APPENDIX. PROVISIONS OF THE MUNICIPAL FINANCE ACT OF 1913 IN REGARD TO MUNICIPAL INDEBTEDNESS.1 SECTION 3. Cities and towns, and fire, water and watch districts, so-called, may, by a majority vote, incur debt for temporary loans in anticipation of the revenue of the financial year in which the debt is incurred and expressly made payable therefrom by such vote, and may issue a note or notes therefor to an amount not exceeding in the aggregate the total tax levy of the preceding financial year, together with the bank, corporation and street railway tax received during the preceding financial year, exclusive of special or additional assessments or revenue from any other source except payments made by the Commonwealth in lieu of taxes on account of property taken for institutions or for metropolitan district purposes. Such notes shall be payable, and shall be paid, not later than one year from the date thereof, and shall not be renewed or paid by the issue of new notes, except as is provided in section nine. SECTION 4. Cities and towns may, by a majority vote, incur debt for temporary loans for the payment of any land damages or any proportion of the general expenses of altering a grade crossing which they are required primarily to pay under the provisions of law, or any proportion of the expense of constructing a highway in anticipation of reimbursement by the Commonwealth, such reimbursement first to have been agreed upon by the Massachusetts Highway Commission, and may issue a note or notes therefor and for a period not exceeding one year from the date thereof; and when any money so paid is repaid to the municipality, it shall be applied to the discharge of the loan. Notes issued under the provisions of this section shall not be renewed or paid by the issue of new notes, except as is provided in section nine. SECTION 5. Cities and towns may incur debt, within the limit of indebtedness prescribed in this act, for the following purposes, and payable within the periods hereinafter specified: (1) For the construction of sewers for sanitary and surface drainage purposes and for sewage disposal, thirty years. (2) For acquiring land for public parks under the provisions of chapter twenty-eight of the Revised Laws and amendments thereof, thirty years. (3) For acquiring land for, and the construction of, schoolhouses or buildings to be used for any municipal or departmental purpose, including the cost of original equipment and furnishing, twenty years.2 1 Acts and Resolves of Massachusetts, 1913, Chap. 719. 2 Amended in 1916 (General Acts of 1916, Chap. 111) so as to authorize incurring of debt for purchase of land for any public purpose. (4) For the construction of additions to schoolhouses or buildings to be used for any municipal purpose, including the cost of original equipment and furnishings, where such additions increase the floor space of said buildings to which such additions are made, twenty years. (5) For the construction of bridges of stone or concrete, or of iron superstructure, twenty years. (6) For the original construction of streets or highways or the extension or widening of streets or highways, including land damages and the cost of pavement and sidewalks laid at the time of said construction, ten years. (7) For the construction of stone, block, brick or other permanent pavement of similar lasting character, ten years. (8) For macadam pavement under specifications approved by the Massachusetts Highway Commission, five years. (9) For the construction of walls or dikes for the protection of highways or property, ten years. (10) For the purchase of land for cemetery purposes, ten years. (11) For such part of the cost of additional departmental equipment as is in excess of twenty-five cents per one thousand dollars of the preceding year's valuation, five years. (12) For the construction of sidewalks of brick, stone, concrete or other material of similar lasting character, five years. (13) For connecting dwellings or other buildings with public sewers, when a portion of the cost is to be assessed on the abutting property owners, five years. (14) For the abatement of nuisances in order to conserve the public health, five years. (15) For extreme emergency appropriations involving the health or safety of the people or their property, five years. Debts may be authorized under the provisions of this section only by a vote of two thirds of the voters present and voting, or of two thirds of all the members of a city council or other governing body, taken by yeas and nays, and subject to the approval of the mayor, if such approval is required by the charter of the city. SECTION 6. Cities and towns may incur debt, outside the limit of indebtedness prescribed in this act, for the following purposes and payable within the periods hereinafter specified: (1) For temporary loans under the provisions of sections three, four or nine, one year. (2) For establishing or purchasing a system for supplying the inhabitants of a city or town with water, or for the purchase of land for the protection of a water system, or for