Community Preservation Act (CPA)

At the April 25, 2022 annual election, the Town of Pepperell voted to adopt the provisions of the Community Preservation Act (CPA), in accordance with MGL CH 44B.

Beginning 7/1/22 on the 1st quarter of the Fiscal 2023 tax bills, the adoption requires a 1% local surcharge on annual real estate tax amounts due, calculated after an exemption of $100,000 on the residential value assessed.

The 1% surcharge shall be reserved and set aside from other municipal funds to implement the provisions of said Act, and to qualify the Town of Pepperell for funding from the Massachusetts Preservation Trust Fund.

What is the CPA?

The Community Preservation Act (CPA) is a tool that helps communities preserve open space and historic sites, create affordable housing, and develop outdoor recreational facilities. CPA also helps strengthen the state and local economies by expanding housing opportunities and construction jobs for the Commonwealth's workforce, and by supporting the tourism industry through preservation of the Commonwealth’s historic and natural resources. As of 6/27/2022, 189 municipalities in the state have adopted CPA.

In addition to the amounts that Pepperell tax payers contribute, there are annual distributions from the state’s Massachusetts community Preservation Trust Fund which add to the total collected.   These annual disbursements serve as an incentive for communities to pass CPA.

A community that accepts the CPA must establish a Community Preservation Committee which will make recommendations to Town Meeting regarding expenditures from the fund. Each year, Pepperell must spend or reserve at least 10% of the Fund’s annual revenues for each of the CPA’s community preservation purposes: open space, historic resources, and community housing.

For more information about CPA go to:

How the CPA is calculated:

The CPA adds an additional 1% surcharge onto your tax bill. $100,000 of the residential value will be taken from your residential property valuation before the surcharge is calculated.   For example:

Residential Property Value = $550,000

FY 2022 Tax Rate = $17.15

CPA Surcharge = 1%

Residential Value Exemption = $100,000

 Surcharge = ((Property Value - Value Exemption) * (Tax Rate/1000)) * CPA Surcharge

Surcharge = ((550,000 - 100,000) *.01715) * .01 = $68.60 total for all quarters

 

Commercial and Industrial properties do NOT get the benefit of the exemption. Mixed Use properties have the $100,000 exemption taken on the residential part of the property, if there is one.

Total Property Value = $750,000

Residential value (part) of the property: $300,000

FY 2022 Tax Rate = $17.15

CPA Surcharge = 1%

Residential Value Exemption = $100,000

 

Surcharge = (((Residential Property Value - Value Exemption) * (Tax Rate/1000)) * CPA Surcharge) + ((Commercial/Industrial Value*.01715) *.01)

Surcharge = ((300,000 - 100,000) *.01715) * .01 + ((450,000*.01715) *.01)

Surcharge = 34.30 + 77.18 = 111.48 total for all quarters

Who pays the CPA?

All real estate parcels pay into the CPA except for parcels that are fully exempt from property taxes. Based on what was voted, there is an automatic $100,000 exemption off the residential value of the property.  Mixed use parcels are reduced by the $100,000 exemption only on the part of the parcel that is residential use.  If the property receives any other exemptions or abatements, the CPA is reduced in proportion to the amount of the exemption or abatement.

Taxpayers who are eligible to defer property taxes CANNOT defer the CPA surcharge.

CPA Exemptions

Exemptions to the Community Preservation Surcharge are available to eligible moderate-income seniors (60+) and low-income residents. An application for exemption from the CPA surcharge must be filed annually by April 1st. Supporting documentation (see below) is required which will help the Assessor determine your eligibility for this exemption.

Residents that already receive a 41C (elderly) exemption will automatically receive the CPA surcharge exemption and do not have to apply for it separately.

Note: The application does not relieve the taxpayer from paying the surcharge while application is being reviewed. If an application is approved, the taxpayer will receive a refund of amounts already paid.

 

Applications should include:

  • Copy of most recent calendar year Income Tax Statement or, if unavailable, statements from all income sources as described below* to verify income
  • Birth Certificate/Driver's License to verify age
  • CPA Exemption Application

Income Requirements:

The Fiscal 2023 median income for a family of 4 for Pepperell's census district (Lowell, MA HUD Metro FMR Area) is $132,400.

Seniors (age 60 or over)

Non-Seniors

Household Size

Annual Income Limit

1

$92,680

2

$105,920

3

$119,160

4

$132,400

5

$142,992

6

$153,584

7

$164,176

8

$174,768

Household Size

Annual Income Limit

1

$74,144

2

$84,736

3

$95,328

4

$105,920

5

$114,394

6

$122,867

7

$131,341

8

$139,814

Requirements include:

  • Property must be residential.
  • Applicant must own and occupy the property as a domicile by January 1st. Any co-owners do not have to occupy the property as a domicile.
  • Applicant must qualify for a household annual income standard* for low-income housing based on the area-wide median income determined annually by the United States Department of Housing and Urban Development (HUD).
  • All owners must meet the income standard for low income housing as determined by HUD. See Income Table above.
  • To qualify as a senior, the applicant must be 60 or older as of January 1st.of the current fiscal year.
  • If you also qualify and receive a 41C exemption, you are automatically qualified for the CPA exemption and you do not need to submit a CPA Exemption Application.

*Annual Household income is income received from all sources regardless of income tax status for the calendar year by all members of the household 18 years or older who are not full-time students, less deductions for dependents other than a spouse, and certain medical expenses. Income includes wages, salaries, bonuses, public and private pensions, retirement income, Social Security, alimony, child support, interest and dividend income, net income from business, public assistance, disability and unemployment insurance, regular contributions and gifts from part outside the household.