Substitute House Bill No. 7151 aims to enhance financial support and technical assistance for municipalities by mandating the Office of Policy and Management (OPM) to assist municipalities in assessing their eligibility for the Motor Vehicle Tax grant. The bill introduces new definitions related to municipal spending, including "adopted budget expenditures" and "capital expenditure," while clarifying exclusions such as debt service and special education costs. It establishes a "municipal revenue sharing account" within the General Fund, detailing the allocation of funds for motor vehicle property tax grants based on mill rates. Notably, the bill repeals Section 4-66l of the general statutes, replacing it with updated provisions that modify how municipalities report their budget expenditures and eliminating the requirement for municipalities to certify compliance with budget caps for fiscal year 2026.

Key changes include the stipulation that municipalities with a mill rate of 25 or above will receive a higher distribution of grants, while those below this threshold will receive the lesser amount. The bill also caps the percentage of grants for certain municipalities, ensuring excess funds are redistributed to those with higher mill rates. Additionally, it prohibits OPM from reducing a municipality's revenue sharing grant in fiscal year 2026 due to exceeding budget caps, thereby preventing potential revenue losses. The effective date for these changes is set for October 1, 2025, and the bill is designed to streamline the revenue sharing process without imposing additional fiscal burdens on the state or municipalities.

Statutes affected:
Raised Bill: 4-66l
PD Joint Favorable Substitute: 4-66l
File No. 528: 4-66l