Monday, December 17, 2018

More revenue needed for CPA

The editorial in the December 1, 2018 Boston Globe, "CPA has grown; state funding should grow with it" advocated an increase in the state fund used to provide money to municipalities under the Community Preservation Act.

The CPA was enacted back in 2000. It provided a mechanism for cities and towns to assist in preserving open space, historic preservation, affordable housing, and recreation. Residents in towns enacting the CPA had to agree by referendum vote to impose a surcharge on their own property taxes. The amount raised through that mechanism was then matched by money from the state. The pool of money the state used to make these payments was funded by a $20 per document surcharge on documents recorded at the registry of deeds.

Between the booming real estate market of the early 2000s (this registry recorded 144,000 documents in 2003 and averages about 60,000 over the past few years) and the scarcity of communities enacting the CPA at the beginning, meant that the state match was dollar for dollar. That has changed and the matching amount now may be as low as 20% of what is raised from town residents.

There have been several efforts made to increase the flow of money into the state matching fund. Most recently, legislation backed by Governor Baker would have raised the registry of deeds surcharge from $20 to $50 per document. Despite the Governor's support, this bill did not survive the last legislative session.

The Globe editorial urges lawmakers to increase CPA funding but suggests a surcharge on recorded documents might not be the way to do that since the flow of money is tied to the health of the real estate market. When times are good, the money flows into the fund; when times are tough, the money dries up.  After seeing how our volume of recorded documents rises and falls pretty dramatically, I agree with this approach.

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