DERBY – The Board of Aldermen and Alderwomen (BOAA) tabled a proposal to give tax assessment breaks to single-and two-family home owners after landlords and public officials questioned whether it was fair.
The elected officials were considering enacting a “homestead exemption” that would reduce assessments for owner-occupied single-family and two-family properties. Condos would have been considered, too.
The exemption was created by state lawmakers in 2024. New Milford is the only municipality to enact it thus far.
The Derby exemption could have shaved anywhere from 5 percent to 35 off the assessment of qualifying owner-occupied houses. The precise language wasn’t set because the conversation was stopped before it got there.
During the public portion of the Jan. 22 BOAA meeting, landlords said Derby was simply shifting the tax burden onto the backs of larger, multi-family apartment houses. Landlords would pass their costs onto their tenants, they said. That shift would cause higher rents in a poor city where about 40 percent of the population rents.
“Unless city spending is reduced, this will create a shift of the tax burden onto renters, commercial property owners, even homeowners who did not qualify for the exemption,” said Andrew Baklik, a Derby resident who owns an apartment complex on Roosevelt Drive. Baklik is also former Mayor Rich Dziekan’s chief of staff and currently works for the Naugatuck Valley Council of Governments.
Baklik called the homestead exemption “not fair nor sustainable.”
It wasn’t just landlords complaining. Story continues after the edited meeting video.
Derby Town/City Clerk Marc Garofalo questioned the initiative, saying officials should be wary of “unintended consequences” of their actions. He specifically worried that cutting assessments for one type of property could trigger taxes to increase on owner-occupied businesses such as Roseland Apizza and The Dew Drop Inn.
He said the homestead exemption needs to be vetted, including the involvement of Aldermanic subcommittees to hash out the program. More planning is needed, the town clerk and former mayor said.
“The percentage (assessment decrease) is not even in the document,” he said.
Derby Republican Town Committee Chairman Gino DiGiovanni Jr. also questioned the wisdom of the initiative, saying there wasn’t enough info on what the homestead exemption would do to the city budget.
“The tax board hasn’t even met yet to go over our budget,” DiGiovanni said. “The residents and the taxpayers have no idea where we are or where we are going.”
DiGiovanni also said he was concerned that the homestead act would shift the tax burden to Derby small businesses, which would discourage future investment.
The homestead exemption was on the table because Derby is heading into budget season while revaluation happens. The average assessment in the city increased by 60 percent. More than 250 residential property owners saw their assessments increase by more than 100 percent.
In Connecticut, property owners can calculate taxes by multiplying the assessed value by the mill rate, and then dividing by 1,000.
It’s unclear if and when the homestead exemption will return for further discussion.
Derby Corporation Counsel Rich Buturla said there is nothing in the state law which created the exemption saying it can’t come back again next year.
The Aldermen and Alderwomen could also consider expanding current tax breaks given to veterans and the elderly as an alternative to the homestead exemption.