SB 45 — AN ACT CONCERNING THE LEARN HERE, LIVE HERE PROGRAM.

Projected Costs Assuming 2,000 participants set aside the maximum $2,500 in income tax payments annually the DECD would require two full-time position The fringe benefit costs for most state employees are budgeted centrally in accounts administered by the Comptroller.

The estimated active employee fringe benefit cost associated with most personnel changes is 40.53% of payroll in FY 23.

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306 at an annual cost of approximately $226,863 ($161,434 for salary and $65,429 for fringe benefits).

These positions would be responsible for tracking the income eligibility, employment, residency, and participation status of program participants, as well as coordinating with the DRS to ensure proper income tax set-asides and file liens against any property’s title for all homes purchased pursuant to the program.

They would also be responsible for enforcing the program’s claw back provisions as needed.

The DECD would also incur additional costs associated with marketing materials and other administrative expenses to be $25,000 in FY 23 and $15,000 annually thereafter once the program is implemented.

The proposal is also estimated to result in a one-time set up and programming cost of $100,000 in FY 20 to the DRS to administer the tax provisions of the proposal.

Background According to data from the Office of Higher Education and the State Department of Education, there are approximately 45,000 graduates from public colleges, independent colleges and vocational technical schoolsper year.

The Connecticut Department ofLabor reportsthat 68% of the 2015 public college graduates were employed in Connecticut nine monthsaftergraduation;itisnotknownhowmanyindependentcollege or vocational school graduates remain in the state.

The Out Years The annualizedongoing cost impact identifiedabove wouldcontinue into the future subject to inflation.

The annualized ongoing revenue impact identified above could be mitigated in the out years to the extent that program participants are subject to the bill’s claw back provisions.

Sources:Department of Labor, Connecticut Employment and Traning Commission 2016- Legislative Report Card Office of Higher Education, 2017-18 Degrees and Certificates Conferred Report sSB45 / File No.

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306 OLR Bill Analysis sSB 45 AN ACT CONCERNING THE LEARN HERE, LIVE HERE PROGRAM.

SUMMARY This bill requires the Department of Economic and Community Development (DECD) commissioner, in consultation with the Department of Revenue Services (DRS) commissioner and Connecticut State Colleges and Universities (CSCU) president, to establish the Learn Here, Live Here program by October 1, 2022.

Current law allows these officials to establish the program, but in practice they have not done so.

Undercurrentlaw,theLearnHere,LiveHereprogram,ifestablished, allows eligible graduates to segregate a portion of their income tax payments and use them later for a down payment on the purchase of their first home in Connecticut.

In mandating the program’s establishment, the bill generally retains the program parameters established in current law, except that it (1) increases, from $1 million to $5million,thecapontheaggregateamountofincometaxpaymentsthat may be segregated annually under the program and (2) extends eligibility to graduates of in-state public and private high schools.

(Current law generally limits eligibility to graduates of in-state postsecondary institutions, see BACKGROUND.) The bill also makes conforming changes to the program’s implementation deadlines.

Under current law, the program must be open to eligible students who graduate on or after January 1, 2014, from eligible institutions.

The bill instead opens it to eligible students who graduate on or after January 1, 2023.

It similarly delays, from January 1, 2014, to January 1, 2023, the date by which the DRS commissioner must begin segregating participating graduates’ income tax payments.

The bill also requires the DECD commissioner to (1) develop a comprehensive public education program by December 1, 2022, and (2) sSB45 / File No.

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Lastly, the bill makes technical and conforming changes.

EFFECTIVE DATE:

Upon passage, except that a conforming change is effective October 1, 2022.

BACKGROUND Program Requirements Once activated, the law allows participating graduates to segregate up to $2,500 per year from their income tax payments for up to 10 years after graduation into the Connecticut first-time homebuyers account.

A participant may apply to the DECD commissioner to withdraw some or all of the funds for a down payment any time within 10 years after graduation, and any balance remaining after 10 years must be deposited in the General Fund.

If the participant does not withdraw any funds after 10 years, the entire amount must be deposited in the General Fund.

If the participant moves out of Connecticut within five years after receiving funds for a down payment, he or she must repay the amount received on a prorated basis (e.g., 40% of the amount received for departures within four years after the payment).

Eligibility The Learn Here, Live Here program is designed to help students graduating from specific educational institutions save money toward the purchase of their first home in Connecticut.

Under current law, the program, once activated, is open to students graduating from regional technical schools, public or private universities and colleges in Connecticut, and health care training schools located here.

The latter includes medical or dental schools, chiropractic colleges, optometry schools or colleges, chiropody or podiatry schools or colleges, occupational therapy schools, hospital-based occupational schools, naturopathy schools or colleges, dental hygiene schools, physical therapy schools, and any other healing arts school or institution.

COMMITTEE ACTION Commerce Committee sSB45 / File No.

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306 Joint Favorable Substitute Yea 21 Nay 2 (03/18/2022) sSB45 / File No.

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