Sunday, October 11, 2020

Question of the Day: "Will there be enough money raised to accomplish something?"

Question of the Day: 
“I don’t mind paying more on my taxes for saving open space, but I don’t want to pay more for the other uses. If money raised gets split up, will it really ever be enough to do anything with?”
Answer: 
If we adopt the Community Preservation Act (CPA) at the 2% surcharge, the Town of Franklin has estimated that the amount raised each year could be over $1 Million a year. Since the law requires that at least 10% of each year’s income is set aside for the three categories, there should be at least $100,000 added to the 3 “buckets” each year. 

The funds designated for a particular category of use can never be used for a different category and will accumulate in that “bucket” until a project is approved. 

Therefore, the funds designated for Open Space/Recreation (which together are one category) cannot be used to fund projects in other categories. The funds set aside for each use remain available for future projects in that category. 

Another option under CPA allows the Town to borrow against the future CPA revenue if there is an expensive proposal or multi-year on which the Town wishes to act.

After 10% is assigned each year to the three "buckets," the remainder is available to use for any type of project, with a small amount available for administering the CPA. This undesignated account is 70% each year.

Three years into CPA, each bucket would have at least $300K and there would be approximately $2.1M in the undefined bucket. 

If a project for Open Space required $5M to purchase available farm land, the $300K plus some of the $2.1M would be short to fund the full project. The Town could go to finance the remainder committing future CPA funds to this.

So the answer is yes, the funds would take a few years to accumulate but should be enough to fund projects.
 

If you have a question about how the Community Preservation Act (CPA) works, please email CPA4Franklin@gmail.com

 

"Will there be enough money raised to accomplish something?"
"Will there be enough money raised to accomplish something?"


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