Connecticut Seal

General Assembly

File No. 64

    February Session, 2018

Substitute House Bill No. 5239

House of Representatives, March 28, 2018

The Committee on Veterans' Affairs reported through REP. HENNESSY of the 127th Dist., Chairperson of the Committee on the part of the House, that the substitute bill ought to pass.

AN ACT CONCERNING ELIGIBILITY FOR CERTAIN VETERANS' PROPERTY TAX EXEMPTIONS.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Subsections (a) to (c), inclusive, of section 12-81f of the general statutes are repealed and the following is substituted in lieu thereof (Effective October 1, 2018, and applicable to assessment years commencing on or after October 1, 2018):

(a) Any municipality, upon approval by its legislative body, may provide that any veteran entitled to an exemption from property tax in accordance with subdivision (19) of section 12-81 shall be entitled to an additional exemption, provided such veteran's qualifying income does not exceed (1) the applicable maximum amount as provided under section 12-81l, or (2) an amount established by the municipality, [not exceeding] provided such amount shall not be less than the applicable maximum amount under [said] section 12-81l. [by more than twenty-five thousand dollars.] The exemption provided for under this subsection shall be applied to the assessed value of an eligible veteran's property and, at the option of the municipality, may be in an amount up to twenty thousand dollars or in an amount up to ten per cent of such assessed value.

(b) Any municipality, upon approval by its legislative body, may provide that any veteran entitled to an exemption from property tax in accordance with subdivision (20) of section 12-81 shall be entitled to an additional exemption, provided such veteran's qualifying income does not exceed (1) the applicable maximum amount as provided under section 12-81l, or (2) an amount established by the municipality, [not exceeding] provided such amount shall not be less than the applicable maximum amount under [said] section 12-81l. [by more than twenty-five thousand dollars.] The exemption provided for under this subsection shall be applied to the assessed value of an eligible veteran's property and shall be in an amount not less than three thousand dollars of such assessed value.

(c) Any municipality, upon approval by its legislative body, may provide that any veteran's surviving spouse entitled to an exemption from property tax in accordance with subdivision (22) of section 12-81 shall be entitled to an additional exemption, provided such surviving spouse's qualifying income does not exceed (1) the maximum amount applicable to an unmarried person as provided under section 12-81l, or (2) an amount established by the municipality, [not exceeding] provided such amount shall not be less than the applicable maximum amount under [said] section 12-81l. [by more than twenty-five thousand dollars.] The exemption provided for under this subsection shall be applied to the assessed value of an eligible surviving spouse's property and, at the municipality's option, may be in an amount up to twenty thousand dollars or in an amount up to ten per cent of such assessed value.

Sec. 2. Subsection (a) of section 12-81jj of the 2018 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2018, and applicable to assessment years commencing on or after October 1, 2018):

(a) Any municipality, upon approval by its legislative body, may provide that any veteran, as defined in subsection (a) of section 27-103, which veteran is a resident of such municipality and ineligible for an exemption from property tax under subdivisions (19) to (21), inclusive, of section 12-81, shall be entitled to an exemption from property tax, provided such veteran's qualifying income does not exceed (1) the maximum amount applicable to an unmarried person, as provided under section 12-81l, or (2) an amount established by the municipality, [not exceeding] provided such amount shall not be less than the applicable maximum amount under section 12-81l. [by more than twenty-five thousand dollars.] The exemption provided for under this section shall be applied to the assessed value of any such veteran's property and, at the municipality's option, may be in an amount up to five thousand dollars or in an amount up to five per cent of such assessed value.

This act shall take effect as follows and shall amend the following sections:

Section 1

October 1, 2018, and applicable to assessment years commencing on or after October 1, 2018

12-81f(a) to (c)

Sec. 2

October 1, 2018, and applicable to assessment years commencing on or after October 1, 2018

12-81jj(a)

VA

Joint Favorable Subst.

 

The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of the General Assembly, solely for purposes of information, summarization and explanation and do not represent the intent of the General Assembly or either chamber thereof for any purpose. In general, fiscal impacts are based upon a variety of informational sources, including the analyst's professional knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.


