Boston’s FY19 Budget Grows 4.4%
After 28 budget hearings over the last 2 months, the Boston City Council is expected to pass the FY19 General Fund budget for the City of Boston later today. A Research Bureau Special Report released today, reviews this budget in detail. The $3.30B budget is allocated primarily among eight large budget accounts and is funded chiefly by the property tax. Employee expenses for salaries and benefits represent 68% of the total recommended budget and 63% of the budget increase.
“With employee costs representing almost 70% of the budget the City must be vigilant in managing its personnel expenses. That means continuing its tight control over employee headcount and being firm in contract negotiations about employee compensation and benefit expenses.” said Sam Tyler, President of the Boston Municipal Research Bureau.
Highlights of the report include:
- Spending for Boston employees absorb 68% of the budget in FY19, requiring the City to be vigilant in managing its personnel expenses.
- Tight control over employee headcount and being firm in contract negotiations about employee compensation and benefit expenses are important for the City.
- More capital spending will be required as the City begins to implement planning initiatives such as Build BPS, Go Boston 2030 and Climate Ready Boston. The five-year capital plan (FY19-FY23) totals $2.43 billion and plans on higher borrowing by the City and utilization of other revenue sources.
- Despite Boston’s robust growth in the property tax, fueled by new development, the City should prepare for a time when the development pipeline will slow down.
Expected ongoing higher increases in the non-discretionary accounts of pensions, debt service, health insurance and state assessments will continue to intensify budget pressure on departmental services and require tighter control over personnel expenses. Read the full Special Report here>