On the campaign trail, Governor-elect Ned Lamont floated a lofty promise that no gubernatorial contender who became governor has ever delivered, but if he shepherds his pledges–“I would fully fund PILOT and I would fully fund ECS,” they’ll represent well over $50 million extra to Bridgeport for reimbursement on payments in lieu of taxes (PILOT) and Education Cost Sharing (ECS) formula.
That would be a tasty proposition for Mayor Joe Ganim as he fashions an election-year budget.
Colleges, hospitals, government buildings and churches are not taxable to host communities. Bridgeport has numerous parcels whose values amount to more than one billion dollars that are non taxable, services desirable to the entire region. Every year it’s a budgeting battle for local bean counters. How much can we plug in from the state in PILOT dough that covers a fraction of what the city would receive if those properties were fully taxable?
Ganim, for one, sees PILOT reimbursement as an investment in cities with the convening of the General Assembly in January.
Ganim penned that narrative in the commentary below that also appears in the Connecticut Post.
What’s the greatest challenge holding back Connecticut businesses from hiring more employees? Many will tell you the most potent element to attract a new workforce is to have vibrant cities with strong cultural and commercial institutions and walkable city centers–attractive places to live, work and play.
Connecticut cities continue to be challenged pockets of need and dependency while affluent suburbs and their counterparts from the cities, each fight for a declining share of revenue from a fiscally challenged state.
Smaller communities need cities to thrive as economic development generators that create jobs held by people living in their regions. Healthy cities are beneficial for all surrounding communities and provide the necessary services we all rely on. These services and institutions include churches, courthouses, colleges and universities, hospitals, as well as state and federal government buildings–all of which do not pay taxes.
Connecticut has restricted the means of revenue collection for our municipal governments to almost exclusively the property tax. In Bridgeport almost half of the property is tax exempt.
The state is bound by statute to reimburse cities for lost property tax revenue through a program called PILOT (payment in lieu of taxes). Statutes on the books for decades committed the state to reimburse cities through PILOT payments for 45 percent of the revenue they lost from tax exempt property. Connecticut never lived up to this commitment.
PILOT reimbursements have been plummeting over the last 10 years. In 2011 the state reimbursed municipalities for 26 percent of lost revenue. That figure was only 14 percent in 2018.
In Bridgeport, we have $35 million of tax-exempt property. The state only reimburses our city for about $11 million annually, creating a gap of $24 million. This inequity compounds year after year. Cities attempt to make up for the difference by charging higher property taxes which puts the burden on our residents and is a deterrent for attracting and retaining new businesses.
We want our cities to be places of innovation and thriving economies where people want to live, and schools turn out the workforce of the future. The state and Governor-elect Ned Lamont have a chance to enact a new budget in 2019 that fully funds the state’s commitment to reimburse cities for PILOT.
This a tall order in our “land of steady habits.” Now can be the time for our state to make meaningful change. Property owners in Bridgeport are ready.