acquiring water rights, thirty years. (3) For the extension of water mains and for water departmental equipment, five years. (4) For establishing, purchasing, extending or enlarging a gas or electric lighting plant within the limits of the territory within which such gas or electric lighting plant is authorized to distribute its product, twenty years; but the indebtedness so incurred shall be limited to an amount not exceeding in a town five per cent and in a city two and one half per cent of the last preceding assessed valuation of such town or city.1 (5) For acquiring land for the purposes of a public playground, as specified in section nineteen of chapter twenty-eight of the Revised Laws and amendments thereof, thirty years; but the indebtedness so incurred shall be limited to an amount not exceeding one half of one per cent of the last preceding assessed valuation of the city or town. Debts for all of the purposes mentioned in this section shall be payable within the periods above specified from the date of the first issue of bonds or notes on account thereof, and may be incurred in accordance with the provisions of existing law, except in so far as the same are inconsistent with the provisions of this act. All other debts hereafter incurred by a city or town shall be reckoned in determining its limit of indebtedness, and debts authorized under the provisions of this section, except for temporary loans, may be incurred only by a vote of two thirds of the voters present and voting, or of two thirds of all the members of a city council or other governing body, taken by yeas and nays, and subject to the approval of the mayor, if such approval is required by the charter of the city. SECTION 7. Cities and towns shall not incur debt for any purpose or for any period of time other than as specified in this act or in chapter six hundred and thirty-four of the acts of the year nineteen hundred and thirteen, and the proceeds of any sale of bonds or notes, except premiums, shall be used only for the purposes specified in the authorization of the loan. ... SECTION 12. Except as otherwise authorized by section six of this act, or by chapter six hundred and thirty-four of the acts of the year nineteen hundred and thirteen, a city shall not authorize indebtedness to an amount exceeding two and one half per cent, and a town shall not authorize indebtedness to an amount exceeding three per cent, on the average of the assessor's valuations of the taxable property for the three preceding calendar years, the valuations being first reduced by the amount of all abatements allowed thereon previous to the last day of December of the preceding calendar year. SECTION 14. Cities and towns shall not issue any notes payable on demand.. 1 Amended by General Acts of 1915, Chap. 115. BIBLIOGRAPHY. Constitutions of the various States. For citation of provisions dealing with limitations on municipal indebtedness, see above, pp. 6, 20 of report. Dillon, John F. Commentaries on the Law of Municipal Corporations (5th ed.) 5 vols. Boston, 1911. Vol. I, Chap. 6, pp. 336-438. McQuillin, Eugene. Treatise on the Law of Municipal Corporations. 6 vols. Chicago, 1913. Vol. 5, pp. 4679-4752. Massachusetts. Bureau of Statistics. Annual Report on the Statistics of Municipal Finances. Vols. 1-9. Boston, 1906-14. Especially vol. 7, 1912, pp. xi-xvii; vol. 8, 1913, pp. ix-xiii; and vol. 9, 1914, pp. ix-xvii. Bureau of Statistics. Report of a Special Investigation Relative Report of the Joint Special Committee on Municipal Finance, New York (City). Bureau of Municipal Research. New York City's Bureau of Municipal Research. The Purpose of the Indebtedness of American Cities, 1880-1912, by Fred E. Clark. Municipal Research No. 75, July, 1916. New York, 1916. (Comprehensive analysis of the purpose of municipal debts.) Department of Finance. The Business of New York City: Where the City gets its Money and How it spends it, by Wm. A. Prendergast, comptroller. New York, 1911. Madison, 1914. (Most com Secrist, Horace. An Economic Analysis of the Constitutional Restrictions upon Public Indebtedness in the United States, Bulletin of the University of Wisconsin, No. 637. prehensive treatise on the subject.) United States. Bureau of the Census. having a Population of over 30,000. Total and Per Capita of All Debts, 1915, pp. 296–301. Financial Statistics of Cities United States. Bureau of the Census. Wealth, Debt and Taxation, 1913. Washington, 1915. Vol. I, Part III, County and Municipal Indebtedness: 1913, 1902 and 1890; pp. 227-446. All the books named in the bibliographies printed with these Bulletins may be found in the room set apart for the Delegates to the Convention in the State Library. PUBLICATION OF THIS DOCUMENT APPROVED BY THE SUPERVISOR OF ADMINISTRATION. THE CONSTITUTIONAL CONVENTION 1917 BULLETIN No. 15 CONSTITUTIONAL RESTRICTIONS ON STATE DEBTS SUBMITTED TO THE CONSTITUTIONAL CONVENTION BY THE COM MISSION TO COMPILE INFORMATION AND DATA FOR THE USE OF THE CONSTITUTIONAL CONVENTION BOSTON WRIGHT & POTTER PRINTING CO., STATE PRINTERS 32 DERNE STREET |