject to the tax since they are not licensed by DPH as short-term general hospitals.) It requires health care providers, upon request, to provide the DSS commissioner with information he needs to make any necessary calculations to seek approval for this exemption. (The same exemption applied against the hospital tax under prior law.)

The act similarly requires the commissioner, before January 1, 2018 and every three years thereafter, to seek CMS approval to exempt financially distressed hospitals from the tax on outpatient hospital services. It defines a “financially distressed hospital” as one that has experienced, over a five-year period, an average net loss of more than 1% of aggregate revenue if the loss is reflected in the five most recent years of financial reports made available by the Office of Healthcare Access for such hospital as of July 1 of the year in which the waiver is requested. (The same exemption applied against the hospital tax under prior law.)

Under the act, any health care provider or hospital for which CMS grants an exemption is exempt from the net revenue tax and any provider or hospital denied an exemption must pay the tax.

The act exempts these waivers from the statutes requiring the DSS commissioner to submit notice of any proposed amendment to the Medicaid state plan to the Human Services and Appropriations committees before submitting it to the federal government.

Definition of Net Revenue. The act defines net revenue as “gross receipts” minus “payer discounts,” “charity care,” and bad debts on which the taxpayer previously paid the tax. Under the act, “gross receipts” means the amount “received” from patients, third-party payers, and others (cash or in-kind) for taxable health care items or services the taxpayer provides in the state. It includes retroactive adjustments under reimbursement agreements with third-party payers, with no deduction for expenses. Under the act, “received” means received or accrued according to the taxpayer's customary accounting method.

“Payer discounts” is the difference between a provider's published charges and the actual payments it received under negotiated agreements with health care payers for a different or discounted rate or payment method. It excludes charity care and bad debts.

“Charity care” is free or discounted health care services provided to individuals who cannot afford to pay, including care to the uninsured patient or patients who are not expected to pay all or part of a provider's bill based on income guidelines and other financial criteria established in statute or in a provider's charity care policies on file at the provider's office. It does not include bad debts and payer discounts.

FY 16 Audited Net Revenue. As discussed above, the tax on inpatient and outpatient hospital services is based on the provider's FY 16 audited net revenue. The act defines “FY 16 audited net revenue” as the amount of revenue the DRS commissioner determines, in accordance with federal law, that a health care provider received for providing inpatient and outpatient hospital services during federal FY 2016, based on information provided by each health care provider subject to the tax. Under the act, the total FY 16 audited net revenue is the sum of FY 16 audited net revenue for each health care provider subject to the tax.

The act requires hospitals to submit to the commissioner any information he determines is required to calculate the FY 16 audited net revenue for all hospitals. They must provide this information by January 1, 2018. The commissioner may request additional information he needs to audit each hospital's net revenue. Once he has completed his examination, the commissioner must, by February 28, 2018, notify each hospital of its FY 16 audited net revenue.

Hospitals that fail to provide the requested information before January 1, 2018, or fail to comply with a request for additional information, are subject to a penalty of $1,000 per day for each day the hospital fails to provide the requested or additional information. The act allows the commissioner to engage an independent auditor to assist him with these duties and responsibilities.

Taxable Services. The tax applies to the revenues a health care provider receives for providing inpatient and outpatient hospital services. Under the act, “inpatient hospital services” are all services (1) ordinarily furnished in a hospital for the care and treatment of inpatients, (2) furnished under the direction of a physician or dentist, and (3) furnished in a hospital. They exclude skilled nursing facility and intermediate care facility services furnished by a hospital with swing bed approval. An “inpatient” is a patient admitted to a medical institution as an inpatient on a physician's or dentist's recommendation and who (1) receives room, board, and professional services in the institution for at least a 24-hour period or (2) is expected to do so by the institution, even if the patient does not actually stay for 24 hours.

