Town leaders in Groton, North Stonington and Stonington respectively used the words "devastating," "catastrophic" and "burdensome" to describe the impact of a proposed bill that would dramatically reduce municipal revenue.

Sen. Martin Looney, D-New Haven, introduced Senate Bill 431, a multi-part bill reforming property taxes. It would:

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[naviga:li]Establish a $50,000 homestead exemption for assessed value on residences for 1-4 families[/naviga:li]

[naviga:li]Establish a one-mill statewide property tax[/naviga:li]

[naviga:li]Repeal the municipal car tax[/naviga:li]

[naviga:li]Establish a statewide car tax between 15 and 19 mills[/naviga:li]

[naviga:li]Use the statewide car tax for PILOT, special education and Alliance District grants to municipalities[/naviga:li]

[naviga:li]Exempt the first $25,000 of business personal property assessed value from municipal property tax[/naviga:li]

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The bill text offers no guarantee that the reimbursements to towns from the statewide property and motor vehicle taxes would make up for the loss of revenue from the municipal motor vehicle tax.

This was one of four bills in a public hearing the Finance, Revenue and Bonding Committee held on Friday, though not nearly the most popular. The hearing began with many advocating for increased mental health services funding, and followed with discussion of Gov. Ned Lamont's proposed repeal of numerous sales tax exemptions.

Stonington First Selectman Rob Simmons said in a written testimony that the statewide car tax "would be collected from local tax payers without any guaranteed reimbursement back to the town. The town budget is strained presently with all the unfunded and reduced State mandates passed each legislative session."

He said the bill would necessitate a 12.5 percent tax rate increase for Stonington, and argued that the Department of Motor Vehicles does not have the capability to administer another program.

Groton Town Manager John Burt said Groton generates more than $6 million from the car tax, while North Stonington First Selectman Mike Urgo said motor vehicles are 8 percent of the grand list in his town.

If the homestead exemption in the bill were applied, Burt said Groton would lose $9,089,130, while Urgo said his town would have to make up $4.5 million in revenue loss.

"Since North Stonington is a rural town, we do not have a large amount of commercial or industrial real estate, the effect will land squarely on the town's residential homeowners," Urgo wrote in submitted testimony.

Both Burt and Sen. Heather Somers, R-Groton, pointed out that years ago, the state sent funds from the Manufacturing Machinery and Equipment Tax to municipalities, but grants were eventually defunded. Their fear is the same thing would happen here.

"If the citizens of Groton are going to be the ones that are taxed on their cars, that needs to come back to the citizens of Groton," Somers said.

Rep. Holly Cheeseman, R-East Lyme, said in an email to constituents that Looney's bill would "move property tax revenue generated in our towns away from East Lyme and Salem to distressed larger cities."

Others who submitted written testimony opposing the bill included the first selectmen of Colchester, Goshen, Harwinton, Wilton and Windsor Locks; the mayor of Norwalk; and the town manager of Avon.

Out of 40 pieces of testimony the Connecticut General Assembly posted online by Friday afternoon, only two were in favor of the bill, on the basis that it could generate additional revenue to avoid cuts to social safety net programs.

e.moser@theday.com