Wednesday, March 30, 2016

Doctrine of Merger

A homeowner came to the registry today looking for a subdivision plan that shows his property. I helped him find it, and his deed. He pointed out how he has owned two lots, each 5000 square feet, for several decades, then went on to say that even though the current zoning ordinance calls for minimum lot size of 10,000 square feet, he still had two building lots because when he purchased them long ago, they complied with the zoning ordinance in effect at the time and so they were "grandfathered in."

I urged him to check with a lawyer about it and suggested among the things he discuss with the lawyer was something called "merger."

As I recall, the doctrine of merger, it holds that when two contiguous lots come under common ownership, they merge together to form a single lot. If this concept applied to zoning, his two "grandfathered lots" may have become a single complying lot when he gained ownership of the second of the lots.

I wasn't doing a good enough job of explaining what merger meant, so finally I asked "have you ever cooked pancakes?" He asked me to repeat the question at least twice before he decided that yes, I had asked him if he had cooked pancakes. "Yes, I've cooked pancakes." So I said, "If you have a smallish frying pan and drop in two scoops of batter intending to make two pancakes, but they spread out and connect together, you end up with one big pancake, not two little pancakes. That's the doctrine of merger." The guy smiled and said "I like that. Now I understand."

And now that my mind is fixated on pancakes, I might be stopping at the Owl Diner tomorrow for breakfast.

Monday, March 28, 2016

Missing out on the Community Preservation Act

The Community Preservation Act was signed into law in Massachusetts about 15 years ago. The purpose of the law was to encourage and to assist communities in preserving open space, creating affordable housing, and conducting historic preservation. To utilize the CPA, residents of a community would have to impose a surcharge of up to 3% on their property taxes. As an incentive to do this, the state would match the funds raised by the surcharge. To fund the matching amounts, the state imposed a surcharge on recording fees at the registry of deeds. Almost all documents carry a $20 surcharge (municipal lien certificates have a $10 surcharge and homesteads and state and federal tax liens are surcharge-free).

In today’s Boston Globe, op-ed columnist Renee Loth urges the city of Boston to adopt a CPA proposal filed by two city councilors (“Boston is losing out bynot adopting the Community Preservation Act”). Here’s how the column begins:

Those lucky folks in Acton. Over the past several years, they have purchased more than 30 acres of farmland and open space, created a wildflower garden and accessible boardwalk at the Acton Arboretum, and started work on their section of a 22-mile rail trail from Lowell to Framingham. In Gloucester, residents have leveraged funding for 80 units of affordable elderly housing in an old grammar school, replaced historic lead glass windows at the Cape Ann museum, and restored Depression-era WPA murals at City Hall. In Cambridge, they have preserved hundreds of affordable rental units that were about to expire, stabilized an eroding slope at Fresh Pond to protect drinking water, and transferred millions of dollars into a housing trust fund. All these communities – and 157 others – recognize the value of protecting their economic, environmental, and cultural assets through the state’s Community Preservation Act.

She spends the rest of the column arguing that it is short-sighted for Boston to continue to ignore the CPA.

You could say the same thing about Lowell. Because even the slightest property tax increase creates much angst in Lowell, it seems unlikely that the voters—especially the small percentage who actually vote in city elections—would volunteer to increase their property taxes, even if the amount of the increase was matched by the state.

What makes it even more short-sighted for Lowell to forego the CPA is that it’s not really the state that’s providing the matching funds; it’s the property owners of Lowell. From 2008 through 2015 here at the Middlesex North Registry of Deeds, we have collected $9,328,900 in Community Preservation Act surcharges for an average of $1,166,112 per year. Although the district consists of ten communities (Billerica, Carlisle, Chelmsford, Dracut, Dunstable, Lowell, Tewksbury, Tyngsborough, Westford, and Wilmington), Lowell accounts for 22% of all documents recorded.

Given those numbers, property owners in Lowell have contributed $2,052,358 to the Community Preservation Fund, all of which has benefitted communities like Acton, Gloucester, and Cambridge. Maybe it’s time for the property owners of Lowell to get some return on their CPA investment.

Monday, March 21, 2016

More on Registry Standardization

In my preceding post, I discussed the process of selecting the ACS computer system and how that was intended to become the standard system in Massachusetts. Unfortunately, that did not happen. Here is a list of registries in Massachusetts (in alphabetical order) along with the computer system they are currently operating. Whether the registry is "state" or "county" is also indicated:

  1. Barnstable - Browntech - county
  2. Berkshire Middle - ACS - state
  3. Berkshire North - ACS - state
  4. Berkshire South - ACS - state
  5. Bristol Fall River - ACS - county
  6. Bristol North - ACS - county
  7. Bristol South - ACS - county
  8. Dukes - ACS - county
  9. Essex North - Browntech - state
  10. Essex South - in-house system - state
  11. Franklin - ACS - state
  12. Hampden - Browntech - state
  13. Hampshire - ACS - state
  14. Middlesex North - ACS - state
  15. Middlesex South - ACS - state
  16. Nantucket - ACS - county
  17. Norfolk - Browntech - county
  18. Plymouth - ACS - county
  19. Suffolk - ACS - state
  20. Worcester - ACS - state
  21. Worcester North - Browntech - state
State v county, 13 registries are state; 7 are county

ACS v Browntech, 15 use ACS, 5 use Browntech, and 1 uses an in-house system

Of the 13 state registries, 9 use ACS; 3 use Browntech, and 1 uses an in-house system.

