Legislature Passes $137 Million Fix for PILOT with Bipartisan Support But No Funding as of Yet

A still unfunded plan to revise and increase state reimbursements to local governments for tax-exempt property, at an estimated cost of $137 million, received significant bipartisan support from Connecticut’s first selectmen and mayors before passing 125-24 in the House and 28-7 in the Senate. 

The bill also included the elimination of welfare liens and provisions against double taxation for commuters

Mayor Justin Elicker of New Haven said he was grateful that first selectmen and mayors from across the state — rural communities and urban ones, small and large, Democratic and Republican — have come out in support of funding the PILOT program. 

Matthew Hoey, first selectman in Guilford, said he supported the new funding formula for PILOT although Guilford’s PILOT funds would not largely increase under the new formula. 

“We understand that regionally, we are all in this together, and what is good for many communities is good for us all,” he said. 

“If we compete within communities, we essentially lose as a state,” added Joe DeLong, executive director and CEO of the Connecticut Conference of Municipalities. 

Elinor Carbone, mayor of Torrington, agreed. 

“Budget stability and predictability is the cornerstone to social and economic growth in our municipalities across the state,” said Carbone. “Establishing this tiered approach … will make this budgeting process a little more predictable.” 

Elicker, who said in a budget presentation on Monday that New Haven is facing a $66 million deficit, welcomed the new PILOT funding, saying that it would go a long way toward allowing the city to maintain services without raising taxes or laying off city employees. 

Greater benefits

State Sen. Martin Looney, D-New Haven, the author of the new tiered PILOT formula, said he was heartened by the bipartisan support that the bill received both in the House and the Senate. 

Looney said the goal with this formula was to distribute the funds in a more equitable manner. 

Under Looney’s formula, municipalities with a net grand list per capita of less than $100,000 would receive a reimbursement of 50 percent of the taxes from tax-exempt property. Those with a net grand list per capita of between $100,000 and $200,000 will receive a reimbursement of 40 percent of these taxes, and those with a net grand list per capita of over $200,000 will receive a reimbursement of 30 percent.

Looney said that a total of 42 municipalities fall within the first tier, 91 fall within the second tier, and the remaining 35 will land in the third tier. 

The bill also provides an additional $5 million to the city of Bridgeport, which recently sold a large amount of property to tax-exempt Sacred Heart University, the bill fully funds the VA Hospital in West Haven and mandates that New London receive PILOT payments for property owned by the Connecticut Port Authority. 

Connecticut has had a PILOT program for years, but it has been severely underfunded, with distressed municipalities like New London, New Haven and Hartford receiving between 20 and 30 percent of what they would receive if the program were fully funded. 

Looney said the new PILOT will cost about $137 million to fund, and the bill provides no mechanism for that funding. 

However, he said he was confident that the new formula will be fully funded.

“More towns will benefit from this,” he said. “Part of the problem previously was that PILOT was of great importance to a relatively small number of communities. Now, the benefit and the interest will be spread more broadly.”

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