Canton, Massachusetts · Saved source text
Fiscal Year 2025 Annual Comprehensive Financial Report pdf file
Saved text from 136 source pages. Transcription and OCR may contain errors; verify figures and wording against the original. Retrieved 2026-10-15.
Source page 41
All of the above items were considered when the Town developed its budget for fiscal year 2026. The
budget was adopted in May 2025 and the Town’s tax rate was certified in November 2025.
Requests for Information
This financial report is designed to provide a general overview of the Town’s finances for all those with
an interest in the government’s finances. Questions concerning any of the information provided in this
report or request for additional financial information should be addressed to the Office of the Finance
Director, 801 Washington Street, Canton, Massachusetts 02021.
Town of Canton, Massachusetts Page 33 of 128 Annual Comprehensive Financial ReportSource page 42
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Basic Financial Statements Town of Canton, Massachusetts Page 35 of 128 Annual Comprehensive Financial Report
Source page 44
TOWN OF CANTON, MASSACHUSETTS
STATEMENT OF NET POSITION
JUNE 30, 2025
Primary Government
Governmental Business-Type
Activities Activities Total
Assets
Cash and cash equivalents $ 58,340,510 $ 14,551,599 $ 72,892,109
Investments 19,882,445 - 19,882,445
Receivables, net:
Property taxes 800,522 - 800,522
Tax liens 1,788,221 70,906 1,859,127
User fees - 5,409,813 5,409,813
Departmental and other 1,954,288 - 1,954,288
Leases 4,345,603 - 4,345,603
Intergovernmental 5,680,769 - 5,680,769
Prepaid items 1,749 - 1,749
Deposit held by third party 47,242 - 47,242
Capital assets not being depreciated 28,874,966 7,274,910 36,149,876
Capital assets, net of accumulated depreciation 102,595,214 57,502,627 160,097,841
Total Assets 224,311,529 84,809,855 309,121,384
Deferred Outflows of Resources
Related to net pension liability 12,185,211 824,837 13,010,048
Related to net other postemployment benefits liability 5,191,471 185,167 5,376,638
Total Deferred Outflows of Resources 17,376,682 1,010,004 18,386,686
Liabilities
Warrants and accounts payable 4,615,335 101,102 4,716,437
Accrued payroll and withholdings 6,998,136 44,650 7,042,786
Retainage payable 96,885 - 96,885
Tax refunds payable 5,059,418 - 5,059,418
Health claims incurred but not reported 1,542,792 - 1,542,792
Accrued interest 221,897 199,593 421,490
Unearned revenue 632,180 - 632,180
Other liabilities 874,570 10,597 885,167
Noncurrent liabilities:
Due within one year 4,466,381 3,320,739 7,787,120
Due in more than one year 153,578,026 30,208,499 183,786,525
Total Liabilities 178,085,620 33,885,180 211,970,800
Deferred Inflows of Resources
Related to leased assets 4,345,603 - 4,345,603
Related to net pension liability 196,643 13,312 209,955
Related to net other postemployment benefits liability 15,671,907 558,978 16,230,885
Total Deferred Inflows of Resources 20,214,153 572,290 20,786,443
Net Position
Net investment in capital assets 103,085,438 40,151,793 143,237,231
Restricted for:
Nonexpendable permanent funds 652,385 - 652,385
Expendable permanent funds 1,692,771 - 1,692,771
Federal and State grants 2,356,958 - 2,356,958
Community preservation 2,757,297 - 2,757,297
District improvement fund 1,367,003 - 1,367,003
Gift funds 4,426,145 - 4,426,145
Unrestricted (72,949,559) 11,210,596 (61,738,963)
Total Net Position $ 43,388,438 $ 51,362,389 $ 94,750,827
See accompanying notes to basic financial statements.
Town of Canton, Massachusetts Page 36 of 128 Annual Comprehensive Financial ReportSource page 45
TOWN OF CANTON, MASSACHUSETTS
STATEMENT OF ACTIVITIES
FISCAL YEAR ENDED JUNE 30, 2025
Program Revenues Net (Expenses) Revenues and Changes in Net Position
Operating Capital
Charges for Grants and Grants and Governmental Business-Type
Functions/Programs Expenses Services Contributions Contributions Activities Activities Total
Primary government:
Governmental activities:
General government $ 9,247,583 $ 506,759 $ 1,505,479 $ - $ (7,235,345) $ (7,235,345)
Public safety 24,971,518 4,010,351 866,912 33,158 (20,061,097) (20,061,097)
Education 93,306,327 2,268,612 24,184,887 3,241,526 (63,611,302) (63,611,302)
Public works 11,792,012 346,841 133,315 857,585 (10,454,271) (10,454,271)
Health and human services 2,334,357 123,618 674,567 - (1,536,172) (1,536,172)
Culture and recreation 5,633,732 1,052,506 418,003 187,363 (3,975,860) (3,975,860)
Interest expense 750,146 - - - (750,146) (750,146)
Total governmental activities 148,035,675 8,308,687 27,783,163 4,319,632 (107,624,193) (107,624,193)
Business-type activities:
Water 8,447,488 11,291,416 - 241,077 $ 3,085,005 3,085,005
Sewer 7,466,072 8,171,260 - - 705,188 705,188
Rink 748,640 450,570 - - (298,070) (298,070)
Total business-type activities 16,662,200 19,913,246 - 241,077 3,492,123 3,492,123
Total Primary Government $ 164,697,875 $ 28,221,933 $ 27,783,163 $ 4,560,709 (107,624,193) 3,492,123 (104,132,070)
General Revenues:
Property taxes 98,320,774 - 98,320,774
Tax liens 252,804 - 252,804
Motor vehicle and other excise 6,153,780 - 6,153,780
Hotel and meals taxes 1,275,654 - 1,275,654
Payments in lieu of taxes 2,051,307 - 2,051,307
Grants and contributions not restricted
to specific programs 2,708,515 - 2,708,515
Penalties and interest on taxes 415,092 - 415,092
Unrestricted investment income 4,090,301 872,348 4,962,649
Transfers (net) (247,129) 247,129 -
Total general revenues and transfers 115,021,098 1,119,477 116,140,575
Change in Net Position 7,396,905 4,611,600 12,008,505
Net Position:
Beginning of year, as previously reported 36,953,367 46,750,789 83,704,156
Change in accounting principle (961,834) - (961,834)
Beginning of year, as restated (See Note IV) 35,991,533 46,750,789 82,742,322
End of year $ 43,388,438 $ 51,362,389 $ 94,750,827
See accompanying notes to basic financial statements.
Town of Canton, Massachusetts Page 37 of 128 Annual Comprehensive Financial ReportSource page 46
TOWN OF CANTON, MASSACHUSETTS
BALANCE SHEET
GOVERNMENTAL FUNDS
JUNE 30, 2025
Nonmajor Total
General ARPA Capital Governmental Governmental
Fund Grant Projects Funds Funds
Assets
Cash and cash equivalents $ 36,270,057 $ 632,180 $ - $ 17,973,581 $ 54,875,818
Investments 11,197,371 - - 1,355,947 12,553,318
Receivables, net of allowance for uncollectibles:
Property taxes 800,522 - - - 800,522
Tax liens 1,781,469 - - 6,752 1,788,221
Motor vehicle excise 558,074 - - - 558,074
Intergovernmental 168,123 - 3,241,526 2,271,120 5,680,769
Departmental and other - - - 1,232,943 1,232,943
Leases 4,345,603 - - - 4,345,603
Prepaid items 1,749 - - - 1,749
Due from other funds 5,226,621 - - - 5,226,621
Total Assets 60,349,589 632,180 3,241,526 22,840,343 87,063,638
Deferred Outflows of Resources - - - - -
Total Assets and Deferred Outflows of Resources $ 60,349,589 $ 632,180 $ 3,241,526 $ 22,840,343 $ 87,063,638
Liabilities
Warrants and accounts payable $ 2,585,854 $ - $ 1,005,189 $ 951,773 $ 4,542,816
Accrued payroll and withholdings 6,934,003 - 1,527 62,606 6,998,136
Retainage payable - - 96,885 - 96,885
Tax refunds payable 5,059,418 - - - 5,059,418
Unearned revenue - 632,180 - - 632,180
Other liabilities 872,619 - - 325 872,944
Due to other funds - - 3,571,745 1,654,876 5,226,621
Total Liabilities 15,451,894 632,180 4,675,346 2,669,580 23,429,000
Deferred Inflows of Resources
Unavailable revenues - property taxes 2,141,994 - - 6,752 2,148,746
Unavailable revenues - excise taxes 558,074 - - - 558,074
Unavailable revenues - other - - - 925,239 925,239
Unavailable revenues - leases 4,345,603 - - - 4,345,603
Total Deferred Inflows of Resources 7,045,671 - - 931,991 7,977,662
Fund Balances
Nonspendable 1,749 - - 652,385 654,134
Restricted - - 3,529,739 18,770,273 22,300,012
Committed 4,213,799 - - - 4,213,799
Assigned 5,072,078 - - - 5,072,078
Unassigned 28,564,398 - (4,963,559) (183,886) 23,416,953
Total Fund Balances 37,852,024 - (1,433,820) 19,238,772 55,656,976
Total Liabilities, Deferred Inflows of Resources,
and Fund Balances $ 60,349,589 $ 632,180 $ 3,241,526 $ 22,840,343 $ 87,063,638
See accompanying notes to basic financial statements.
Town of Canton, Massachusetts Page 38 of 128 Annual Comprehensive Financial ReportSource page 47
TOWN OF CANTON, MASSACHUSETTS
RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TOTAL FUND BALANCES TO THE STATEMENT OF NET POSITION
JUNE 30, 2025
Total Governmental Fund Balances $ 55,656,976
Capital assets used in governmental activities are not financial resources and therefore are
not reported in the funds. 131,470,180
Other long-term assets that are unavailable to pay current-period expenditures 3,632,059
Deferred outflows and inflows of resources to be recognized in future fiscal years
are not available resources and, therefore, are not reported in the funds:
Deferred outflows related to net pension liability 12,185,211
Deferred outflows related to net other postemployment benefits liability 5,191,471
Deferred inflows related to net pension liability (196,643)
Deferred inflows related to other net postemployment benefits liability (15,671,907)
Net effect of reporting deferred outflows and inflows of resources 1,508,132
Assets, deferred outflows of resources and liabilities and deferred inflows of resources of the
Town's internal service funds are included in the Statement of Net Position, but are not
reported in the governmental funds. 9,387,395
In the Statement of Activities, interest is accrued on outstanding long-term debt
whereas in the governmental funds interest is not reported until due. (221,897)
Long-term liabilities are not due and payable in the current period and therefore are not
reported in the government funds:
Bonds and notes payable (27,055,391)
Unamortized premiums on bonds (1,953,857)
Compensated absences (3,600,110)
Net pension liability (44,980,061)
Net other postemployment benefits liability (80,454,988)
Net effect of reporting long-term liabilities (158,044,407)
Net Position of Governmental Activities $ 43,388,438
See accompanying notes to basic financial statements.
