Scituate Faces Budget Cuts, Adopts New Financial Policies

Town officials grapple with limited revenue growth, consider future override

SCITUATE, MA - November 5 - Scituate officials are facing tough decisions as they prepare the fiscal year 2026 budget, with limited revenue growth forcing cuts to vacant positions and reductions in some services. At the same time, the Select Board has adopted new financial policies after a four-year process, aiming to improve the town's financial management and planning.

Town Administrator Jim Boudreau presented an overview of the FY2026 budget to the Select Board, highlighting the challenges ahead. The town is anticipating a 2.5 percent increase in taxes, aligned with Proposition 2 1/2, and new growth of $700,000, down from $1.9 million in the previous year.

"We are anticipating two and a half percent increase in taxes. New growth at 700,000. Last year it was 1.9. We'll see when that takes a huge nosedive," Boudreau said.

The budget constraints have led to the elimination of several vacant positions, including a client operator position in the Water Enterprise and positions in the police department, library, and engineering department. Seasonal positions have also seen reduced hours.

Boudreau emphasized that no layoffs are planned, but the town is facing a significant shortfall. "We have $1.3 million... For all the operating budgets left over, when we do the splitting of the schools, that'll add up to $380,000 to fund everything that needs to fund fiscal year 26," he explained.

The budget discussion included the possibility of an override in the future. The Select Board approved a new policy requiring the budget to include a discussion of an override option when service reductions are proposed.

Board member James Gilmore supported this policy, stating, "I think it's just a good practice to have this as a right of discussion. That when overrides, when cuts have to occur, there should be an answer."

In a separate but related matter, the Select Board adopted new financial policies after a four-year process. The policies cover areas such as debt, revenue, enterprise funds, and capital reserves.

Nancy Holt, the town's Finance Director, presented the policies to the board. "I think predominantly, we're in agreement with them," she said, noting that most of the policies align with best practices.

The new policies include guidelines for maintaining reserve fund balances, limits on debt service as a percentage of the budget, and requirements for funding other post-employment benefits (OPEB) liabilities.

One policy that generated discussion was the requirement for enterprise funds to maintain emergency reserves. The board ultimately approved a policy allowing enterprise funds to maintain reserves between 0.05% and 2% of their budgets, with a minimum of $10,000 to $50,000 recommended.

Gilmore expressed support for the policies, saying, "I think by having these kinds of statements in our policy, it is going to, not just us, but future boards, going to ask you to work to the better interest of running a patch."

The adoption of these policies is expected to improve the town's financial planning and potentially impact its bond rating. Holt noted that the policies will help ensure compliance and transparency in the town's financial operations.