The act defines “outpatient hospital services” as preventive, diagnostic, therapeutic, rehabilitative, or palliative services (1) furnished to outpatients, (2) furnished by or under the direction of a physician or dentist, and (3) furnished by a hospital. An “outpatient” is a patient of an organized medical facility, or a distinct part of such facility, who is expected by the facility to receive, and does receive, professional services for less than a 24-hour period, regardless of (1) when the patient is admitted, (2) whether a bed is used, or (3) whether the patient remains in the facility past midnight.

Under the act, “ASC services” are those services furnished in connection with covered surgical procedures performed in an ASC for which payment for the procedure is allowable under federal law. They include only facility services and exclude surgical procedures.

Hospital-Owned ASCs. Under the act, net revenue derived from furnishing a health care item or service to a patient must be taxed only once. Net revenue from each hospital-owned ASC must be (1) considered net revenue of the hospital and (2) reported as net revenue from inpatient or outpatient hospital services as applicable.

Under the act, a hospital-owned ASC includes only those ASCs that (1) are considered departments of the owner-hospital and (2) have provider-based status according to federal law. (Provider-based status is a Medicare payment designation that allows qualifying health care facilities to bill Medicare as a hospital outpatient department and thereby receive higher payments.) If an ASC is owned by a hospital but is not considered to be a hospital department or does not have provider-based status, its net revenue must not be considered the owner-hospital's net revenue; rather, it must file and pay tax for any net revenue it receives from providing ASC services.

DRS Guidance. The act requires the DRS commissioner to issue guidance on the administration of the tax on inpatient and outpatient hospital services after completing a study of the applicable federal law governing the administration of health care provider taxes. The commissioner must conduct the study in collaboration with the DSS commissioner, the OPM secretary, the Connecticut Hospital Association, and the hospitals subject to the tax.

Nursing Home and ICF-ID User Fees

Facilities Subject to the Fees. The act imposes quarterly resident day user fees on nursing homes and ICF-IDs that are generally the same as those imposed under prior law. The act imposes the nursing home fee on all nursing homes (i.e., any licensed chronic and convalescent nursing home or rest home with nursing supervision) and requires the DSS commissioner to seek a federal Medicaid waiver to exempt continuing care retirement communities (CCRCs) from the fee (described further below). CCRCs were similarly exempt from the nursing home fee under prior law.

The act imposes the ICF-ID user fee on the same facilities subject to the fee under prior law (i.e., residential facilities for people with intellectual disabilities that are certified to meet federal requirements and, in the case of private facilities, state-licensed).

Fee Calculation. Under prior law, DSS was required to calculate the fees every two years based on the facilities' net revenue (i.e., the amount billed for all services provided, less contractual allowances, payer discounts, charity care, and bad debt) and a percentage set by the OPM secretary up to the maximum amount federal law allows (6%). The act instead establishes the fees as the product of each facility's total resident days during the quarter multiplied by (1) $21.02 for nursing homes and (2) $27.26 for ICF-IDs, which generally equal the current user fees set by DSS. (The nursing home resident user fee was previously $16.13 per resident day for municipally owned nursing homes and homes licensed for more than 230 beds.)

Under the act, a nursing home or ICF-ID resident day is the same as under prior law, that is, a day a nursing home or ICF-ID provides residential care to an individual, and includes a day (1) a resident is admitted, (2) for which the facility is eligible for payment for reserving the resident's bed due to hospitalization or temporary leave, or (3) a resident dies.  As under prior law, a resident day does not include the day a resident is discharged or, in the case of nursing homes, a Medicare day (i.e., days of nursing home care service provided to someone eligible for Medicare payments).

Waiver and Fee Reduction. The act requires the DSS commissioner to seek federal approval from CMS to (1) exempt CCRCs from the nursing home fee and (2) impose a lower fee of $16.13 for municipally-owned homes and those homes licensed for more than 230 beds. Under the act, the exemption and lower fee apply if CMS grants approval; if CMS denies the exemption or lower fee, the nursing home fee or higher user fee applies (i.e., CCRCs pay the nursing home fee or the higher fee applies to larger or municipally-owned homes).

