Mayor Cahill proposes FY2026 budget with large school funding increase, seeks $3M for roads from reserves

Mayor Michael Cahill presented the City of Beverly’s proposed fiscal year 2026 operating budget to the City Council on June 2, emphasizing investments in public schools and fiscal reserves while proposing to return to the property tax levy limit.

Cahill said the FY2026 proposal includes a 9.1% increase for the Beverly Public Schools, describing the two‑year change as a $12.7 million increase with $11.5 million coming from city taxpayers. He said the budget would add 55 school staff compared with the 2019–20 school year and that the proposal includes $7.1 million in new money for schools, of which $6.44 million is city taxpayer funding.

The mayor noted that city salaries, benefits and mandated costs are the largest drivers of the budget and that pension and health insurance costs will rise: he cited a pension increase of about $570,000 and a projected 10% increase in city health insurance premiums (roughly $706,000). He also cited other non‑discretionary increases including trash and recycling (+$165,000) and the Essex North Shore Agricultural and Technical School assessment (+$385,000).

Cahill said Beverly’s financial reserves are strong, with $23,770,000 in the stabilization fund and a projected $9,500,000 in free cash later this year, representing over 19% of the proposed operating budget. He asked the council’s support to appropriate $3,000,000 from reserves or free cash for road and sidewalk improvements and said combined with Chapter 90 and other committed funds the city could mobilize “well over $8,000,000 this year” for pavement and sidewalk work.

The mayor also reviewed capital and grant activity, noted more than $80,000,000 in grants secured during his administration and flagged City Hall as the next capital project to be advanced by design and future appropriation. He said the proposed operating budget requests an overall increase of $7,762,000 over FY2025, driven by employee compensation and non‑discretionary cost increases.

Councilor St. Hilaire and other councilors asked procedural questions about the budget materials and digital availability for the public; Cahill and finance staff said a digital version of the budget would be available starting the next day. The council referred the mayor’s budget (order 171) to the Finance and Property Committee for public hearings and detailed review; the finance committee scheduled the first budget hearing for Thursday following the meeting.