How would proposed Connecticut laws impact realty, home construction?
Norwich — The real estate, construction, and financial professionals gathered on Wednesday morning gasped when Craig Caulkins, president of Home Builders & Remodelers Association of Eastern Connecticut, mentioned that proposed state legislation would require electric car charging stations in all new residential construction.
If enacted, Senate Bill 771 would amend the State Building Code to mandate a certain number or percent, based on the scale of construction, of electric vehicle capable and electric vehicle ready parking spaces.
This is one of many proposals that would impact those gathered Wednesday at the Holiday Inn Norwich for a joint meeting of HBRAECT and the Eastern Connecticut Association of Realtors. Sen. Paul Formica, R-East Lyme, gave the attendees a wide-ranging overview on tolls, paid family and medical leave, marijuana legalization, offshore wind and the borrowing cap.
Prior to his update, three people spoke about legislative proposals pertaining to housing: Caulkins, Connecticut Association of Realtors CEO Cindy Butts and Southeastern Connecticut Housing Alliance Chairman Norton Wheeler.
Here’s a rundown of what they’re fighting against or for.
Removal of tax exemptions
Coming before the Finance, Revenue and Bonding Committee on Wednesday was House Bill 7410, which would remove a slew of tax exemptions for a variety of goods and services. One of Butts’ biggest concerns is the taxation of real estate commissions.
“It’s hard enough to convince someone to buy a home and stay in Connecticut; we can’t just keep adding these new taxes on,” she said.
The bill also would remove the tax exemption on renovation and repair of residential property, which Caulkins fears would lead to an underground home improvement market in the state.
Buyer’s conveyance tax
House Bill 5254 would allow municipalities to impose a buyer’s tax on the conveyance of real property, with the funds going toward the purchase of open space land, brownfield remediation or other environmental projects.
Butts said the Connecticut Association of Realtors fights this bill every year. This year, a public hearing was held on Feb. 4, but the bill hasn’t left the Environment Committee and Butts said it’s “dead for now.”
Estate and gift taxes
The Finance, Revenue and Bonding Committee on March 15 held a public hearing on House Bill 6031, to phase out the estate tax over five years. Butts said CT Realtors favors repeal of both the estate and gift taxes, because they will keep wealth in the state.
“What we don’t want is penalties for not doing something. We like incentives; we don’t like penalties,” Butts said. She said this about her support for Lamont’s amended school regionalization proposal and opposition to Senate President Martin Looney’s forced regionalization proposal.
But the same logic could apply to two bills Caulkins supports that would provide tax credits; both passed out of the Planning and Development Committee on a bipartisan vote.
House Bill 7366 would give a tax credit to buyers of energy-efficient homes, as defined by the homes’ score on the Home Energy Rating System Index. Senate Bill 1071 promotes aging-in-place initiatives by allowing a tax credit for retrofitting a home, meaning that changes are made to allow greater accessibility and accommodate an illness or disability.
Caulkins indicated that age-in-place initiatives are beneficial because the high costs of nursing homes can mean more people end up on Medicaid, costing taxpayers more in the long run.
The biggest concern from Wheeler is that Gov. Ned Lamont has proposed no new bond authorizations for affordable housing for the next two fiscal years.
“Affordable housing developers invest hundreds of thousands of dollars in preparing project applications” to access funds, Wheeler said. “Without new funds budgeted for the coming years, many developers will stop working in Connecticut.”
He expressed concern that “the rug’s been pulled out from underneath” organizations that are using their operating budgets to plan expansions, considering former Gov. Dannel Malloy approved affordable housing bonding.