Town of Canton, Massachusetts Page 39 of 128 Annual Comprehensive Financial ReportSource page 48
TOWN OF CANTON, MASSACHUSETTS
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
FISCAL YEAR ENDED JUNE 30, 2025
Nonmajor Total
General ARPA Capital Governmental Governmental
Fund Grant Projects Funds Funds
Revenues:
Property taxes $ 97,462,945 $ - $ - $ 828,605 $ 98,291,550
Tax liens 217,557 - - - 217,557
Intergovernmental 20,383,397 1,288,275 3,241,526 8,924,658 33,837,856
Motor vehicle and other excises 6,173,577 - - - 6,173,577
Hotel and meals taxes 1,275,654 - - - 1,275,654
Licenses and permits 1,359,485 - - - 1,359,485
Penalties and interest on taxes 415,092 - - - 415,092
Payments in lieu of taxes 2,051,307 - - - 2,051,307
Fines and forfeitures 65,325 - - - 65,325
Charges for services - - - 1,909,983 1,909,983
Departmental and other revenue 964,420 - - 3,738,932 4,703,352
Investment income 3,137,697 - - 353,704 3,491,401
Contributions and donations - - - 973,454 973,454
Total Revenues 133,506,456 1,288,275 3,241,526 16,729,336 154,765,593
Expenditures:
Current:
General government 5,129,897 654,135 229,754 672,557 6,686,343
Public safety 16,601,184 85,697 486,420 1,125,656 18,298,957
Education 59,327,022 24,600 6,535,587 9,894,738 75,781,947
Public works 8,806,222 185,906 949,126 654,662 10,595,916
Health and human services 1,146,989 6,388 - 463,279 1,616,656
Culture and recreation 3,397,200 95,059 3,619,658 1,916,578 9,028,495
Pension benefits 14,921,454 - - - 14,921,454
Employee benefits 15,032,735 - - 158,542 15,191,277
State and county assessments 1,531,897 - - - 1,531,897
Debt service:
Principal 3,316,211 - - 185,000 3,501,211
Interest 1,141,256 - - 38,740 1,179,996
Total Expenditures 130,352,067 1,051,785 11,820,545 15,109,752 158,334,149
Excess (Deficiency) of Revenues Over (Under) Expenditures 3,154,389 236,490 (8,579,019) 1,619,584 (3,568,556)
Other Financing Sources (Uses):
Transfers in 3,415,735 - 818,000 2,831,957 7,065,692
Transfers out (3,660,596) (236,490) (838,325) (2,577,410) (7,312,821)
Total Other Financing Sources (Uses) (244,861) (236,490) (20,325) 254,547 (247,129)
Net Change in Fund Balances 2,909,528 - (8,599,344) 1,874,131 (3,815,685)
FUND BALANCES - Beginning of year 34,942,496 - 7,165,524 17,364,641 59,472,661
FUND BALANCES - End of year $ 37,852,024 $ - $ (1,433,820) $ 19,238,772 $ 55,656,976
See acompanying notes to basic financial statements.
Town of Canton, Massachusetts Page 40 of 128 Annual Comprehensive Financial ReportSource page 49
TOWN OF CANTON, MASSACHUSETTS
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
FISCAL YEAR ENDED JUNE 30, 2025
Net Change in Fund Balances - Total Governmental Fund Balances $ (3,815,685)
Governmental funds report capital outlays as expenditures. However, in the Statement of
Activities the cost of those assets is allocated over their estimated useful lives and
reported as depreciation expense. The net amounts are reflected here as reconciling items:
Capital outlays 16,795,062
Depreciation expense (6,364,877)
Net effect of reporting capital assets 10,430,185
In the Statement of Activities, Internal Service Funds established to administer the Town's
health insurance and worker's compensation activities are included within the Statement of
activities whereas these activities are not presented in the Statement of Revenues,
Expenditures and Changes in Fund Balances. (1,598,748)
The issuance of long-term debt provides current financial resources to governmental funds,
while the repayment of the principal of long-term debt consumes the financial resources of
governmental funds. Neither has any effect on net position. Also governmental funds report
the effect of issuance costs, premiums, discounts, and similar items when debt is first issued,
whereas these amounts are amortized in the Statement of Activities. The net amounts are
reflected here as reconciling items:
Amortization of premiums on bonds and notes payable 359,419
Repayments of debt 3,501,211
Net effect of reporting long-term debt 3,860,630
Revenues in the Statement of Activities that do not provide current financial resources are
unavailable in the Statement of Revenues, Expenditures and Changes in Fund Balances.
Therefore, the recognition of revenue for various types of accounts receivable differ between
the two statements. The amount presented represents the difference in unavailable revenue. 315,216
In the Statement of Activities, interest is accrued on outstanding long-term debt;
whereas in governmental funds interest is not reported until due. The net
amount presented here as a reconciling item represents the difference in
accruals between this year and the prior year. 70,431
Some expenses reported in the Statement of Activities do not require the use of current
financial resources and therefore are not reported as expenditures in the governmental funds:
Compensated absences (144,004)
Pension benefits (1,807,954)
Other postemployment benefits 86,834
Net effect of reporting long-term liabilities (1,865,124)
Change in Net Position of Governmental Activities $ 7,396,905
See accompanying notes to basic financial statements.
Town of Canton, Massachusetts Page 41 of 128 Annual Comprehensive Financial ReportSource page 50
TOWN OF CANTON, MASSACHUSETTS
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
JUNE 30, 2025
Governmental
Business-Type Activities Activities
Total Internal
Enterprise Service
Water Sewer Rink Funds Funds
Assets
Current assets:
Cash and cash equivalents $ 6,415,122 $ 7,260,000 $ 876,477 $ 14,551,599 $ 3,464,692
Investments - - - - 7,329,127
Receivables (net):
User charges 3,076,597 2,333,216 - 5,409,813 -
Tax liens 31,852 39,054 - 70,906 -
Departmental and other - - - - 163,271
Deposit held by third party - - - - 47,242
Total current assets 9,523,571 9,632,270 876,477 20,032,318 11,004,332
Noncurrent assets:
Capital assets not being depreciated 5,873,953 1,400,957 - 7,274,910 -
Capital assets, net of accumulated depreciation 37,138,318 10,738,925 9,625,384 57,502,627 -
Total noncurrent assets 43,012,271 12,139,882 9,625,384 64,777,537 -
Total Assets 52,535,842 21,772,152 10,501,861 84,809,855 11,004,332
Deferred Outflows of Resources
Related to net pension liability 417,623 333,057 74,157 824,837 -
Related to net other postemployment benefit liability 127,727 49,120 8,320 185,167 -
Total Deferred Outflows of Resources 545,350 382,177 82,477 1,010,004 -
Liabilities
Current liabilities:
Warrants and accounts payable 90,456 8,888 1,758 101,102 72,519
Accrued payroll and withholdings 28,988 14,108 1,554 44,650 -
Health claims incurred but not reported - - - - 1,542,792
Accrued interest 179,087 20,506 - 199,593 -
Other liabilities 10,597 - - 10,597 1,626
Compensated absences 55,600 4,795 - 60,395 -
Bonds and notes payable 2,735,544 459,020 65,780 3,260,344 -
Total current liabilities 3,100,272 507,317 69,092 3,676,681 1,616,937
Noncurrent liabilities:
Compensated absences 166,801 14,386 - 181,187 -
Net other postemployment benefit liability 1,979,457 761,239 128,934 2,869,630 -
Net pension liability 1,541,597 1,229,436 273,742 3,044,775 -
Bonds and notes payable 20,108,061 2,342,683 1,662,163 24,112,907 -
Total noncurrent liabilities 23,795,916 4,347,744 2,064,839 30,208,499 -
Total Liabilities 26,896,188 4,855,061 2,133,931 33,885,180 1,616,937
Deferred Inflows of Resources
Related to net pension liability 6,740 5,375 1,197 13,312 -
Related to net other postemployment benefit liability 385,580 148,283 25,115 558,978 -
Total Deferred Inflows of Resources 392,320 153,658 26,312 572,290 -
Net Position
Net investment in capital assets 22,868,827 9,385,525 7,897,441 40,151,793 -
Unrestricted 2,923,857 7,760,085 526,654 11,210,596 9,387,395
Total Net Position $ 25,792,684 $ 17,145,610 $ 8,424,095 $ 51,362,389 $ 9,387,395
See accompanying notes to basic financial statements.
Town of Canton, Massachusetts Page 42 of 128 Annual Comprehensive Financial ReportSource page 51
TOWN OF CANTON, MASSACHUSETTS
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION
PROPRIETARY FUNDS
FISCAL YEAR ENDED JUNE 30, 2025
Governmental
Business-Type Activities Activities
Total Internal
Enterprise Service
Water Sewer Rink Funds Funds
Operating Revenues:
Charges for services $ 11,291,416 $ 8,171,260 $ 450,570 $ 19,913,246 $ -
Employee contributions - - - - 4,149,675
Employer contributions - - - - 12,646,869
Stop loss reimbursements - - - - 298,635
Total Operating Revenues 11,291,416 8,171,260 450,570 19,913,246 17,095,179
Operating Expenses:
Operating costs 3,868,047 1,608,107 401,517 5,877,671 -
Massachusetts Water Resources Authority assessment 2,757,416 5,206,605 - 7,964,021 -
Depreciation 1,390,176 630,263 304,144 2,324,583 -
Employee benefits - - - - 19,292,827
Total Operating Expenses 8,015,639 7,444,975 705,661 16,166,275 19,292,827
Operating Income (Loss) 3,275,777 726,285 (255,091) 3,746,971 (2,197,648)
Nonoperating Revenues (Expenses):
Investment income 441,097 382,494 48,757 872,348 598,900
Interest expense (431,849) (21,097) (42,979) (495,925) -
Total Nonoperating Revenues (Expenses) 9,248 361,397 5,778 376,423 598,900
Income Before Capital Contributions
and Transfers 3,285,025 1,087,682 (249,313) 4,123,394 (1,598,748)
Capital contributions 241,077 - - 241,077 -
Transfers in 238,099 4,530 4,500 247,129 -
Total Capital Contributions and Transfers 479,176 4,530 4,500 488,206 -
Change in Net Position 3,764,201 1,092,212 (244,813) 4,611,600 (1,598,748)
Total Net Position - Beginning of the Year 22,028,483 16,053,398 8,668,908 46,750,789 10,986,143
Total Net Position - End of the Year $ 25,792,684 $ 17,145,610 $ 8,424,095 $ 51,362,389 $ 9,387,395
See accompanying notes to basic financial statements.
