Summary

Beverly Forecast Projects Nearly $4M Deficit

BeverlyDec 9, 20252 min read

At a glance

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The committee approved revisions to its financial forecast, which now projects a $3,921,385 deficit for fiscal year 2027; the revisions passed unanimously, 8-0.

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Financial Forecasting Committee

Topics discussed

Budget & TaxEducation

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What this means

The forecast says Beverly’s projected spending is growing faster than its revenues, creating a deficit that may require higher fees, service reductions, or additional tax revenue to close. The report discusses reducing certain municipal and school staffing, reviewing spending on vocational education, and possibly considering a Proposition 2½ override if policymakers want to maintain existing services. The committee also noted that the stabilization fund target is 10% to 15% of the operating budget.

Key decisions

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Approved revised forecast figures and report language, including a projected FY27 deficit of $3,921,385, by an 8-0 vote.
Added language explaining that property tax revenues are largely governed by Proposition 2½.
Added language recommending that city policymakers consider reducing the free-cash target percentage to support operating expenditures, while warning that this could increase future budget pressure.
Revised the vocational education discussion to note that higher costs are due largely to enrollment increases and that large increases create difficult policy decisions.
Kept the school and municipal budgets presented together rather than separating them, with the motion passing 7-1.
Added language stating that addressing the projected deficit may require raising fees or cutting services with unprecedented impact.
Approved revised language discussing whether Beverly should consider a Proposition 2½ override to retain existing services.
Added reducing certain municipal and school staffing to the report's listed strategies.

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