Current Fund appropriations for accumulated absence liabilities must be:

The correct answer highlights that Current Fund appropriations for accumulated absence liabilities must be deposited in a dedicated trust fund. This practice is essential because accumulated absence liabilities refer to benefits that employees are entitled to but have not yet utilized, such as sick leave or vacation pay. By depositing these funds into a dedicated trust, municipalities can properly manage and safeguard these liabilities, ensuring they are available when employees do eventually claim them. This approach also aligns with best financial practices and accountability, as it helps maintain clarity in financial reporting and ensures that the funds are specifically earmarked for their intended use.

This method enhances fiscal responsibility by acknowledging the obligation upfront and designating resources for future payouts, which can assist in preventing budget shortfalls when these liabilities come due. In contrast, other options do not offer the same level of accountability or control.