Questions and Answers

Updated December 2006

General Information | Using Land Bank Funds | Protecting Land Bank Properties | Miscellaneous

NOTE: In 2005, 13 of the 15 towns on Cape Cod voted to convert the Cape Cod Land Bank Act in their towns to the Community Preservation Act, thereby ending the Cape Cod Land Bank. Two, the towns of Chatham and Provincetown, having previously adopted the Community Preservation Act in addition to the Cape Cod Land Bank, have both preservation programs in place.

General Information

What is the Cape Cod Land Bank?

In 1998, the Massachusetts Legislature enacted the Cape Cod Open Space Land Acquisition Program for the purposes of acquiring land and interests in land to protect public drinking water supplies and open space and conservation land, and to create walking and bicycle trails and recreational areas. The Act required approval of the voters in each of the Cape's 15 towns through a referendum that was on the ballot in November 1998. The referendum passed in every town on Cape Cod. It expires in 2020.

How is the Land Bank funded?

The program is funded by a 3% surcharge on real estate property tax bills in each community beginning in FY 2000. This money is placed in a town land bank fund which is dedicated for this purpose and accrues interest. Additional sources of funds include a $15 million state matching program which was authorized in the Act (described below). Donations can also be made to the town land bank fund. Towns can bond in anticipation of future land bank revenue.

What is the role of the town open space committees?

Each town's board of selectmen or town council is required to create or designate a town open space committee to carry out the provisions of the Act. The committee can be an existing board, special committee, or nonprofit land trust/conservation organization. Committee members may not be paid for their service. Town committees are responsible for recommending to town meeting (town council in Barnstable) what lands or interests in lands should be acquired with town land bank funds.

How is land purchased?

Each acquisition of interests in land must be approved by a municipality's town meeting (or town council). If borrowing is involved a 2/3 vote is required, if not a simple majority is sufficient. The warrant article should reference the land bank as a funding source for the acquisition.

How soon can funds be spent?

Towns began collecting revenue in FY 2000. By the end of 1999, approximately 800 acres of land had been approved for purchase totalling close to $20 million.

What kind of land can be purchased with local land bank funds?

The Act permits the following kinds of land to be purchased: existing and future wellfields, aquifers and recharge areas; agricultural lands; forest lands; fresh and salt water marshes and other wetlands; ocean and pond frontage, beaches, dunes and other coastal lands; scenic vistas; nature or wildlife preserves; land and easements for trails; and land for recreational use. In addition to outright land purchase, the Act permits the acquisition of conservation restrictions or development rights from landowners.

Can a town use land bank funds to buy land for active recreation and facility construction?

The Act makes clear that funds can be used to purchase land for recreational uses. Land bank funds cannot be used to develop facilities beyond the 3% permitted for "maintenance and improvements." Section 3 of the Act makes clear that passive recreation facilities can be developed on lands purchased with land bank funds, so long as they are consistent with the purposes for which the land was acquired.

Can a town use land bank funds for up front costs associated with land acquisition (option payments, appraisals, surveys, P&S deposit)?

The Department of Revenue has stated that upfront costs associated with acquisition of real property interests can be funded with land bank funds, so long as they are made in good faith anticipation of purchase. A number of towns have received town meeting approval for the dedication of funds for this purpose.

Can money from one town be used to purchase land in another town?

Yes. The land is owned and managed by the town that acquires it.

Can land bank funds be used to maintain town conservation land?

The Act allows up to 3% of land bank funds to be used for maintenance and improvement of property purchased with land bank funds. Maintenance/improvement of other town conservation lands not purchased with land bank funds is not permitted.

Can land bank funds be used to administer the program (upgrading assessors equipment, paying staff salaries, etc.)?

No. The Mass. Department of Revenue has stated that this is not an allowable expense. Land bank funds must be used for acquisition of real property interests and associated costs.

What uses can occur on property protected with land bank funds?

The Act states that any land or interests in land purchased with land bank funds shall be retained in a "natural, scenic or open condition" and shall be bound by a permanent deed restriction limiting the use of the land or interest in land to the purpose for which it was acquired. The Act states that a deed restriction must be placed on the land that is enforceable by the either a state agency or a land trust. It is clear that improvements can be made for passive recreational purposes that are not inconsistent with the reasons for which the land was acquired. To be safe, a town should specify in its town meeting vote, the purposes for which the land is being acquired.

Can a town sell portions of land acquired with land bank funds (e.g. a parcel includes a house which could be divided off and sold)?

There is no provision in the Act that permits this, however a town could supplement land bank funds with other towns funds (e.g. general fund) to make such a purchase, and then use the proceeds from the sale to reimburse the town.

Can a town convert land bank properties to another use?

No. Properties that are purchased for conservation/open space purchases will be protected both by the deed restriction required in the Act, as well as by Article 97 of the Massachusetts Constitution. Article 97 requires that in order to remove a parcel from conservation use there must be approval by the conservation commission, board of selectmen, and town meeting/town council, as well as the Massachusetts legislature and the Secretary of Environmental Affairs.

Who owns and manages property purchased with land bank funds?

Section 4 of the Act requires property interests acquired with land bank funds to be owned and managed by the town that purchases them. However, the Board of Selectmen/Town Council may delegate management of lands to a qualified nonprofit organization or for wellhead sites to a water company/district or fire district. A management plan is not required to be prepared (unless state Self-Help funds are used) but may be helpful for large or complex properties.

Can a Board of Selectmen or Town Meeting override the recommendations of the town open space committee and purchase different properties?

The Act delegates the responsibility of making recommendations to town meeting to the town's open space committee. A Board of Selectmen may disagree with their recommendation, but the Act does not provide for the Selectmen to make different recommendations to town meeting. Town Meeting, of course, has the final say and may accept or reject the recommendations of an open space committee.

What should a town's open space committee consider in determining what land to protect?

Town open space committees are required to "use as a guideline" local and regional open space plans, master plans, and local comprehensive plans, if any in considering any specific acquisition.

Can a landowner take a charitable deduction for a bargain sale to the town?

Yes, a landowner can take a deduction for the difference between the appraised fair market value and the town's purchase price. A qualified appraisal will be required by the IRS.

Can a town opt out of the land bank?

There is no provision in the Act for a town to withdraw from participation in the Land Bank.

Are towns still eligible to apply for EOEA Self Help grants for land acquisition?

Absolutely. In fact the Act specifically states that the availability of land bank funds "shall not affect the eligibility of any town to receive funds" under these programs. A town must have an approved five year open space and recreation plan to be eligible for Self Help grants. The state has awarded 13 Self Help grants in 9 communities since the inception of the Land Bank, a total of $3,591,000.

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