(1) A town may accumulate retained earnings or fund balances, as appropriate, in any fund.
(2) The accumulation of a fund balance in the town general fund may not exceed 100% of the total revenue of the town general fund for the current fiscal period.
(3)
(a) The town council may, in a budget year, appropriate from estimated revenue or excess fund balance in the town general fund to a reserve for capital improvements:
(i) for the purpose of financing future specified capital improvements; and
(ii) in accordance with a formal long-range capital plan adopted by the governing body.
(b) The reserves described in Subsection (3)(a) may accumulate from year to year in a capital improvements fund until the accumulated total is sufficient to permit economical expenditure for the specified purposes.