Mayor Recommends 4.45% Budget Increase for FY26

Budget season in the City of Boston began on April 9 with Mayor Michelle Wu’s release of her FY26 recommended budget. The $4.84B operating budget represents a 4.45% increase from FY25, or an increase of $206.0M, driven by increased spending on Boston Public Schools and costs such as debt service and pension payments. To more easily compare continuing services, the 4.45% increase does not take into account the $110M one-time FY25 payment from the City’s budgetary reserve to start a Housing Accelerator Fund. While Mayor Wu announced that this budget would not add any new positions and seeks salary savings from eliminating long-term vacant positions, FTEs are expected to rise by 214.9 (1.1%) from 2025, as the City continues to fill some vacancies.

Fixed costs were a particular source of growth in the proposed budget, with non-discretionary items such as debt service, pensions, and state assessments expected to grow $93.4M or 8.6%. The budget also includes a 3.0% increase for Boston Public Schools, which does include the cost of the tentative collective bargaining agreement with the Boston Teachers Union. Including these costs, this line item is expected to increase 4.3%, with expenses being paid for from the City’s collective bargaining reserve.

To learn more about the details of Boston’s FY26 proposed budget, read the full Research Update here