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Finance director outlines FY26 revenues: $469.6M total and $3.16M proposed levy increase
Summary
City finance staff presented revenue assumptions and explained how Massachusetts’ levy limits and new growth affect the city’s taxable capacity; the presentation included estimates of tax-rate effects for a typical single-family home.
The city’s finance presenter walked Lawrence City Council members through the revenue side of the proposed fiscal 2026 budget, showing total revenues of $469,611,008.65 and explaining how the state’s levy limit, Proposition 2½, and new growth feed into the city’s tax levy calculations.
Why it matters: The revenue assumptions determine how much the city must raise from property taxes and how an increase in the levy translates to changes in the tax rate and individual tax bills.
The finance presenter explained the main revenue categories for FY26: taxes and excise (real and personal property), state aid (including education funding and chapter 78 allocations), local receipts (motor vehicle excise, charges for services, licenses and permits), and other financing sources (a $5.0 million transfer from the stabilization fund and indirect enterprise fund costs). The proposed revenue total presented was $469,611,008.65.
On tax policy, the presenter reviewed Proposition 2½ (the 1980 voter-approved limit on property-tax increases), the levy limit and levy limit growth (2.5 percent plus new growth), and the city’s excess levy capacity. The presentation noted Lawrence’s excess levy capacity at roughly $13.0 million and said that new growth in recent calculations was about $1.4 million in one year and roughly $1.2 million in another slide; the presenter cautioned that new-growth figures vary annually and come from the assessors’ office.
Finance staff calculated a FY26 levy limit and showed how deductions for allowances (abatements and exemptions such as elderly, veterans and blind) reduce taxable levy. The presentation stated a proposed FY26 tax levy of $91,544,131 and reported that the levy increase from FY25 would be $3,161,241.
The presenter used Department of Local Services (DLS) interactive tools during the hearing, showing that Lawrence’s average single-family assessed value was $450,108, per-capita income $20,919, and the FY25 residential tax rate $8.80. Using the proposed levy increase, staff estimated an illustrative FY26 tax rate around 9.11 and an estimated annual tax-bill increase of about $139 for a single-family home assessed at $450,000. The presenter explicitly called the estimate illustrative and noted many variables affect final bills.
Councilors asked specific follow-ups about intergovernmental (“cherry sheet”) assessments, the composition of local receipts, and the treatment of the $5.0 million stabilization transfer. The presenter pointed councilors to budget-book pages and to the DLS tools for community comparisons, and said some figures (for example, the detailed school internal allocations) were not shown on the city-side book because the school department provides only a one-line total for its appropriation.
Councilors also raised debt and debt-service questions. Finance staff pointed to an amortization schedule and a debt-outstanding table in the budget book showing city and school debt; outstanding debt at end of FY25 was presented as about $158.85 million and forecast to be about $150.56 million at the end of FY26 after scheduled principal and interest payments. Staff said the city works with a financial advisor and remains within statutory borrowing limits.
No formal council action was taken on revenues during this session. Finance staff and councilors agreed to follow up in subsequent hearings on targeted questions (debt-service detail, intergovernmental assessments, and motor-vehicle excise reimbursements).
