Home Fairfield Proposed legislation would add buyer’s fee to CT real estate transactions

Proposed legislation would add buyer’s fee to CT real estate transactions

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The Connecticut General Assembly’s Planning and Development Committee is considering a bill that would allow municipalities to charge a buyer’s fee on property transactions larger than $150,000.

House Bill 6926, introduced by Democratic Reps. Linda Orange, Kevin Ryan and Joe Gresko, would permit a municipality to impose a buyer’s fee on the conveyance of property occurring on or after July 1 at a top rate of 1 percent of the sales price. The fees collected would be placed in a separate account for the purchase, preservation and stewardship of open space.

Eric Hammerling, executive director of the Connecticut Forest & Park Association, expressed his organization’s support for the bill. “State and federal grants to protect land typically require a local match, and this bill would authorize towns to generate a local source of funding to help preserve special places for the public,” he said. “I hope the bill will pass and that many towns will take advantage of the opportunity.”

Meanwhile, the Connecticut Association of Realtors (CAR) has expressed its opposition, maintaining that such additional costs would have a detrimental effect on home sales.

“To have legislators sit back and say, ‘Just add that 1 percent and we can use it to buy open space, what’s the difference?’ sounds well-intentioned,” said CAR President Michael Barbaro, “but we are the ones on the front lines, sitting at the closing table and we see that people just don’t have that extra 1 percent to spend. Homebuyers are maxed out.

“We are obviously pro-open space,” Barbaro said. “We think it’s a great thing. But (6926)  is just not something we can support.”

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3 COMMENTS

  1. I think the article is a little misleading. It is not another State Tax.
    I was in the State Capitol for the presentation on House Bill 6926.
    And, I agree completely with CAR that we do not want another State tax.

    However, this bill gives TOWNS the OPTION of collecting this tax. It is not a good idea for every town, and not every town has the same need to acquire open space or the same costs.

    This week my Town Council unanimously passed a resolution setting up a Land Acquisition Fund for this very purpose. There is a lot of development going on and citizens are concerned have expressed concern that we do not have a strategy in place for identifying, purchasing and protecting open space. Rather than bond every acquisition (and add the cost of interest) we look at House Bill 6926 as one of many tools we need as a town. It might be one of the options we look at if the legislature gives us the authority.

  2. I think giving Towns the right to choose this option for funding open space preservation is a very positive step, and one taken by other States and Counties around the country. Open space adds value to surrounding properties and Towns in general. Plus the benefit of outdoor recreation, natural diversity, and water filtration – an important factor for many Town residences on well water. Bravo to the State Legislators for moving this forward.

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