News

Dear Friends,

In this newsletter, I will focus solely on the school budget — the most important issue the city is currently facing.

Debate over the school budget has dominated local news since March, when the School Committee and Superintendent Anna Nolin proposed a budget that exceeded what Mayor Fuller had allocated to the school system. That debate continues now that the Mayor has presented her allocation budget (not the one that the School Committee wants) to the City Council. 

In this update, I will:

1. Provide information about how our schools are funded.

2. Explain our current situation and potential next steps.

3. Set forth my plan for tackling the difficult issue of school funding in future years as your next Mayor.

How are our schools funded?

Our city expenditures are traditionally divided between direct spending for our schools and all other spending, including city services, pension obligations, and payments for capital improvements (either directly or by paying for the cost of bonds to do this work). Direct school spending is more than half of the total city budget. However, within the rest of the budget are expenses for school-related items, such as school nurses. When our total spending is considered, more than two-thirds of all city revenues are used to support our schools.

Under our city charter, the Mayor controls how much the city will spend in each fiscal year (the fiscal year runs from July 1 – June 30). Typically, in January she tells the School Committee how much money she intends to provide for the schools for the next fiscal year. The School Committee then must work within that allocation to create a school budget. The School Committee’s budget is then presented to the City Council.

Meanwhile, in mid-April (traditionally the day after Patriot’s Day), the Mayor presents her total budget (including her allocation for the schools) to the City Council. Over the course of the next month, the City Council reviews that budget. However, while the City Council engages in a thorough review of the budget, it does not have the authority to either increase spending or shift spending from one area to another. Even if the City Council rejects the Mayor’s budget as being insufficient or disagrees with her allocation of funds among departments, it still goes into effect. Thus, the Mayor has almost complete control over all city spending.

What about "free cash"?

In addition to the budget itself, the Mayor also submits her proposal for spending from “free cash.” Free cash is the amount of money that is left each year after paying all expenditures. It is prudent to have some amount of free cash available each year to pay for unanticipated expenses (such as when a school boiler unexpectedly breaks, extra police and fire overtime, or unusually large snow removal costs). The Administration also has been using a significant amount of free

cash each year to pay for ongoing road maintenance. In recent years, the Administration has had larger than anticipated amounts of free cash for multiple reasons, including one-time settlements with utilities; relatively mild winters; and higher than budgeted interest income. Notably, the City Council must approve proposed free cash expenditures.

In early 2024, when we had an extraordinary amount of free cash due to a one-time settlement with a utility, the Mayor and the City Council placed $22 million of that free cash into an Education Stabilization Fund to help fund the schools operating expenses for several years. Last fall, when free cash was again robust, the Mayor placed an additional $2 million into the Stabilization Fund.

What was proposed for this year’s school budget?

This year, in response to the Mayor’s allocation, Superintendent Anna Nolin presented a series of alternative budget scenarios to the School Committee. Her “level funding” budget exceeded the Mayor’s allocation by approximately $4 million. The School Committee then voted to approve Superintendent Nolin’s level funding budget.

On April 17, the School Committee met with the City Council’s Programs and Services and Finance Committees to present its budget (the budget that was greater than the Mayor’s allocation). The Committees deferred action on the proposal until after the Mayor presented her budget.

What happens next at the City Council?

On April 22, the Mayor presented her budget to the City Council along with her proposals for the use of free cash. Included in that presentation was a plan to use free cash to pay for an unexpected increase in health insurance and an array of maintenance, equipment, and supplies for the schools but not for the staffing needs identified by the Superintendent. The Mayor’s budget did not contain any further increases to the schools’ allocation.

Over the course of the next month the City Council will discuss and debate the budget and the proposed use of free cash. During that process, the City Council may submit non-binding resolutions to the Mayor requesting changes in spending. Ultimately, unless the City Council votes to reduce the budget, it will go into effect on July 1 as proposed. While the Council does have the authority to reject the Mayor’s free cash proposals, it cannot then redirect how that money is spent.

How will I fund the schools to meet the educational needs of our students as mayor?

I have stated repeatedly that education will be my top priority as Mayor. I am a graduate of the Newton Public Schools, as are my younger siblings, our three children, and our daughter-in-law. I am grateful for the excellent education that we all received. I served on the School Committee for eight years, including as its chair, and have tremendous respect and appreciation for the work of our educators, administrators, and staff. Our public schools are our most important asset, and we need to work together to continue to build trust in our schools and make them thrive.

If elected, I will inherit Mayor Fuller's school budget for the first six months of 2026 and that is the budget under which we will operate. With that said, it is common for financial challenges to present themselves while managing budgets and I will work cooperatively, collaboratively, and creatively with my leadership team, the School Committee, the Superintendent, and the residents of our city to address them. Those challenges are likely to include cuts in federal (and indirectly state) funding because of the Trump Administration’s efforts to reduce federal spending.

Our work for fiscal years 2027 and thereafter will start immediately after I am elected, with clear, straightforward discussions about city finances, including the following:

• What funding sources are utilized to support our schools (both in direct allocations to the school budget and support for the schools from the city side of the budget).

• How to best estimate revenues and expenses in a conservative, but not overly conservative, manner.

• What risks do we face to the entire budget because of the Trump Administration’s actions.

• How to fully fund our outstanding pension liability before the state-mandated 2040 deadline in a manner that is both fiscally responsible and does not place undue strain on current budgets.

Students today face challenges that did not exist when I was growing up here or even pre-COVID. Here is what we will do together to address them:

• Promote academic excellence for all students.

• Make sure that every child feels safe and secure in school.

• Strengthen our extracurricular activities at all levels (including those run by our partners at the elementary After School programs, the Boys and Girls Club, and the YMCA).

• Address the mental health issues that many of our students are facing.

• Support initiatives to help students quickly and effectively when there are behavior problems or learning issues so that these students can thrive now without far costlier interventions in the future.

Together, I am confident that we will develop a long-term, sustainable plan to fund the schools to the best of our ability and ensure that they provide an outstanding education for our children.

As always, I welcome your thoughts, questions, comments, and criticisms!

Thanks,

Marc