SB 849 — AN ACT CONCERNING THE LEARN HERE, LIVE HERE PROGRAM.

Senate General Assembly FileCommittee Bill No.

235849 January Session, 2023 SenateLCO Bill No.

8495060 Senate,Referred Marchto 28, 2023 The Committee on CommerceCOMMERCE reportedIntroduced throughby: SEN.

HARTLEY(CE) ofAN theACT 15thCONCERNING Dist.,THE ChairpersonLEARN ofHERE, theLIVE CommitteeHERE onPROGRAM. the part of the Senate, that the bill ought to pass.

AN ACT CONCERNING THE LEARN HERE, LIVE HERE PROGRAM.

(a)[The]OnorbeforeOctober1,2023,theCommissionerofEconomic(a)[The]OnorbeforeOctober1,2023,the CommissionerofEconomic and Community Development, in consultation with the Commissioner of Revenue Services and the president of the Connecticut State Colleges and Universities, [may] shall establish the Learn Here, Live Here program.

Persons (1) who graduate on or after January 1, [2014] 2024, from such high schools, institutions, universities, colleges or schools, and (2) whose annual federal adjusted gross income is not more than seventy-five thousand dollars, may have their income tax liability, up to a maximum of two thousand five hundred dollars annually, SB849segregated /into Filethe Connecticut first-time homebuyers account LCO 5060 \\PRDFS1\SCOUSERS\FORZANOF\WS\2023SB-00849-R01 of 4 SB.docx Committee Bill No.

235849 1established SB849pursuant Fileto No.section 32-4j, provided not more than [one] five million dollars from all program participants may be so segregated in any calendar year.

235 segregated into the Connecticut first-time homebuyers account established pursuant to section 32-4j, provided not more than [one] five million dollars from all program participants may be so segregated in any calendar year.

If a participant ceases to live in the state at any time SB849LCO /5060 File{\\PRDFS1\SCOUSERS\FORZANOF\WS\2023SB-00842 of 4 R03-SB.docx } Committee Bill No.

235849 2up SB849to Filefour No.years after such date, such participant shall repay forty per cent of the amount paid out.

235 up to four years after such date, such participant shall repay forty per cent of the amount paid out.

SB849LCO /5060 File{\\PRDFS1\SCOUSERS\FORZANOF\WS\2023SB-00843 of 4 R03-SB.docx } Committee Bill No.

235849 3This SB849act Fileshall No.take effect as follows and shall amend the following sections:

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

2 October 1, 2023 32-4k CE Joint Favorable SB849APP /Joint FileFavorable No.LCO 5060 R03-SB.docx }OUSERS\FORZANOF\WS\2023SB-00849- 4 of 4

235 4 SB849 File No.

235 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:

Agency Affected Fund-Effect FY 24 $ FY 25 $ Department of Economic & GF - Cost 148,750 180,000 Community Development Department of Revenue Services GF - Cost 100,000 None State Comptroller - Fringe GF - Cost 52,990 70,653 Benefits1 Department of Revenue Services;

GF - Revenue None Up to Loss 5,000,000 Note:

GF=General Fund Municipal Impact:

None Explanation The bill, which requires the Department of Economic and Community Development (DECD) to establish the currently optional Learn Here, Live Here program, results in:

1) a General Fund revenue lossofupto$5millionannually beginninginFY25,2)anongoingsalary and fringe benefit cost of $176,740 in FY 24 and $235,653 annually thereafter, 3) marketing and administrative costs of $25,000 in FY 24 and $15,000 annually thereafter and 4) a one-time cost of $100,000 to the Department of Revenue Services (DRS) in FY 24 only.

Projected Costs Assuming 2,000 participants set aside the maximum $2,500 in income tax payments annually the DECD would require two full-time positions 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 42.82% of payroll in FY 24.

SB849 / File No.

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235 at an annual cost of approximately $235,653 ($165,000 for salary and $70,653 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.

DECD would also incur additional costs associated with marketing materials and other administrative expenses to be $25,000 in FY 24 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 24 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:DepartmentofLabor, ConnecticutEmploymentandTrainingCommission2016- Legislative Report Card Office of Higher Education, 2017-18 Degrees and Certificates Conferred Report SB849 / File No.