Substitute House Bill No. 5883

Public Act No. 00-203

An Act Concerning The Open Space Trust Fund.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (a) There is established a charter oak open space trust account, within the General Fund, which shall be nonlapsing and shall be separate from bond funds provided for any similar programs or purposes.

(b) For the fiscal year ending June 30, 2001, disbursements from the charter oak open space trust account shall be made as follows: (1) Sixty per cent of the funds shall be deposited into the charter oak open space grant program account established pursuant to section 2 of this act; and (2) forty per cent of the funds shall be deposited in the charter oak state parks and forest account established pursuant to section 5 of this act.

Sec. 2. (NEW) (a) (1) There is established a charter oak open space grant program account, within the General Fund, which shall be a separate, nonlapsing account. The account shall consist of any funds required or allowed by law to be deposited into the account including, but not limited to, funds from the charter oak open space trust account established pursuant to section 1 of this act, gifts or donations received for the purposes of section 7-131d of the general statutes, as amended by this act. Investment earnings credited to the assets of the account shall become part of the assets of the account. Any balance remaining in the account at the end of any fiscal year shall be carried forward in the account for the fiscal year next succeeding. Payments from the account shall be made upon authorization by the Commissioner of Environmental Protection. Neither the proceeds of any general obligation bonds of the state nor the investment earnings of any such proceeds shall be deposited in the account.

(2) At least fifty per cent of the funds deposited in the charter oak open space grant program account from the charter oak open space trust account shall be used to make grants under the charter oak open space grant program established pursuant to subsection (b) of this section to municipalities and nonprofit land conservation organizations. If fifty per cent of such funds have not been used by municipalities or nonprofit land conservation organizations prior to July 1, 2003, then after said date expenditures may be made from remaining funds for the charter oak state parks and forests program established pursuant to section 5 of this act.

(b) There is established the charter oak open space grant program. The program shall provide grants to municipalities and nonprofit land conservation organizations to acquire land or permanent interests in land for open space and watershed protection. All land or interest in land acquired under this program shall be preserved in perpetuity predominantly in its natural and open condition for the specific open space purposes for which it was acquired, provided any improvements or changes to the property shall be supportive of such condition or purpose. No municipality shall be eligible for grants under this section unless the municipality has adopted an open space plan in its plan of development.

(c) The Commissioner of Environmental Protection may make grants in accordance with section 7-131d of the general statutes, as amended by this act, under the charter oak open space grant program to: (1) Municipalities in an amount not to exceed sixty per cent of the purchase price not to exceed the fair market value of a parcel of land or interest in land that is proposed to be acquired and permanently preserved that is located in municipalities with population densities of at least one thousand five hundred persons per square mile, and (2) municipalities or nonprofit land conservation organizations in an amount not to exceed fifty per cent of the purchase price not to exceed the fair market value of a parcel of land or interest in land that is proposed to be acquired and permanently preserved that is (A) not owned by a water company, as defined in section 25-32a of the general statutes but is on a public drinking supply watershed or acquifer area or within one hundred and fifty feet of a distribution reservoir or a first-order stream tributary to a distribution reservoir, or (B) owned by an electric distribution company or electric supplier, as defined in section 16-1 of the general statutes. Applicants for grants under the program shall provide a copy of the application to the chairperson of the review board established under section 7-131e of the general statutes, as amended by this act. The board shall provide comments to the commissioner on pending applications as it deems necessary.

(d) The program shall expire when the state and municipal open space goal is achieved as provided in subsection (b) of section 23-8 of the general statutes. Any moneys remaining in the charter oak open space grant program account at the time the program expires shall revert to the recreation and natural heritage trust program established under section 23-74 of the general statutes.

Sec. 3. Section 7-131d of the general statutes is repealed and the following is substituted in lieu thereof:

(a) There is established the protected open space and watershed land acquisition grant program. The program shall provide grants to municipalities and nonprofit land conservation organizations to acquire land or permanent interests in land for open space and watershed protection and to water companies, as defined in section 25-32a, to acquire and protect land which is eligible to be classified as class I or class II land, as defined in section 25-37c, after acquisition. All lands or interests in land acquired under this program shall be preserved in perpetuity predominantly in their natural scenic and open condition for the protection of natural resources while allowing for recreation consistent with such protection and, for lands acquired by water companies, allowing for the improvements necessary for the protection or provision of potable water.

