The ongoing pandemic has made it extremely difficult to predict what communities will receive from the CPA Trust Fund in November. Revenue for the Trust Fund comes from filing fees collected at the state's Registries of Deeds (home sales, mortgage filings, etc.), but no one knows what the real estate market will look like between now and November.
With that in mind, the Department of Revenue (DOR) has issued preliminary guidance on November's distribution to help municipalities finalize their FY21 budgets. In order to be conservative, the agency's projection is based solely on revenue that was collected before April and is currently sitting in the Trust Fund. Almost all of this revenue came in prior to the Governor's state of emergency order in March. DOR says they will issue an update as it becomes clearer what registry collections are looking like in the coming months.
The Department of Revenue is projecting an 11.2% first round trust fund distribution in November of 2020.
The pandemic hit just as the revenue for the Trust Fund began to climb dramatically - a result of the legislation passed last year to raise Registry fees for CPA. The higher fees kicked in on January 1, and as you can see from the month-by-month chart of Registry collections, the pre-pandemic reports were showing very positive results. With seven months to go until November’s distribution, the final percentage will undoubtedly be much higher than DOR’s current projection. The Coalition will continue efforts to have DOR issue updated projections as new data comes in.
Read DOR's full statement below:
FY2021 Community Preservation State Match - May 1, 2020
DLS customarily provides guidance on the estimated first round state match for the Community Preservation Act (CPA). While current events have made estimating the state match a challenge, we have calculated a conservative estimate for use in municipal budget discussions.
A change to fees collected by the Registry of Deeds went into effect on January 1, 2020. This change was implemented to boost the CPA trust fund balance to provide for a greater state match. The COVID-19 outbreak will undoubtedly have an impact on the transactions at the Registry of Deeds, however, and the magnitude of that impact is impossible to project. The best estimate we can provide, based on the current fund balance and an estimate of locally committed surcharges, would be a match of 11.2%.
We will provide updated guidance on the state match percentage as additional data becomes available.