Hanover Proposes $3.5 Million Override for FY2026

School funding increase, property tax hike included in plan

HANOVER - February 3 - Hanover officials are considering a $3.5 million override for fiscal year 2026 that would increase property taxes by an average of $911 for residential taxpayers. The proposal, presented to the Select Board on Feb. 3, includes a $3.8 million increase for Hanover Public Schools.

Town Manager Joseph Colangelo and Budget Director Jim Hoyes outlined two budget scenarios - a base budget within the constraints of Proposition 2 1/2 and an override budget requiring voter approval.

"These three cost centers highlighted here, the combined total increase since 2019 is the increase of 10 million dollars annually on the operating budget, also showing an 80 percent increase since 2019," Colangelo said, referring to mandatory cost increases in areas like pension obligations, special education, and vocational school assessments.

The override scenario budget would increase recurring revenue by $5.2 million compared to FY25. It allocates an additional $3.8 million to Hanover Public Schools, as requested by the Select Board.

"This override proposal would estimate to increase property taxes by $911 for the average," Colangelo said. "So below your $1,000 limit."

The Select Board had directed Colangelo to keep any override increase under $1,000 for the average residential taxpayer.

Hoyes noted about 63% of homeowners would face a tax increase below the $911 average under the override, while 37% would see a larger increase.

The base budget proposal includes a $1.9 million increase for Hanover Public Schools to maintain current service levels plus an additional $500,000. It also preserves state certification funding for the town library in both budget scenarios, as directed by the Select Board.

Officials are projecting declining new growth revenue, which has boosted budgets in recent years. Colangelo said new growth estimates are "much less now" with major developments like the mall already completed.

To offset some costs, the town plans to apply $750,000 in meals tax revenue to the operating budget, up from $450,000 this year. Meals tax receipts have grown significantly, with projections showing over $1 million annually by fiscal 2035.

"When you back into what gross receipts that is, it's over $100 million a year of restaurant meals across the town that's generating this tax revenue," Hoyes said.

The base budget proposal also reduces the use of free cash reserves to $1.1 million, down from $2.3 million in fiscal 2023. Hoyes cautioned free cash may be limited next year due to tight budgets.

"I wouldn't expect free cash to be very large coming in to be added to whatever's left over," he said.

The proposals come after voters rejected a $1,400 average tax increase override last year. That resulted in service reductions and new fees like transfer station charges.

The Advisory Committee will review the budgets in coming weeks before making recommendations to Town Meeting in May.

Colangelo defended the budget process amid some community criticism.

"We really have tried to look at every piece of information that's come in, every critique, every suggestion, nothing's been discarded," he said. "It was all heavily considered and certainly did our best to deliver a budget, you know, under the general policy directives that this board sets and also taking in the input from the entire community."

Select Board Chair Vanessa O'Connor emphasized the importance of passing an override this year.

"I think it's absolutely imperative that we pass this override," she said. "I do hope that even if everyone does feel that this wasn't exactly what they wanted, I mean, that's the definition of a compromise, but I think we all need to try and get on a similar page."

The Select Board inserted the budget proposals into draft warrant articles for the May 5 Annual Town Meeting. Voters will have final say on any override at the town election May 17.

Full meeting available via HCTV.