As with the hospital waivers discussed above, the act exempts the nursing home and ICF-ID user fee waivers from the statutes requiring the DSS commissioner to submit notice of any proposed amendment to the Medicaid state plan to the Human Services and Appropriations committees before submitting it to the federal government.

Tax Credits

The act prohibits health care providers from using tax credits to reduce their health provider tax liabilities. Under prior law, hospitals and ambulatory surgical centers could apply urban and industrial site reinvestment tax (UISR) credits against their hospital or ASC taxes.

Under the act, any provider assigned UISR tax credits to apply against the prior hospital or ASC tax may further assign the credits once to another taxpayer or taxpayers, but these taxpayers may (1) claim the credits only for the tax year for which the provider would have been eligible to claim them and (2) not further assign the credits. The assigning health care provider must file with the DRS commissioner information the commissioner requests on such assignments, including the current credit holders as of the end of the preceding calendar year.

Tax and Fee Administration

Filing Returns and Remitting Taxes and Fees. Under the act, taxpayers doing business in this state (i.e., health care providers subject to the tax or fee) must file quarterly returns, and remit the tax and fee payments to the DRS commissioner by the last day of January, April, July, and October of each year on DRS-prescribed forms. The returns must be signed by one of the taxpayer's principal officers and state the (1) taxpayer's name and location, (2) amount of its net patient revenue or resident days during the respective quarter, and (3) other information the commissioner deems necessary to properly administer the health provider taxes and the state's Medicaid program.

Taxpayers must file the returns electronically and remit their payments by electronic funds transfer, regardless of whether they would have otherwise been required to do so electronically under existing law.

Failure to Pay Tax or Fee. Taxpayers that fail to pay the tax or fee they owe on time are subject to a penalty of 10% of the unpaid tax or fee or $50, whichever is greater, plus 1% interest for each full or partial month that the tax or fee remains unpaid.

If a taxpayer does not file a return within one month of its due date, the DRS commissioner may make the return based on the best information available and according to the prescribed form. In addition to the tax or fee due, the taxpayer must pay a penalty of 10% of the tax or fee due or $50, whichever is greater. Interest of 1% on the tax due accrues for each full or partial month that it remains unpaid.

The DRS commissioner must notify the DSS commissioner of any delinquent amount. Once the DSS commissioner receives the notice, he must deduct and withhold the amount due from any amount DSS would otherwise pay the taxpayer.

Penalty Waivers. The DRS commissioner may waive all or part of any penalty if the taxpayer proves that his failure to pay the tax or fee was for reasonable cause and was not intentional or due to neglect. By law, the Penalty Review Committee must approve penalty waivers of more than $1,000.

Willfully Failing to Pay the Taxes or Fees or Supplying False Information. In addition to other penalties provided by law, taxpayers that willfully fail to pay the taxes or fees, file returns, keep records, or supply information within the time allowed under the act are subject to a fine of up to $1,000, one year in prison, or both. The act allows DRS to prosecute taxpayers for these violations within three years after they were committed. (The act appears to incorrectly refer to violations committed on or after July 1, 1997.)

The act also provides that anyone who willfully delivers or discloses to the commissioner or his authorized agent any list, return, account, statement, or other document known to be fraudulent or false in any material matter is, in addition to any other penalties provided by law, guilty of a class D felony (see Table on Penalties). Taxpayers may not be charged with these two offenses (willfully failing to pay the taxes or fees or supplying fraudulent or false information) for the same tax period, but they may be charged and prosecuted for both such offenses based on the same information.

