Legislation to Modernize Municipal Finance and Government Signed Into Law

The Massachusetts Legislature passed, and Governor Charles Baker recently signed into law, comprehensive legislation to modernize municipal finance and governance laws in Massachusetts, including provisions to eliminate or update obsolete laws, promote local independence, streamline state oversight, and provide greater flexibility for cities and towns.

“This legislation offers our cities and towns additional tools to improve their fiscal stability and streamline operations,” said Senator Jason Lewis.  “With municipalities routinely operating under tight financial pressures, this law will provide local governments with greater flexibility and independence.”

The new law eliminates or updates obsolete laws that no longer serve a meaningful purpose, including the repeal of county government finance reporting requirements and changes to the civil motor vehicle infraction law to allow cities and towns to issue citations electronically.

The law promotes local autonomy for cities and towns, allowing for more control over certain funding decisions and local regulations. For example, it allows municipalities to enter into joint powers agreements to provide services regionally and reduces the state’s role in setting liquor license quotas for on-premises drinking.  It also streamlines state oversight of many tax collection procedures to make the process more transparent and predictable for local officials.

Through a successful amendment to the legislation proposed in the Senate by Senator Lewis and in the House of Representatives by State Representative Michael Day of Stoneham, the bill provides an opportunity for school districts to better manage the unpredictable nature of special education costs.  Specifically, this bill would give municipalities the option of establishing a stabilization fund that could be used to help pay for unexpected and unbudgeted out-of-district special education costs, including tuition and transportation.  These expenses can present significant challenges for school budgets.

Finally, the law takes steps to provide municipalities with greater flexibility, including a study on double utility poles, changes to procurement laws to simplify, clarify and increase thresholds for construction contracts and updates to the way municipalities use parking revenues, to allow for use on a wide range of transportation-related issues.