CPF Futures Could Be Directed, In Part, To Water Quality Help If Tax Is Extended

Some of the authors of the original Community Preservation Fund legislation are pitching a new 20-year extension of the immensely successful preservation program, with an eye toward tapping a portion of the enormous bounty of the 2-percent real estate transfer tax to fund programs targeting water quality issues.

State and local lawmakers have held discussions about proposing a re-authorization of the CPF tax, which is currently in place through 2030, from 2030 through 2050, with a component allowing up to 10 percent of the revenues raised—potentially upward of $270 million over the 20-year period—to be directed toward water quality improvement efforts.

“The rationale is that while land preservation was the dominating policy issue since the 1980s, water quality has become the dominant issue of this decade,” State Assemblyman Fred W. Thiele Jr. said. “To preserve community character, our economy and environment, we must not just protect our land but also our water. At the same time, we are not finished with land preservation. We need to do both.”

Mr. Thiele said that forecasts of the CPF revenues during that 20-year period estimate the fund would take in approximately $1.5 billion. Some $270 million of that would be dedicated to water quality improvement projects, while $1 billion would still go toward land preservation, with the remainder going to stewardship and maintenance of existing projects and offsetting taxes.

In Southampton Town alone, some $156 million could be generated for water quality projects by the new CPF revenues over the 20-year extension.

“There is no question that the CPF is tied to the idea of protecting the environment as a critical component of community character and all that makes us the special place that we are,” Southampton Town Supervisor Anna Throne-Holst said this week. “Now that we are all so aware of the water quality crisis we are facing, and painfully aware of what a costly lift it is going to be to address that issue, it just fits into the whole idea of what that fund is tied to.”

In the three years since Stony Brook University scientists drew conclusive connections between residential septic systems and deepening water quality crisis in local bays, municipalities have struggled with the enormity of the expense that making a dent in the septic system problem presents. Towns have begun dedicating money to incentives for homeowners to upgrade aging septic systems—programs that were instantly popular but only able to fund a handful of upgrades. Thousands of homes need to be connected to more advanced septic systems to begin to reduce nitrogen levels at the rate necessary to affect water quality.

In Southampton Town, Ms. Throne-Holst’s administration and Stony Brook University staff have pitched the idea of creating a technology development hub on the East End to spur improvements in treatment systems that will reduce the amount of nitrogen released into groundwater. Ms. Throne-Holst said that she thinks improving septic technology is going to be the most important component of solving the water quality issues, and should be the recipient of substantial funds.

“We know there is a crisis, but we also know that there is no technology that reaches what we think is the standard we need to reach, at a realistic price point,” she said. “It’s a huge nut to crack.”

Compounding the problem, Mr. Thiele noted, is the fact that once-robust federal funding for water quality improvement efforts has vanished in recent decades. “Unlike the 1970s and 1980s, when the federal government paid 75 percent for water quality projects, today there is no federal money,” he said. “We are all looking at major capital expenditures being necessary to improve water quality, with no federal money and little state money to do the job.”

The CPF, however, has been a cash cow for preservation. Since being implemented in 1999, the program has raised more than $900 million for land preservation in the five East End townships. The CPF was reauthorized in 2009 with overwhelming support from voters. As home prices keep climbing, the income from the 2-percent tax has swelled steadily.

If the idea to direct some of the windfall toward water quality moves forward, there would have to be state legislation proposed to extend the CPF with the new caveat, and approval by the State Legislature. There would then have to be a referendum by voters in the five East End towns that participate in the CPF before the extension became law.