Sec. 12-62d. *(See end of section for repeal information.) Residential property tax relief for municipalities with certain effective tax rate following revaluation: State program related to revaluatio - Connecticut Statutes

      Sec. 12-62d. *(See end of section for repeal information.) Residential property tax relief for municipalities with certain effective tax rate following revaluation: State program related to revaluations effective in 1987 and 1988; municipal option program commencing in 1989. (a) Municipal option to adopt program in accordance with subsection (d) commencing October 1, 1989. Commencing October 1, 1989, any municipality which meets the criteria as set forth in this subsection may, upon approval of its legislative body, provide for residential property tax relief in accordance with the provisions of subsection (d) of this section. Such property tax relief may be allowed if the municipality has implemented in that year a revaluation of all real property as required in section 12-62 and the effective tax rate for residential property, as determined in accordance with the provisions of this section, is one and one-half per cent or more of the market value of residential property in such municipality. Effective tax rate, as used in this section, means a ratio in which the numerator shall be the total tax imposed on all residential real property in the year of revaluation and the denominator of which shall be the present true and actual value of such property in such year, as determined in accordance with section 12-63. Not later than three days following final action with respect to the adoption of a mill rate for the year of revaluation the chief executive officer shall determine the effective tax rate as provided in this subsection and shall give notice of his determination to the Secretary of the Office of Policy and Management. Within five business days of receipt of such notice, said secretary shall issue a determination as to the validity of the effective tax rate so determined. If the chief executive officer is aggrieved by the finding of the secretary, he may, within thirty days make application in the nature of an appeal therefrom to the superior court of the judicial district in which the municipality is located. Such citation shall be signed by the chief executive officer, acting on behalf of the municipality, and such appeal shall be returnable at the same time and in the same manner as required in the case of a summons in a civil action and shall be served upon the secretary. Such application shall be a preferred case, to be heard, unless cause appears to the contrary, at the first session by the court or by a committee appointed by the court. Within twenty days of the secretary's notice confirming the validity of the effective tax rate determination, or within ten days of a decision of the court upholding the validity of the effective tax rate determination, the chief executive officer shall submit to the legislative body his recommendation concerning residential property tax relief, and the legislative body shall act upon such recommendation within thirty days. Whenever used in this section, "municipality" means any town, consolidated town and city or consolidated town and borough.

      (b) Property tax surcharge in municipalities adopting program under subsection (d). In any municipality in which the legislative body provides for residential property tax relief pursuant to this section, a property tax surcharge of no more than the lesser of (1) fifteen per cent of the property tax payable for the assessment year in which such relief is granted, or (2) the portion of the total tax credit which may be provided under subsection (d) of this section allocable to the surcharged property, shall be charged for all real and personal property subject to property tax imposed by such municipality classified, for purposes of assessment, as commercial, industrial or public utility, or a combination thereof, excepting (A) motor vehicles, (B) multiple-dwelling structures which are more than fifty per cent residential in use and which contain more than three units and (C) lodging houses, provided the surcharge shall be calculated and surcharged against each individual parcel or item of property on a basis which includes multiple-dwelling structures which are more than fifty per cent residential in use and which contain more than three units and lodging houses as surcharged property. Such property tax surcharge shall be payable and collectible as other property taxes and subject to the same liens and processes of collection, provided such surcharge shall be due and payable not sooner than thirty days after the installment of the property tax for the assessment year on which residential property tax credits are applied. The amount of property tax surcharge made payable in the year in which revaluation becomes effective in such municipality shall remain unchanged in each of the four succeeding years. Any new construction in such municipality which would have been subject to the property tax surcharge payable under this subsection if completed in the year in which such surcharge first becomes effective shall be subject to such surcharge for the year in which such structure is approved for use and in each of the succeeding years in which such surcharge is applicable.

      (c) Definition of residential property for purposes of program adopted under subsection (d). Property which shall be eligible for tax relief under the provisions of this section shall be defined as any single parcel of residential property used exclusively for residential purposes, including a single-family residence and a multiple-dwelling structure containing not more than three units, used by the occupants as a place of permanent residence.

      (d) Alternative plans of property tax credit which may be adopted based on amount derived from property tax surcharge. Amount of credit per parcel in year effective remains unchanged for four succeeding years. The amount derived from the property tax surcharge allowed under subsection (b) of this section, in any municipality eligible to provide residential property tax relief under the provisions of this section, may be used for purposes of granting property tax credits to residential property eligible for such credits under subsection (c) of this section, in accordance with either of the following alternative plans for such relief, as decided by the legislative body of such municipality:

      (1) A plan in which the property tax credit applicable to each eligible parcel of residential property shall be determined as follows: The credit for each eligible parcel of residential property shall be the amount derived from the property tax surcharge as provided by subsection (b) of this section, divided by the number of such parcels of residential property, except that the maximum credit for each such parcel shall not exceed seven hundred fifty dollars. The amount of property tax credit applicable to each eligible parcel of residential property in the year such plan becomes effective shall remain unchanged in each of the four succeeding years of such plan.

      (2) A plan in which the property tax credit applicable to each eligible parcel of residential property shall be determined as the amount by which the property tax applicable to such parcel of residential property exceeds one and one-half per cent of the present true and actual value of such property, as determined in accordance with section 12-63, provided no such property tax credit for any eligible parcel shall exceed two hundred fifty per cent of mean property tax credit, as determined in accordance with this subdivision, to the extent that revenue in accordance with subsection (b) of this section will allow. The amount of property tax credit applicable to each eligible parcel of residential property in the year such plan becomes effective shall remain unchanged in each of the four succeeding years of such plan.

