In what is largely a win for municipalities, the Legislature unanimously passed the Municipal Modernization Act on the last day of the 2015-2016 session. The Bill should improve municipal administration, mostly over financial matters, by reducing red tape and a number of obsolete laws.
Many of these changes will go into effect in early November, but some apply retroactively, and the implementation of others is delayed until 2017.
Requiring municipal audits. The flip side of decreased DOR oversight is that municipalities must now commission periodic audits of their accounts using private accounting firms and DOR standards. Previously, towns and cities could ask DOR to conduct such audits, but were not required to do so.
Year-end appropriation transfers. The Bill eliminates limits on year-end appropriation transfers.
Massachusetts General Law on end of year financial transfers for cities & Towns:
MGL chapter 44, section 33B: (b) A town may, by majority vote at any meeting duly held, transfer any amount previously appropriated to any other use authorized by law. Alternatively, the selectmen, with the concurrence of the finance committee or other entity established under section 16 of chapter 39, may transfer within the last 2 months of any fiscal year, or during the first 15 days of the new fiscal year to apply to the previous fiscal year, any amount appropriated, other than for the use of a municipal light department or a school department, to any other appropriation.
