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HB 5407

AN ACT CONCERNING STATE REIMBURSEMENT TO MUNICIPALITIES FOR REVENUE LOST DUE TO THE PROPERTY TAX EXEMPTION FOR VETERANS WITH A ONE HUNDRED PER CENT PERMANENT AND TOTAL DISABILITY RATING.

2026 Regular Session Introduced by Mark Anderson and 8 co-sponsors

Connecticut would reimburse municipalities for property tax revenue lost from exempting 100% permanently disabled veterans, shifting the fiscal burden from local governments to the state.

FILE NO. 148
#policyandmanagement #officeof #propertytaxassessors #propertytaxexemptionsforveterans #statefunds
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WeVote Research Nonpartisan
Bill Summary · HB 5407

Legislative bill overview

HB 5407 would require Connecticut to reimburse municipalities for property tax revenue they lose when granting property tax exemptions to veterans with 100% permanent and total disability ratings. Currently, municipalities absorb this revenue loss entirely, reducing their tax base without state compensation.

Why is this important

Veterans with severe disabilities already receive federal benefits for their condition, but Connecticut's property tax exemption provides additional relief. However, this shifts the fiscal burden to local governments, potentially affecting school funding, municipal services, and property tax rates for other residents. State reimbursement would address the equity concern of forcing municipalities to subsidize veteran benefits through lost revenue.

Potential points of contention

  • Cost to state budget: Reimbursing all municipalities statewide could be expensive; unclear if the bill specifies funding source or phase-in approach
  • Fairness debate: Whether veteran tax relief should be funded by state (broader tax base) versus municipalities (those directly benefiting from veteran residency)
  • Scope questions: Exemption applies only to 100% disability ratings—whether this threshold appropriately targets those most in need versus other veteran categories
  • Implementation details: The bill's current status shows referral but no specification of reimbursement formula, timing, or which veterans qualify retroactively

Compiled from official sources — confirm details with the bill’s official record.

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