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April 2, 2024

Farmer tax credit proposal sees bipartisan support ahead of committee vote

PHOTO | JOSEPH ABAD Healthy produce displayed and ready for purchase at the North End Senior Center in Hartford from Gotta’s Farm, one of several Hartford Food System farms participating in the Hartford Harvest Farm Share.
By Skyler Frazer

A bill that would allow Connecticut farmers to receive tax credits for certain expenses has received bipartisan support from the legislature and could be sent to the full General Assembly for debate and a vote.

What’s in the bill:

House Bill 5492, which was introduced by the Finance, Revenue and Bonding Committee and co-sponsored by both Democrats and Republican lawmakers, would establish a new 20% property tax credit for certain farm-related capital expenses, and also increase the maximum property tax exemption threshold a municipality may approve for certain farm-related property from $100,000 to $200,000.

What’s at stake:

Connecticut farmers have been struggling financially in recent years as costs of doing business increase and their profit margins narrow. Since 2012, Connecticut has lost nearly 8% of its farms and 13% of its farmland, according to U.S. Department of Agriculture data, and local farmers have been ramping up agrotourism initiatives and other efforts to diversify their revenue streams.

Who’s for it:

A plethora of farmers submitted testimony in favor of the bill, saying it would help farms of all sizes stay in business and continue to operate in Connecticut.

  • “Unfortunately, the cost to construct and maintain farm buildings has increased over the years just like most other expenses, and the cost of farm machinery has increased at an even higher percentage,” said Paul Larson, co-owner of Sprucedale Gardens Nursery and Greenhouse and president of Connecticut Farm Bureau Association. “The allowable limit for these exemptions from local property tax was set many years ago and as you can imagine, these amounts are overdue for an adjustment to reflect the current values. This bill, as written, would raise these allowable exemption values and would be a very welcome benefit to the farmers in our state.”

Who’s against it:

While farmers and agricultural industry groups support the measure, municipalities pushed back on the proposal. Both the Connecticut Conference of Municipalities (CCM) and Connecticut Council of Small Towns (COST) submitted testimony calling the bill another unfunded mandate for the state’s towns and cities. 

  • “Towns and cities remain almost exclusively reliant on the imposition of a regressive property tax system to fund all levels of local service and these proposals would further increase property tax rates that already subsidize the current 100 mandated property exemptions. Additional exemptions to the property tax further shift the burden of paying for local education and services to other taxpayers,” said Randy Collins, CCM’s associate director of public policy.

What’s next:

The Finance, Revenue and Bonding Committee is expected to send the bill to the House floor with a joint favorable report during the group’s meeting Tuesday afternoon.

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