(b) Grants may be made under the [program] protected open space and watershed land acquisition grant program established under subsection (a) of this section or under the charter oak open space grant program account established under section 2 of this act to match funds for the purchase of land or permanent interests in land which purchase meets one of the following criteria: (1) Protects land identified as being especially valuable for recreation, forestry, fishing, conservation of wildlife or natural resources; (2) protects land which includes or contributes to a prime natural feature of the state's landscape, including, but not limited to, a shoreline, a river, its tributaries and watershed, an aquifer, mountainous territory, ridgelines, an inland or coastal wetland, a significant littoral or estuarine or aquatic site or other important geological feature; (3) protects habitat for native plant or animal species listed as threatened or endangered or of special concern, as defined in section 26-304; (4) protects a relatively undisturbed outstanding example of a native ecological community which is now uncommon; (5) enhances and conserves water quality of the state's lakes, rivers and coastal water; (6) preserves local agricultural heritage; or (7) in the case of grants to water companies, protects land which is eligible to be classified as class I land or class II land after acquisition. The commissioner may make a grant under the protected open space and watershed land acquisition grant program to a distressed municipality or a targeted investment community, as defined in section 32-9p, for restoration or protection of natural features or habitats on open space already owned by the municipality, including, but not limited to, wetland or wildlife or plant habitat restoration or restoration of other sites to a more natural condition, or replacement of vegetation, provided the total amount of grants to such municipalities for such purposes may not exceed twenty per cent of the total amount of grants made in any fiscal year.

(c) No grant may be made under the [program] protected open space and watershed land acquisition grant program established under subsection (a) of this section or under the charter oak open space grant program account established under section 2 of this act for: (1) Land to be used for commercial purposes or for recreational purposes requiring intensive development, including, but not limited to, golf courses, driving ranges, tennis courts, ballfields, swimming pools and uses by motorized vehicles other than vehicles needed by water companies to carry our their purposes, provided trails or pathways for pedestrians, motorized wheelchairs or nonmotorized vehicles shall not be considered intensive development; (2) land with environmental contamination over a significant portion of the property provided grants for land requiring remediation of environmental contamination may be made if remediation will be completed before acquisition of the land or any interest in the land and an environmental assessment approved by the Commissioner of Environmental Protection has been completed and no environmental use restriction applies to the land; (3) land which has already been committed for public use; (4) development costs, including, but not limited to, construction of ballfields, tennis courts, parking lots or roadways; (5) land to be acquired by eminent domain; or (6) reimbursement of in-kind services or incidental expenses associated with the acquisition of land. This subsection shall not prohibit the continuation of agricultural activity, the activities of a water company for public water supply purposes or the selling of timber incidental to management of the land which management is in accordance with approved forest management practices provided any proceeds of such timber sales shall be used for management of the land. In the case of land acquired under this section which is designated as a state park, any fees charged by the state for use of such land shall be used by the state in accordance with the provisions of title 23 or section 22a-27h.

(d) Any municipality or group of contiguous municipalities may apply to the Commissioner of Environmental Protection for a grant-in-aid of a program established to preserve or restrict to conservation or recreation purposes the use of open space land. Such grant shall be used for the acquisition of land, or easements, interests or rights therein, or for the development of such land, or easements, interests or rights therein, for purposes set forth in this section, or both, in accordance with a plan of development adopted by the municipal planning commission of the municipality within which the land is located. Any application for a grant-in-aid relating to land located beyond the territorial limits of the applying municipality shall be subject to approval of the legislative body of the municipality within whose territorial limits the land is located. A municipality applying for aid under this section, may designate its conservation commission as its agent to make such application.