Examination of Records and Deficiency Assessments. The act authorizes the DRS commissioner to examine the records of any taxpayer subject to the taxes or fees as he deems necessary. If he determines there is a deficiency, he must assess the deficiency, give notice of the deficiency assessment to the taxpayer, and make demand for payment. Interest of 1% per month on the amount due accrues from the date when the original tax or fee was due. An additional penalty of (1) 10% of the deficiency or $50, whichever is greater, applies when it appears that the deficiency is due to negligence or intentional disregard for the act or regulations and (2) 25% of the deficiency applies when it appears that the deficiency is due to fraud or intent to evade the act or regulations. A taxpayer cannot be subject to more than one penalty in relation to the same tax period. Taxpayers must pay the tax, penalty, and interest due within 30 days after the notice's mailing.

The commissioner must mail notice of a deficiency assessment to the taxpayer within three years after the return is filed or was originally due, whichever is later. But there is no time limit when a willfully false or fraudulent return is filed with intent to evade the tax or fee. In cases where the taxpayer consents, in writing, to an extension of the period for assessing an additional tax or fee, the amount of the additional tax due may be determined at any time within the extended period. The extended period may be further extended by additional written consents before the period expires.

The DRS commissioner may require taxpayers to (1) keep certain prescribed records and (2) produce books, papers, documents, and other data to provide or secure information relevant to the determination of the taxes or fees and their enforcement and collection. The commissioner, or any person he authorizes, may examine such books, papers, records, and equipment and may investigate the business's character to verify the accuracy of a tax return or determine the amount due.

Agreements with the DSS Commissioner. The act authorizes the DRS commissioner to enter into an agreement with the DSS commissioner delegating to the latter the authority to examine health provider taxpayer records and returns and determine whether the correct amount of tax has been paid. These examinations and determinations have the same effect as those made by DRS.

The act also authorizes the DRS commissioner to enter into an agreement with the DSS commissioner to facilitate the exchange of returns or return information necessary for the DSS commissioner to perform his responsibilities and ensure compliance with the state's Medicaid program.

The DSS commissioner may engage an independent auditor to assist him in performing these duties and responsibilities. Any reports the independent auditor generates must be provided simultaneously to DRS and DSS.

Regulations. The DRS commissioner may adopt regulations to implement the health provider taxes and fees.

Claims for Overpayment. A taxpayer who has overpaid has three years from the date the tax or fee was due to file a written claim for a refund stating the specific grounds for the claim. Within a reasonable time, as the commissioner determines, the commissioner must decide the claim's validity and, if valid, have the comptroller provide a refund. Failure to file a claim within the three-year period constitutes a waiver of the right to an overpayment refund. If the commissioner disallows the claim, notice must be mailed to the taxpayer briefly setting forth his factual findings and the reasons for the disallowance. His action becomes final 60 days after being mailed, unless the taxpayer has filed a written protest with the commissioner, as described below.

Written Protest. Within 60 days after the mailing of a proposed disallowance for an overpayment claim, the taxpayer may file a written protest with the commissioner against the proposed disallowance indicating the grounds on which the protest is based. The commissioner must reconsider the proposed disallowance and may grant a hearing if the taxpayer, or its authorized representative, requests one. Notice of the commissioner's determination must be mailed to the taxpayer and must briefly indicate the commissioner's findings and the basis of his decision. The commissioner's decision on the protest is considered final one month from the date he mails the notice unless the taxpayer appeals to court during this period as described below.

Appeals of Commissioner's Decisions. The act allows a taxpayer aggrieved by the DRS or DSS commissioner's action, or that of an authorized agent, in setting the amount of any health provider tax, penalty, interest, or fee to apply, in writing, for a hearing and correction to the DRS commissioner within 60 days after notice of the action. The application must indicate the reasons why the hearing should be granted and the amount by which the tax, penalty, interest, or fee should be reduced. The commissioner must promptly consider the application and may grant or deny the hearing request. He must immediately notify the taxpayer if the hearing is denied. If the hearing is granted, he must notify the applicant of the hearing's date, time, and place. After the hearing, the commissioner may issue an order that appears just and lawful and provide a copy to the taxpayer. DRS may order a hearing on its own initiative and require the taxpayer or any individual it believes has relevant information to appear, with any specified documents, for examination under oath.

