Community Preservation Act Surcharge

Data on the CPA program

• The CPA program currently generates about $3 million per year. 
• Since 2014, the CPA program has given $18.2 million to affordable housing, $9.7 million to historic preservation projects, and $7.6 million to open space and recreation. 
• The City has borrowed against CPA revenue for projects that created over 100 units of affordable housing, and to construct an elevator in the West Branch Library. 
• $24 million in local revenue has generated $7 million in state match, and leveraged $315 million in funding from other sources.
• More information and a list of projects funded by CPA can be found in the FY25 Annual Report.

How much funding would the CPA surcharge increase generate?

• Increasing the CPA surcharge would grow the CPA program’s budget from $3 million to about $6 million per year.
• It would more than double the annual matching funds Somerville receives from the state.  
• This will enable the CPA program to give more funding to eligible projects to address community needs for affordable housing, open space, accessibility, and lifecycle upgrades to historic buildings.
• The maximum allowed under state law, a surcharge increase to 3% takes full advantage of the revenue generating tools available for these needs.

How will this impact property taxpayers?

• The average owner-occupied condo would see an annual increase of $38 per year.
• The average owner-occupied single family would see an increase of $93 per year.
• Low income homeowners and low-moderate income seniors can apply for full exemptions from the CPA surcharge (generous qualifying income levels). 

Who qualifies for exemptions from the CPA surcharge?

• The first $100,000 value of all residential and commercial property is exempt from the CPA surcharge.
• The surcharge is a percent of the property tax bill. Any other reductions in the property tax bill will be reflected in a reduced CPA surcharge.
• Low-income property owners and low to moderate income seniors can apply annually to be exempted from the CPA surcharge. See the table below for the income limits to qualify in 2024.
• These exemptions exist now and do not change under the proposed surcharge increase.
• To learn more about how to apply for property tax exemptions, visit the Board of Assessors page.
   

Ballot Question

Shall this City of Somerville amend its acceptance of the Community Preservation Act (Sections 3 to 7, inclusive of chapter 44B of the General Laws) as approved by the City Council, a summary of which appears below:

SUMMARY

The City of Somerville accepted the Community Preservation Act (Sections 3 to 7 of Chapter 44B of the General Laws of Massachusetts) and established a "Community Preservation Fund" with a dedicated funding source. Fund monies may only be spent on affordable housing, open space, and historic preservation, as follows: to (1) acquire, create and preserve open space, which includes land for park and recreational uses and the protection of public drinking water well fields, aquifers and recharge areas, wetlands, farm land, forests, marshes, beaches, scenic areas, wildlife preserves and other conservation areas, (2) rehabilitate and restore land for recreational use, (3) acquire, preserve, rehabilitate and restore historic buildings and resources, (4) acquire, create, preserve and support affordable housing and (5) rehabilitate and restore open space and affordable housing that was acquired or created with community preservation funds.

In the City of Somerville, the funding source currently is a 1.5% surcharge on the annual property tax assessed on real property. The City of Somerville has adopted the following exemptions from the annual surcharge: (1) property owned and occupied as a domicile by any person who qualifies for low income housing or low or moderate income senior housing in Somerville as defined in Section 2 of the Act; (2) $100,000 of the value of each taxable parcel of residential real property; and (3) $100,000 of the value of each taxable parcel of class 3, commercial property and class 4, industrial property as defined in Section 2A of Chapter 59.

This amendment will increase the surcharge from 1.5% to 3%. This amendment will take effect starting in fiscal year 2026, which begins on July 1, 2025. At least 10% of the funds for each fiscal year will be spent or reserved for later spending on each of the Act's three community preservation purposes: (1) open space, (2) historic resources and (3) community housing. The surcharge will continue to be calculated in the same manner by multiplying the real estate tax on the parcel by the adopted percentage. A taxpayer receiving a regular property tax abatement or exemption will also receive a pro rata reduction in the surcharge.