OFA Fiscal Note

State Impact: None

Municipal Impact:

Municipalities

Effect

FY 19 $

FY 20 $

Various Municipalities

Grand List Reduction

None

Potential

Explanation

There is a minimal grand list reduction to municipalities associated with the bill, which allows towns that provide certain additional optional veteran property tax exemptions to increase the income thresholds for eligibility. The grand list reduction would vary based on the number of people eligible at new income limits. Presumably, a town that opts to increase income eligibility for veterans would increase its mill rate to shift the tax burden to other residents rather than experience revenue loss.

The Out Years

The annualized ongoing fiscal impact identified above would continue into the future subject to a change in mill rates and assessment values.

OLR Bill Analysis

sHB 5239

AN ACT CONCERNING ELIGIBILITY FOR CERTAIN VETERANS' PROPERTY TAX EXEMPTIONS.

SUMMARY

This bill allows municipalities that provide certain additional optional veteran property tax exemptions to increase the income thresholds for eligibility.

Under current law, municipalities may offer tax exemptions to veterans whose incomes are below (1) the state's income limit for other veterans' property tax exemptions, set annually by the Office of Policy and Management (OPM) (for 2018, $35,300 for individuals and $43,000 for married couples) or (2) an amount the municipality sets, up to $25,000 more than the state limit. The bill instead allows municipalities to set the income limit, with the minimum being the amount OPM sets.

The bill applies the new income thresholds to the additional optional municipal property tax exemptions for:

EFFECTIVE DATE: October 1, 2018, and applicable to assessment years commencing on or after that date.

BACKGROUND

Property Tax Exemption Eligibility

Veterans. The state-mandated veterans property tax exemption is available to state residents who are veterans of the U. S. Armed Forces (Army, Navy, Marine Corps, Coast Guard, and Air Force and any reserve component of these branches, including the Connecticut National Guard performing duty under Title 32 of federal law) and have served at least 90 days in a time of war, as shown in Table 1.

Table 1: Post-1940 "Service in Time of War"

Operation

Date

Service Condition

World War II

12/07/41-12/31/47*

Active service during the war

Korean War

06/27/50-01/31/55

Active service during the war

Lebanon Conflict

07/01/58-11/01/58 or 09/29/82-03/30/84

Combat or combat-support role in Lebanon

Vietnam Era

02/28/61-07/01/75

Active service during the war

Grenada invasion

10/25/83-12/15/83

Combat or combat-support role in Grenada

Operation Earnest Will (escort of Kuwaiti tankers flying U.S. flag in Persian Gulf)

07/24/87-08/01/90

Combat or combat-support role

Panama invasion

12/20/89-01/31/90

Combat or combat-support role

Persian Gulf War

08/02/1990 until a date prescribed by the President or law

Active-service anywhere during the war (not necessarily in the Persian Gulf or in a combat role)

Additionally, World War II veterans of certain allied armed forces are also eligible if they (1) were a U. S. citizen at enlistment and received an honorable discharge or (2) have been a U. S. citizen for at least 10 years and participated in armed conflict with an enemy of the United States (CGS 12-81(19) and 27-103).

Veterans with Disabilities. The law provides state-mandated property tax exemptions to veterans with a VA-rated disability of at least 10% (CGS 12-81(20)). (The disability does not have to be service-related, and unlike the exemptions for non-disabled veterans, wartime service is not required to qualify.)

Surviving Spouse. A state-mandated property tax exemption is available to an unmarried surviving spouse of a deceased service member or veteran who qualified for the wartime state-mandated exemption described above. The deceased service member or veteran must have died either during his or her term of service or after receiving an honorable discharge (CGS 12-81(22)).

Related Bill

HB 5240, reported favorably by the Veterans' Affairs Committee, increases the minimum exemption amount, from $3,000 to $50,000, a municipality must provide certain disabled veterans if it chooses to offer an additional optional property tax exemption to such veteran.

COMMITTEE ACTION

Veterans' Affairs Committee

Joint Favorable Substitute

Yea

14

Nay

0

(03/14/2018)

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