Holyoke consultant presents multiyear forecast showing modest shortfalls, strong debt capacity

TJ Plant, a consultant with Open Architects, told the Holyoke City Council on May 28 that his firm prepared a multiyear financial plan to help the city project revenues and expenditures and to guide capital decisions. The presentation uses conservative assumptions for local revenue, Chapter 70 and unrestricted general government aid, and a standard Prop 2½ approach to levy growth (prior-year levy plus 2.5 percent plus new growth).

Plant said the forecast rolls the mayor’s submitted budget forward under those assumptions and separates general government, public safety, education, human services and enterprise funds. He said the model projects to fiscal year 2030 and that, for a total budget he described as roughly $226,000,000, the near-term gap shown (about $1.3 million) is not “insurmountable” given the city’s overall size and the conservative assumptions used.

The plan assumes a $5,500,000 annual debt-service capacity to preserve the city’s ability to issue debt for capital projects as older debt retires. Plant emphasized the debt schedule shows principal falling off in coming years and that maintaining a stable annual principal-and-interest target would create room for new capital borrowing.

Plant and Mayor Joshua Garcia said the forecast is a tool, not a finalized plan. Garcia said the forecast will help councilors and administration “keep our finger on the pulse” but cautioned all assumptions remain subject to change as conference‑committee action, revenue developments and contract negotiations occur.

Councilors asked about several inputs. Plant described his assumptions: a 3 percent general aid increase, a 5 percent historical average for Chapter 70 (education) for the forecast period, and a 3 percent personnel increase used in the baseline. He said health‑insurance costs were modeled at 6 percent in the consultant work, though the mayor noted the budget itself uses a 9 percent health‑insurance assumption to build reserves for the city’s plan redesign and self‑insurance transition. Plant said the retirement estimate was taken from the retirement board’s schedule (PERAC) at about 3.5 percent.

Plant said he used the Senate’s conference numbers available at the time for state aid and that those figures could change in conference committee. He repeatedly described the model as configurable: “all these assumptions can be changed and played with,” he said, and councilors will receive an Excel version of the forecast after the hearing.

Councilors also pressed Plant and administration on capital needs. Plant said the debt profile leaves Holyoke well positioned to issue debt for projects, and Mayor Garcia said the administration will work with the consultant to create a five‑year capital improvement plan (CIP) to prioritize items such as cruisers and routine capital outlays once free cash and stabilization options are clearer.

The presentation included a breakdown of local receipts (meals, excise, cannabis excise, fees), Cherry Sheet offsets (assessments such as charter school and school choice), enterprise funds and Community Preservation Act receipts. Plant recommended maintaining conservative budgeting practices rather than relying on one‑time revenues.

The presentation ended with an emphasis on flexibility: the modeling is intended to allow the council and mayor to “pivot” if revenues differ from assumptions and to avoid relying on one‑time sources to balance operations.