CPA Matching Fund Projections for 2010
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The Massachusetts Department of Revenue (DOR) has issued an updated projection of the first round CPA Trust Fund distribution that communities can expect to receive this coming October. DOR is estimating the first round distribution will be between 31% and 32% of the amount that communities raise locally from their CPA surcharge.
This projection is higher than DOR's previous estimate of 28%, as Trust Fund revenues collected at the Registry of Deeds are up slightly from last year.
The formula DOR uses to distribute revenue from the statewide CPA Trust Fund on an annual basis is complicated. In order to better understand the formula used to distribute revenue from the Statewide CPA Trust Fund, the Community Preservation Coalition provides the following description of the general criteria applied.
The good news for Sudbury is that this will amount to another $400,000 – $450,000 allocation to the local CPA program in 2010.
Round One
Eighty percent (80%) of the total revenue in the Trust Fund at the end of August each year will be paid out in round one, and each of the CPA communities will receive the same percentage match to funds raised locally with their CPA surcharges. If a community’s CPA surcharge is less than 3%, it is not eligible to advance to the second and third round.
Rounds Two and Three
The funds remaining in the CPA Trust Fund after the first round distribution (20% of the total funds in the Trust Fund) are available for distribution in rounds two and three. Only communities that have adopted the maximum 3% surcharge are eligible to receive additional funding in rounds two and three. There are 74 communities with a 3% surcharge level (click here to see the list).
The second and third rounds are weighted so that smaller and less affluent communities receive higher funding. The state’s Commissioner of Revenue is charged with ranking CPA communities based on population and property valuation per capita. Based on this ranking, communities are divided into deciles, which determine the degree of additional funds distributed (click here to see the decile rankings).
Communities with the lowest equalized property valuations and smallest populations are placed in the most favorable deciles, which provide higher matches in the second and third rounds. Decile 1 provides the highest level of funding in rounds two and three (and decile 10 the lowest).
As a result of this weighting, it is possible that some smaller CPA communities will still end up receiving a 100% match by the end of the second round. The third round distribution is optional, at the discretion of the Commissioner of Revenue.
Want to know more?
The two documents below explain this formula in a bit more detail:
Click here for a sample calculation of the Trust Fund distribution formula (prepared by DOR)
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