The Community Preservation Act - Frequently Asked Questions

What is a Community Preservation Fund?

The Community Preservation Act would amend the Town Law, authorizing towns to voluntarily establish, through local referendum, a fund to preserve natural areas and water resources, working farms, and historic architecture. Community Preservation Funds can be financed by a small real estate transfer fee, other gifts, and interest. The fee could be no higher than 2%, and would apply only to the amount of a real estate transfer above the median price for that particular county.

The purpose of such a fund is to develop and implement a preservation plan to protect community character by purchasing land from willing sellers. A town might also use the fund to establish a transfer of development rights bank, or to manage land that is acquired (utilizing up to 10 percent of the fund).

Will every town have to create a Community Preservation Fund?

No! Under the Community Preservation Act, New York's cities and towns choose whether or not to create a fund. To utilize this voluntary option, a town will have to take the actions outlined below. No community is required to take any action.

How could a Town use this Fund?

A town can use its fund to acquire easements or property to preserve community character, including, but not limited to: parks, nature preserves, recreation areas, open space, agricultural lands, lands of exceptional scenic value, marshes or wetlands, aquifer recharge areas, undeveloped beach lands or shoreline, wildlife refuges, unique or threatened ecological areas, natural river areas, forested lands, public access, stream rights, historic places and properties listed on the Historic Register or protected under a municipal historic preservation law, or lands to establish a greenbelt.

If the Community Preservation Act becomes law, what would a town have to do to use its authority?

To use this new tool, a town would have to adopt a local law; develop and adopt a Community Preservation Plan; and pass a voter referendum in a general election. There should be a public meeting prior to adoption of the Plan, and a hearing prior to the purchase of any property. Also, the town must establish an Advisory Board made up of five to seven town residents to review and make recommendations of expenditures from the Fund.

What is required in a Community Preservation Plan?

A town's plan should list and prioritize potential properties for acquisition. The plan must also look into alternatives for preservation, such as fee simple acquisition, zoning regulations, density reductions, cluster development, site plan or design requirements, transfer of development rights programs, purchase of development rights, and scenic and conservation easements.

The Plan must be completed 60 days before the voter referendum and updated at least every five years. It should also be filed with three New York State offices: Department of Environmental Conservation, Department of Agriculture and Markets, and the Office of Parks, Recreation, and Historic Preservation.

What other requirements apply to using preservation funds?

• No land can be acquired until there is a public hearing (as per section 247 of Municipal Law).
• Lands acquired shall be managed so as to "allow for public use, preserve native biological diversity, and limit improvements so as to protect ecological value and wildlife habitat, preserve cultural property."
• For management of the lands, towns may enter into agreements with land trusts.
• Once land is purchased, it cannot be sold or used for other purposes without an Act of the Legislature. (i.e. the requirements for the alienation of parkland would apply)

How does this bill amend the Tax Law?

This Act will amend the Tax Law (Section 1561) to allow towns to establish a real estate transfer fee. As described below, a town can impose a local law imposing a fee on real property over $500, at a rate of up to two percent, subject to a mandatory referendum pursuant to Section 23 of the Municipal Home Rule Law, after establishing a Community Preservation Fund pursuant to Section 64G of the Town Law. Sixty days after passage of a local law, the fee could go into effect.

Who would pay this fee in towns that exercised this option?

The fee would be paid by the buyer. The fee would be paid at the same time as the existing real estate transfer tax. Note that the fee would apply only to that portion of the sale price above the median price in that particular county.

What types of real estate transfers would be exempt from this fee?

Property transfers involving the State of New York, its agencies, political subdivisions, and corporations are exempt. So are transfers involving the U.S. government and the United Nations. Other exemptions include property transfers that are:

• used to secure a debt
• bona fide gifts
• in connection with a tax sale
• to merely change identity or form of ownership
• a deed of partition
• pursuant to the Federal Bankruptcy Act
• a contract or option without the use or occupancy of property
• for a conservation easement
• already have a restriction prohibiting development
• a purchase of development rights or transfer of development rights for conservation
• agricultural land subject to a restriction under Agriculture and Markets Law

There are also provisions for co-op housing, but the fee does apply.