The budget presentation highlighted the impact of inflation on the town’s fiscal landscape, with healthcare and benefits costs identified as major drivers of increased spending. The town’s retirement assessment is set to increase by over 8%, with healthcare premiums anticipated to rise by an average of 14.8%. These rising costs are straining the town’s budget, which heavily relies on property taxes capped at a 2.5% increase.

To address the budget shortfall, the town is exploring state grants to fund essential positions, such as health inspectors and a mental health clinician for the police department. However, the reliance on grants underscores the precariousness of the town’s financial situation. The elimination of several positions, including a community services coordinator and a business development director, further highlights the challenges faced in maintaining service levels.

Public safety staffing remains a concern, with the fire department operating at minimum staffing levels and facing occasional station closures. Similarly, the police department’s ability to respond to traffic safety complaints and medical emergencies is hindered by the lack of additional officers. These staffing constraints are compounded by competitive wages in the labor market, which have led to the departure of trained personnel for better-paying positions elsewhere.

The town is also grappling with the need to balance its budget in compliance with state laws, as deficit spending is not an option. This fiscal reality necessitates careful consideration of operational strategies and reserves to avoid jeopardizing the town’s financial health and bond rating. The budget discussions emphasized the importance of addressing these challenges collaboratively, with the possibility of raising fees and exploring regional partnerships to enhance efficiency.

Amid these financial challenges, the town’s educational spending remains a priority, with Chelmsford exceeding the state-mandated net school spending requirement by 31%. However, the cost to educate a child in Chelmsford public schools has reached nearly $18,000, raising questions about budget sustainability. The school budget is proposed at $75.65 million, reflecting a 2.4% increase, while general government operating departments see a more modest increase of 1.7%.

The budget constraints are further emphasized by the allocation of $4 million, or 69% of the new available funds, to health insurance and retirement assessments. The Massachusetts Middlesex County Retirement System assessment amounts to $113.1 million, with $12 million dedicated to addressing unfunded pension liabilities that must be resolved by 2040.

Chelmsford’s capital improvement plan, part of the fiscal year 2026 budget, outlines $6 million for infrastructure projects, including school security enhancements and public safety facility upgrades.

The meeting also highlighted the town’s revenue sources, with property taxes constituting over 76% of funding. The average single-family tax bill has increased by 19.8% over five years, reaching $8,820. This shift in tax burdens is due to stagnant commercial property values, further complicating the town’s financial outlook.