CT SB00501

Motor Vehicle Property Tax Assessment Reform (Effective July 1, 2024): Beginning with the October 1, 2024 assessment year, the Secretary of OPM must establish annual motor vehicle valuation guidelines in consultation with the Department of Motor Vehicles. Motor vehicle depreciation rates are increased by 5 percentage points at each level (e.g., 85% of MSRP in year one instead of 80%), with a minimum assessment of $500 for vehicles 20+ years old. Registered motor vehicles are excluded from personal property declarations, and vehicles are now taxed in the town where first registered (rather than last registered) in the assessment year.

Motor Vehicle Mill Rate Cap and Pro-Rata Changes: The motor vehicle mill rate is capped at 32.46 mills for assessment years beginning October 1, 2021 and thereafter, and must be set lower than the real property/personal property mill rate, with municipalities permitted to reduce it to zero. The pro-rata taxation period for newly registered vehicles is extended through the last day of September (from April 1), and the OPM Secretary must annually notify municipalities of their option to reduce or eliminate the motor vehicle mill rate.

Innovation Banks (Replacing "Uninsured Banks"): The term "uninsured bank" is replaced with "innovation bank" throughout Title 36a, defined as a Connecticut bank that does not accept retail deposits but may accept nonretail deposits eligible for FDIC insurance. Innovation banks require minimum equity capital of $5 million, must display conspicuous signage that deposits are not FDIC insured, and may convert to or from full Connecticut banks subject to regulatory requirements.

Interest Waiver on Tax Underpayments Related to Employee Retention Credit (Effective from Passage): No interest shall be imposed on tax underpayments under chapters 208, 228z, or 229 resulting from amended returns filed due to IRS guidance on the federal employee retention credit program, and any interest already paid must be refunded by the Commissioner of Revenue Services.

Insurer Assessment Changes (Effective October 1, 2025): The basis for insurer assessments shifts from taxes "imposed on" to taxes "reported to" the Commissioner of Revenue Services prior to application of any credits, calculated on the calendar year two years prior (changed from one year). No company pays more than 25% of actual Insurance Department/OHA/OHS expenditures, with payments due quarterly and late penalties of $25 plus 6% annual interest.

School Building Project Procurement and Oversight: Selection pools for architectural and construction management services are changed from "not more than four" to "at least three" qualified proposers. Construction manager contracts executed on or after July 1, 2024 must include a guaranteed maximum price, require retention of all documents for two years following audit, submission of quarterly reports on ineligible costs, and quarterly meetings with the board of education. The project completion notice deadline is reduced from three years to one year after certificate of occupancy.

South Central Connecticut Regional Water Authority Charter — Aquarion Acquisition: The authority's charter is expanded to permit acquisition of Aquarion Water Company or its subsidiaries as a noncore business exempt from investment cap limitations, with new bonding authority specifically for the acquisition. The authority board expands from 5 to 7 members (January 1, 2025) and to 11 members upon PURA approval of the acquisition, with 6 from the South Central district and 5 from the new Aquarion district.

Aquarion Regional Water District and Water Authority: A new Aquarion Regional Water District encompassing 59 towns and cities is created, governed by a representative policy board with weighted voting based on customer proportion and land acreage. A new Aquarion Water Authority is established as a public corporation with an 11-member board (5 appointed by the Aquarion policy board, 6 from the South Central authority), empowered to set rates, issue bonds, acquire property, and operate water/wastewater systems — all subject to PURA approval of the acquisition before any appointments take effect. PURA shall have no ongoing jurisdiction over the authority's rates or operations.

Aquarion Water Authority Financial Framework: The authority may issue negotiable bonds secured by revenues, enter interest rate swap agreements, and establish just and equitable rates sufficient to cover operations, debt service, and payments in lieu of taxes. Authority property is exempt from taxation but annual PILOT payments equal to otherwise-due taxes (excluding authority improvements) must be made to municipalities. Contracts exceeding $50,000 require sealed bids, and projects over $3.5 million or noncore investments over $1.5 million require policy board approval after public hearing.

Miscellaneous Provisions: Section 163 of Public Act 24-151 is repealed effective from passage. Municipalities may impose fines up to $250 for unregistered motor vehicles subject to property tax. Personal property depreciation schedules for electronic data processing equipment, manufacturing machinery, and other categories are codified with specified annual rates.