February 6, 2026
To: Town Council
From: Jamie Hellen, Town Administrator
RE: FY27 Budget Model Revision & Revised Five-Year Fiscal Forecast
Attached is the latest draft FY27 budget model, which presents a balanced budget model. All budget documents will be uploaded to the one stop shop town budget website.
Staff have provided a revised FY27 budget model and forecasts from the August 2025 version:
- Town Administrator Memorandum;
- Revised FY27 Control Sheet and Budget;
- Five-Year Fiscal forecast to reflect the proposed baseline FY27 budget.
Executive Analysis
I present a balanced budget model for FY27. This model provides updated revenue assumptions, the requested budget model by the Superintendent, and all department requests, including the restoration of some lost municipal services. Highlights are detailed below.
FY27 Budget Model Revision
The elected officials, town boards/committees and community stakeholders need to begin to strategize a sustainable solution to the structural budget deficit for FY28 and beyond, while analyzing the pros and cons of the decisions that will have to be made in FY27. This model will continue to shift slightly throughout the budget process, but is a very strong foundation going into the FY27 budget season. The model presented tonight will largely mirror my budget submittal as my formal budget proposal under Town Charter requirements in 6-3-1, 6-4-1, and 6-5-1. See dates below.
I have provided a model to give everyone time to strategize a game plan for the future without any department cuts or conversations about property tax increases in FY27. Given the context of two failed overrides within the past 18 months, the proposal tonight does not show the need for a general override or any other tax increase that affects the operating budget.
While the use of one-time funds is far from ideal, I can realistically expect that the town can use $1-2 +/- million a year in free cash in a short term (1-2 years) manner, while a sustainable strategy is decided by the Town Council, School Committee and the community. However, this approach will have an impact on the town and school capital program for FY26 and gets us further behind for future investments to town and school fleet, capital, facilities, fields, and infrastructure.
The model does not impede on Tier 1 capital requests, which were recommended for approval by the Finance Committee. Tier 1 requests are focused on items that were broken and needed to be fixed/replaced, as well as investments in safety gear and technology for police and fire. My recommendation is to hold off on any additional capital funding considerations that have not been recommended by the Finance Committee until after the operating budget is finalized. Any remaining free cash can pay health group deficits or provide additional capital allocations.
Health Care Transition
I have assumed a 14% increase for all school and town employee health care employees based on current enrollment. Group Insurance Commission (GIC) rates and plan design are set in mid-March. Open enrollment is in April. Staff will have definite health care numbers by approximately Memorial Day. The actual data could be under the assumption, or we could be over. We could have surpluses, or deficits, from our existing self-insured health group as we exit that system. Once health care numbers are in, staff can modify a final budget (the weeks of May 25 and June 1st) with a final FY27 budget vote expected on June 10th.
While the budget assumes $8,814,000 million transfer in benefits ($7,980,000 employee health care and $834,000 in Medicare) costs from the schools to the town benefits budget, it is my intention to transfer the figure based on actual subscriber data (as well as assumptions of any future changes in that figure through October 1st, 2026 when school hiring has been largely completed). This number is almost certainly going to shift and we will work with the schools on these assumptions.
Franklin Public Schools - Account 300
This budget model assumes the Superintendent's recommended budget, as presented to the School Committee over the past few weeks. I have provided an Account 300 chart at the bottom of this memo to show the history of requests versus allocations over the past decade.
I give significant credit to Chair Paul Griffith, Vice-Chair Callaghan, Superintendent Giguere, and the former and current School Committees for doing the very challenging work toward stabilizing the School budget over the past two years. Through disciplined collective bargaining strategy, thorough review of operations, many very difficult decisions and public discussions, a long overdue redistricting and a District Improvement Plan (DIP), I feel the Schools are in the most stabilized financial position in my tenure in Franklin. While strategic investments are desired and a game plan is needed for both capital and operating, the District is on a solid foundation for FY27.
Furthermore, the School Committee unanimously voted this past week to transfer school benefits to the municipal budget account 910. I greatly appreciate the collaboration!
Student achievement is excellent and very competitive in Eastern Massachusetts. For High Schools over 1,400 students, Franklin ranks among the best Top 20 high schools in Eastern Massachusetts and is mentioned in the same class as some of the most desired large districts. Franklin is providing an excellent education to students across all grade levels, including multiple Blue Ribbon winning elementary schools, while providing consistently championship level athletics and an overall great experience for kids to thrive and excel.
Continue reading the memorandum - https://ma-franklin.civicplus.com/DocumentCenter/View/8319/11a-1---MEMO---FY27-Budget-Update---List-of-Changes