Town of Canton, Massachusetts Page 43 of 128 Annual Comprehensive Financial ReportSource page 52
TOWN OF CANTON, MASSACHUSETTS
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FISCAL YEAR ENDED JUNE 30, 2025
Governmental
Business-Type Activities Activities
Total Internal
Enterprise Service
Water Sewer Rink Funds Funds
Cash Flows from Operating Activities:
Receipts from users $ 10,672,987 $ 7,472,920 $ 450,570 $ 18,596,477 $ -
Receipts from interfund services provided - - - - 16,966,809
Payments to employees (1,131,617) (550,598) (121,256) (1,803,471) -
Payments to vendors (5,496,356) (6,420,041) (268,206) (12,184,603) -
Payments for interfund services used - - - - (19,371,181)
Net Cash Provided by (Used in) Operating
Activities 4,045,014 502,281 61,108 4,608,403 (2,404,372)
Cash Flows from Noncapital Financing Activities:
Transfers in 238,099 4,530 4,500 247,129 -
Net Cash Provided by Noncapital
Financing Activities 238,099 4,530 4,500 247,129 -
Cash Flows from Capital and Related Financing Activities:
Proceeds from capital contributions 241,077 - - 241,077 -
Acquisition and construction of capital assets (3,975,844) (901,096) - (4,876,940) -
Principal payments on bonds and notes (2,706,000) (489,944) (55,000) (3,250,944) -
Interest payments on bonds and notes (820,643) (81,323) (51,201) (953,167) -
Net Cash Used in Capital and Related
Financing Activities (7,261,410) (1,472,363) (106,201) (8,839,974) -
Cash Flows from Investing Activities:
Investment income 441,097 382,494 48,757 872,348 598,900
Investment of operating cash - - - - (774,080)
Net Cash Provided by (Used in) Investing Activities 441,097 382,494 48,757 872,348 (175,180)
Net Change in Cash and Cash Equivalents (2,537,200) (583,058) 8,164 (3,112,094) (2,579,552)
Cash and Cash Equivalents:
Beginning of the year 8,952,322 7,843,058 868,313 17,663,693 6,044,244
End of the year $ 6,415,122 $ 7,260,000 $ 876,477 $ 14,551,599 $ 3,464,692
Reconciliation of Operating Income (Loss) to Net Cash
Provided by (Used in) Operating Activities:
Operating Income (Loss) $ 3,275,777 $ 726,285 $ (255,091) $ 3,746,971 $ (2,197,648)
Adjustments to reconcile operating income (loss) to net
cash provided by (used in) operating activities:
Depreciation 1,390,176 630,263 304,144 2,324,583 -
Changes in assets, deferred outflows of resources,
liabilities and deferred inflows of resources:
Receivables (618,429) (698,340) - (1,316,769) (128,370)
Amounts held by insurance carrier - - - - 14,558
Deferred outflows of resources 248,966 176,848 38,299 464,113 -
Accounts payable and accrued expenses (62,336) (204,522) 1,191 (265,667) (224,338)
Other liabilities - - - - 1,626
Health claims incurred but not reported - - - - 129,800
Net other postemployment liability (86,977) (33,449) (5,665) (126,091) -
Net pension liability (140,806) (112,293) (25,002) (278,101) -
Deferred inflows of resources 38,643 17,489 3,232 59,364 -
Net Cash Provided by (Used in) Operating
Activities $ 4,045,014 $ 502,281 $ 61,108 $ 4,608,403 $ (2,404,372)
Noncash capital and related financing activities:
Amortization of bond premium $ 376,005 $ 60,344 $ 8,222 $ 444,571 $ -
See accompanying notes to basic financial statements.
Town of Canton, Massachusetts Page 44 of 128 Annual Comprehensive Financial ReportSource page 53
TOWN OF CANTON, MASSACHUSETTS
STATEMENT OF FIDUCIARY NET POSITION
JUNE 30, 2025
Other Private
Postemployment Purpose
Benefits Trust Fund Trust Funds
Assets
Cash and cash equivalents $ 76,144 $ 190,647
Investments:
Equities 825,896 -
Equity mutual funds 10,445,409 -
Bond mutual funds 4,623,788 -
Total Assets 15,971,237 190,647
Liabilities
Warrants payable - -
Total Liabilities - -
Net Position
Restricted for other postemployment benefits 15,971,237 -
Restricted for private purposes - 190,647
Total Net Position $ 15,971,237 $ 190,647
See accompanying notes to basic financial statements.
Town of Canton, Massachusetts Page 45 of 128 Annual Comprehensive Financial ReportSource page 54
TOWN OF CANTON, MASSACHUSETTS
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FISCAL YEAR ENDED JUNE 30, 2025
Other Private
Postemployment Purpose
Benefits Trust Fund Trust Funds
Additions
Contributions:
Employer $ 5,983,049 $ -
Other - 3,000
Total contributions 5,983,049 3,000
Investment income:
Interest and dividends 589,626 17,865
Net appreciation in fair value of investments 938,691 -
Less - investment management fees (14,651) -
Net investment earnings 1,513,666 17,865
Total Additions 7,496,715 20,865
Deductions
Education - scholarships - 1,000
Retiree benefits 4,632,854 -
Total Deductions 4,632,854 1,000
CHANGE IN NET POSITION 2,863,861 19,865
NET POSITION AT BEGINNING OF YEAR 13,107,376 170,782
NET POSITION AT END OF YEAR $ 15,971,237 $ 190,647
See accompanying notes to basic financial statements.
Town of Canton, Massachusetts Page 46 of 128 Annual Comprehensive Financial ReportSource page 55
TOWN OF CANTON, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
YEAR ENDED JUNE 30, 2025
I. Summary of Significant Accounting Policies
The accompanying basic financial statements of the Town have been prepared in conformity with
generally accepted accounting principles (GAAP) as applied to state and local governments. GAAP
is prescribed by the Governmental Accounting Standards Board (GASB), which is the primary
standard-setting body for state and local government entities. The following is a summary of the more
significant policies and practices used by the Town:
A. Reporting Entity
The Town is located in Norfolk County, fifteen miles southwest of Boston and was incorporated
as a Town in 1797. An elected five-member Select Board (“the Board”) governs the Town and
an appointed Town Administrator oversees the Town’s daily executive and administrative duties.
The Town follows the open town meeting form of government. The Town provides
governmental services for the territory within its boundaries, including police and fire protection,
disposal of garbage and rubbish, public education in grades K-12, water and sewer services, street
maintenance, parks and recreational facilities.
Component units, while separate entities, are in substance part of the governmental operations if
the significance of their operations and/or financial relationship with the Town meet certain
criteria. Pursuant to these criteria there are no component units required to be included in the
financial statements.
The Town is a member community of the Blue Hills Regional Technical School that provides
educational services to nine area communities. This joint venture assesses each community its
share of operational and debt service costs based on student population and other factors. In
fiscal year 2025, the Town’s share of the operating and debt service expenses was $1,753,230.
There is no equity interest reported in these financial statements. Complete audited financial
statements can be obtained directly from the District’s administrative office located at 800
Randolph Street, Canton, Massachusetts 02021.
B. Government-Wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net position and the statement of
activities) report information on all of the non-fiduciary activities of the primary government and
its component units. For the most part, the effect of interfund activity has been removed from
these statements. Governmental activities, which normally are supported by taxes and
intergovernmental revenues, are reported separately from business-type activities, which rely
primarily on fees and charges for support.
Separate financial statements are provided for governmental funds, proprietary funds and
fiduciary funds, even though the fiduciary funds are excluded from the government-wide
financial statements. Major individual government funds and major individual enterprise funds
are reported as separate columns in the fund financial statements. Nonmajor funds are aggregated
and presented in a single column.
Town of Canton, Massachusetts Page 47 of 128 Annual Comprehensive Financial ReportSource page 56
Major Fund Criteria – Major funds must be reported if both of the following criteria are met:
1) The total assets and deferred outflows, liabilities and deferred inflows, revenues, or
expenditures/expenses of an individual governmental or enterprise fund are at least ten
percent of the corresponding element (assets and deferred outflows, liabilities and
deferred inflows, etc.) for all funds of that category or type (total governmental or total
enterprise funds), and
2) The total assets and deferred outflows, liabilities and deferred inflows, revenues, or
expenditures/expenses of the individual governmental fund or enterprise fund are at least
five percent of the corresponding element for all governmental and enterprise funds
combined.
Additionally, any other governmental or enterprise fund that management believes is particularly
significant to the basic financial statements may be reported as a major fund.
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources
measurement focus and the accrual basis of accounting. Under this method, revenues are
recorded when earned and expenses are recorded when a liability is incurred. Property taxes are
recognized as revenues in the fiscal year for which they are levied. Grants and similar items are
recognized as revenue as soon as all eligibility requirements imposed by the provider are met.
The statement of activities demonstrates the degree to which the direct expenses of a given
function or segment is offset by program revenues. Direct expenses are those that are clearly
identifiable with a specific function or segment. Program revenues include: 1) charges to
customers or applicants who purchase, use, or directly benefit from goods, services, or privileges
provided by a given function or segment and 2) grants and contributions that are restricted to
meeting the operational or capital requirements of a particular function or segment. Taxes and
other items not properly included among program revenues are reported instead as general
revenues.
The governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized when
susceptible to accrual (i.e. measurable and available). Revenues are considered to be available
when they are collectible within the current period or soon enough thereafter to pay liabilities of
the current period. Expenditures are recorded when the related fund liability is incurred, except
for unmatured interest on general long-term debt which is recognized when due, certain
compensated absences, claims and judgments which are recognized when the obligations are
expected to be liquidated with current expendable available resources.
The Town considers property tax revenues to be available if they are material and collected
within 60 days after the end of the fiscal year. Investment income associated with the current
fiscal period is susceptible to accrual and has been recognized as revenue of the current fiscal
period. All other revenue items are considered to be measurable and available only when the
cash is received and are recognized as revenue at that time.
Town of Canton, Massachusetts Page 48 of 128 Annual Comprehensive Financial ReportSource page 57
The government reports the following major Governmental Funds:
General Fund – is the government’s primary operating fund. It accounts for all financial
resources of the general government except those required to be accounted for in another
fund.
ARPA Grant Fund – is used to account for activities of the Town’s ARPA federal grant
program
Capital Projects Fund – is used to account for financial resources that are restricted,
committed or assigned to expenditures for capital outlays.
Nonmajor Governmental Funds – consist of special revenue, capital projects and permanent
funds that are aggregated and presented in the Nonmajor Governmental Funds column on the
Governmental Funds financial statements. The following describes the general use of these
fund types:
The Special Revenue Funds are used to account for the proceeds of specific revenue sources
that are restricted or committed to expenditures for specified purposes other than debt service
or capital projects.
The Permanent Funds are used to account for financial resources that are restricted to the
extent that only earnings, not principal, may be used for purposes that support the
governmental programs.
The proprietary fund financial statements are reported using the economic resources
measurement focus and the accrual basis of accounting. Under this method, revenues are
recognized when earned and expenses are recorded when the liabilities are incurred.
Proprietary funds distinguish operating revenues and expenses from non-operating items.
Operating revenues and expenses generally result from providing services and producing and
delivering goods in connection with a proprietary fund’s principal ongoing operations. The
principal operating revenues are user charges and fees, while operating expenses consist of
salaries, ordinary maintenance, assessments, indirect costs and depreciation. All revenues and
expenses not meeting this definition are reported as non-operating revenues and expenses.
The government reports the following major proprietary funds:
Water Enterprise Fund – is used to account for the operation of the Town’s water activities.
Costs associated with maintaining the related infrastructure and providing services to the
general public on a continuing basis, including depreciation, are financed or recovered
primarily through user charges.
Sewer Enterprise Fund – is used to account for the operation of the Town’s sewer activities.
Costs associated with maintaining the related infrastructure and providing services to the
general public on a continuing basis, including depreciation, are financed or recovered
primarily through user charges.
Rink Enterprise Fund – is used to account for the operation of the Town’s ice skating rink
activities.