Of the 7 county registries, 5 use ACS and 2 use Browntech.

Registry of Deeds standardization

This is a follow-up to Thursday's post about my involvement in a Real Estate Bar Association (REBA) program earlier this week (I wrote this on Friday but inadvertently did not publish it until today, Monday, March 21, 2016). During our panel discussion, several audience members asked about the elusive topic of standardizing registry computer systems. I was able to give a brief reply then, but since it is a topic of broad interest, I thought I would explore the topic in a series of blog posts. Today, I offer a history lesson on how the ACS system came to be selected for use in so many registries of deeds:

  1. Back in the late 1990s, after several counties had been abolished, the Secretary of State's office began working closely with registers of deeds in Cambridge, Lowell, Worcester, and Greenfield, the only registries using the Wang computer system, and with the register from Northampton, were a system by Perceptics was in use. Neither Wang nor Perceptics was capable of handling dates beyond the year 1999.
  2. Because December 31, 1999 was a hard deadline and because the process of selecting a new computer system was a lengthy one, the Secretary's office and the registers decided to "remediate" the computer code in use on Wang and Perceptics so they could operate beyond 1999 and to defer the search for the new system until after January 1, 2000.
  3. However, since all involved knew that any replacement system would use Windows-compatible PCs on a wide area network, we used funding available for Y2K preparation to acquire and install the hardware and infrastructure that would be needed for the new system, whatever that system might turn out to be, prior to January 1, 2000.
  4. Y2K passed without incident.
  5. In 2000 and early 2001, the bursting of the dot-com bubble caused state revenue collections to plunge. As a result, the funding for a new computer system was frozen.
  6. In the spring of 2001, after an indication that state Information Technology (IT) Bond that was to be used for new registry computer systems might soon become available, the five registers of deeds and the Secretary of State's office began a system selection process. A RFP was issued, vendor demonstration days were held, and site visits were made to registries of deeds in Chicago, Illinois; Philadelphia, Pennsylvania; Wilmington, Delaware; and Charlotte, North Carolina; to see the systems of the top respondent computer companies in action.
  7. Although the new system would initially be installed in just these five registries, the RFP (and the philosophy of all involved) was that this new computer system would eventually be used at every registry of deeds in the state. The timetable for replacements in other registries was not firm; the understanding was that as existing computer systems needed replacement, the ACS system would be installed. But, if an existing computer system was working satisfactorily and the register of deeds in that office wished to continue using the system, no new system would be forced on that registry.
  8. In April 2002, ACS was selected as the "target migration system." The first installation, in Lowell, became active on July 1, 2002. The other four registries followed in succession. Afterwards, many but not all of the registries in Massachusetts shifted to ACS which is now in place in a majority of registries in the Commonwealth.

Thursday, March 17, 2016

REBA Update on Registries of Deeds

Yesterday I traveled to the new headquarters of the Real Estate Bar Association of Massachusetts (REBA) at 295 Devonshire St in Boston to participate in a panel discussion. The name of the event was "Escape from the 19th Century: An Update on the Evolving Registries of Deeds."

At the conclusion of the 90-minute program, an audience member asked me if I was "the one who wrote the blog" and said how useful and enjoyable he found it. He very tactfully used the present tense since I have fallen out of the habit of posting here. Being reminded that there is an audience for online registry news and information has prompted me to return to the blog today (and hopefully for many days to come).

My portion of the talk was mostly about the use of technology at the registry of deeds. Computers have definitely transformed the way title examinations are conducted. Opinions differ substantially on whether that's a good thing or a bad thing. It should not come as a surprise that I believe our use of technology at the registry has been a great advancement, however, I also am the first to say that it - particularly our website - could be much better than it is. All I can say is that we're working on it.

In the bigger picture, it was clear to me that all three segments of the conveyancing community involved in yesterday's discussion - title examiners, closing attorneys, and registers of deeds - are existentially threatened by technology. While real estate law and the interpretation of real estate documents has been and will continue to be incredibly complex, the act of recording and retrieving documents is not, and so technology threatens not only to change how those things get done, but to greatly reduce the market for people who perform those tasks. That's a given. What is not a given is the response of those whose jobs will change as a result of technology. As I said in my closing remarks yesterday, never in history has a group whose livelihood has been threatened by advances in technology succeeded in holding off that technology. Trying to do that just accelerates one's demise. The better response is to embrace the technology and get ahead of it. Doing that increases efficiency, provides better service, and yes, allows one to remain relevant.