Higher Interest Rates Provide Silver Lining for the CPA Trust Fund

While collections for the CPA Trust Fund this year have been trending downwards, there is a silver lining - higher investment returns have almost quadrupled the amount of interest being paid into the fund as of FY23.

The MA Department of Revenue (DOR) is charged with maintaining the statewide CPA Trust Fund - the funding source for the annual matching payments to CPA communities. But before the funds are paid out each November, DOR makes two adjustments to the fund balance: the interest that accrued during the year is added to the funds' bottom line, and then any DOR administrative costs are subtracted from the balance.

As you’ll see in the chart below, there's a double dose of good news for the CPA Trust Fund. First, revenue from interest has dramatically increased to over $220,000 in FY2023 (this is nearly four times the average annual interest earned since FY13). And the Department of Revenue has not deducted any administrative expenses over the past four years, leaving more funding available for CPA municipalities.

The Coalition requested these figures as part of our continuing effort to bring more transparency to CPA financial data. Earlier this year we partnered with DOR to publish the end-of-year accounting figures for each CPA community on DOR’s website. Municipalities self-report their CPA financial data to the state each year, detailing the CPA spending, account balances, category reserve amounts, interest and more for each CPA community for all years since 2008.