Town of Canton, Massachusetts Page 49 of 128 Annual Comprehensive Financial ReportSource page 58
Additionally, the following proprietary fund type is reported:
Internal Service Fund – is used to account for the Town’s self-insured health insurance,
workers’ compensation, unemployment claims and building insurance activities. Because
these services primarily benefit governmental rather than business-type activities, they have
been included within governmental activities in the government-wide financial statements.
Fiduciary fund financial statements are reported using the economic resources measurement focus
and use the accrual basis of accounting. Fiduciary funds are used to account for assets held in a
trustee capacity and cannot be used to support the governmental programs.
The government reports the following fiduciary funds:
Other Postemployment Benefits Trust Fund – is used to accumulate funds for future payments
of other post-employment benefits for retirees such as health and life insurance.
Private-Purpose Trust Fund – is used to account for trust arrangements under which principal
and income benefit individuals, private organizations or other governments. This fund is
used for educational scholarships.
D. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position/Fund Balance
Deposits and Investments – The Town’s cash and cash equivalents are considered to be cash on
hand, demand deposits, and short-term investments with original maturities of three months or
less from the date of acquisition.
Investments of the Town are recorded at fair value in accordance with GASB Statement No. 72,
Fair Value Measurement and Application. Accordingly, the change in fair value of investments
is recognized as an increase or decrease to investment assets and investment income.
Receivables – Real estate and personal property taxes are assessed on January 1 every year. Bills
are sent quarterly and are due on August 1, November 1, February 1, and May 1, or thirty days
subsequent to the mailing date. Interest accrues on delinquent taxes at the rate of 14% per
annum. Motor vehicle excise are billed annually for each vehicle registered in the Town based on
vehicles reported to the Town by the Commonwealth of Massachusetts. Water and sewer user
fees are billed quarterly based on individual meter readings and are subject to interest and
penalties if not paid by the respective due dates. Property taxes, motor vehicle excise taxes and
water and sewer user fees are recorded as receivables in the fiscal year of the levy.
Real estate taxes and water and sewer user fees are secured through a lien process within 60 days
after the due date and are considered 100% collectible. Accordingly, an allowance for
uncollectible balances for these receivables is not reported. All personal property tax and excise
tax receivables are shown net of an allowance for uncollectible balances comprised of those
outstanding amounts greater than five years old. Other departmental receivables are shown net of
an allowance for uncollectible balances based on historical trends and specific account analysis.
The Town’s lease receivable is measured at the present value of lease payments expected to be
received during the lease terms. The payments are recorded as an inflow of resources in the
period the payments are received. Deferred inflows are recorded at the initiation of the leases in
an amount equal to the initial recording of the lease receivable. The deferred inflow of resources
is amortized using the effective interest method over the terms of the leases.
Town of Canton, Massachusetts Page 50 of 128 Annual Comprehensive Financial ReportSource page 59
Inventories – Inventories, which are not material to the basic financial statements, are considered
to be expenditures at the time of purchase.
Capital Assets – Capital assets, which include land, land improvements, buildings and
improvements, machinery and equipment, vehicles and infrastructure (e.g. roads, water and sewer
mains, and similar items), are reported in the applicable governmental or business-type activities
columns in the government-wide financial statements. Capital assets are recorded at historical
cost or estimated historical cost if purchased or constructed. Donated capital assets, donated
works of art and similar items, and capital assets received in a service concession arrangement are
reported at acquisition value rather than fair value. Interest incurred during the construction
phase of capital assets of business-type activities is included as part of the capitalized value of the
assets constructed.
All purchases and construction costs in excess of $25,000 are capitalized at the date of acquisition
or construction, respectively, with expected lives of greater than one year. The costs of normal
maintenance and repairs that do not add to the value of the asset or materially extend assets lives
are not capitalized.
Capital assets (excluding land and construction-in-process) are depreciated by the Town on a
straight-line-basis over the following estimated useful lives:
Land improvements 20-50 years
Buildings and improvements 20-50 years
Machinery and equipment 3-20 years
Vehicles 5 years
Infrastructure 40-50 years
Interfund Balances – Activity between funds that are representative of lending arrangements
outstanding at the end of the fiscal year are referred to as either due to/from other funds or
advances to/from other funds. All other outstanding balances between funds are reported as due
to/from other funds.
Any residual balances outstanding between the governmental activities and business-type
activities are reported in the government-wide financial statements as internal balances.
Interfund Transfers – During the course of its operations, resources are permanently reallocated
between and within funds. These transactions are reported as transfers in and transfers out in the
individual fund statements. Transfers between and within governmental and fiduciary funds are
eliminated from the governmental activities in the statement of activities. Any residual balances
outstanding between the governmental activities and the business–type activities are reported in
the statement of activities as transfers, net.
Investment Income – Excluding the permanent endowment funds, investment income derived
from major and nonmajor governmental funds is legally assigned to the general fund unless
otherwise directed by state law. Investment income of the proprietary funds is retained by those
funds. Net appreciation on permanent endowment funds is reported in expendable permanent
funds in the governmental activities.
Compensated Absences – It is the Town’s policy to permit employees to accumulate earned but
unused vacation, sick and compensatory time. Unused vacation and compensatory time is
accrued when it is more likely than not to be used for time off or otherwise paid in cash or settled
Town of Canton, Massachusetts Page 51 of 128 Annual Comprehensive Financial ReportSource page 60
through non-cash means. Sick leave is accumulated in various rates based on individual
collective bargaining agreements and is accrued only to the extent that leave is more likely than
not to be used for time off or otherwise paid in cash or settled through non-cash means. It is
assumed that when sick leave is taken the leave hours earned last are the first ones utilized or
paid. Compensated absence liabilities related to both governmental and business-type activities
are normally paid from the funds reporting payroll and related expenditures. Amounts related to
these benefits are estimated and recorded in the government-wide and proprietary fund financial
statements. A liability for these amounts is reported in Governmental Funds only if they have
matured.
Long-term Obligations – Long-term debt is reported as liabilities in the government-wide and
proprietary fund statement of net position. Bond premiums and discounts are amortized over the
life of the bonds using the effective interest method. Bond anticipation notes payable are reported
net of the applicable bond premium or discount.
In the governmental fund financial statements, the face amount of long-term debt issued is
reported as other financing sources. Premiums received on a debt issuance are reported as other
financing sources while discounts are reported as other financing uses. Issuance costs are
exclusively reported as general government expenditures regardless of whether they are withheld
from the actual proceeds.
Deferred Outflows/Inflows of Resources – In addition to assets, the statement of financial position
will sometimes report a separate section for deferred outflows of resources. This separate
financial statement element, deferred outflows of resources, represent a consumption of net assets
that applies to future periods and so will not be recognized as an outflow of resources
(expense/expenditure) until then. The Town has two types of items that are reported on the
government-wide statement of net position which relate to outflows from changes in the net
pension liability and the other postemployment benefit liability. The deferred pensions will be
recognized in pension expense in future years as more fully described in Note III, subsection A.
The deferred other postemployment benefits will be recognized in employee benefits expense in
future years as more fully described in Note III, subsection C.
In addition to liabilities, the statement of financial position will sometimes report a separate
section for deferred inflows of resources. This separate financial statement element, deferred
inflows of resources, represent an acquisition of net assets that applies to future periods and so
will not be recognized as an inflow of resources (revenue) until that time. The Town has three
items that are reported as deferred inflows of resources. The first arises under a modified accrual
basis of accounting and, accordingly, the item unavailable revenue is reported in the
governmental funds balance sheet. The governmental funds report unavailable revenues from
four sources: property taxes, excise taxes, leases and other. These amounts are deferred and
recognized as an inflow of resources in the period that the amounts become available. The other
items are reported on the government-wide statement of net position and relate to inflows from
leases and changes in the other postemployment benefit liability. The deferred lease revenues
will be recognized in charges for services and investment income in future years as more fully
described in Note II, subsection B. The deferred other postemployment benefits will be
recognized in employee benefits expense in future years as more fully described in Note III,
subsection C.
Net Position – In the government-wide financial statements, net position reported as “net
investment in capital assets” includes capital assets, net of accumulated depreciation, less the
Town of Canton, Massachusetts Page 52 of 128 Annual Comprehensive Financial ReportSource page 61
principal balance of outstanding debt used to acquire capital assets. Unspent proceeds of capital
related debt are not considered to be capital related debt.
Net position is reported as restricted when amounts are not available for appropriation or are
legally restricted by outside parties for a specific use. Net position has been restricted for the
following:
Nonexpendable permanent funds represent the endowment portion of donor restricted trusts
that support governmental programs.
Expendable permanent funds represent the spendable portion of donor restricted trusts that
support governmental programs.
Federal and State grants represent assets that have restrictions placed on them from federal
and state granting agencies.
Community preservation represents assets that are restricted by state law for the purposes of
acquiring or developing open space and recreational facilities, historic resources and
affordable housing.
District improvement fund represent assets that are restricted by state law for specific capital
purposes of the District improvement fund.
Gift funds represent assets that are restricted by donors for specific governmental programs
and uses.
Fund Balance – In the fund financial statements, fund balance for governmental funds is reported
in classifications that comprise a hierarchy based primarily to the extent in which the Town is
required to honor constraints on the specific purpose for which amounts in the funds can be spent.
Fund balance is reported in five components – nonspendable, restricted, committed, assigned, and
unassigned as described below:
Nonspendable represents amounts that cannot be spent because they are either (a) not in
spendable form (i.e. inventory or prepaid) or (b) legally or contractually required to be
maintained intact such as the corpus of an endowment.
Restricted represents amounts that have constraints placed either externally by third-parties
(creditors, grantors, contributors, or laws or regulations of other governments) or by law
through constitutional provisions or enabling legislation. Enabling legislation authorizes the
Town to assess, levy, charge or otherwise mandate payment of resources (from external
resource providers) and includes a legally enforceable requirement (compelled by external
parties) that those resources be used only for the specific purposes stipulated in the
legislation.
Committed represents amounts that can only be used for specific purposes pursuant to
formal action of the Town Meeting through Town Meeting Articles, which represent the
most binding constraint that give rise to committed fund balance. Those committed amounts
cannot be used for any other purpose unless the Town Meeting removes or changes the
Town of Canton, Massachusetts Page 53 of 128 Annual Comprehensive Financial ReportSource page 62
specified use by taking the same type of action (through Town Meeting Articles) it
employed previously to commit those amounts.
Assigned represents amounts that are constrained by the Town’s intent to be used for
specific purposes but are neither restricted nor committed. The Select Board has by
ordinance authorized the Finance Director to assign fund balance. The Town Meeting may
also assign fund balance as it does when appropriating fund balance to cover a gap between
estimated revenue and appropriations in the subsequent year’s appropriated budget.
Unassigned represents amounts that have not been restricted, committed or assigned to
specific purposes within the general fund. The general fund is the only fund that reports a
positive unassigned fund balance amount. Other governmental funds besides the general
fund can only report a negative unassigned fund balance amount.
When both restricted and unrestricted resources are available for use, it is the Town’s policy to
use restricted resources first, then unrestricted resources (committed, assigned and unassigned) as
they are needed. When unrestricted resources (committed, assigned and unassigned) are available
for use it is the Town’s policy to use committed resources first, then assigned, and then
unassigned as they are needed.
