Guide to Setting Up a Trust: Key Steps and Considerations
Explore essential steps and considerations for setting up a trust, including reading the warrant article, creating a declaration of trust, appointing trustees, understanding trust documents, and working with town offices and other boards and commissions. Learn about internal operations, including electing officials, managing finances, maintaining minutes, and collaborating with the administration for a successful trust setup.
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Presentation Transcript
Kathleen M. ODonnell, Esq. www.kathleenmodonnell.com kmeodonnell@verizon.net
Where to Start? Read the Warrant Article and the By-Laws adopted under the Article Do you have a Declaration of Trust? How many Trustees do you have? What other Town Offices do they hold, if any? Is there a good reason to have all of the Selectmen serve as Trustees?
Trust Documents Declaration of Trust - Why do you need one? What does it cover? Name of the Trust Purposes Tenure of Trustees Meetings Powers of Trustees Acts of Trustees how many do you need to sign Liability can t bind the Town Amendments Accounts Duration indefinite Trustees Certificates as evidence of authority
Trust Documents Record Declaration of Trust or Trust Certificate at Registry of Deeds Trustees should be appointed and a Trustees Certificate recorded at the Registry of Deeds
Internal Operations Elect Chair of Board of Trustees Elect Secretary Accounting: Statute does give Trust the authority open your own account but usually - Use the Town s Treasurer and Town accounts Establish protocols for reports from Treasurer to Trust to include updates on expenditures from Trust funds
Internal Operations Minutes Open Meeting Law requirements E-mail warnings Posting agendas Approved minutes, accounting, and votes should be maintained where??
Working with Other Boards and Commissions Boards of Selectmen Community Preservation Committee Housing Authority Housing Commission If the Trustees come from these entities, and they should, be sure that the Trustee remembers which hat he/she is wearing when making a decision
Working with Administration Is Town Administrator/Manager an ex officio member of the Trust? Town Treasurer need good working relationship if you expect timely, accurate, reports Do you have access to Town Counsel? Should you use Town Counsel Uniform Procurement Act Requests for Proposals
Funding Sources Money from inclusionary zoning 40B payments Tax lot sales need cooperation of Treasurer to limit sales to affordable housing purposes Community Preservation Act Gifts and donations in kind or in cash Form 8283 Gift acknowledgement
Working with CPA Funds Proposals to CPC Grant Agreements what are they and why you should have one Terms: Description of project or general grant? Amount of grant how and when are funds delivered to Trust Reporting requirements? Restriction required in return for funds? Compliance with Uniform Procurement Act?
Tasks Review existing Housing Plan for opportunities for development Consider use of funds as leverage for access to other funding sources Establish guidelines for expenditures for example - $150k per housing unit Use of funds for local housing needs, not necessarily for units on the Subsidized Housing Inventory
EXAMPLES OF TRUST ACTIVITIES Purchase land for affordable housing Acquire town owned parcels through transfer by town meeting vote or purchase at tax title auction Purchase restrictions on private construction projects Provide financing to non-profit developers in return for mortgage or additional affordable units
EXAMPLES DownpaymentAssistance Program - Provide funds to cover gap between market sale price and affordable price in return for deed rider Research potential zoning changes to allow development of affordable housing on grandfathered lots
EXAMPLES Allow accessory units through special permits Allow mixed use in commercial districts through special permits Inclusionary zoning Foreclosure prevention assistance through short term loans
Closing Requirements Purchase Uniform Procurement Act (c. 30B Section 16) can file uniqueness determination with Central Register Disposition no exemption for uniqueness must comply with c. 30B File Disclosure of Beneficial Interests (c. 7 Section 40J) with DCAM Don t forget the IRS need to file 1099S reporting the sale, obtain affidavit from seller that he/she is not a foreign person subject to backup withholding (FIRPTA)
