Walsh supports Community Preservation Act

May 6, 2016
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Mayor Martin Walsh announced on April 27 his support for the Community Preservation Act (CPA), which if approved would boost funding for affordable housing, historic preservation, and open spaces, according to a press release.

The proposal is currently pending before the City Council and potentially could be placed on the ballot in Boston in November.

Enacted by the state in 2000, the CPA allows communities to create a local fund for open space, historic preservation, and affordable housing. CPA requires that 10 percent of money collected be directed to those three efforts every year. The remaining 70 percent may be spent or put in reserve for those purposes.

The Boston CPA is a one percent property tax surcharge, with exemptions for low-income homeowners as well as low- and moderate-income senior owners. The tax would be calculated through a complex formula: It is a 1 percent tax on the cost of a property bill after $100,000 of value has been subtracted and the residential exemption applied, if applicable. That means an owner who has a property assessed at $400,000 would see an increase in the property bill of about $13. It is not a 1 percent increase in the property tax.

“Our city is growing and thriving, but success has brought challenges—housing costs being one of the greatest,” said Walsh, according to the press release. “We’ve studied the impacts and benefits, and I believe the Community Preservation Act offers a balanced and timely strategy for helping Boston build affordable housing, invest in our parks, and preserve Boston’s historic and inclusive character. I thank the City Council for taking this up, and look forward to working with them and our community partners in support of the Community Preservation Act.”

Communities can decide on the distribution of funds across affordable housing, historic preservation, or open space initiatives, as long as each area receives at least 10 percent of the total available funds. To determine which projects will receive funding, Boston would create a Community Preservation Committee upon adoption of the Act. The five-to-nine member board would make recommendations on CPA projects to the City Council.

In addition to the funds raised by the surcharge on property owners, communities that have adopted the CPA also receive matching contributions provided by a statewide Community Preservation Trust Fund, administered by the state Department of Revenue. These matching funds come from a surcharge on transaction fees at the Registry of Deeds and appropriations by the State Legislature. The match has ranged from 23 percent to approximately 50 percent. Last year, the match was 29 percent.

Currently, 160 towns and cities across the Commonwealth have approved the CPA, and $1.6 billion has been raised for community preservation funding statewide. New City revenue from the surcharge is estimated to be $16.5 million annually, and the average homeowner would pay an additional $28 per year.

The Boston CPA proposal is pending before the City Council. Following its adoption by the City Council, the proposal would then be put before voters in November. Alternatively, the question could be placed on the ballot without a Council vote, but would require a petition signed by at least five percent of Boston’s registered voters, which would be certified by the Election Commission.