The Town has not established financial policies with respect to maintaining minimum fund
balance amounts.
Stabilization Funds – The Town maintains a general stabilization fund, in accordance with
Massachusetts General Law Chapter 40, Section 5B. The fund may be used for any municipal
purpose upon the condition of a two-thirds vote of the Town Meeting. The balance of the fund
totals $11,483,653 at June 30, 2025 and is reported as unassigned fund balance in the General
Fund. Amounts are appropriated into the fund by a majority vote of the Town Meeting. There are
no requirements to make annual contributions to this fund.
The Town maintains a capital stabilization fund, in accordance with Massachusetts General Law
Chapter 40, Section 5B. The fund may be used for any municipal capital purpose upon the
condition of a two-thirds vote of the Town Meeting. The balance of the fund totals $4,278,881 at
June 30, 2025 and is reported as unassigned fund balance in the General Fund. Amounts are
appropriated into the fund by a majority vote of the Town Meeting. There are no requirements to
make annual contributions to this fund.
Encumbrances – The Town’s encumbrance policy regarding the general fund is to (1) classify
encumbrances that arise from the issuance of purchase orders resulting from normal purchasing
activity approved by the Finance Department as assigned, and (2) classify encumbrances that
result from an action of the Town Meeting as committed. Encumbrances of funds already
restricted, or committed are included within the classification of those fund balances and not
reported separately. The Town reports $869,078 of encumbrances from normal purchasing
activity in the general fund as assigned and $4,213,799 of encumbrances from Town Meeting
Articles in the general fund as committed. There are no encumbrances reported in any other fund.
Endowment Funds - The Town's endowment funds consist primarily of the Town's Cemetery
Trust Funds. The Select Board, acting as the Town's Cemetery Commissioners, make all
decisions as allowed under Massachusetts General Laws regarding the spending authority of
investment income. These amounts are reflected as restricted balances in the statement of net
position.
Town of Canton, Massachusetts Page 54 of 128 Annual Comprehensive Financial ReportSource page 63
The following table reflects the Town’s fund balance categorizations:
ARPA Capital Nonmajor
General Grant Projects Governmental Total
Nonspendable:
Nonexpendable trust funds $ - $ - $ - $ 652,385 $ 652,385
Prepaid items 1,749 - - - 1,749
Restricted:
School lunch - - - 1,787,364 1,787,364
Recreation revolving - - - 1,023,950 1,023,950
Human services revolving - - - 400,076 400,076
Library revolving - - - 186,697 186,697
Other Town revolving - - - 619,038 619,038
School revolving - - - 629,292 629,292
General municipal private grants - - - 336,118 336,118
Ambulance receipts reserved - - - 2,903,860 2,903,860
Community preservation - - - 2,742,007 2,742,007
Police grants - - - 309,336 309,336
Other Town grants - - - 160,057 160,057
School grants - - - 36,250 36,250
General municipal donations - - - 3,320,577 3,320,577
School donations - - - 769,450 769,450
District improvement fund - - - 1,367,003 1,367,003
Human services other - - - 371,135 371,135
Roadway improvements - - 2,115,547 63,951 2,179,498
Building improvements - - 1,405,789 - 1,405,789
Other capital outlay - - 8,403 - 8,403
Library trust funds - - - 583,834 583,834
Conservation trust funds - - - 442,690 442,690
Other trust funds - - - 666,247 666,247
Other purposes - - - 51,341 51,341
Committed:
General government 122,727 - - 122,727
Police 824,653 - - - 824,653
Fire 1,537,944 - - - 1,537,944
Education 288,857 - - - 288,857
Infrastructure 678,913 - - - 678,913
Public buildings 197,171 - - - 197,171
Library 492,137 - - - 492,137
Other purposes 71,397 - - - 71,397
Assigned:
Information technology 129,697 - - - 129,697
Education 13,045 - - - 13,045
Fire department 163,890 - - - 163,890
Contract benefits 129,088 - - - 129,088
Town insurance 143,837 - - - 143,837
Other purposes 289,521 - - - 289,521
Subsequent years' budget 4,203,000 - - - 4,203,000
Unassigned 28,564,398 - (4,963,559) (183,886) 23,416,953
$37,852,024 $ - $ (1,433,820) $19,238,772 $55,656,976
Town of Canton, Massachusetts Page 55 of 128 Annual Comprehensive Financial ReportSource page 64
E. Excess of Expenditures Over Appropriations and Deficits
During the fiscal year, expenditures exceeded appropriations for state and county charges. This
deficit was funded through available revenues in the current year. The Town incurred individual
fund deficits totaling $4,963,559 and $183,886 in the Capital project major and nonmajor
governmental funds, respectively.
F. Use of Estimates
The preparation of basic financial statements in conformity with GAAP requires management to
make estimates and assumptions that affect the reported amounts of assets and liabilities and
disclosure for contingent assets and liabilities at the date of the basic financial statements and the
reported amounts of the revenues and expenditures/expenses during the fiscal year. Actual results
could vary from estimates that were used.
II. Detailed Notes to All Funds
A. Deposits and Investments
A cash and investment pool is maintained that is available for use by all funds. Each fund type’s
portion of this pool is displayed on the balance sheet as “cash and cash equivalents”. The
deposits and investments of trust funds are held separately from those of other funds.
State laws and regulations require the Town to invest funds only in pre-approved investment
instruments which include but are not necessarily limited to bank deposits, money markets,
certificates of deposit, U.S. obligations, repurchase agreements, and the State Treasurer’s
investment pool (the Pool). In addition, the statutes impose various limitations on the amount and
length of investments and deposits. Repurchase agreements cannot be for a period of over ninety
days, and the underlying security must be a United States obligation.
The Pool meets the criteria of an external investment pool. The Pool is administered by the
Massachusetts Municipal Depository Trust (the MMDT), which was established by the Treasurer
of the Commonwealth who serves as Trustee. The fair value of the position in the Pool is the
same as the value of the Pool shares.
Custodial Credit Risk: Deposits - In the case of deposits, this is the risk that in the event of a bank
failure, the government’s deposits may not be returned to it. The Town has adopted a policy that
no more than 25% of the Town’s cash may be comprised of unsecured bank deposits, except for a
30 day reprieve during times of heavy collections. The credit worthiness of banks will be tracked
by Veribanc, or other bank credit worthiness reporting systems, and the Treasurer will move or
collateralize deposits as a result of negative reports. At year-end, the carrying amount of the
Town's deposits was $35,077,588 and the bank balance was $35,502,038. Of the Town's bank
balance, $34,804,680 was covered by federal depository insurance or the Depositor’s Insurance
Fund; $613,785 was collateralized and the remainder was exposed to custodial credit risk because
it was uninsured and uncollateralized.
Custodial Credit Risk: Investments – In the case of investments, this is the risk that in the event of
the invested party not being able to provide required payments to investors, ceasing to exist, or
filing of bankruptcy, the Town may not be able to recover the full amount of its principal
Town of Canton, Massachusetts Page 56 of 128 Annual Comprehensive Financial ReportSource page 65
investment and/or investment earnings. The Town has adopted a policy to review the financial
institutions financial statements and the background of each advisor. All securities not held
directly by the Town will be held in the Town’s name and tax identification number by a third
party custodian and evidenced by safekeeping receipts showing individual CUSIP numbers for
each security. The investments in the MMDT are not exposed to custodial credit risk as their
existence is not evidenced by securities that exist in physical or book form. The Town’s
investment in a repurchase agreement is held by a counterparty, but not in the Town’s name. The
repurchase agreement is fully collateralized with U.S. government securities. The Town’s
investments in negotiable certificates of deposit are fully covered by federal depository insurance.
Fair Value of Investments – The Town reports its investments at fair value. The Town
categorizes its fair value measurements within the fair value hierarchy established by GAAP.
This hierarchy is based on valuation inputs used to measure the fair value of the asset or liability.
The three levels of the hierarchy are as follows:
• Level 1 – Inputs are quoted prices in active markets for identical investments at the
measurement date.
• Level 2 – Inputs (other than quoted prices included in Level 1) are either directly or
indirectly observable for the investment through correlation with market data at the
measurement date and for the duration of the instrument’s anticipated life.
• Level 3 – Inputs reflect the Town’s best estimate of what market participants would use
in pricing the investment at the measurement date.
The following table presents the Town’s investments carried at fair value on a recurring basis in
the statement of net position at June 30, 2025:
Fair Value Measurements Using
6/30/25 Level 1 Level 2 Level 3
Investments by fair value level
Debt securities:
U.S. government obligations $ 6,266,292 $ 5,813,441 $ 452,851 $ -
Corporate fixed income securities 6,281,323 - 6,281,323 -
Bond mutual funds 5,893,817 - 5,893,817 -
Total debt securities 18,441,432 5,813,441 12,627,991 -
Equity securities:
Common stock 6,890,697 6,890,697 - -
Equity mutual funds 10,445,409 - 10,445,409 -
Total equity securities 17,336,106 6,890,697 10,445,409 -
Total investments by fair value level 35,777,538 $ 12,704,138 $ 23,073,400 $ -
Investments measured at amortized cost
State investment pool 38,081,312
Total investments measured at fair value $ 73,858,850
Town of Canton, Massachusetts Page 57 of 128 Annual Comprehensive Financial ReportSource page 66
Debt and equity securities classified in Level 1 are valued using prices quoted in active markets
for those securities. Corporate fixed income securities, U.S. governmental obligations and bond
and equity mutual funds classified in Level 2 are valued using matrix pricing based on the
securities’ relationship to benchmark quoted prices. The State Treasurer’s investment pool
(MMDT) is valued at amortized cost. The MMDT’s investment advisor may value the pool using
an alternative valuation method that more accurately reflects the fair value in accordance with the
pools fair value pricing policies should amortized cost not approximate the fair value of the pool.
There are no restrictions or limits on withdrawals from the pool and no direct fees are charged to
participants.
Interest Rate Risk – The Town limits investment maturities as a means of managing its exposure
to fair value losses arising from increasing interest rates. The Town’s policy limits investments
of operating funds to one year or less.
At June 30, 2025, the Town had the following investments with maturities:
Maturities in Years
Investments 6/30/25 Less than 1 1-5 6 - 10
Corp. Fixed Income Securities $ 6,281,323 $ 835,405 $ 5,269,514 $ 176,404
U.S. government obligations 6,266,292 1,915,471 3,307,822 1,042,999
Bond mutual funds 5,893,817 5,893,817 - -
State investment pool 38,081,312 38,081,312 - -
Total investments with maturities $ 56,522,744 $ 46,726,005 $ 8,577,336 $ 1,219,403
Concentration of Credit Risk – The Town has adopted a policy to limit the amount of investments
that may be invested in a single issuer to 10% of the Town’s investments, except for U.S
government obligations, investments fully collateralized with U.S. government obligations and
the Pool (MMDT). At June 30, 2025, Town has 52% of its investments in the MMDT.
Credit Risk – The Town has adopted a policy to only purchase investment grade securities with a
high concentration in securities rated ‘A’ or better.
