Daniel Zhao, Senior Photographer

In a Tuesday morning hearing, New Haven residents and politicians came together to continue voicing support for a bill that would increase funding for the state’s Payment in Lieu of Taxes, or PILOT, program.

The hearing was hosted by the Connecticut General Assembly’s Finance, Revenue and Bonding Committee. It was held after Gov. Ned Lamont’s proposed FY 2021-2022 budget did not provide substantial boosts to the PILOT program — a move that New Haven Mayor Justin Elicker opposed. Tuesday’s bill, introduced by Senate President Pro Tempore Martin Looney of New Haven, would allocate more funds to municipalities with a higher proportion of tax-exempt property. New Haven, which now receives around $42 million annually through PILOT, would receive $91 million if the bill passed — a jump of almost $50 million. New Haven would receive the highest boost out of all the municipalities or districts covered by the bill, as it has the highest proportion of tax-exempt property. 

The mayor and other New Haveners at the hearing said that the city — which faces a projected $66 million budget deficit for the next fiscal year — desperately needs additional funding to avoid resorting to major hikes in property taxes.

“This is by far the most important piece of legislation contemplated in this session,” Elicker said at the hearing. “It’s not only the highest legislative priority of the city of New Haven, but it’s essential to the vitality of many other communities and the economic wellbeing of our state.”

The tier system, which prioritizes cities with larger amounts of tax-exempt land, designates tiers based on the per capita value of the city’s net grand list — or the value of its taxable property. The first tier, which includes New Haven, is for cities with under an under $100,000 per capita grand list figure. Cities in this tier would receive 50 percent of what the state’s PILOT formula is supposed to provide — 77 percent of lost property tax revenue. Tier two and three cities would receive 40 and 30 percent of this 77 percent figure, respectively. The state has never actually provided the 77 percent reimbursement that the PILOT formula stipulates, and Looney called the figure “aspirational.”

Elicker said that Connecticut, compared to other states, is over reliant on property taxes. While PILOT was intended to remedy this, funding through the program has dropped over the last two decades and tax-exempt property in New Haven is on the rise. This combination, Elicker said, has led to an “increasingly challenging financial situation for our city, putting pressure on our ability to provide the very basic services that our residents and taxpayers need.” Elicker called New Haven’s situation “dire,” as he said he was forced to cut over 100 jobs in his last budget — while still raising taxes.

The price tag on the three-tiered PILOT model comes to around $129 million, Looney said. But in response to the cost, Elicker said there was no safe alternative.

“What do we think will happen if the city of New Haven ceases to be an economic engine in our state?” Elicker asked the committee. “How are we supposed to attract new residents when our cities are increasingly unaffordable? The annual cost of this proposal pales in comparison to the revenue it would generate if we chose to invest in our cities and help them build out of this pandemic stronger than before.”

Several other mayors and first selectmen from across the state also gave their testimony on Tuesday, demonstrating bipartisan support for the program as well as a general sense of frustration towards Lamont’s handling of the proposal. In particular, New London Mayor Michael Passero said he was “very disappointed” with the governor’s proposed budget.

Darien First Selectman Jayme Stevenson, one of the more vocal state Republicans in support of PILOT funding, testified in favor of the program — even though her city would fall into a tier that would receive the least additional funding.

“The health of our state is dependent upon many factors,” Stevenson said. “One of them is the health of our urban centers.”

Looney told the News he shares Elicker’s commitment to locking down PILOT funding, but also said he was less critical of Lamont’s proposed budget. Looney said that based on “personal conversations” with the governor, as well as several public statements in which Lamont expressed more general support for increased PILOT funding, Looney was optimistic about the potential for success with the bill.  

Looney also said he was deeply encouraged by the over 20 New Haveners who came out to express support for the bill on Tuesday.

“Governor Lamont has said to me that he is supportive of PILOT and recognizes its equity,” Looney said. “The issue is just finding the funds to implement it. [The hearing] was a sign of the broad based recognition of the fairness of this proposal.”

Although no one testified against the bill, some Republicans expressed skepticism over its effectiveness. Darien State Rep. Terrie Wood called out the fact that Democrats have held control of the legislature since the 1980s but have not made a move to fund PILOT at this level. At the hearing, Wood questioned why Democrats had not already fully funded PILOT. 

Offering support to Looney, New Haven State Rep. Roland Lamar said more focus should be placed on the root of financial problems in Connecticut municipalities rather than on why PILOT has not been funded over the years. 

According to Lamar, this is because Connecticut property taxes are “not sensitive” to varying levels of income. Though higher-income individuals generally pay more in taxes, Connecticut residents are paying the same percent on property taxes regardless of how financially well off they are. Lamar said PILOT funding would help ease that burden, and cities like New Haven can avoid significantly raising property taxes for all. 

Harold Brooks, president of Local 3144 — a union comprised of management professionals who work for the city of New Haven — echoed Lamar’s concerns about the disproportionate effect of increased property taxes on low-income families. However, Brooks went further to state that increased PILOT funding is an essential step to address systemic racial inequality in New Haven. 

Brooks said because the state has never fully funded the PILOT program, previous raises in property taxes and cuts in services have disportionately affected people of color. 

“The underfunding of PILOT continues to exacerbate inequality in our communities,” Brooks said. “COVID-19 showed how large the inequity between communities of color and ones that receive a disproportionate amount of PILOT funding is. This structure would correct an injustice that has existed for years.”

The bill awaits a vote by the Finance, Revenue and Bonding Committee.

Thomas Birmingham | thomas.birmingham@yale.edu

Owen Tucker-Smith | owen.tucker-smith@yale.edu

THOMAS BIRMINGHAM
OWEN TUCKER-SMITH
Owen Tucker-Smith covers the Mayor's office, City Hall and local politics. He is also an associate editor at the Yale Daily News Magazine. Originally from Williamstown, MA, he is a first-year in Ezra Stiles College majoring in statistics and data science.