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In accordance with Section 35T of Chapter 10 of the Massachusetts General Laws, the Comptroller, in consultation with the Department of Revenue, is required to submit a letter which certifies the annual base revenue amount for the MBTA for the following fiscal year and estimates the dedicated sales tax revenue for the current fiscal year to be credited to the MBTA. The MBTA relies on a pledged portion of the Commonwealth’s sales tax revenue to fund its services.
On March 1 of each year, the Office of the Comptroller, in consultation with the Department of Revenue, certifies the base sales tax revenue for the next fiscal year based on the sales tax received for the prior fiscal year increased by the amount of inflation – up to 3%.
On March 15 of each year, the amount of sales tax revenue dedicated to the MBTA is calculated by multiplying 16% of the projected sales tax revenue, with an addition of $160 million. The base revenue and dedicated revenue amounts are compared, and the higher amount is what is projected to be transferred to the MBTA.
In November and April of each year, the projection is recalculated and updated to verify whether additional funds need to be transferred.
