Rising costs and lagging revenues are creating conditions for yet another budgetary storm in fiscal 2026.
In a bleak forecast delivered to the Select Board Tuesday night, Finance Director Jared Mullane said the revenues the town expects in the coming fiscal year are not sufficient to pay for the spending that town departments and the schools say they need to maintain services at their current levels. Without cuts to town and school budgets or receipt of additional revenue, the town faces an estimated deficit of $1.3 million, Mullane said. Massachusetts law requires municipal budgets to balance, with expenses matching revenue.
Deficits have been a feature of Harvard’s forecasts for at least the past five years. Last year, Harvard voters approved a tax override of $423,902 to balance this year’s budget. That increase, coupled with flat property values, will boost this year’s property tax rate to an estimated $15.65 per $1,000 of assessed property value, pending approval by the state Department of Revenue.
At this point in the budget cycle, however, forecasts of revenues and expenditures resemble a long-range weather forecast, more accurate than a seasonal forecast in Farmers’ Almanac, but less so than a three-day forecast on Channel 5. Some numbers are known, such as the amount that can be raised by taxation without an override or the salaries and wages specified in the town’s employee contracts. Others are guesses, such as the amount of state aid the town can expect, which won’t be known for certain until next July, or the excise taxes that will be collected on automobiles.
The table below summarizes what’s known about the fiscal 2026 budget today. Without another override, total revenues are expected to remain flat. Without cuts, the town budget will increase approximately 8% and the school budget 5.9%, both well above the annual 2.5% property tax increase allowed by Proposition 2½. A substantial portion of the town’s increase is due to a 12% increase in the benefits paid to town employees, which, together with town building and liability insurance, accounts for $6,000,000 of the town’s portion of the budget.
With next year’s budget requests now in the hands of the administration, Select Board, and Finance Committee, Town Administrator Dan Nason told the board Tuesday that he, Mullane, and Assistant Town Administrator Allyson Mitchell planned to meet with department heads this week, including School Superintendent Linda Dwight, to look for ways to trim their requests. Once that was done, he said, it might be useful to call an all-boards meeting “to align on budget priorities and potential cost-saving measures.” Such a meeting, added member SusanMary Redinger, would be useful to educate departments on the pressures faced by others and to foster a sense of shared pain and cooperation.
Meanwhile, Finance Committee members are reviewing the more than two dozen departmental and other budgets they have received. The committee meets next on Dec. 13 to discuss its findings and decide whether to ask particular department heads to attend a future meeting to answer questions about their goals and numbers.
