Author: Municipal Finance Legal Guidance
This month's Ask DLS features frequently asked questions concerning special education reserve funds. Please let us know if you have other areas of interest or send a question to cityandtown@dor.state.ma.us. We would like to hear from you.
What is a special education reserve fund?
Chapter 218, §24 of the Acts of 2016 entitled An Act Modernizing Municipal Finance and Government provides for the establishment of a special education reserve fund. The special education reserve fund is a local option that enables municipal and regional school districts to establish a reserve fund that can be used in future years for unanticipated or unbudgeted costs of special education, out-of-district tuition or transportation costs.
How is the special education reserve fund established under G.L. c. 40, § 13E?
To establish the special education reserve fund, a majority vote of both the school committee and the local legislative body is required. For a town, the legislative body is Town Meeting. For a city, the legislative body is City Council. For regional school districts, the local legislative body means a majority vote of the legislative bodies in a majority of the regional school district’s members.
How may funds be appropriated into the special education reserve fund?
Once the fund is established, the school committee may include a separate line item in its annual budget to appropriate monies into the fund. However, the balance in such a reserve fund shall not exceed 2 percent of the annual net school spending of the school district.
How are funds expended from a special education reserve fund?
Funds can only be expended or transferred out after a majority vote of both the school committee and selectboard or city council. For regional school districts, approval must include a majority vote of the selectboards or city councils of a majority of the regional school district’s members.
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| Date published: | October 2, 2025 |
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