JACK CLARKE
Keeping act alive

A coalition of affordable housing and land preservation groups is pressing state lawmakers to guarantee more state money for a program that has helped create hundreds of housing units and save thousands of acres of green space.

Of concern is the Community Preservation Act, which allows cities and towns to charge up to a 3 percent property tax surcharge and receive state matching money to pay for affordable housing, open space and historic preservation projects. A total of 119 Bay State communities have adopted the CPA since it was passed in 2000, generating $122 million and benefiting from a dollar-for-dollar state match.

But as more communities are expected to participate in the CPA, the Community Preservation Coalition – which includes prominent open space, affordable housing and preservation organizations – wants to ensure a strong state match in the future. The coalition has filed a bill that would have the state pledge at least a 75 percent match, by potentially boosting fees paid at the registries of deeds. Under current law, cities and towns are guaranteed only a 5 percent state match through the program.

Supporters also want to make the CPA more appealing to urban areas by permitting cities that implement a 1 percent local surcharge to get state matching funds equal to a 3 percent surcharge if they already dedicate additional local funds – such as linkage fees and hotel/motel taxes – for affordable housing, open space or historic preservation projects.

“We’re trying to keep [the CPA] alive and keep it growing and make it more interesting to the cities,” said Jack Clarke, director of public policy and government relations for the Massachusetts Audubon Society.

State matching money for the CPA comes from a trust fund that draws from fees attached to real estate transactions recorded at the registries of deeds throughout the commonwealth.

With the home sales and refinancing activity booming in recent years, the fund has been flush with cash, and communities with the CPA have received a dollar-for-dollar state match. But with the real estate market softening and as more communities approve the CPA, supporters fear the fund, and state match, will shrink.

“With less activity at the registries right now due to the economy and with more communities coming in, the likelihood of getting a 100 percent match over the long term diminishes,” said Clarke.

‘An Incredible Windfall’
Under the proposal, an increase in registry fees would be triggered if the fund fell below a certain level that wouldn’t enable the state to provide a 75 percent match. The legislation does not mention a specific increase in registry fees.

“I have an open mind on the proposal, and am carefully looking at the language of the legislation,” said Sen. Marian Walsh, a West Roxbury Democrat who supports the CPA. “I am happy that the CPA has been deemed one the most successful grant programs in the history of the commonwealth, with almost a third of the communities participating.”

Seventeen communities approved the CPA last year and another 28 joined in 2005. Five communities –Winchester, Hudson, Lunenburg, West Boylston and Phillipston – will vote on the CPA this spring, with more likely to follow in the fall.

Communities should receive a 100 percent state match this year, but the Community Preservation Coalition is projecting that the state match will drop in 2008, according to Katherine Roth, the coalition’s associate director.

Thomas Callahan, executive director of the Massachusetts Affordable Housing Alliance (MAHA), said cities and towns have been more eager to adopt the CPA because the program doesn’t rely on an annual appropriation from the state operating budget.

“There’s always skepticism when there is a state program like that Â… about whether the state match will be there,” said Callahan. “The funding mechanism was key to giving communities the confidence that the state match would be there.”

With the strong real estate market in recent years, the trust fund coffers have exceeded expectations. When the law was established, supporters anticipated the fund to draw anywhere from $25 million to $30 million, but the fund has been substantially higher each year. At one point in early 2003, the fund had as much as $60 million.

Still, with the exception of cities like Cambridge, Quincy, Newburyport and Peabody, CPA has mostly drawn clusters of suburban communities and few large and medium-sized cities.

Supporters, including MAHA, waged an unsuccessful campaign to bring the CPA to Boston in 2001, after facing stiff opposition from influential business leaders.

The CPA has been a harder sell to cities where voters aren’t keen on increasing their tax burden, particularly since cities tend to have more low- to moderate-income residents, according to supporters. And since urban areas are generally built-out, there aren’t a lot of opportunities to use CPA money for open space in many cities, Callahan explained.

The proposed bill tries to address that situation, according to Callahan. “It kind of acknowledges the work of some communities like Boston and Quincy, which have done a lot on affordable housing through inclusionary zoning or linkage fees,” he said.

When asked whether applying different rules to some cities would create controversy for communities that already have adopted the CPA, Callahan explained that it would benefit all communities by attracting more cities to the program and strengthening its influence.

“If there is a statewide constituency for the CPA, it would make it hard for any future Legislature or gubernatorial administration to tangle with it,” he said.

Roth said towns with the CPA have seen “an incredible windfall” that has spurred them to undertake projects they wouldn’t be able to afford. The activity has encouraged more towns to consider the CPA.

“We can barely keep up with demand,” said Roth. “We’re seeing a whole lot of interest in the program.”

The bulk of the CPA funding is being used for open space and affordable housing, according to a report issued by the Massachusetts Housing Partnership. More than 40 percent of CPA money has been spent for open space preservation statewide, while about 31 percent has gone for the creation of affordable housing, according to a survey by the Massachusetts Housing Partnership.

The majority of communities – 60 percent – have set aside less than 10 percent of CPA money on affordable housing, the study found.

“A number of communities that are doing affordable housing are doing it for the first time. They don’t have experience with planning and development of affordable housing, so it takes them a lot of time to get up to speed,” said Roth.

The law has led to the creation or preservation of 871 affordable housing units, 7,349 acres of conservation land and 300 historic sites, according to Clarke. It’s also been used to create 154 new parks, playgrounds and athletic fields, he said.

Two significant projects that were possible because of the CPA was the preservation of Surrenden Farm, 350 acres along the Nashua River in Groton, and Echodale Farm in Easthampton, said Craig McDonnell, Massachusetts director for the Trust for Public Land.

“The hope is to encourage more cities and towns to adopt the act. It has been a really important piece of conservation finance law that has enabled lots of excellent conservation projects to be funded in a fiscal climate that has been somewhat challenging for conservation generally,” said McDonnell.