Increasing costs of special education tuition has contributed to the sharp increase in the school budget over the past few years, Superintendent Dede Galdston told the School Committee on Monday night, and for budget for the 2026-27 school year the district will have to find ways to close a multi-million dollar deficit.
During the Preliminary Budget overview for the Fiscal Year 2027 School Budget Galdston said the shortfall facing the Watertown Public Schools is $2.5 million, which is based on what she called a level-services budget. The total budget would be $67 million, while the current revenues — including a 4 percent increase in funding from the City — is $64.5 million.
School administrators and the School Committee will be working on the budget for the next several weeks, and the School Committee will hold a public hearing on March 23 and take a final vote on the recommended budget on March 26, Galdston said.
“So what we need to do is think about our level-services budget, think about what we can do to bridge that deficit so that we are able to balance a budget moving forward,” Galdston said. “But realizing that with that has to come some creative thinking as to how we’re going to do that without impacting services to our students here in Watertown.”
The biggest increases come in contracted salary increases, which will be about $2.5 million higher than the current budget year, and an anticipated increase in the special education budget of $2.1 million, Galdston said.
“Tuitions for private school (special education) placements over the last five years have increased 42 percent,” Galdston said “Our budget has not increased 42 percent. Our budget has increased about 16 percent, so when you have that large difference it needs to be included in the considerations for the budget.”
The state does provide some relief for out-of-district special education tuitions, through the special education circuit breaker. Districts get 75 percent reimbursement for costs above $59,000 per student (the district pays the first $59,000).
Galdston said that amount is based on the previous year, and also has varied — especially when there is a difficult budget year at the state level. This could be one of those years.
“Why I say up to 75 percent because the state is it varies upon what the state can allocate to circuit breaker when there were difficulties in the finances at the state level, that reimbursement was 55 percent so if you build your budget thinking you’re going to get 75 percent back, then you’re going to be in trouble, because you’re going to be really short,” she said.
The City has a Special Education Stabilization fund to cover the cost of unexpected increases in special ed costs. City Council President and School Committee member Mark Sideris said the Stabilization Fund was created after the Watertown Schools had funding emergencies.
“The past two times that I’ve sat on the City Council that we had to come up with additional funding mid-year was before we did a stabilization fund, because we got some additional out-of-district placements that were we couldn’t cover the cost,” Sideris said. “We had to get the City Council to provide the funding.”
School officials have already looked at areas of potential savings, including prepaying some of next year’s special education tuitions from budget surpluses left after Fiscal Year 2026, look at staffing to student ratios and save through attrition, reinstating the athletics and extracurricular fees, increasing bus and building rental fees, and tapping into revolving funds.
Staff attrition could save up to $800,000, said Galdston who stressed that would not mean layoffs.
“We’re not talking about wholesale reduction of force. That’s not what we’re talking about,” Galdston said. “We’re looking at attrition, which means if somebody leaves, do we need to refill that position? We have unfilled positions, do we need to fill the unfilled positions? If it’s February and we haven’t had the need to fill that position.”
The Watertown Public Schools have also frozen any non-discretionary spending for the rest of the current school year, Galdston said.
For the past three years, Watertown students have not had to pay sports or extracurricular fees, but Galdston said that is no longer possible because the revolving funds that used to pay for those have been depleted.
“So we would have to build that back up by reinstating fees,” Galdston said ” We’ll talk about this in depth later, but we would go back to what I think was a very wonderful way to do athletic fees, which was one-time your first sport is $150 your, second sport is $75, and then your third sport is free.”
The School administration has also created a priority list for positions and initiatives to be funded if additional funding is found. The items have been ranked, with the top priority going to an assistant principal/Special Education Administrator, second priority would be a Watertown High School history teacher and a Cunniff Elementary School math interventionalist, and the third priority would be a Lowell Elementary School math interventionalist and a WHS English teacher.
School Committee member Lisa Capoccia said she would like to see another budget figure included when the school budget is presented to the public.
“If you ask us to recommend a 4 percent increase, then that’s totally fine. That’s your choice, but I don’t think that’s level-service,,” Capoccia said. “I’d like to see another budget that doesn’t have to be 8 percent more, but maybe it’s the $800,000 and includes some key ranked salary and ranked non-salary items. Because I think it’s not so much about us not going with your recommendation, it’s very important that the community understands the cost of education and what they get with certain amounts.”
See the documents from the Watertown Public Schools’ FY27 Preliminary Budget presentation by clicking here.