FY25 City Budget Includes New Police Program, Funds for High School Project & to Meet Climate Goals

Print More

Watertown’s Budget Stable Now, May Not be in Future Years

Watertown City Hall

The City of Watertown’s financial situation looks good for Fiscal Year 2025, which starts July 1, 2024, but the City may face some challenging budgets in the following years, City Manager George told the City Council on Tuesday night.

The budget includes funding some ongoing efforts, such as the Watertown Square Area Plan, the Watertown High School project. It also includes funding to implement the City’s Energy and Sustainability Plan, to start the human rights commission, and add new programs, including at the Watertown Police Department.

On April 30, Proakis presented his FY25 budget, which will be $203.975 million, which is a 1.96 percent increase from the revised FY24 budget (the current year). The majority of the budget comes from local property taxes, which funds 81 percent, or $165 million in FY25. State Aid makes up about 8 percent of the budget, and will be $16.33 million (up about $269,000). Local receipts, such as motor vehicle, hotel and meals excise taxes, bring in $15.8 million or 7.75 percent.

The property tax figure includes a 2.5 percent increase allowed by Proposition 2-1/2, as well as $4 million in new growth (new developments).

The budget increase is under 2 percent for FY25, after increases of 4, 5, or 6 percent in recent years. Proakis said last year new growth was $10 million, but future years will be well below that figure and he expects the trend of shrinking new growth figures to continue.

“The projection (for new growth) this year is $4 million and the projection for following years is $3 million,” Proakis said. “It is not where it had been. Be aware there are not a lot of new buildings coming out of the ground in the Boston area, based upon where our construction finance world is now. Because of that, and increased debt service and higher interest rates, there is a substantial risk of financial headwinds based upon current trends.”

While he does not see new growth going above $3 million each year from FY26, 27 or 28, he also does not believe it will drop below $2 million. Proakis said he is taking a conservative approach.

“I believe we have eight lab buildings that are permitted that have not started construction at this point,” he said. “I don’t want to plug one of those into projections for new growth until I see shovels in the ground and a building coming out of the ground.”

Depending on what types of new developments are built, Watertown residential property owners may see greater tax increases. Watertown shifts the burden of property taxes 175 percent from residential to commercial, industrial and personal properties. However, in recent years, the City has run into the limit of how much can be shifted. The State limits the property value that can be shifted. Most of the recent development has been commercial projects, including life science labs.

In Watertown’s case the limit is to have at least 61.24 percent in residential value, but this year a Home Rule Petition was passed by the Legislature allowing Watertown to drop that to 50 percent. The relief will only be for three years, unless extended.

“Even with that relief we are still at a ceiling as far as how much tax burden we can put on the commercial side,” Proakis said. “It means there is some value in doing multifamily residential and commercial together as we come out of building recession into a new growth situation. If we do them together we can keep that 175 percent split on the commercial side.”

Budget Highlights

The budget includes funding some ongoing efforts, such as the Watertown Square Area Plan, the Watertown High School project. It also includes funding to implement the City’s Energy and Sustainability Plan, start the Human Rights Commission, and add new programs, including at the Watertown Police Department.

The budget includes $1.8 million for the Watertown Square Stabilization Account, to go along with $1.8 million put into the account in October.

“This will allow us to start the streetscape design to begin upon completion and approval of the plan ….” Proakis said. “When the Council sees fit to approve the plan that includes streets and sidewalks and parks and open space we can go work on the next step, which is to find someone to essentially to take the conceptual drawings that have been through the community process and start advancing them through an engineering and a landscaping architecture design process which we can take and continue to share as we refine them.”

The budget also includes $2.1 million for the High School Stabilization Account, which Proakis said means Watertown has reached an important milestone with the project by covering the last gap in the projected budget and not having to borrow more than $150 million.

“I do believe at this point we can say we are back in a position where we are fulfilling the statement that (former City Manager) Mr. (Michael) Driscoll made that he would work to deliver a brand new high school to the City of Watertown without a debt exclusion and within the confines of Proposition 2.5,” Proakis said. “And this $2.1 million was the last piece. It was literally one percent of the (total City) budget. That one percent was important to get us to that point. I want to get us there and keep us there.”

The budget includes funds to establish a police cadet program with four part-time cadets, Proakis said. He added that the program, along with changes in the collective bargaining agreement, will help with police officer recruitment.

“The creation of the cadet program allows us the opportunity to bring people in to work part time in the Police Department to do a number of different roles, even fill some of those crossing guard roles that we sometimes struggle with,” Proakis said.

Sustainability was the City Council’s number one goal, and Proakis said the budget includes funding for 1.5 new employees to focus on climate efforts. A Sustainability Planner in the Community Development & Planning is in the budget along with money to make a part-time grant-funded sustainability position full time. Also, a part-time Recycling Coordinator is planned in the Department of Public Works. Funds will also be available to invest in the City’s solar infrastructure, tree plantings, and transportation management goals to achieve climate targets, he added.

The budget provides $5,000 for the newly created Human Rights Commission. The budget also has funds to provide full text transcription and summaries of all televised public meetings, and $7,000 to support the Department of Senior Services’ new Transportation GoGo Program, which
provides affordable and accessible transportation services to seniors.

The City will transfer $50,000 in pest control funding from DPW to the Health Department
budget. Proakis said the DPW will continue to oversee pest control for construction projects, and general pest control needs will be handled by the Health Department.

Another new position is a management and grants specialist who will report to the City Manager.

“This focus will allow the City to have a centralized staff person that can seek out grant
opportunities and work with staff to provide the best possible applications for these programs,” Proakis said.

The budget includes $1.25 million for the account to purchase properties. Proakis said this money plus $1.25 million put in the budget last year, provides $2.5 million to use if the opportunity arises for the City to purchase land.

The Affordable Housing Trust would receive $250,000, and $17,000 has been allocated for the Watertown Cultural Council.

“This is new. We have been supporting our Arts and Culture Committee with funding. This is essentially what a lot of communities have been doing — matching a state grant for the cultural Council, which allows them to basically double their ability to provide impact in Watertown,” Proakis said. 

The City Council will hold a series of budget hearings in May and June. The budget will be voted on in June.

See City Manager George Proakis’ budget presentation slides by clicking here. See the detailed budget book by clicking here.

Leave a Reply

Your email address will not be published. Required fields are marked *