(e) At closing, a permanent conservation easement, as defined in section 47-42, shall be executed for any property purchased with grant funds, which conservation easement shall provide that the property shall remain forever predominantly in its natural and open condition for the specific conservation, open space or water supply purposes for which it was acquired provided any improvements or changes to the property shall be supportive of such condition or purposes. The permanent conservation easement shall be in favor of the state acting through the Commissioner of Environmental Protection, or his designee, which may be a municipality or a land conservation organization. In the case of land acquired for water supply protection, a water company may hold an easement in conjunction with the state or a nonprofit entity to protect the water supply. Such permanent conservation easement shall also include a requirement that the property be made available to the general public for appropriate recreational purposes, the maintenance of which recreational access shall be the responsibility of the grantee provided such access shall not be required for land which will be classified as class I or class II land by a water company if such access is inconsistent with the provision of pure drinking water to the public. An exception to the provision of public recreational access may be made at the discretion of the Commissioner of Environmental Protection when provision for public access would be unreasonably detrimental to the wildlife or plant habitat or other natural features of the property or, for land where development rights have been purchased, would be disruptive of agricultural activity occurring on the land. Any instrument conveying an interest in land less than fee which interest is purchased under this section shall provide for the permanent preservation of the land and public access consistent with the land's use or protection and with any restrictions prescribed by the Department of Public Health in order to protect a public drinking water source.

Sec. 4. Subsection (a) of section 7-131e of the general statutes, as amended by public act 99-58, is repealed and the following is substituted in lieu thereof:

(a) Grant award decisions under the protected open space and watershed land acquisition grant program established under section 7-131d, as amended by this act, or under the charter oak open space grant program established under section 2 of this act shall be made by the Commissioner of Environmental Protection at least semiannually. All complete and eligible grant applications shall be acted upon by the commissioner as soon as practicable. A single project may receive a grant in more than one grant cycle, subject to future availability of funds and subject to the limitations set forth in this section and sections 23-78, 12-498 and 7-131d, as amended by this act. Up to two per cent of the grant funds may be used for administrative expenses including, but not limited to: (1) Contractors to assist the Department of Environmental Protection in the review and evaluation of grant proposals and baseline data collection for conservation easements; (2) appraisals or appraisal reviews; and (3) preparation of legal and other documents. Administrative expenses may not be used for staff salaries. Not later than September 1, 1998, for the protected open space and watershed land acquisition grant program established under section 7-131d, as amended by this act, and not later than September 1, 2000, for the charter oak open space grant program account established under section 2 of this act, the commissioner shall develop written guidelines and a ranking system for consistency and equity in the distribution of grant awards under [this program] the protected open space and watershed land acquisition grant program established under section 7-131d, as amended by this act, or under the charter oak open space grant program account established under section 2 of this act based on the criteria listed in subsections (b) and (c) of section 7-131d, as amended by this act. Consistent with such criteria, additional consideration shall be given to: (A) Protection of lands adjacent to and complementary to adjacent protected open space land or class I or class II water company lands; (B) equitable geographic distribution of the grants; (C) proximity of a property to urban areas with growth and development pressures or to areas with open space deficiencies and underserved populations; (D) protection of land particularly vulnerable to development incompatible with its natural resource values including the protection of a public water supply source; (E) consistency with the state's plan of conservation and development; (F) multiple protection elements, such as water quality and supply protection, scenic preservation and farmland preservation; (G) the extent to which the presence of already constructed buildings or other manmade improvements diminish or overshadow the natural resource value of a proposed acquisition, or its value relative to its cost; and (H) preservation of forest lands and bodies of water which naturally absorb significant amounts of carbon dioxide.

Sec. 5. (NEW) (a) There is established a charter oak state parks and forests account, within the General Fund, which shall be a separate, nonlapsing account. The account shall consist of any funds required or allowed by law to be deposited into the account including, but not limited to, funds from the charter oak open space trust account established pursuant to section 1 of this act, gifts or donations received for the purposes of this section. Investment earnings credited to the assets of the account shall become part of the assets of the account. Any balance remaining in the account at the end of any fiscal year shall be carried forward in the account for the fiscal year next succeeding. Payments from the account shall be made upon authorization by the Commissioner of Environmental Protection. Neither the proceeds of any general obligation bonds of the state nor the investment earnings of any such proceeds shall be deposited in the account. Funds in the state parks and forests account shall be expended to acquire land as set forth in subsection (b) of this section.

(b) There is established the charter oak state parks and forests program to enable the state to acquire land for open space and watershed protection. All land acquired by the state under this program shall be preserved in perpetuity predominantly in its natural scenic and open condition for the protection of natural resources while allowing for recreation consistent with such protection as specified in subsection (b) of section 7-131d of the general statutes, as amended by this act.

