How much money does a town get and for how long?
All land in the PILOT program is valued by the Department of Revenue following their guidelines for assessing State Owned Lands. The value set by DOR is then multiplied by the local commercial property tax rate. If land values ever depreciate or the tax rate drops, the payment does not decrease. The PILOT payment is guaranteed and made annually. 2013 PILOT Amounts
What is the difference between Watershed Management PILOT and other state Payments in Lieu of Taxes?
1. MWRA ratepayers pay the bill. Funds for the Watershed Management PILOT payments come from Massachusetts Water Resources Authority (MWRA) rate payers who use the reservoir waters; the MWRA provides funding to the DCR to make PILOT payments to the watershed towns. Unlike other PILOT programs for state-owned lands, which are disbursed through the State's Local Aid program ("Cherry Sheets") and are subject to legislative appropriation (currently 76% of full value), the Watershed Management program is paid in full directly to each community. The DCR payment does not appear on the Cherry Sheet.
2. DCR PILOT utilizes the local commercial tax rate. The PILOT which is distributed through the "Cherry Sheet" is based on a statewide average of residential tax rates calculated by The Department of Revenue Division of Local Services . Watershed Management PILOT is required to utilize each community's commercial tax rate in calculating the PILOT obligation.
3. The payment can never be less than the previous year. MGL c. 59, §5G states that Watershed Management PILOT can never be less than the previous year's payment. This "hold harmless" clause provides the watershed communities the security of level funding even if a drop in valuation or tax rate combines to lower the calculated PILOT. This requirement will provide over $650,000 to watershed communities in FY11.
What is the difference between the Watershed Management PILOT Program and Chapter 61 land?
The Watershed Management PILOT program land is owned by the Commonwealth of Massachusetts. Chapter 61 land is privately owned with property taxes abated 95% in exchange for a commitment to keep the land in active forest use for 10 year intervals. The Chapter 61 program is managed by the Forestry & Fire Control section of the DCR.
Is the per-acre PILOT payment the same in all 30 communities?
No, there is a wide variation in the per-acre PILOT payment from community to community. This is due to varying real estate prices, which are a key factor in determining land valuation, and local tax rates.
What kind of activities are allowed on Watershed Management PILOT land?
The primary goal of the DCR Division of Water Supply Protection is to assure the highest possible water quality. This means that it is essential that the land remain in as pristine and undisturbed condition as possible. Public access is allowed on all but the most critical lands. In order to protect the water supply, activities are generally limited to passive recreation such as hiking, nature study and in some areas, fishing and hunting are permitted. Please visit the public access web page for more information about public access to DCR Division of Water Supply Protection land.
What are the economic benefits of Watershed Management PILOT?
All lands in a community pose some financial burden to that community. This burden is dependent on the type of land use. Examples of community costs are school systems, roadways, utilities, police and fire services. Since PILOT lands will always remain in their natural state and are actively maintained by the DCR, they pose minimal financial burden on the host community.
The American Farmland Trust has been conducting studies that investigate the financial burden of major land use categories in Massachusetts and throughout the country. These studies compare the average dollar cost of services for residential land, commercial/industrial land, and farm/forest/open land to the property tax dollar collected. In the AFT "Cost of Community Service Studies" Fact Sheet, it is reported that farm/forest/open land cost only $0.35 of each tax dollar, commercial/industrial cost $0.29 for each dollar collected, while residential land yielded a net loss, costing $1.16 for each tax dollar collected.