At June 30, 2025, the credit quality ratings of investments were as follows:
Corporate U.S. Government
Quality Ratings Fixed & Agency
(Moody's) Income Obligations Totals
AAA $ 688,950 $ - $ 688,950
Aa1 - 6,266,292 6,266,292
A1 820,975 - 820,975
A2 995,437 - 995,437
A3 1,570,814 - 1,570,814
Baa1 344,836 - 344,836
Baa2 1,860,311 - 1,860,311
Totals - All $ 6,281,323 $ 6,266,292 $ 12,547,615
The Town’s investments in bond mutual funds and the MMDT are unrated.
Town of Canton, Massachusetts Page 58 of 128 Annual Comprehensive Financial ReportSource page 67
B. Receivables
Receivables as of year-end for the Town's individual major and non-major governmental funds
in the aggregate, including the applicable allowances for uncollectible accounts, are as follows:
Gross Allowance for Net
Amount Uncollectibles Amount
Receivables:
Real estate and personal property taxes $ 800,522 $ - $ 800,522
Tax liens and foreclosures 1,788,221 - 1,788,221
Community preservation surcharges 8,538 - 8,538
Motor vehicle and other excise taxes 978,629 (420,555) 558,074
Ambulance fees 1,684,940 (794,868) 890,072
Public safety details 171,317 (66,210) 105,107
School fees 202,597 - 202,597
Street betterments 26,629 - 26,629
Leases 4,345,603 - 4,345,603
Intergovernmental 5,680,769 - 5,680,769
Total $ 15,687,765 $ (1,281,633) $ 14,406,132
Receivables as of year-end for Town's proprietary funds are as follows:
Gross Allowance for Net
Amount Uncollectibles Amount
Receivables:
Water user charges $ 3,076,597 $ - $ 3,076,597
Water liens 31,852 - 31,852
Sewer user charges 2,333,216 - 2,333,216
Sewer liens 39,054 - 39,054
Stop loss receivables 163,271 - 163,271
Total $ 5,643,990 $ - $ 5,643,990
Governmental funds report deferred inflows of resources in connection with receivables for revenues
that are not considered to be available to liquidate liabilities of the current period. The following
identifies the components of deferred inflows of resources in the governmental funds:
Other
General Governmental
Fund Funds Total
Receivable type:
Real estate and personal property taxes $ 360,525 $ - $ 360,525
Tax liens and foreclosures 1,781,469 6,752 1,788,221
Motor vehicle and other excise taxes 558,074 - 558,074
Community preservation surcharges - 8,538 8,538
Ambulance fees - 890,072 890,072
Street betterments - 26,629 26,629
Leases 4,345,603 - 4,345,603
Total $ 7,045,671 $ 931,991 $ 7,977,662
Town of Canton, Massachusetts Page 59 of 128 Annual Comprehensive Financial ReportSource page 68
Leases Receivable
The Town has entered into a lease for a photovoltaic electricity generating facility on Town land.
Under the lease, the tenant pays the Town an annual base rent of $300,000 which increases
annually by 2.5% for the initial term of twenty years, except for a 12.75% increase after year ten.
The tenant has the right to extend the initial term for one five-year period. The lease receivable is
measured as the present value of the future minimum rent payments expected to be received
during the lease term at a discount rate of 2.11%. In fiscal year 2025, the Town recognized
$370,836 of lease revenue and $65,530 of interest revenue under the lease.
The Town has entered into three leases for wireless communications equipment on Town land.
Under the leases, the tenants pay the Town annual base rents between $45,000 and $63,380 which
increases annually by between 2.0% and 3.0% for the initial terms of five to ten years. The
tenants have the right to extend the initial terms for three additional five-year periods. The lease
receivable is measured as the present value of the future minimum rent payments expected to be
received during the lease terms at discount rates between 2.52% and 3.99%. In fiscal year 2025,
the Town recognized $142,542 of lease revenue and $24,655 of interest revenue under these
leases.
The Town has entered into a lease for the operation of a restaurant at the Town’s Paul Revere
Heritage Site. Under the lease, the tenant pays the Town an annual base rent of $85,000 with
annual increases of between $5,000 and $15,000 per year for the ten year lease term. The lease
receivable is measured as the present value of the future minimum rent payments expected to be
received during the lease terms at discount rate of 5.39%. In fiscal year 2025, the Town
recognized $78,348 of lease revenue and $31,652 of interest revenue under the lease.
Future minimum lease payments as of June 30, 2025, are as follows:
Year Ending
June 30 Principal Interest Total
2026 $ 628,859 $ 105,762 $ 734,621
2027 596,894 89,039 685,933
2028 598,111 76,083 674,194
2029 635,009 56,157 691,166
2030 673,523 38,021 711,544
2031-2033 1,213,206 31,649 1,244,855
Total $ 4,345,602 $ 396,711 $ 4,742,313
Town of Canton, Massachusetts Page 60 of 128 Annual Comprehensive Financial ReportSource page 69
C. Interfund Receivables, Payables and Transfers
The composition of interfund balances at June 30, 2025 is as follows:
Receivable Fund Payable Fund Amount
General Fund Capital Projects Fund $ 3,571,745
General Fund Nonmajor Governmental Funds -
State Grants 1,445,505
General Fund Nonmajor Governmental Funds -
Roadway Improvements 209,371
$ 5,226,621
The outstanding balances between funds result mainly from the timing difference between the
dates that (1) reimbursable expenditures occur, (2) the intergovernmental reimbursements are
received and (3) the payments to the general fund are made.
The composition of interfund transfers for the fiscal year ended June 30, 2025 is as follows:
Transfers In
Capital Nonmajor Water Sewer Rink
General Projects Governmental Enterprise Enterprise Enterprise
Transfers Out Fund Fund Funds Fund Fund Fund Total
General Fund $ - $ 818,000 $ 2,831,957 $ 1,609 $ 4,530 $ 4,500 $ 3,660,596 (1)
ARPA Grant Fund - - - 236,490 - - 236,490 (2)
Capital Projects Fund 838,325 - - - - - 838,325 (3)
Nonmajor Governmental Funds 2,577,410 - - - - - 2,577,410 (4)
Total $ 3,415,735 $ 818,000 $ 2,831,957 $ 238,099 $ 4,530 $ 4,500 $ 7,312,821
(1) Transfers to capital projects for roadway capital, transfers to nonmajor governmental funds for retirement buyback reserves,
special education and capital outlays, transfers to water, sewer and rink enterprise funds for salary increases.
(2) Transfers to water enterprise fund for capital outlays.
(3) Transfers to general fund for fire department capital.
(4) Transfers to general fund to supplement operating budgets.
Town of Canton, Massachusetts Page 61 of 128 Annual Comprehensive Financial ReportSource page 70
D. Capital Assets
Capital asset activity for the year ended June 30, 2025, was as follows:
Beginning Ending
Balance Increases Decreases Balance
Governmental Activities:
Capital assets not being depreciated:
Land $ 15,017,961 $ - $ - $ 15,017,961
Construction in process 5,448,988 11,264,339 (2,856,322) 13,857,005
Total capital assets not being depreciated 20,466,949 11,264,339 (2,856,322) 28,874,966
Capital assets being depreciated:
Land improvements 4,837,918 - - 4,837,918
Buildings 97,153,630 653,036 - 97,806,666
Building improvements 33,797,961 - - 33,797,961
Machinery and equipment 14,401,090 3,709,626 - 18,110,716
Vehicles 10,179,290 656,790 - 10,836,080
Infrastructure 40,042,038 3,367,593 - 43,409,631
Total capital assets being depreciated 200,411,927 8,387,045 - 208,798,972
Less accumulated depreciation for:
Land improvements (2,952,097) (154,937) - (3,107,034)
Buildings (42,131,372) (2,432,335) - (44,563,707)
Building improvements (23,163,700) (1,144,468) - (24,308,168)
Machinery and equipment (10,823,465) (988,354) - (11,811,819)
Vehicles (8,247,826) (580,932) - (8,828,758)
Infrastructure (12,520,421) (1,063,851) - (13,584,272)
Total accumulated depreciation (99,838,881) (6,364,877) - (106,203,758)
Total capital assets being depreciated, net 100,573,046 2,022,168 - 102,595,214
Total governmental activities capital assets, net $ 121,039,995 $ 13,286,507 $ (2,856,322) $ 131,470,180
Beginning Ending
Balance Increases Decreases Balance
Business-Type Activities:
Capital assets not being depreciated:
Land $ 624,852 $ - $ - $ 624,852
Construction in process 9,158,051 2,212,430 (4,720,423) 6,650,058
Total capital assets not being depreciated 9,782,903 2,212,430 (4,720,423) 7,274,910
Capital assets being depreciated:
Buildings 18,758,743 - - 18,758,743
Building improvements 10,944,884 - - 10,944,884
Machinery and equipment 5,057,632 4,073,742 - 9,131,374
Vehicles 912,966 42,788 - 955,754
Infrastructure 66,203,065 3,268,403 - 69,471,468
Total capital assets being depreciated 101,877,290 7,384,933 - 109,262,223
Less accumulated depreciation for:
Buildings (7,831,755) (439,600) - (8,271,355)
Building improvements (1,064,853) (282,158) - (1,347,011)
Machinery and equipment (3,279,259) (367,273) - (3,646,532)
Vehicles (854,243) (23,832) - (878,075)
Infrastructure (36,404,903) (1,211,720) - (37,616,623)
Total accumulated depreciation (49,435,013) (2,324,583) - (51,759,596)
Total capital assets being depreciated, net 52,442,277 5,060,350 - 57,502,627
Total business-type activities capital assets, net $ 62,225,180 $ 7,272,780 $ (4,720,423) $ 64,777,537
Town of Canton, Massachusetts Page 62 of 128 Annual Comprehensive Financial ReportSource page 71
Beginning Ending
Balance Increases Decreases Balance
Business-type Activities: Water
Capital assets not being depreciated:
Land $ 624,852 $ - $ - $ 624,852
Construction in process 8,548,190 1,421,334 (4,720,423) 5,249,101
Total capital assets not being depreciated 9,173,042 1,421,334 (4,720,423) 5,873,953
Capital assets being depreciated:
Buildings 17,495,139 - - 17,495,139
Building improvements 241,742 - - 241,742
Machinery and equipment 3,085,014 3,963,742 - 7,048,756
Vehicles 912,966 42,788 - 955,754
Infrastructure 35,638,760 3,268,403 - 38,907,163
Total capital assets being depreciated 57,373,621 7,274,933 - 64,648,554
Less accumulated depreciation for:
Buildings (7,211,570) (408,010) - (7,619,580)
Building improvements (104,654) (12,087) - (116,741)
Machinery and equipment (2,284,308) (201,130) - (2,485,438)
Vehicles (854,243) (23,832) - (878,075)
Infrastructure (15,665,285) (745,117) - (16,410,402)
Total accumulated depreciation (26,120,060) (1,390,176) - (27,510,236)
Total capital assets being depreciated, net 31,253,561 5,884,757 - 37,138,318
Total Water capital assets, net $ 40,426,603 $ 7,306,091 $ (4,720,423) $ 43,012,271
Business-type Activities: Sewer
Capital assets not being depreciated:
Construction in process $ 609,861 $ 791,096 $ - $ 1,400,957
Capital assets being depreciated:
Buildings 1,263,604 - - 1,263,604
Buildings and improvements 99,685 - - 99,685
Machinery and equipment 1,647,868 110,000 - 1,757,868
Infrastructure 30,564,305 - - 30,564,305
Total capital assets being depreciated 33,575,462 110,000 - 33,685,462
Less accumulated depreciation for:
Buildings (620,185) (31,590) - (651,775)
Buildings and improvements (32,397) (4,984) - (37,381)
Machinery and equipment (924,074) (127,086) - (1,051,160)
Infrastructure (20,739,618) (466,603) - (21,206,221)
Total accumulated depreciation (22,316,274) (630,263) - (22,946,537)
Total capital assets being depreciated, net 11,259,188 (520,263) - 10,738,925
Total Sewer capital assets, net $ 11,869,049 $ 270,833 $ - $ 12,139,882
Town of Canton, Massachusetts Page 63 of 128 Annual Comprehensive Financial ReportSource page 72
Beginning Ending
Balance Increases Decreases Balance
Business-type Activities: Rink
Capital assets being depreciated:
Buildings $ 10,603,457 $ - $ - $ 10,603,457
Machinery and equipment 324,750 - - 324,750
Total capital assets being depreciated 10,928,207 - - 10,928,207
Less accumulated depreciation for:
Buildings (927,802) (265,087) - (1,192,889)
Machinery and equipment (70,877) (39,057) - (109,934)
Total accumulated depreciation (998,679) (304,144) - (1,302,823)
Total capital assets being depreciated, net 9,929,528 (304,144) - 9,625,384
Total Rink capital assets, net $ 9,929,528 $ (304,144) $ - $ 9,625,384
Depreciation expense was charged to functions/programs as follows:
Governmental Activities: Business-Type Activities:
General government $ 473,456 Water $ 1,390,176
Public safety 955,102 Sewer 630,263
Education 2,858,639 Rink 304,144
Public works 1,437,183 $ 2,324,583
Health and human services 87,208
Culture and recreation 553,289
$ 6,364,877
E. Temporary Debt
The Town is authorized to borrow on a temporary basis to fund the following:
Current Operating Costs – Prior to collection of revenues, expenditures may be financed through
the issuance of revenue or tax anticipation notes (RANS or TANS).
