At Annual Town Meeting, the jargon of municipal government fills the air, befuddling newcomers as well as many longtime residents. Here’s a guide to terms you may hear at the Bromfield School Saturday, May 4.
Articles
Items of business to be voted on at Town Meeting. This year’s Town Meeting warrant contains 37 numbered articles.
Available funds
Money that’s available in an account to meet unforeseen expenses or other one-time costs. Examples of available funds include free cash (see “Free Cash”), the Reserve Fund, and the Stabilization Fund.
Calculator (also known as the financial recap)
The calculator, which appears on page 12 of this year’s warrant booklet, is a forecast of town budgets through fiscal 2024. Though it includes future spending requests that may be revised or never approved, planners use its assumptions to anticipate future surpluses or deficits and take appropriate action. The assumptions used to create the forecasts are listed on page 11 of the booklet.
Capital budget
Capital projects, including land purchases, are those that cost more than $20,000 and have a useful life of more than five years. Pages 19-23 of the Town Meeting booklet list capital projects expected within the next five years. Projects typically paid for by transfers from the Capital Stabilization and Investment Fund are listed in pages 19-21, while major projects that will require borrowed money are listed on pages 22 and 23.
Community Preservation Fund (CPF)
The Community Preservation Act, adopted by Harvard in 2001, permits Harvard to levy a real estate surtax of 1.1% on Harvard properties with the possibility of matching funds provided by the state. The fund can be spent on open space preservation, preservation of historical resources, development of affordable housing, and the acquisition and development of outdoor recreational facilities. A minimum of 10% of the annual fund income must go toward each of the following: open space projects (excluding recreational uses), historical preservation projects, and affordable housing projects.
Debt exclusion (also known as excluded debt)
The principal and interest on debt for a particular project that is not subject to the levy limit. When Town Meeting approves a debt exclusion, it adds the cost of that debt to the Proposition 2½ levy limit for the life of the debt. A debt exclusion increases the tax rate for the life of the loan. A debt exclusion requires a two-thirds vote at Town Meeting and a majority vote at Town Election.
Fiscal year
Fiscal 2020 begins July 1, 2019, and ends June 30, 2020.
Free cash
Funds remaining from line items in Harvard’s previous year’s budget, plus revenue received in excess of budget, less any unpaid back taxes, and reduced by any fund deficits. These funds are certified each year by the state Department of Revenue and are then available to the town. If the money is not appropriated by June 30, it ceases to be available for use by the town until the next round of certification the following fiscal year.
General Fund
This account is used by the town for money received and spent, including federal and state reimbursements and local property taxes and fees. Money in the General Fund may be appropriated only by a majority vote of Town Meeting.
Home-rule petition
A petition to the state Legislature to enact special legislation pertaining to Harvard.
Levy
The amount of money that Harvard can raise through real and personal property taxes in any given fiscal year. The levy for fiscal 2020 is $26.9 million.
Local receipts
Income derived by the town from motor vehicle excise taxes, Transfer Station fees, licenses and permits, penalties and interest on taxes, and so on.
New growth
The additional tax revenue generated by new construction, renovations, and other increases in the property tax base during a calendar year. It does not include value increases caused by normal market forces or by revaluations. The amount is added to the levy limit in addition to the 2.5% increase allowed under Proposition 2½.
Omnibus budget
For convenience, all recommended appropriations for operating expenses of Harvard’s various town departments are gathered in one multipage article for the Annual Town Meeting. The period covered by the omnibus budget is the upcoming fiscal year. The fiscal 2020 omnibus budget can be found on pages 34 through 40 of the 2019 Annual Town Meeting booklet.
Override
A vote by the town to increase the levy limit allowed under Proposition 2½; always an option when there’s a deficit. Such an increase requires a majority vote at both a town meeting and an election. Since 1980, towns have been limited by Proposition 2½ in the amount of property tax they may levy without an override vote. This limitation requires an increase in the property tax to be held to no more than 2.5% of the previous year’s tax levy plus the value of taxable property added by new construction (new growth). Harvard’s last override was in 2009. None is requested for fiscal 2020.
Recap
A projection of all revenue and spending expected in the coming fiscal year. For comparison, it includes actual amounts for fiscal 2017 and 2018, budgeted amounts for fiscal 2019 and 2020, and projected amounts for fiscal 2021 through fiscal 2024. The recap appears on page 12 of the warrant booklet.
Reserve Fund
An annual fund established by a town meeting warrant article to cover extraordinary or unforeseen expenses during each fiscal year. Any department needing to spend more than its budget on a particular line item must ask the Finance Committee to make a transfer from the Reserve Fund. Sums not transferred by June 30 revert to the town’s overlay reserve. Town officials ask Town Meeting to transfer money into the fund each year to cover the extra cost of snow removal in a hard winter or unexpected spending for special education students.
Stabilization Fund
A permanent fund used to smooth out unexpected increases in budgeted expenses or to pay for capital projects. Harvard has two such funds: One is the Stabilization Fund, which covers unexpected increases in the town budget, and the second is the Capital Planning and Investment Fund for capital projects. Harvard’s bylaw requires the Stabilization Fund have a balance equal at least to 5% of the omnibus budget (not including excluded debt.) To appropriate money from either fund requires a two-thirds vote of Town Meeting.
Town Meeting
Harvard’s legislature, the meeting at which registered voters conduct the business of governing Harvard, including making laws and expending money.
Transfers
Money appropriated for use in a line item of Harvard’s omnibus budget and later proposed to be moved to another line item or to be expended for another purpose. It is also the money from any designated fund proposed for use in a warrant article. A transfer must be approved by a majority vote of Town Meeting.
Source: Municipal Glossary, Massachusetts Department of Revenue, Division of Local Services, July 2018, www.mass.gov/files/documents/2018/07/30/municipalglossary.pdf
