We are grateful for the Educational Stabilization Account, which is now a critical source of new funding for Newton Public Schools. However, it should be noted that once the Educational Stabilization Account is fully depleted, we expect to have a substantial funding shortfall that will need to be addressed. It should also be noted that the school district intended a $5.1M usage for FY26 and, at least in the initial discussions with Mayor Fuller, we are not in agreement with this previously published expectation.
2. Growing and complex student needs
Newton, along with all other Massachusetts communities, continues to cope with growing and increasingly complex and persistent student needs, both in academics and in social- emotional health and well-being. These needs have only been exacerbated by the COVID- 19 pandemic, increased isolation and interpersonal and emotional setbacks post-pandemic, and student needs and unfunded state mandates to meet them are growing, despite declining enrollment. To meet those growing needs, the district will be creating additional special education classrooms including one STRIDE classroom at Bowen Elementary School and new REACH classrooms at Lincoln-Eliot. These programs will require a grand total of 15.1 new FTE spread across both programs. More information about these programs can be found in the Overview by Major Program Area section below under the subtitle “Student Services” in the pages below.
3. Benefit and Salary costs outpacing our revenue
Health insurance costs have been rapidly rising across Massachusetts, and Newton is no exception. Historically, health insurance rates have risen annually at a rate of roughly 4.5%; in FY25, however, this rate rose by 5.0% and in FY26 health insurance rates are anticipated to rise by 11.2%. In FY25 Newton was given $700,000 of one-time funding meant to offset some of the strain of rising insurance costs and is expected to receive $1.3M in one-time funding for this same purpose. These funds, while appreciated, are not anticipated to be offered again to the district in FY27, which means Newton will need to make up these funds while likely also continuing to deal with untenably rising health insurance costs. The issues created by NPS needing to rely on one-time funding like this are further expounded upon in the next bullet point. Other benefit costs are anticipated to rise much less rapidly, save for Worker’s Compensation, which is anticipated to rise by 25% over FY25’s costs, and Medicare Part B, which has been steadily decreasing due to being slowly phased out over the past two years. Overall, all employee benefits costs are rising in FY26 by a grand total of $3.4M, or 7.9%. In addition to rising health insurance costs, Newton has the added budget pressure of its salary costs increasing by more than the district’s annual allocation, as is the case for many municipalities; indeed, many who have recently settled new educator contracts have needed to make cuts due to new costs. The annual allocation for Newton Public Schools, as mentioned at the outset, is growing by 3.65% for FY26; salaries rates, however, are growing by an average of 4.3%. With salary and benefits costs already making up 87% of the district’s budget, these increases place considerable budgetary pressure on the district to meet these growing employee costs while also maintaining a high level of quality education
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