QUINCY — Mayor Thomas Koch has called for a 7.7% spending increase for the next fiscal year to pay for an operating budget he says “truly reflects the value of our community.”
The mayor Monday presented a budget of $372.7 million to city councilors, including $120 million for school service and $69 million for public safety operations. The proposed budget for the fiscal year that begins July 1 is a steep increase over the current year’s budget of $346.6 million.
“Working together, we have a quality of life unmatched in the Commonwealth,” Koch told councillors. “I’m constantly asked, ‘Why are we doing so much? Wait.’ Wait what?… I believe we are preparing this city to be better left than we found it.”
The budget increase is so significant, Koch said, in part because the past two years have been kept “very lean” due to economic uncertainty during the coronavirus pandemic. He said local revenues, including building fees, meal taxes, hotel taxes and excise taxes, are increasing; state aid is on the rise; and the city expects revenue from the new city-run Furnace Brook Golf Club to offset some costs.
Koch said the majority of the 7.7% increase is largely related to rising health care costs, wage increases for city and school employees and the second year of integration of debt service for a $475 million pension obligation approved in 2020.
The city borrowed $475 million over a 30-year bond term to pay off the city’s pension obligation, which at the time was an unpaid liability. The bond replaced the old pension fund repayment system — in which the city pension board essentially sent out a bill at the start of each budget season — for a bond funding plan that funded the pension system in one go. one time.
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This year, the city will pay $15.6 million for bail, up $6 million from last year. Koch said he expects that number to continue to rise for another two years and then level off for the duration of the recovery period.
“We have a bit more debt to come for the next few years, but over time, I believe, looking back on it, it will be a decision that will be welcomed for many years to come,” he said.
Added teachers, police officers and more
This year’s budget also includes an additional $3.5 million for the school department to hire new teachers, who will be paid for through increases in public education funding. The budget adds five new police officer positions; $600,000 in investment capital for the public building service; a community liaison for the mayor’s office to manage equity and diversity efforts; and several other full-time positions, including a food inspector, four part-time library workers, and a building inspector.
An additional $6 million has been set aside to pay for planned wage adjustments for city employees. All of the city’s employment contracts are due to expire this year.
The majority of the city’s budget is funded by property taxes, with state aid and local revenues covering the rest. Tax rates are set for the calendar year but the city’s fiscal year runs from July 1 to June 30.
The city decides its tax rates each December by determining how much money it will need to fund the budget over the last six months of the fiscal year, and works backwards from there to find the rate needed. for it.
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Such a large increase in the budget will likely lead to higher property taxes this fall. Koch said the city has never taxed residents as much as it could, and even taking into account increased spending, there will still be tens of millions of dollars in excess drawdown capacity.
Chris Walker, chief of staff for Mayor Thomas Koch, said the fiscal year 2023 budget will be available Tuesday on the city’s website.
City councilors did not discuss the budget on Monday, but will instead hear from city department heads in a series of finance committee meetings in the coming weeks. Councilors can reduce money from the mayor’s spending plan, but cannot add to it. The budget must be returned to the mayor’s office with all cuts finalized by mid-June.
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Contact Mary Whitfill at mwhitfill@patriotledger.com.
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