Connecticut Nonprofits in a Property Tax Showdown

Connecticut Nonprofits in a Property Tax Showdown

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Connecticut has become ground zero for immediate action on proposals to change the rules on tax exemption on the property owned and used by charitable nonprofits. One bill would retroactively (back to October 2016) repeal the exemption for property owned by hospitals in the state. The legislation would also allow municipalities to levy a property tax on nonprofit hospitals. Hospital leaders testified in unity against the measure, emphasizing their purpose as a safety net for communities and the need for legislative and budgetary policies that advance and not undermine their missions.

separate measure, heard last Friday, would authorize local governments to decide whether to tax property after it changes ownership or use. A mayor and other supporters compared nonprofit property tax exemption to developers asking for a tax abatement and how negotiations must take place. The CT Community Nonprofit Alliance responded in its written and oral testimony that “this proposal would be a cataclysmic change in state policy.” The state association of nonprofits continued, “It would stop some nonprofits from expanding – put differently, it would prevent them from meeting a rising demand for life-sustaining services.”

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