Capital Projects and Other Approved Costs – Projects may be temporarily funded through the
issuance of bond anticipation notes (BANS) or grant anticipation notes (GANS). In certain cases,
prior to the issuance of these temporary notes, the governing body must take the necessary legal
steps to authorize the issuance of the general obligation bonds. Temporary notes may not exceed
the aggregate amount of bonds authorized or the grant award amount.
Temporary notes are general obligations of the Town and carry maturity dates that are limited by
state law. Interest expenditures and expenses for temporary borrowings are accounted for in the
general fund and enterprise funds, respectively.
There was no temporary note activity during the fiscal year.
Town of Canton, Massachusetts Page 64 of 128 Annual Comprehensive Financial ReportSource page 73
F. Long–Term Obligations and Debt
The Town issues general obligation bonds and notes to provide funds for the acquisition and
construction of major capital facilities. General obligation bonds and notes have been issued for
both governmental and business-type activities. Additionally, the Town incurs various other
long-term obligations relative to associated personnel costs.
State law permits the Town, under the provisions of Chapter 44, Section 10, to authorize
indebtedness up to a limit of 5.0 percent of its equalized valuation. Debt issued in accordance
with this section of the law is designated as being “inside the debt limit.” In addition, the Town
may authorize debt in excess of that limit for specific purposes. Such debt, when issued, is
designated as being “outside the debt limit”.
The following reflects the current year activity in the long-term liability accounts:
Beginning Ending Due within
Balance Additions Deletions Balance one year
Governmental Activities:
General obligation bonds $ 30,347,900 $ - $ (3,484,900) $ 26,863,000 $ 3,231,000
Unamortized bond premium 2,313,276 - (359,419) 1,953,857 318,712
Notes from direct borrowings and placements 208,702 - (16,311) 192,391 16,641
Compensated absences, net (a) 3,456,106 144,004 - 3,600,110 900,028
Net pension liability 49,088,419 13,993,164 (18,101,522) 44,980,061 -
Net other postemployment benefits liability 83,990,144 12,136,750 (15,671,906) 80,454,988 -
Total Governmental Activities $ 169,404,547 $ 26,273,918 $ (37,634,058) $ 158,044,407 $ 4,466,381
Business-Type Activities - Water:
General obligation bonds $ 21,535,400 $ - $ (2,334,400) $ 19,201,000 $ 2,116,000
Unamortized bond premium 1,677,410 - (376,005) 1,301,405 247,944
Notes from direct borrowings and placements 2,712,800 - (371,600) 2,341,200 371,600
Compensated absences, net 143,529 78,872 - 222,401 55,600
Net pension liability 1,682,403 479,586 (620,392) 1,541,597 -
Net other postemployment benefits liability 2,066,434 298,604 (385,581) 1,979,457 -
Total Water 29,817,976 857,062 (4,087,978) 26,587,060 2,791,144
Business-Type Activities - Sewer:
General obligation bonds 1,337,700 - (245,700) 1,092,000 195,000
Unamortized bond premium 112,261 - (60,344) 51,917 15,745
Notes from direct borrowings and placements 1,902,030 - (244,244) 1,657,786 248,275
Compensated absences, net 10,312 8,869 - 19,181 4,795
Net pension liability 1,341,729 382,474 (494,767) 1,229,436 -
Net other postemployment benefits liability 794,688 114,834 (148,283) 761,239 -
Total Sewer 5,498,720 506,177 (1,193,338) 4,811,559 463,815
Business-Type Activities - Rink:
General obligation bonds 1,704,000 - (55,000) 1,649,000 58,000
Unamortized bond premium 87,165 - (8,222) 78,943 7,780
Net pension liability 298,744 85,160 (110,162) 273,742 -
Net other postemployment benefits liability 134,599 19,450 (25,115) 128,934 -
Total Rink 2,224,508 104,610 (198,499) 2,130,619 65,780
Total Business-Type Activities $ 37,541,204 $ 1,467,849 $ (5,479,815) $ 33,529,238 $ 3,320,739
(a) As restated. See Note IV.
The governmental activities liabilities will be liquidated by the general fund. The business-type
liabilities will be liquidated by the enterprise fund reporting the liabilities.
The following is a summary of outstanding long-term debt obligations as of June 30, 2024:
Town of Canton, Massachusetts Page 65 of 128 Annual Comprehensive Financial ReportSource page 74
Interest Beginning Ending
Description of Issue Rate Balance Additions Maturities Balance
Governmental Activities:
General Obligation Bonds 2.00 - 5.00% $ 27,925,500 $ - $ (2,888,500) $ 25,037,000
General Obligation Refunding Bonds 2.00 - 4.00% 2,422,400 - (596,400) 1,826,000
Total General Obligation Bonds 30,347,900 - (3,484,900) 26,863,000
Add: Unamortized bond premium 2,313,276 - (359,419) 1,953,857
Total General Obligation Bonds, net 32,661,176 - (3,844,319) 28,816,857
Massachusetts Clean Water Trust 2.00% 208,702 - (16,311) 192,391
Total notes from direct borrowings and placements 208,702 - (16,311) 192,391
Total Governmental Activities debt $ 32,869,878 $ - $ (3,860,630) $ 29,009,248
Business-Type Activities - Water:
General Obligation Bonds 2.00 - 5.00% $ 15,437,500 $ - $ (1,392,500) $ 14,045,000
General Obligation Refunding Bonds 3.25 - 4.00% 6,097,900 - (941,900) 5,156,000
Total General Obligation Bonds 21,535,400 - (2,334,400) 19,201,000
Add: Unamortized bond premium 1,677,410 - (376,005) 1,301,405
Total General Obligation Bonds, net 23,212,810 - (2,710,405) 20,502,405
Massachusetts Water Resource Authority 0.00% 2,712,800 - (371,600) 2,341,200
Total notes from direct borrowings and placements 2,712,800 - (371,600) 2,341,200
Total Water debt $ 25,925,610 $ - $ (3,082,005) $ 22,843,605
Business-Type Activities - Sewer:
General Obligation Bonds 2.00 - 5.00% $ 565,000 $ - $ (108,000) $ 457,000
General Obligation Refunding Bonds 3.25 - 4.00% 772,700 - (137,700) 635,000
Total General Obligation Bonds 1,337,700 - (245,700) 1,092,000
Add: Unamortized bond premium 112,261 - (60,344) 51,917
Total General Obligation Bonds, net 1,449,961 - (306,044) 1,143,917
Massachusetts Water Resource Authority 0.00% 417,725 - (44,709) 373,016
Massachusetts Clean Water Trust 2.00% 1,484,305 - (199,535) 1,284,770
Total notes from direct borrowings and placements 1,902,030 - (244,244) 1,657,786
Total Sewer debt $ 3,351,991 $ - $ (550,288) $ 2,801,703
Business-Type Activities - Rink:
General Obligation Bonds 2.5 - 5.0% $ 1,704,000 $ - $ (55,000) $ 1,649,000
Total General Obligation Bonds 1,704,000 - (55,000) 1,649,000
Add: Unamortized bond premium 87,165 - (8,222) 78,943
Total Rink Debt $ 1,791,165 $ - $ (63,222) $ 1,727,943
Total Business-Type Activities, net $ 31,068,766 $ - $ (3,695,515) $ 27,373,251
Town of Canton, Massachusetts Page 66 of 128 Annual Comprehensive Financial ReportSource page 75
Payments on outstanding bond balances due in future years consist of the following:
Direct Borrowings
Year Ending General Obligation Bonds and Placements
June 30 Principal Interest Principal Interest
Governmental Activities
2026 $ 3,231,000 $ 1,031,160 $ 16,641 $ 3,765
2027 2,995,000 893,055 16,974 3,431
2028 2,616,000 758,603 17,315 3,090
2029 2,232,000 649,502 17,664 2,742
2030 1,707,000 547,414 18,019 2,386
2031-2035 6,857,000 1,847,584 95,676 6,351
2036-2040 5,380,000 839,440 10,102 101
2041-2044 1,845,000 142,560 - -
Total $ 26,863,000 $ 6,709,318 $ 192,391 $ 21,866
Business-Type Activities - Water
2026 $ 2,116,000 $ 718,803 $ 371,600 $ -
2027 2,060,000 631,310 371,600 -
2028 2,011,000 539,145 371,600 -
2029 2,004,000 456,772 371,600 -
2030 1,816,000 369,285 371,600 -
2031-2035 5,039,000 1,082,986 483,200 -
2036-2040 2,910,000 486,044 - -
2041-2044 1,245,000 86,668 - -
Total $ 19,201,000 $ 4,371,013 $ 2,341,200 $ -
Business-Type Activities - Sewer
2026 $ 195,000 $ 43,310 $ 248,275 $ 23,660
2027 136,000 36,210 252,388 19,547
2028 138,000 29,410 256,583 15,352
2029 139,000 22,510 260,863 11,071
2030 135,000 15,560 265,230 6,705
2031-2034 349,000 24,740 374,447 2,250
Total $ 1,092,000 $ 171,740 $ 1,657,786 $ 78,585
Business-Type Activities: Rink
2026 $ 58,000 $ 48,451 $ - $ -
2027 64,000 45,551 - -
2028 65,000 42,351 - -
2029 65,000 39,101 - -
2030 72,000 35,851 - -
2031-2035 395,000 144,126 - -
2036-2040 440,000 97,184 - -
2041-2045 490,000 38,981 - -
Total $ 1,649,000 $ 491,596 $ - $ -
Town of Canton, Massachusetts Page 67 of 128 Annual Comprehensive Financial ReportSource page 76
Massachusetts Water Resource Authority (MWRA)
The Town’s has five outstanding notes from direct borrowings and placements issued to the
MWRA on August 24, 2020, January 25, 2021, August 15, 2021, April 15, 2022 and March 4,
2024 for $2,600,000, $68,150, $1,116,000, $44,588 and $334,350, respectively. The notes are
payable without interest in ten equal installments. Any imputed interest is immaterial to the water
and sewer enterprise funds.
