This summary is intended to provide general information about municipal revenues and special funds under Massachusetts law. It is not designed to address all questions or issues about these revenues or funds. Nothing contained in this summary changes the laws that govern municipal revenues and special funds.
REVENUE TREATMENT -A fundamental principle of municipal finance in Massachusetts is that all revenue received or collected from any source by a city, town or district department or official belongs to the general fund and can be spent for any lawful purpose only after appropriation by the legislative body. G.L. c. 44, § 53. No revenues can be segregated from the general fund into a separate fund to be reserved for specific purposes or spent without appropriation unless expressly authorized by a statute (general law or session act).
GENERAL FUND REVENUES (Estimated Receipts)Definition: all unrestricted revenues, including real and personal property taxes, other local taxes, such as excises, special assessments and betterments, unrestricted local aid, investment and rental income, voluntary and statutory payments in lieu of taxes and other receipts not expressly dedicated by statute. The anticipated general fund revenues for a fiscal year constitute the tax levy as a financing source (raise and appropriate), which may be appropriated until the tax rate is set. Collections during the year above the estimates used to set the rate are not ordinarily available for appropriation until after the close of the fiscal year and certification by the Director of Accounts as part of the municipality’s undesignated fund balance (free cash). G.L. c. 59, § 23.
posted by Jeff Bennett