Issue Position: Reducing Property Taxes for the Middle Class

Issue Position

From Middlebury to Middletown and Norwalk to Norwich, people in Connecticut feel squeezed. Our state has become one of the most expensive places to raise a family or start a business. And in the face of stagnant wages and weak job growth, Hartford politicians have hit middle class families with tax increase after tax increase. Even worse, there's barely anything to show for it: after three decades of mismanagement by governors of both parties, our budget hole remains deep and Connecticut's working families are being asked to pick up more of the tab. It's unfair, it's unproductive, and it needs to change. Connecticut's middle class needs and deserves a break.

Businesses won't come to a state where their employees can't afford to live. Young people won't consider building a future in a state where they can't afford to own a home. And long-time residents won't retire where they can't afford to remain.

That's why I'm proposing a plan to give Connecticut families a property tax cut. Decades of fiscal mismanagement mean we can't afford pie-in-the-sky promises, so I'm proposing a smart, achievable commitment to responsibly give middle class families the tax relief they deserve. It's not only the right thing to do for working families; property tax relief is key to making Connecticut a better place to start or grow a business and create jobs.

Connecticut's property tax system is broken. We rely far too much on taxing people's homes and cars to fund essential local services. And towns and cities with the greatest local needs also have the greatest difficulty raising local revenues, with less local wealth to draw on and much of their local property exempt from taxation. Municipalities must become more efficient and reduce costs -- but our state must also provide immediate relief to hard-pressed middle class families.

High-need towns and cities have schools to fund, roads to repair, and police and firefighters to keep on the job. With flat or declining local wealth, they are backed into ever-higher property tax rates -- making it harder to attract residents and businesses and keep long-time locals in their homes. Development is distorted, too, creating incentives for towns to limit access to families with school-aged children and making it less attractive to develop affordable housing in our cities. Worse still, the burden of high property taxes is unfairly distributed: lower- and middle-income families and seniors are hit the hardest. And this is a problem that isn't unique to homeowners: 20 percent or more of the cost of rent in Connecticut is due to local property taxes.

Reforming this broken system is imperative, but it will take time to turn around -- and working families in Connecticut can't afford to wait. Recently, the middle class lost one of the last breaks it got. Governor Malloy rolled back the property tax credit, effectively raising taxes on the middle class.

In my first biennial budget as governor, I will restore and expand the property tax credit for working families. Starting in the second year of my first budget, I will reverse Malloy's tax hike by raising the property tax credit for existing beneficiaries by 50 percent. And I'll expand eligibility, allowing any taxpayer with property tax liability to participate and growing the number of Connecticut residents who can get a break. If your household earns up to $160,500 a year, you'll qualify for relief from property taxes paid on your home or your car. 900,000 taxpayers in homes with more than 2 million Connecticut residents would see a benefit. About half of these residents will be getting much-needed property tax relief for the first time in four years. That is meaningful relief, and it's delivered responsibly at a cost of around just 1 percent of the most recent annual state budget.

Looking ahead, we need to do more. It's no secret that Connecticut's budget is as broken as our property tax system. Decades of fiscal mismanagement by Hartford politicians in both parties have put real limits on how much of a tax break we can reasonably afford -- constraints that the Republicans willfully ignore in the hopes that no one will call them out on their fantasy math. Impossible promises won't ever put money back in the pockets of working families in Connecticut, but responsible planning will.

That's why in my second biennial budget, I'll propose additional property tax relief targeted at the low- and middle-income taxpayers who are hit the hardest by this broken system. We'll use the first two years to begin to get our state's finances back on track, so that we can afford critical tax relief aimed at the families struggling hardest in Connecticut to make ends meet. For a relatively modest cost, we can provide up to a $1,200 credit to working families owning or renting a home and paying more than 6.5 percent of their income in property taxes. There are nearly 350,000 taxpayers in Connecticut, in homes with 915,000 people, who would stand to benefit. And the average beneficiary will receive a nearly $700 tax cut.

In the longer term, we need fundamental structural reform of Connecticut's broken property tax system. That means having every stakeholder at the table -- from municipal and nonprofit leaders who must do more with less, to teachers and first responders who make our communities run, to homeowners and renters who have to be able to afford a place to live. Structural reform starts with identifying inefficiencies within our fragmented system of 169 towns and cities, but it also means critically reexamining whether regional services make more sense than leaving every locality to fend for itself. These are tough choices, and only one candidate is telling the truth about them. I won't be afraid to lead on structural reform -- and to stand up right away for working families and the middle class who need a break and cannot wait.

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