Brookline officials outline FY26 financial plan as schools project $8.2 million shortfall

Town Administrator Chaz Carey presented the Town of Brookline’s initial fiscal‑year 2026 financial plan on Feb. 25, telling the Select Board, Advisory Committee and the newly formed Expenditures and Revenue Study Committee that the town and schools face a structural gap between recurring revenues and expenses.

Carey said the plan “encompasses all of the town’s projected revenues and expenditures, including those that come out of enterprise funds,” and stressed that the presentation is the start of a multi‑week review process that will involve hearings, subcommittees and the new study committee.

The plan forecasts a total spending and revenue picture that Carey said represents a 4.4% increase from the prior year. The school department’s initial, fully loaded request projects an $8.2 million shortfall; the town’s own projected gap for FY26 is approximately $560,000. The budget documents included projections for property tax growth, enterprise activity and appropriations of certified free cash.

Nut graf: The presentation laid out the pressures behind the gaps — rising health‑care costs, collective bargaining, sanitation contract changes, capital and debt service — and identified both one‑time and recurring choices the town must make to balance the budget. Carey and Deputy Town Administrator Melissa Gough told boards they will use hearings and the new Expenditures and Revenue Study Committee to identify structural options rather than rely on one‑time fixes.

Most of the town’s budget growth, the presentation said, is driven by wages and benefits. Carey and Finance Director Lincoln Heinemann emphasized that more than 80% of town and school costs are staff wages and benefits; Carey noted group health insurance increases budgeted at roughly 12% for the coming year. “We must balance our budgets,” Carey said, adding that municipalities in Massachusetts cannot deficit‑spend and that the town must be conservative in revenue estimates.

The schools’ shortfall reflects a fully loaded budget request that includes program expansions and staffing requests in addition to contractual increases; Carey and Heinemann explained that a smaller “maintenance” or level‑funded alternative can reduce the gap but that the district is also carrying a current‑year deficit driven in part by special‑education costs. School committee members and union leaders in public comment urged the town to minimize student‑facing cuts.

Justin Brown, president of the Brookline Educators Union, told the Select Board: “To be clear, we are saying no to any cuts,” and urged the town to use stabilization or other available sources to plug the gap rather than reduce staff or services. Teachers and school staff who spoke during public comment described programs and positions they said would be harmed by proposed reductions; Spanish teacher Alyssa Connor said, “You cannot make these cuts without affecting the quality of what we do.”

Carey described steps already taken to reduce near‑term pain: shifting some recurring capital needs to American Rescue Plan Act (ARPA) funds for one year, pausing a CIP increase that had been planned in order to direct $2 million toward the school split this year, and appropriating free cash to the capital program and stabilization fund. He warned that using one‑time ARPA or free‑cash funds to paper over recurring deficits only delays a harder reckoning and could risk higher borrowing costs long term.

The presentation identified roughly $23.5 million in estimated free cash certification, with approximately $20.8 million recommended for appropriation to capital and reserves in FY26 and a portion left unappropriated to seed next year’s free cash. Carey said the town will continue to fund pensions toward a targeted 2030 schedule and will remain mindful of other post‑employment benefit (OPEB) obligations.

The Select Board and Advisory Committee agreed to the following immediate steps: (1) the newly formed Expenditures and Revenue Study Committee will begin hearings in early March to analyze structural options and set timelines; (2) the town will work with the school committee on a formal deficit review and a memorandum of shared commitments to increase transparency and controls; and (3) staff will continue to refine revenue assumptions and to present departmental hearings to the Advisory Committee’s subcommittees as scheduled.

Carey and Gough said the town was actively reviewing federal and state grant risks, estimating about $3 million of potential exposure on the town side if federal funding were cut. They said school programs funded with federal or grant funds could be more exposed and that the town and district are coordinating on contingency plans.

Ending: The Select Board and Advisory Committee framed the meeting as the beginning of a collaborative process rather than immediate action. Carey said the town will provide support to the school department’s deficit review and that the new study committee’s findings will inform whether further measures — including long‑term revenue options — are required for FY27 and beyond.

Votes at a glance: The Select Board also handled multiple routine and administrative votes during the meeting and approved the following motions by unanimous voice vote of members present. Counts are recorded as unanimous among members in attendance.

- Approval of minutes for Feb. 5 and Feb. 11, 2025 — approved (unanimous). - Omnibus approval of agenda items 3(b) through 3(u) — approved (unanimous). - Appointment of Emily Williams as Director of the Council on Aging (Town Administrator recommendation) — approved (unanimous). - Appointment of Richard Murphy to the Transportation Board — approved (unanimous). - Appointment of Cliff Brown as alternate advisory committee member to the Expenditures and Revenue Study Committee — approved (unanimous). - Ratification of Ground Floor commercial incentive standards and guidelines for mixed‑use districts outside Harvard Street — approved (unanimous). - Authorization to accept MWRA financial assistance and to enter loan agreements for sewer inflow & infiltration and water lead‑service line work — approved (unanimous).

Quotes (selected): "This plan encompasses all of the town's projected revenues and expenditures, including those that come out of enterprise funds," Town Administrator Chaz Carey said when he opened the financial presentation. "To be clear, we are saying no to any cuts," Justin Brown, president of the Brookline Educators Union, told the board during public comment. "You cannot make these cuts without affecting the quality of what we do," said Alyssa Connor, a Spanish teacher at Brookline High School.