House Bill No. 5158, reported favorably by the Committee on Housing, proposes an act concerning the standardized valuation of affordable rental housing. The bill, effective October 1, 2024, amends subsection (a) of section 8-216a of the general statutes by repealing the current language and substituting it with new provisions. The key changes include the deletion of language that refers to the provisions of other statutes or special acts and the insertion of language that specifies that the present true and actual value of real property used solely for low or moderate-income housing shall be based on the capitalized value of the net rental income of such property. The term "net rental income" is defined as the gross income of the property as limited by the schedule of rents or carrying charges, less reasonable operating expenses and property taxes.

The fiscal impact statement indicates that there is no state impact, but there may be a municipal impact if municipalities are not already using the net rental income method of valuation for such properties. This could result in a grand list reduction, potentially leading to a revenue loss unless municipalities adjust their mill rates accordingly. The bill is expected to apply to approximately 1,100 housing projects statewide. The bill analysis clarifies that municipalities must assess properties classified as housing for only low- and moderate-income households based on the capitalized value of net rental income, which reflects actual rent received, rather than fair market value. This assessment method is already available as a local option for municipalities that have adopted it by ordinance. The bill also includes technical changes and maintains the existing definition of "net rental income."