      (e) Municipality adopting plan under subsection (d) may not adopt plan under section 12-62c. Dedicated fund to be established. Any municipality which has elected to allow tax credits with respect to certain residential property in accordance with subsection (d) of this section (1) may not adopt a plan to be effective in the same assessment year under section 12-62c and (2) shall establish, for purposes of the plan of tax credits adopted, a dedicated fund which shall be subject to annual budget procedures and be included as part of the annual audit of such municipality.

      (f) Property tax credits may not be credited to first installment of the tax. Not later than thirty days preceding the date on which any property tax credits allowed in accordance with this section are to be applied, the assessor shall certify to the tax collector (1) a listing of all properties eligible for such property tax credit and (2) a listing of all properties against which a fifteen per cent property tax surcharge is to be charged. The tax collector shall cause the applicable property tax credit or surcharge to be applied to the rate bill for each such parcel of property. Residential property tax credits shall be credited not earlier than the second installment of the tax for the assessment year in which such relief is granted, and not later than the last installment of such tax. In the event that a tax bill is paid in full prior to the application of a property tax credit under the provisions of this section, the owner or owners of such property shall be eligible for a refund of the amount of the credit in a manner to be determined by the municipality. The residential property tax relief allowed by this section shall be applicable in the year in which revaluation becomes effective and in each of the four succeeding assessment years.

      (g) Management study requirement for municipalities adopting a plan under subsection (d). (1) Any municipality electing to provide residential property tax relief in accordance with this section shall conduct a management study of its municipal government within one year following implementation of such program. Such study shall include, but not be limited to, a program review of expenditure, organization, management of finances and assessment practices. The study shall include input from the local business community and residential property taxpayers.

      (2) The study results shall be reported to the legislative body of the municipality for consideration. The legislative body shall hold at least two public hearings and shall consider the recommendations of the study and public input thereon. Following such public hearings, the legislative body shall develop a plan of implementation and shall file such plan with the Secretary of the Office of Policy and Management and with the General Assembly.

      (3) Any municipality which fails to comply with the provisions of this subsection shall be subject to the penalty provisions of subsection (e) of section 12-62.

      (P.A. 88-321, S. 1, 10; P.A. 89-251, S. 191, 192, 203; P.A. 90-148, S. 14, 34; 90-262, S. 2, 4; June Sp. Sess. P.A. 91-14, S. 7, 30; May Sp. Sess. P.A. 92-17, S. 10, 59; P.A. 94-175, S. 1, 32; May Sp. Sess. P.A. 94-4, S. 80, 85; P.A. 95-160, S. 64, 69; P.A. 06-183, S. 3.)

      *Note: Pursuant to public act 06-183, section 12-62d is repealed, effective July 1, 2006, and applicable to assessment years commencing on or after October 1, 2010.

      History: P.A. 88-321, S. 1 effective May 10, 1988, and applicable to assessment years commencing October 1, 1987, and thereafter; P.A. 89-251 provided in Subsec. (a) that the state program of residential property tax relief would apply to municipalities with revaluations effective for assessment years commencing in 1987 and 1988, in lieu of assessment years commencing in 1987 to 1991, inclusive, as originally established, and made corresponding changes in dates in Subsecs. (b) and (c), and added Subsec. (e) enabling a municipality to adopt residential property tax relief in accordance with Subsec. (h) in a year such municipality has implemented a revaluation of all real property, provided in such year the effective tax rate for residential property is 1.5% or more of market value of such property, Subsec. (f) providing for property tax surcharge in municipalities adopting a program in accordance with Subsec. (h), with surcharge to be applicable to commercial, industrial or public utility property except motor vehicles, Subsec. (g) defining residential property for purposes of a program adopted in accordance with Subsec. (h), Subsec. (h) describing the alternative plans of property tax credit which may be adopted based on the amount derived from the property tax surcharge, Subsec. (i) providing that any municipality adopting a plan under Subsec. (h) may not adopt a plan under Sec. 12-62c related to the same revaluation, and providing that a dedicated fund be established for purposes of the property tax credit program, Subsec. (j) requiring that property tax credits may not be credited to the first installment of the tax and providing that if tax is paid in full before the credit, a refund procedure shall apply and Subsec. (k) requiring a management study of municipal government in any municipality adopting a plan under Subsec. (h); P.A. 90-148 amended Subsec. (f) by excluding multiple-dwelling structures which are more than 50% residential from real property classified as commercial and subject to the surcharge, effective May 18, 1990, and applicable to assessment years of municipalities commencing on or after October 1, 1989; P.A. 90-262 amended Subsec. (f) to provide that the surcharge against each individual property shall be made on a basis which includes otherwise exempted multifamily residential structures, effective June 8, 1990, and applicable to assessment years of municipalities commencing on or after October 1, 1989; June Sp. Sess. P.A. 91-14 deleted the former Subsecs. (a) to (d), inclusive, which established a program of state-reimbursed property tax relief, relettering remaining Subsecs. and revising references to them accordingly, effective October 1, 1991, and applicable to the assessment year commencing October 1, 1990; May Sp. Sess. P.A. 92-17 amended Subsec. (f) to exclude lodging houses from real property classified as commercial and subject to the surcharge but to provide that the surcharge against each individual property be made on a basis which includes otherwise exempted lodging houses, effective June 19, 1992, and applicable to assessment years of municipalities commencing on or after October 1, 1991; P.A. 94-175 made a technical change in the statutory reference in Subsec. (g)(3), effective June 2, 1994; May Sp. Sess. P.A. 94-4 and P.A. 95-160 revised effective date of P.A. 94-175 but without affecting this section; P.A. 06-183 repealed section, effective July 1, 2006, and applicable to assessment years commencing on or after October 1, 2010.