Court Appeal. Any taxpayer aggrieved by an order, decision, determination, or disallowance of the commissioner can appeal for relief to the Superior Court for the judicial district of New Britain. The appeal must be made within one month after notice is served of the commissioner's action. It must be accompanied by a citation for the commissioner to appear in court. The citation and appeal must be handled like other civil actions, and the authority filing the appeal must provide a bond to assure prosecution of the appeal and compliance with court orders. These appeals become preferred cases, which must be heard at the first court session unless there is cause to do otherwise.

The court is authorized to grant equitable relief. If the tax or charge has already been paid, relief may include interest at a rate of 0.67% per month. If the taxpayer has appealed without probable cause, the court may charge double or triple costs, and when an appeal is denied, the court can impose costs against the taxpayer bringing the appeal. But, the court cannot charge costs against the state.

Enforcement. The act authorizes the DRS commissioner, and any duly authorized agent, to conduct inquiries, investigations, or hearings as the act provides, and administer oaths and take testimony under oath related to the matter being investigated. At any hearing the commissioner orders, he or his agent may subpoena witnesses and books, papers, and documents. Individuals subject to subpoena cannot use the self-incrimination protection of the Constitution to refuse subpoenas, but information gathered through these processes cannot be used in criminal proceedings. When a person refuses to respond to the commissioner's subpoena, the commissioner can ask the Superior Court to enforce it and, in the face of continued lack of cooperation, the court can order the recalcitrant party imprisoned for up to 60 days. In such cases the commissioner is authorized to continue the investigation. Officers who serve subpoenas are entitled to compensation and fees at the same rates as officers and witnesses in state courts.

Collection. Taxes, including penalties, interest, and fees, due and unpaid, may be collected through existing statutory procedures. The interest must be at least 1.25% per month. The commissioner or his authorized agent can sign a tax warrant, which must include an itemized bill of the amount due, to be served on the taxpayer. The amount of unpaid tax, penalty, interest, and fees is a lien against all of the taxpayer's Connecticut real estate and may be filed with the town clerk where the property is located. Such a lien is not effective against a mortgage holder or a bona fide purchaser of the property who does not know of the lien. When the tax has been paid, the commissioner, on the request of any interested party, must issue a certificate discharging the lien. Any foreclosure action on the lien must be brought by the attorney general in the judicial district where the property is located. The court may limit the time for redemption of the lien, order sale of the property, or issue some other decree it deems equitable. Fees must be treated as a tax for purposes of withholding state payments due a taxpayer to offset delinquent taxes and related penalties.

Revenue

Beginning in FY 18, the act authorizes the comptroller, at the close of each fiscal year, to record as revenue the amount of health provider taxes and fees received by the DRS commissioner within five business days after the July 31 following the end of the fiscal year.

963-965 — HOSPITAL SUPPLEMENTAL PAYMENTS

Requires DSS to distribute supplemental hospital payments based on criteria developed in consultation with the Connecticut Hospital Association; establishes a schedule for payments; allows DSS to advance payments for distressed hospitals; and prohibits the governor from reducing any allotment to the supplemental payment account

Prior law allowed DSS to establish, within available appropriations, a supplemental inpatient pool for certain hospitals. The act instead requires DSS to establish one or more supplemental pools for certain hospitals. Generally, supplemental pools refer to hospitals grouped for purposes of receiving supplemental Medicaid payments.

For FYs 18 and 19, the act requires DSS to distribute supplemental Medicaid payments to applicable hospitals based on criteria it determines in consultation with the Connecticut Hospital Association (CHA), including utilization and proportion of total Medicaid expenditures. Under the act, the consultation (1) requires DSS to send proposed distribution criteria in writing to CHA at least 30 days before making any payments based on the criteria and (2) must provide an opportunity to discuss the criteria before making any payments based on them, with an exception for supplemental payments for the quarter ending September 30, 2017. For those payments, DSS must send the distribution criteria at least seven days before making payments.

