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Haverhill mayor presents balanced FY26 budget, cites health-insurance spike and OPEB planning
Summary
The mayor’s recommended fiscal 2026 operating budget aims to limit reliance on one-time funds and caps the levy increase at 5.2%, while departments face a sharp rise in health‑insurance costs and the city plans to begin addressing a large OPEB liability.
The mayor and budget staff presented a recommended fiscal year 2026 operating budget that they said is balanced and limits reliance on one‑time funds while capping the tax levy increase at 5.2% for 2026.
In a presentation to the City Council’s budget hearing, Angel (budget staff) said the Group Insurance Commission announced 2026 rate increases that drive an average health‑insurance cost increase for Haverhill of about 12.5%, which Angel said translates to “over $3,300,000 in additional costs in 2026.” The mayor later summarized the result: “We have a balanced budget.”
Why it matters: councilors were shown a 10‑year projection that the mayor’s team used to constrain levy use, prioritize capital needs and hold departmental increases near 2½ percent. The budget book, the administration said, sets aside a maximum levy usage of $140,323,000 and leaves an excess levy capacity of about $2.3 million (roughly 1.6%). That modeling also allocates 100% of Chapter 70 funding to schools and assumes a 1.6% levy reserve.
Key details: the administration highlighted several cost drivers and planning items. The budget includes added debt service tied to the Constantino Middle School debt (described as contributing about 24% of the projected tax‑bill increase cited by staff). The Group Insurance Commission (GIC) rate changes were described as the largest single hurdle; Angel said the GIC’s announced 2026 increases reached “up to 18% for certain plans.” To offset pressures, the administration imposed a discretionary spending freeze from April 15 through the end of FY25 to generate additional free cash for one‑time capital needs rather than carry them into the FY26 operating budget.
On long‑term liabilities, the administration presented the city’s OPEB (other post‑employment benefits) and pension outlook. Staff said the city’s unfunded pension assessment is expected to be satisfied in 2032, producing an anticipated drop in the annual pension assessment of roughly $25 million thereafter; the administration said it is planning to form an OPEB trust committee and use some of the freed pension assessment to begin funding OPEB liabilities.
Council reaction and follow‑up: councilors asked about federal funding risks and how cuts at the federal level could affect local programs; staff said departments prepared 10% cut scenarios, with education identified as among the largest federal funding categories that could be affected. The budget book and related documents were confirmed as available online; the administration also noted upcoming departmental presentations at subsequent hearings.
Ending: Councilors moved and approved the mayor’s budget presentation at the hearing. The budget book, staff said, contains detailed line‑item information, capital needs, and the 10‑year projection the administration used to craft the recommended FY26 operating budget.