Massachusetts Clean Water Trust (MCWT)
The Town’s has an outstanding note from direct borrowings and placements issued to the MCWT
under the Commonwealth’s Dam and Seawall Repair and Removal Fund. The note was issued on
February 24, 2015, payable at a 2% interest rate with payments through March 6, 2035.
The Town’s has an outstanding note from direct borrowings and placements issued to the MCWT
under its State Revolving Loan Fund for $3,745,695 with interest payable at 2% and payments
through July 15, 2030. The financing agreement with the MCWT contains a provision that in the
event of default, outstanding amounts due and payable shall be paid from any undisbursed
proceeds on account or be deducted from any state local aid distributions owed to the Town. This
provision also allows the MCWT to declare the entire outstanding principal amount due
immediately.
The following represents authorized and unissued debt as of June 30, 2025:
Project Amount
Governmental:
Galvin Middle School $ 240,624,835
Building improvements 3,071,320
Departmental equipment/vehicles 3,501,986
Museum improvements 2,000,000
Other capital projects 1,122,000
Business-type:
Water projects 10,215,000
Sewer projects 4,133,252
Total Authorized and Unissued $ 264,668,393
III. Other Information
A. Retirement System
Retirement System Description – The Town contributes to the Norfolk County Retirement System
(the “System”), a cost-sharing multiple-employer defined benefit pension plan. The System was
established under Chapter 32 of the Commonwealth of Massachusetts General Laws (MGL) and
is administered by Norfolk County Retirement Board (the “Board”). Standalone audited financial
statements for the year ended December 31, 2024 were issued and are available at the Norfolk
County Retirement System, 480 Neponset Street, Canton, MA 02021.
Town of Canton, Massachusetts Page 68 of 128 Annual Comprehensive Financial ReportSource page 77
The System provides retirement, disability and death benefits to plan members and beneficiaries.
Chapter 32 of the MGL assigns authority to establish and amend benefit provisions of the plan.
Cost-of-living adjustments granted between 1981 and 1997 and any increase in other benefits
imposed by the Commonwealth’s state law during those years are borne by the Commonwealth
and are deposited into the pension fund directly. Cost-of-living adjustments granted after 1997
must be approved by the Board and are borne by the System.
Contributions Requirements – The System has elected provisions of Chapter 32, Section 22D (as
amended) of Massachusetts General Laws, which require that a funding schedule be established
to fully fund the pension plan by June 30, 2040. Under provisions of this law, participating
employers are assessed their share of the total retirement cost based on the entry age, normal
actuarial cost method. The Town contributed $7,565,945 to the System in fiscal year 2025,
which equaled the actuarially-determined contribution requirement for the fiscal year.
Net Pension Liability – At June 30, 2025, the Town reported a liability of $48,024,836 for its
proportionate share of the net pension liability. The net pension liability was measured as of
December 31, 2024 and the total pension liability used to calculate the net pension liability was
determined by an actuarial valuation as of January 1, 2024. There were no material changes to
the System’s benefit terms since the previous actuarial valuation.
The Town’s proportion of the net pension liability is based on a projection of the Town’s long-
term share of contributions to the System relative to the projected contributions of all employers.
The Town’s proportion was approximately 7.48% at December 31, 2024, which was lower than
7.54% from the prior valuation.
Fiduciary Net Position –The System’s fiduciary net position was determined using the accrual
basis of accounting. The System’s accounting records are maintained on a calendar-year basis in
accordance with the standards and procedures established by PERAC. Contributions from
employers and employees are recognized in the period in which they become due pursuant to
formal commitments, statutory or contractual requirements. Benefit payments (including refunds
of employee contributions) are recorded when incurred, regardless of the timing of payment.
Investments are reported at fair value; fair value is determined as the price one would receive in
an orderly transaction between market participants at a measurement date.
Pension Expense – The Town recognized $9,496,280 in pension expense in the statement of
activities in fiscal year 2025; which was allocated to all functional expenses that applied.
Deferred Outflows of Resources and Deferred Inflows of Resources – At June 30, 2025, the
Town reported deferred outflows of resources and deferred inflows of resources related to
pensions from the following sources:
Town of Canton, Massachusetts Page 69 of 128 Annual Comprehensive Financial ReportSource page 78
Deferred Outflows Deferred Inflows
of Resources of Resources
Net differences between projected and
actual earnings on pension plan investments $ 4,145,330 $ -
Differences between expected and
actual experience 2,336,474 -
Changes in assumptions 6,526,369 -
Changes in proportion and differences
between Town contributions and
proportionate share of contributions 1,875 209,955
Total $ 13,010,048 $ 209,955
The deferred outflows of resources and deferred inflows of resources are expected to be
recognized in the Town’s pension expense as follows:
Year ended June 30,
2025 $ 4,618,988
2026 6,499,215
2027 1,993,969
2028 (312,079)
Total $ 12,800,093
Actuarial Valuation – The measurement of the System’s total pension liability is developed by an
independent actuary. The latest actuarial valuation was performed as of January 1, 2024. The
significant actuarial assumptions used in the actuarial valuation included:
Actuarial cost method Individual entry age normal
Investment rate of return 7.625%
Projected salary increases 3.5% - 5.5%
Inflation 2.75%
Cost of living adjustments 3.00% of the first $20,000 of retirement income
Asset valuation method Fair value
Mortality rates: Pub-2010 Public Retirement Plans Mortality Tables
from the Society of Actuaries dated January 2019 with
Scale MP-2021
The investment rate of return assumption is a long-term assumption and is based on capital
market expectations by asset class, historical returns and professional judgment. The market
expectations analysis used a building-block approach, which included expected returns by asset
Town of Canton, Massachusetts Page 70 of 128 Annual Comprehensive Financial ReportSource page 79
class and the target asset allocation. The target allocation and best estimates of arithmetic real
returns for each major asset class are summarized in the following table:
Long-Term
Target Expected Real
Asset Class Allocation Rate of Return
Domestic equity 30.5% 7.3%
International equity 15.5% 8.0%
Fixed income 20.5% 4.9%
Real estate 9.5% 7.0%
Private equity 10.0% 10.2%
Hedge funds 11.5% 8.6%
Real assets 2.5% 8.9%
The System’s investment policy’s total, blended expected rate of return seeks to meet or exceed
the assumed actuarial rate of return.
Discount Rate – The discount rate used to measure the total pension liability in the January 1,
2024 actuarial valuation report was 7.625%, which was a consistent with the prior year of 7.625%
in the previous actuarial valuation. The projection of cash flows used to determine the discount
rate assumed plan member contributions were made at the current contribution rate and that
employer contributions will be made at rates equal to the actuarially-determined contribution
rates and the member rate. Based on those assumptions, the System’s fiduciary net position was
projected to be available to make all projected future benefit payments of current plan members.
Therefore, the long-term expected rate of return on pension plan investments was applied to all
periods of projected benefit payments to determine the total pension liability.
Sensitivity Analysis – The following presents the Town’s proportionate share of the net pension
liability calculated using the discount rate of 7.625% as well as the Town’s proportionate share of
the net pension liability using a discount rate that is one percentage point lower or one percentage
point higher than the current rate:
Current
1% Decrease Discount 1% Increase
(6.625%) (7.625%) (8.625%)
Town's proportionate share
of net pension liability $ 65,070,230 $ 48,024,836 $ 33,542,056
B. Massachusetts Teachers’ Retirement System
Teachers and certain administrative employees of the School Department participate in the
Massachusetts Teachers’ Retirement System (“MTRS”), a cost-sharing multiple employer
defined benefit pension plan. The MTRS is managed by the Commonwealth on behalf of
municipal teachers and municipal teacher retirees. Like the System, MTRS was established
under Chapter 32 of Massachusetts General Laws. The Commonwealth’s legislature has the
authority to amend or modify the MTRS’s funding policies.
The Commonwealth is a nonemployer contributor to the MTRS and is legally responsible by
statute for all actuarially determined employer contributions and future benefit requirements of
Town of Canton, Massachusetts Page 71 of 128 Annual Comprehensive Financial ReportSource page 80
the MTRS. Therefore, the Town is considered to be in a special funding situation as defined by
GASB Statement No. 68, Accounting and Financial Reporting for Pensions.
For the year ended June 30, 2025, the Commonwealth contributed $9,129,880 to the MTRS on
behalf of the Town. The Town’s proportionate share of the collective MTRS net pension liability
at this reporting date was 0.377653%, which was based on the actual, actuarially determined
contribution made by the Commonwealth on behalf of the Town as a percentage of the total
annual contribution made by the Commonwealth on behalf of all employers.
The table below presents the Town’s proportionate share of the following:
Paid (or assumed)
Commonwealth On Behalf Town
Portion of the Town Portion
Net pension liability $ 95,759,376 $ (95,759,376) $ -
Pension expense 7,904,133 (7,904,133) -
In addition to pension expense reported as previously discussed, the Town has recognized
intergovernmental revenue and pension expense of $7,904,133 associated with this arrangement.
C. Other Postemployment Benefits (OPEB)
The Town administers a single employer defined benefit healthcare plan (the “OPEB Plan”). The
OPEB Plan provides health, dental and life insurance benefits (other postemployment benefits) to
current and future retirees, their dependents and beneficiaries in accordance with Section 20 of
Massachusetts General Law Chapter 32B.
Specific benefit provisions and contribution rates are established by collective bargaining
agreements, state law and Town ordinance. All benefits are provided through the Town’s
premium-based insurance program. The OPEB Plan does not issue a stand-alone financial report
and is presented as a fiduciary fund in the Town’s financial statements.
With respect to OPEB plan reporting, GASB issued GASB Statement No.’s 74, Financial
Reporting for Postemployment Benefit Plans Other Than Pensions, and Statement No, 75,
Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions.
Reporting requirements for governments who administer an OPEB plan as defined under the
accounting standard are required to present disclosures under both GASB 74 and GASB 75.
GASB 74 requires specific disclosures and required supplementary information that relate
directly to the fiduciary fund in which the OPEB Plan is recorded. GASB 75 address disclosures
related to the net OPEB liability required to be recorded by the government in its applicable
financial statements. A number of these disclosures are identical, especially if the measurement
date under GASB 75 is the same as the plan year-end date. When a different measurement date is
used different assumptions and calculations will result.
For the year ended June 30, 2025, the Town elected to use a measurement date that was the same
as the plan year-end date thus the majority of the same disclosures are used and will not be
repeated.
Town of Canton, Massachusetts Page 72 of 128 Annual Comprehensive Financial Report