HB 5167 — AN ACT CONCERNING PROPERTY TAX ABATEMENT FOR CERTAIN FIRST-TIME HOMEBUYERS.

House of Representatives General Assembly RaisedFile Bill No.

516735 February Session, 2024 LCOHouse Bill No.

515167 ReferredHouse toof Representatives, March 14, 2024 The Committee on PLANNINGPlanning ANDand DEVELOPMENTDevelopment Introducedreported by:through REP.

(PD)KAVROS ANDEGRAW ACTof CONCERNINGthe PROPERTY17th TAXDist., ABATEMENTChairperson FORof CERTAINthe FIRST-TIMECommittee HOMEBUYERS.on the part of the House, that the bill ought to pass.

AN ACT CONCERNING PROPERTY TAX ABATEMENT FOR CERTAIN FIRST-TIME HOMEBUYERS.

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516735 This1 actHB5167 shallFile takeNo. effect as follows and shall amend the following sections:

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Section 1 October 1, 2024, and New section applicable to assessment years commencing on or after October 1, 2024 PD Joint Favorable HB5167 / File No.

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35 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 25 $ FY 26 $ Various Municipalities Potential See Below See Below Revenue Loss Explanation The bill results in a potential revenue loss beginning in FY 25 to any municipality that chooses to abate up to $500 in property taxes, for up to five years, for homeowners with a first-time home buyer mortgage purchased via the Connecticut Housing Finance Authority (CHFA).

The revenue lossfor eachmunicipality willvary based ontheamount oftheabatement andthenumber ofeligible homeowners.It isestimated that there are approximately 26,400 homeowners across the state with the specific type of CHFA mortgage .

If all municipalities implemented a maximum $500 abatement, the revenue loss cumulatively to all municipalities would be approximately $13.2 million annually.

If any municipality chooses not to offer the abatement, it will have no revenue loss associated with the bill, and the total revenue loss among municipalities will be lower.

The Out Years 1CHFA has 26,399 outstanding first-time home buyer mortgages as of December 31, 2023.

It is assumed that each of those people would be eligible for the abatement established by the bill if their municipality chose to offer it.

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35 The annualized ongoing fiscal impact identified above would continue into the future subject to the number of municipalities that implement the abatement, the amount of the abatement, and the number of CHFA first-time homebuyers in such municipalities.

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35 OLR Bill Analysis HB 5167 AN ACT CONCERNING PROPERTY TAX ABATEMENT FOR CERTAIN FIRST-TIME HOMEBUYERS.

SUMMARY This bill allows municipalities to abate up to $500 in property taxes per assessment year on a residential property owned by someone who purchased it with a Connecticut Housing Finance Authority-issued mortgage for first-time homebuyers.

The property must be encumbered by the mortgage and the abatement may be for up to five assessment years.

The abatement must be approved by the municipality’s legislative body or, in a town in which the legislative body is a town meeting, by the board of selectmen.

Under the bill, a residential property is a single-family dwelling that is the owner’s principal residence.

EFFECTIVE DATE:

October 1, 2024, and applies to assessment years beginning on or after that date.

COMMITTEE ACTION Planning and Development Committee Joint Favorable Yea 20 Nay 0 (03/01/2024) HB5167 / File No.

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