For FYs 18 and 19, the act also requires DSS to pay the total amount of hospital supplemental payments to applicable hospitals in accordance with the total amount for payments included in the approved state budget, subject to DSS' determination that the payments comply with federal law.

The act establishes a payment schedule for supplemental payments for FYs 18 and 19, as shown in Table 36.

Table 36: Supplemental Payment Schedule

For the Quarter Ending

Payment Due On

September 30, 2017

The later of the act's effective date or September 30, 2017

December 31, 2017

December 31, 2017, except that DSS may delay the payment until 14 days after receiving federal approval for necessary changes to the Medicaid state plan for such payments

March 31, 2018 and subsequent quarters through June 30, 2019

The last day of each calendar quarter

The act also eliminates an obsolete provision pertaining to blended inpatient hospital case rates.

Payment Advances for Distressed Hospitals

For FY 18, the act allows the DSS commissioner to advance all or a portion of the quarterly supplemental payment to a distressed hospital in accordance with the act's provisions. Under the act, a distressed hospital is a short-term acute care hospital licensed by DPH that (1) DSS determines is financially distressed in accordance with criteria DSS develops and (2) is independent and not affiliated with any other hospital or system that includes two or more hospitals, as documented through the certificate of need process administered by DPH's Office of Health Care Access.

Such a hospital must request the advance in writing with an explanation of how the hospital complies with conditions established under the act. The hospital must provide the DSS commissioner with all requested financial information, including annual audited financial statements, quarterly internal financial statements, and accounts payable records.

The DSS commissioner may impose conditions he determines necessary to make an advance, including financial reporting, a schedule for repayment, and adjustments to future payments.

Governor's Rescission Authority

For FYs 18 and 19, the act prohibits the governor from reducing any allotment requisition or allotment in force for DSS' Hospital Supplemental Payments account.

EFFECTIVE DATE: Upon passage

966-974 — REVENUE ESTIMATES

Adopts revenue estimates for FYs 18 and 19 for appropriated state funds

The act adopts revenue estimates for FYs 18 and 19 for appropriated state funds, as shown in Table 37.

Table 37: Revenue Estimates for FYs 18 and 19

Fund

FY 18

FY 19

General Fund

$18,554,500,000

$18,637,000,000

Special Transportation Fund

1,588,500,000

1,628,100,000

Mashantucket Pequot and Mohegan Fund

58,100,000

58,100,000

Regional Market Operation Fund

1,100,000

1,100,000

Banking Fund

30,000,000

30,200,000

Insurance Fund

90,000,000

91,400,000

Consumer Counsel and Public Utility Control Fund

27,000,000

27,300,000

Workers' Compensation Fund

24,867,000

28,122,000

Criminal Injuries Compensation Fund

3,000,000

3,000,000

EFFECTIVE DATE: Upon passage

975 — UCONN HEALTH CENTER (UCHC) FRINGE BENEFIT COST DIFFERENTIAL FUNDING

Repeals a requirement for the comptroller to fund the fringe benefit cost differential of UCHC employees (CGS 3-123i)

The act eliminates a law that required the comptroller to fund the “fringe benefit cost differential” of UCHC employees with up to $13.5 million in resources appropriated for state comptroller fringe benefits. The fringe benefit cost differential is the difference between the average fringe benefit rate for employees of acute-care hospitals and the fringe benefit rate for UCHC employees.

EFFECTIVE DATE: Upon passage

982 — KIRKLYN M. KERR GRANT PROGRAM

Repeals the program, which provides grants to veterinary medicine students

The act repeals the Kirklyn M. Kerr grant program, which provides grants to state residents pursuing degrees in veterinary medicine at an accredited veterinary graduate school. UConn administers the program and students attend Iowa State University at in-state rates.

EFFECTIVE DATE: July 1, 2018