Sunday, August 5, 2018

Templeton Selectmen required to report to Advisory Committee; not the other way around;

This is per Templeton Town General By-Laws and state statute:

Article II - Town Meeting:
Section 6. All articles in any warrant for a town meeting shall be referred to the Advisory Committee for its consideration. The Selectmen after drawing any such warrant shall transmit immediately a copy thereof to the chairman of said committee. A public hearing shall be held, upon all such articles, unless a public hearing by some other tribunal is required by law, and a notice of such hearing shall be given by inserting in the local newspaper. Said committee shall, after due consideration of the subject matter of such articles, report thereon to the town meeting, in writing, such recommendations as it deems best for the interests of the town and its citizens. Copies of the report of the Advisory Committee shall be made available to the voters at least two days before town meetings and at all town meetings

(In this day, perhaps the above should be changed to "a copy to said committee or Advisory Committee as a whole"  as most of our Town's by-laws were crafted and approved prior to the arrival of e-mail.)

Article IV - Advisory Committee

Section 4a. All articles, other than those deemed by the Board of Selectmen to constitute an emergency, sought to be inserted in the Town Warrant for the Annual Town Meeting shall be filed with the Board of Selectmen, and referred by them to the Advisory Committee on or before April 10th and all articles sought to be inserted in the Warrant for a Special Town Meeting shall be referred by the Board of Selectmen to the Advisory Committee at least 14 days before the date set for such meeting.

End of Year TransfersThe state also specifies that only town meeting may transfer appropriated monies. Town meeting cannot delegate this authority to the finance committee (Chapter 44 s33B M.G.L.), (see also In Our Opinion, 92-836). However, in 2006 the state allowed the board of selectmen, with the approval of the finance committee, to transfer sums between May 1 and July 15. This does not apply to appropriations for the local or regional school systems or light boards. Transfers are by majority vote. Further, the courts have ruled generally that even though a town bylaw calls for the finance committee to hold public hearings, these hearings are “incidental” to the proper function of the committee and are therefore not mandatory (Young v. Westport, 302 Mass.597, reaffirmed by Illig v. Plymouth, 337 Mass. 239)

Reserve Funds:

The law (Chapter 40 Section 6 M.G.L.) allows towns to appropriate money — either at the annual or special town meeting — into a reserve fund “to provide for extraordinary or unforeseen expenditures.” DOR has expressed its opinion that reserve fund transfers are appropriate:to provide for urgent or unforeseen expenditures that could not have been anticipated before town meeting; and/or;to allow immediate expenditures of funds in the event of an emergency (threat to public safety or health) when the delay of having to call a special town meeting could be potentially harmful.In either case, the fiance committee must approve all proposed transfers from a reserve fund. It is also understood that a reserve fund should not be to reverse a vote of town meeting or as a “backdoor” means of increasing the budget. Finance committees should adopt their own reserve fund guidelines to supplement the state statute, and should help other town offials gain a better understanding of appropriate uses of a reserve fund.
In 1870, a group of Quincy citizens banded together to restore fiancial order in their municipality, creating the Commonwealth’s fist fiance committee. In 1910, the Massachusetts courts ruled that a municipal fiance committee was legal (Sinclair v. Fall River, 198 Mass 248). In that same year, the Massachusetts General Court also acknowledged the need for municipal fiance committees statewide, requiring all but the smallest municipalities to establish such committees to assist in dealing with emerging municipal challenges (St 1910, Ch. 130, s 2). Several additional legislative assists (i.e., St 1923, Ch. 388 and St 1929, Ch. 270), reinforced the mandated or permitted existence of municipal finance committees.

Massachusetts General Law, chapter 39
Section 16. Every town whose valuation for the purpose of apportioning the state tax exceeds one million dollars shall, and any other town may, by by-law provide for the election or the appointment and duties of appropriation, advisory or finance committees, who shall consider any or all municipal questions for the purpose of making reports or recommendations to the town; and such by-laws may provide that committees so appointed or elected may continue in office for terms not exceeding three years from the date of appointment or election.
In every town having a committee appointed under authority of this section, such committee, or the selectmen if authorized by a by-law of the town, and, in any town not having such a committee, the selectmen, shall submit a budget at the annual town meeting.

Budget preparation And submission
The prime functions of the finance committee are to review departmental budgets and submit a balanced budget to town meeting. All municipal officers authorized to spend money must annually provide the finance committee with estimates of how much funding will be needed “for the proper maintenance of the departments under their jurisdiction.” These estimates are submitted to the town accountant, or if there is none, to the finance committee or possibly the selectmen (Chapter 42 s.59 M.G.L.). These estimates are used in the
preparation of a town’s annual operating and capital budgets. The Massachusetts Department of Revenue (DOR) has ruled that finance committees are responsible for preparing and submitting their municipality’s annual budget (Chapter 39 s 16, Ch. 41, s 59 and s 60M.G.L.), unless there is a charter or
bylaw giving this authority to the board of selectmen or town manager (DOR’s In Our Opinion, 93-310). The exact format of an annual town budget is community specific. DOR has determined that while the law regarding annual municipal budget format is directed to cities, it should also be followed by towns.
The format found in the law addresses itself to budgetary basics. Almost all towns and cities in the Commonwealth go well beyond this in their annual budget presentation package (see Chapter 2). DOR has also ruled that only a town meeting — not the finance committee or selectmen — may determine the exact budget format to be used (see In Our Opinion, 92-145). As a practical matter, town meeting
would have to vote to reject the present format and request anew one for the following year.

Was Town Meeting asked to change the traditional budget format? If they were not asked, by what authority did the selectmen have to change the format? Has it resulted in less clarity concerning Taxpayer money?

Financial Policy of Templeton; by way of the board of selectmen.
Templeton Town website:

page 23 - H-3 Monthly and quarterly Reporting

Monthly reporting helps a community to determine whether sufficient funds are available to cover current obligations, any surplus can be invested, or shortfall exists requiring temporary borrowing.


The Town Accountant shall produce and distribute monthly budget to actual reporting to evaluate the Town's financial position per Massachusetts state law. These reports shall be submitted to the Board, user agencies, Town Administrator and Advisory Committee, among others. This will enable the Town to take prompt management action in the event that fiscal problems are indicated or adjust spending behavior to meet financial challenges.

The Town's Financial Team, accountant, treasurer/collector, principle assessor, shall make a formal public presentation to the board of selectmen and the status of accounts, their activities and concerns over negative trends each month following the ending of a fiscal year quarter together with any steps recommended by the Town Administrator to deal with such negative trends.

References: (none listed)

It is August 5, 2018 and still no report for June 2018. Not expected until late August, so much for policy. Back in 2016, a mere 2 years ago, there was a financial report (of sort) for the month of June, given out on June 28. Remember that there were over 60 financial transfers during that fiscal year. A monthly report is different from an end of the year report.

Accurate monthly reporting could help prevent something that happened regarding a one transfer where as it turned out, there was not enough money in a fund to use for a transfer and some money had to be transferred back into that particular fund. There is also the case of the totals being off as reported in an expenditure report. Again, if a policy is not to be followed, why have the policy in the first place?

I wonder if the Templeton selectmen ever read that per a ruling of the Department of Revenue; only Town Meeting, not the finance committee or selectmen may determine the exact budget format to be used.