Understanding the Community Preservation Act
by Michelle Murdock, News Editor
March 8, 2010

The Community Preservation Act (CPA), signed into law on September 14, 2000, is statewide enabling legislation to allow cities and towns to exercise control over local planning decisions.  It allows cities and towns that accept its provisions to levy a property tax surcharge of up to three percent (3%) for the purpose of creating a local Community Preservation Fund and qualifying for state matching funds.

While towns use property taxes to provide for operating costs, until the passage of the Community Preservation Act, there was no steady funding source for preserving and improving a community’s infrastructure.   According to the Massachusetts Executive Office of Environmental Affairs (EOEA), “Community Preservation is dedicated to providing tools and programs to help local leaders and residents make information decisions about growth and development.”  It’s about “maintaining the quality of life in our municipalities by empowering cities and towns to preserve what is important to their individual character.” 

The Executive Office of Environmental Affairs’ (EOEA) website also states that “Community Preservation is not a "no growth" policy. Instead, Community Preservation promotes pro-active and careful decision-making to direct future development to the most suitable locations.”

Hopkinton voted to adopt the CPA on May 21, 2001 and adopted a CPA by-law in July 2001 with a surcharge of two percent (2%).  Prior to the adoption of CPA, Hopkinton relied upon the Open Space Preservation Fund and appropriations from the town’s Stabilization Fund for monies for open space.   The Open Space Preservation Commission was authorized by Town Meeting in 1998, and was approved by the State Legislature in 1999 and was the first of its kind.  Its role is to evaluate undeveloped land and to rank parcels according to a specific set of criteria.  Most of the funding for land purchases now comes from the monies collected under the Community Preservation Act (CPA).

CPA remains in effect for a minimum of five years after which it can be revoked by a majority vote at Town Meeting.  Exemptions are made for the first $100,000 of taxable value of residential real estate and for those would qualify for low-income housing.   For several years, Hopkinton had a history of 100% matching by the state and received $378,973 in 2002, $420,112 in 2003 and $513,429 in 2004.   The number of communities participating in the CPA match has grown from 34 communities in 2002 to 135 communities in 2009.  In recent years, state matching funds have dwindled, with Hopkinton receiving a 67% match in 2008 ($446,697) and only a 35% match or $236,718 in 2009.  

The funds collected in the Community Preservation Fund can only be used for the following purposes:

• The acquisition, creation and preservation of open space,
• The acquisition, preservation, rehabilitation and restoration of historic resources,
• The acquisition, creation and preservation of land for recreational use,
• The creation, preservation and support of community housing, and
• The rehabilitation or restoration of open space, land for recreational use and community housing

The statute mandates that at least 10 percent of the CPA funds be used for open space, 10 percent for housing, and 10 percent for historic purposes.  The remaining 70 percent can be allocated for any combination of the allowed uses and a maximum of five percent can be used for administering CPA.

CPA funds do not need to be used in the year that they are collected.  They can be set aside for future uses.  It is also possible to borrow money against anticipated CPA funds, however,  if a municipality issues bonds or notes, the surcharge necessary to repay debt service must remain in effect, even if the rest of the surcharge is otherwise revoked after five years.   While selectmen have suggested rethinking the CPA tax for fiscal year 2011, Hopkinton cannot eliminate it entirely and a Town Meeting vote would be required to reduce the tax to one percent; the amount needed to cover debt expenses.

There are five statutory members on the Community Preservation Committee (CPC) which include one member from each of the following town boards:  Conservation Commission, Historical Commission, Housing Authority, Parks and Recreation Commission and the Planning Board.  The CPC may include up to nine (9) members in total.

By statute, the CPC is constituted for the sole purpose of studying community preservation needs and making recommendations for expenditures. The committee consults with existing town boards and conducts at least one public hearing to solicit proposals of projects for possible funding recommendations.   Hopkinton’s CPC usually hold its public hearing in November. Final funding decisions are accomplished through Town Meeting articles in May.