Finance Committee Tracks Revolving Funds

By Kim Siebert MacPhail

Town and School departments maintain accounts called “revolving funds” into which certain revenues are deposited. Town Meeting establishes the Town’s revolving funds; over time, thirteen such accounts have been approved for various departments including Library, Conservation, Selectmen (2), Facilities, DPW, Health, and Recreation (6).  At the November 15 Finance Committee meeting, member Meredith McCulloch reported about the status of the Town’s revolving funds. She will also make a presentation about the Schools’ revolving funds at a later date.

“Essentially,” said McCulloch, “a revolving fund is set up so that funds coming in are dedicated to the project for which funds are going out. There are strict rules under [Massachusetts General Law] Chapter 44, Section 53 E½ about setting a limit for how much will be in the fund and you have to say what it’s for. It’s not just general money; it has to be used for a specific purpose.”

According to McCulloch, the Library’s revolving fund was established fifteen or twenty years ago and it is where fines for overdue materials are deposited. The Library’s fund is limited to $17,000 and the money can be used to replace lost cards or damaged books and materials.  Fines received over that amount are diverted to the General Fund and appear on the Town ledgers as a component of Free Cash.

At Annual Town Meeting each spring, an article is dedicated to the reauthorization of the Town’s revolving funds. Additionally last spring, a revolving fund was established for the DPW for the Town’s new trash containers and refuse collection bags. Another was created for the Board of Health for flu clinics and the purchase of vaccines.

Other Town department revolving funds include:

Conservation:  A Wetlands Protection Revolving Fund is collected from applicant permit fees. The proceeds are used to purchase consultant services to “fulfill the work of the Commission.” Funds may not exceed $100,000.

Selectmen (2): Cable Television franchise fees are collected and used to purchase equipment, supplies, and services. The fund may not exceed $200,000.

Depot Park rental fees for use of the train are used to purchase equipment, supplies and services.  The Depot Park revolving fund may not exceed $75,000.

Facilities: Old Town Hall/Town Center rental fees are used to offset the cost of utilities, equipment, supplies and services. The fund cannot exceed $150,000.

Health: Monies from gifts and fees are used for public health programs such as clinics. The fund cannot exceed $25,000.

Recreation (6): These are funds derived from fees and passes that, in turn, fund programs and staff. No specific dollar limit on these funds was reported.

The Finance Committee expects to hear a report in January on the Schools’ revolving funds.

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