(c) When ranking lands to be acquired under the charter oak state parks and forests program, the Commissioner of Environmental Protection shall give priority first to open space land to be permanently preserved that is located in municipalities with population densities of at least one thousand five hundred persons per square mile, and second to open space land to be permanently preserved that is owned by an electric distribution company or electric supplier, as defined in section 16-1 of the general statutes, and to open space land to be permanently preserved that is designated as class I, class II or class III land, as defined in section 25-37c of the general statutes.

(d) The charter oak state parks and forests program shall expire when the state and municipal open space goal is achieved as provided in subsection (b) of section 23-8 of the general statutes. Any moneys remaining in the charter oak open space grant program account at the time the program expires shall revert to the recreation and natural heritage trust program established under section 23-74 of the general statutes.

Sec. 6. Section 47 of public act 99-173 is amended by adding subsection (c) as follows:

(NEW) (c) A credit that is allowed under this section, with respect to any taxable year commencing on or after January 1, 2000, but is not used by a taxpayer may be carried forward to each of the successive income years until such credit is fully taken. In no case shall a credit that is not used be carried forward for a period of more than ten years.

Sec. 7. Section 25-32 of the general statutes, as amended by section 63 of public act 99-2 of the June special session, is repealed and the following is substituted in lieu thereof:

(a) The Department of Public Health shall have jurisdiction over all matters concerning the purity and adequacy of any source of water supply used by any municipality, public institution or water company for obtaining water, the safety of any distributing plant and system for public health purposes, the adequacy of methods used to assure water purity, and such other matters relating to the construction and operation of such distributing plant and system as may affect public health. The qualifications of the operators of water treatment plants or water distribution systems which treat or supply water used or intended for use by the public shall be subject to the approval of said department pursuant to regulations adopted by the commissioner in accordance with chapter 54.

(b) No water company shall sell, lease, assign or otherwise dispose of or change the use of any watershed lands, except as provided in section 25-43c, without a written permit from the Commissioner of Public Health. Said commissioner shall not grant a permit for the sale, lease or assignment of class I land, except as provided in subsection (d), and shall not grant a permit for a change in use of class I land unless the applicant demonstrates that such change will not have a significant adverse impact upon the present and future purity and adequacy of the public drinking water supply and is consistent with any water supply plan filed and approved pursuant to section 25-32d. The commissioner may reclassify class I land only upon determination that such land no longer meets the criteria established by subsection (a) of section 25-37c because of abandonment of a water supply source or a physical change in the watershed boundary. Not more than fifteen days before filing an application for a permit under this section, the applicant shall provide notice of such intent, by certified mail, return receipt requested, to the chief executive officer and the chief elected official of each municipality in which the land is situated.

(c) The Commissioner of Public Health may grant a permit for the sale, lease, assignment or change in use of any land in class II subject to any conditions or restrictions in use which the commissioner may deem necessary to maintain the purity and adequacy of the public drinking water supply, giving due consideration to: (1) The creation and control of point or nonpoint sources of contamination; (2) the disturbance of ground vegetation; (3) the creation and control of subsurface sewage disposal systems; (4) the degree of water treatment provided; (5) the control of watershed land by the applicant through ownership, easements or use restrictions or other water supply source protection measures; (6) the effect of development of any such land; and (7) any other significant potential source of contamination of the public drinking water supply. The commissioner may grant a permit for the sale, lease or assignment of class II land to another water company, municipality or nonprofit land conservation organization provided, as a condition of approval, a permanent conservation easement on the land is entered into to preserve the land in perpetuity predominantly in its natural scenic and open condition for the protection of natural resources and public water supplies while allowing for recreation consistent with such protection and improvements necessary for the protection or provision of safe and adequate potable water. Preservation in perpetuity shall not include permission for the land to be developed for any commercial, residential or industrial uses, nor shall it include permission for recreational purposes requiring intense development, including, but not limited to, golf courses, driving ranges, tennis courts, ballfields, swimming pools and uses by motorized vehicles other than vehicles needed by water companies to carry out their purposes, provided trails or pathways for pedestrians, motorized wheelchairs or nonmotorized vehicles shall not be considered intense development. The commissioner may reclassify class II land only upon determination that such land no longer meets the criteria established by subsection (b) of section 25-37c because of abandonment of a water supply source or a physical change in the watershed boundary.

(d) The commissioner may grant a permit for the sale of class I or II land to another water company, to a state agency or to a municipality if the purchasing entity agrees to maintain the land subject to the provisions of this section, any regulations adopted pursuant to this section and the terms of any permit issued pursuant to this section. Such purchasing entity may not sell, lease, assign or change the use of such land without obtaining a permit pursuant to this section.

(e) The commissioner shall not grant a permit for the sale, lease, assignment or change in use of any land in class II unless (1) the land in class II is being sold, leased or assigned as part of a larger parcel of land also containing land in class III and use restrictions applicable to the land in class II will prevent the land in class II from being developed, [or] (2) the applicant demonstrates that the proposed sale, lease, assignment or change in use will not have a significant adverse impact upon the purity and adequacy of the public drinking water supply and that any use restrictions which the commissioner requires as a condition of granting a permit can be enforced against subsequent owners, lessees and assignees, [and] (3) the commissioner determines, after giving effect to any use restrictions which may be required as a condition of granting the permit, that such proposed sale, lease, assignment or change in use will not have a significant adverse effect on the public drinking water supply, whether or not similar permits have been granted, and (4) on or after January 1, 2003, as a condition to the sale, lease or assignment of any class II lands, a permanent conservation easement on the land is entered into to preserve the land in perpetuity predominantly in its natural scenic and open condition for the protection of natural resources and public water supplies while allowing for recreation consistent with such protection and improvements necessary for the protection or provision of safe and adequate potable water, except in cases where the class II land is deemed necessary to provide access or egress to a parcel of class III land, as defined in section 25-37c of the general statutes, that is approved for sale. Preservation in perpetuity shall not include permission for the land to be developed for any commercial, residential or industrial uses, nor shall it include permission for recreational purposes requiring intense development, including, but not limited to, golf courses, driving ranges, tennis courts, ballfields, swimming pools and uses by motorized vehicles other than vehicles needed by water companies to carry out their purposes, provided trails or pathways for pedestrians, motorized wheelchairs or nonmotorized vehicles shall not be considered intense development.

(f) Nothing in this section shall prevent the lease or change in use of water company land to allow for recreational purposes that do not require intense development or improvements for water supply purposes, for leases of existing structures, or for radio towers or telecommunications antennas on existing structures. For purposes of this subsection, intense development includes golf courses, driving ranges, tennis courts, ballfields, swimming pools and uses by motorized vehicles, provided trails or pathways for pedestrians, motorized wheelchairs or nonmotorized vehicles shall not be considered intense development.

[(f)] (g) The term "public water supply source" includes all springs, streams, watercourses, brooks, rivers, lakes, ponds, wells or underground waters from which water is taken, and all springs, streams, watercourses, brooks, rivers, lakes, ponds, wells or aquifer protection areas, as defined in section 22a-354h, thereto and all lands drained thereby; and the term "watershed land" means land from which water drains into a public drinking water supply.

[(g)] (h) The Commissioner of Public Health shall adopt and from time to time may amend the following: (1) Physical, chemical, radiological and microbiological standards for the quality of public drinking water; (2) minimum treatment methods, taking into account the costs thereof, required for all sources of drinking water, including guidelines for the design and operation of treatment works and water sources, which guidelines shall serve as the basis for approval of local water supply plans by said commissioner; (3) minimum standards to assure the long-term purity and adequacy of the public drinking water supply to all residents of this state; and (4) classifications of water treatment plants and water distribution systems which treat or supply water used or intended for use by the public. On or after October 1, 1975, any water company which requests approval of any drinking water source shall provide for such treatment methods as specified by the Commissioner of Public Health, provided any water company in operation prior to October 1, 1975, and having such source shall comply with regulations adopted by said commissioner in conformance with The Safe Drinking Water Act, Public Law 93-523, and shall submit on or before February 1, 1976, a statement of intent to provide for treatment methods as specified by said commissioner, to said commissioner for approval.

[(h)] (i) The Department of Public Health may perform the collection and testing of water samples required by regulations adopted pursuant to this section when requested to do so by the water company. The department shall collect a fee equal to the cost of such collection and testing. Water companies serving one thousand or more persons shall not request routine bacteriological or physical tests.

[(i)] (j) The condemnation by a state department, institution or agency of any land owned by a water company shall be subject to the provisions of this section.

[(j)] (k) The commissioner may issue an order declaring a moratorium on the expansion or addition to any existing public water system that the commissioner deems incapable of providing new services with a pure and adequate water supply.

[(k)] (l) The commissioner may issue, modify or revoke orders as needed to carry out the provisions of part III of this chapter. Except as provided otherwise in this part, such order shall be issued, modified or revoked in accordance with procedures set forth in subsection (b) of section 25-34.

[(l)] (m) The Commissioner of Public Health shall adopt regulations, in accordance with the provisions of chapter 54, to include local health departments in the notification process when a water utility reports a water quality problem.

Sec. 8. Section 47 of public act 99-173 is repealed and the following is substituted in lieu thereof:

(a) For purposes of this section, "donation of open space land" means the value of any land conveyed without financial consideration, or the value of any discount of the sale price in any sale of land or interest in land, to the state, a political subdivision of the state or to any nonprofit land conservation organization where such land is to be permanently preserved as protected open space.

(b) There shall be allowed a credit for all taxpayers against the tax imposed under section 12-217, as amended, in an amount equal to fifty per cent of any donation of open space land. For purposes of calculating the credit under this section, the amount of donation shall be based on the use value of the donated open space land. For purposes of this subsection, "use value" means the fair market value of land at its highest and best use, as determined by a certified real estate appraiser.

Sec. 9. (NEW) (a) On or before April 1, 2001, the Commissioner of Agriculture shall prepare a list of agricultural land whose development rights have been offered to the state under section 22-26gg of the general statutes and for which there is a written agreement for a purchase price. Purchase of development rights pursuant to said section 22-26gg shall be made from agricultural land appearing on the list. The list shall be revised every six months.

(b) The list and revisions to such list shall be submitted to the State Bond Commission and considered by the commission in authorizing bonds pursuant to section 22-26hh of the general statutes, as amended by section 10 of this act.

Sec. 10. Section 22-26hh of the general statutes, as amended by section 12 of public act 99-241, is repealed and the following is substituted in lieu thereof:

(a) The State Bond Commission shall have power, from time to time, to authorize the issuance of bonds of the state in one or more series and in principal amounts not exceeding in the aggregate eighty-three million seven hundred fifty thousand dollars, the proceeds of which shall be used by the Commissioner of Agriculture for the purposes of this chapter, provided not more than two million dollars shall be used for the purposes of section 22-26jj. All provisions of section 3-20, or the exercise of any right or power granted thereby which are not inconsistent with the provisions of this section are hereby adopted and shall apply to all bonds authorized by the State Bond Commission pursuant to this section, and temporary notes in anticipation of the money to be derived from the sale of any such bonds so authorized may be issued in accordance with said section 3-20 and from time to time renewed. Such bonds shall mature at such time or times not exceeding twenty years from their respective dates as may be provided in or pursuant to the resolution or resolutions of the State Bond Commission authorizing such bonds. None of said bonds shall be authorized except upon a finding by the State Bond Commission that there has been filed with it a request for such authorization, which is signed by or on behalf of the Secretary of the Office of Policy and Management and states such terms and conditions as said commission, in its discretion, may require. Said bonds issued pursuant to this section shall be general obligations of the state and the full faith and credit of the state of Connecticut are pledged for the payment of the principal of and interest on said bonds as the same become due, and accordingly and as part of the contract of the state with the holders of said bonds, appropriation of all amounts necessary for punctual payment of such principal and interest is hereby made, and the Treasurer shall pay such principal and interest as the same become due.

(b) To the extent there is a balance of bonds authorized but not allocated by the State Bond Commission on or after July 1, 2000, pursuant to subsection (a) of this section for the purposes of this chapter, the State Bond Commission shall authorize the issuance of such balance for the purposes of said chapter.

Sec. 11. This act shall take effect from its passage and shall be applicable to all open space land donations made on or after the income year commencing January 1, 1999, except that sections 1 to 7 inclusive, shall take effect July 1, 2000.

Approved June 7, 2000