Peterborough Select Board proposes $25.01 million operating budget with no tax hike

Peterborough’s Select Board is proposing a flat budget for Fiscal Year 2027 that would result in no increase to the amount raised through taxation.

The total proposed operating budget is $25.01 million. After accounting for revenues, Enterprise Funds (ETF), Capital Reserve Funds (CRF), Revolving Funds and warrant articles, the net operating budget is $10.87 million — $193,122 higher than the previous year’s $10.68 million.

Town Administrator Nicole MacStay said revenues and capital reserve funds offset that increase, keeping the net amount to be raised through taxation at $12.33 million — unchanged from the previous year.

There originally was a $3,199 increase, but it was amended to $0 after an adjustment to the staff development line at the Select Board’s Feb. 17 joint meeting with the Budget Committee.

Tax Overview

MacStay said the $25.01 million figure includes expenditures from the General Fund, Revolving Funds, Enterprise Funds, Capital Reserve Funds and warrant articles.

Because Revolving Funds and Enterprise Funds are supported by fees, the portion of the budget supported by taxation is the $16.65 million General Fund. That amount is offset by $5.78 million in projected General Fund revenue, bringing the initial net to raise through taxation to $10.87 million, excluding warrant articles.

Warrant articles add a projected $1.461 million to the tax impact. Combined with the $10.87 million General Fund net, the total net to raise through taxation is $12.33 million — the same as in FY26, resulting in a 0% increase.

Warrant Articles 6, 7 and 11 represent the largest tax impacts.

Articles 6 and 7 are separate $400,000 requests from the Department of Public Works. Article 6 would raise and appropriate $400,000 for the DPW Fleet Management Capital Reserve Fund, while Article 7 would allocate $400,000 to the Roadway Systems Upgrades Capital Reserve Fund.

Article 11 would raise $230,000 for the Fire Department’s Apparatus and Equipment Capital Reserve Fund.

Budget Cost Drivers

MacStay highlighted several key cost drivers in the proposed budget.

“Health insurance premiums are up 7.5%, that’s a major contributor,” she said. MacStay noted that while premiums rise nearly every year, market volatility is driving the sharper increase.

Electricity costs are another significant factor. The town is budgeting 18.5 cents per kilowatt-hour, up from 13.4 cents per kilowatt-hour last year — an increase of 5.1 cents.

“Our contract with Community Power expired,” MacStay said. “Due to uncertainty in supply and delivery of electricity, we’re predicting a higher rate.”

Retirement costs are also rising. The town budgeted $181,451 for combined Police and Fire retirement expenses.

Proposed warrant articles

Of the 18 warrant articles reviewed, seven are new proposals, encompassing Articles 15 through 21.

Article 15 would establish a Health and Dental Expendable Trust Fund with a $25,000 appropriation from the Unassigned Fund Balance to help offset potential midyear insurance premium increases.

MacStay said the proposal is intended to avoid situations like the SchoolCare issue in FY26, when the town received a pro-rated bill from the Manchester-based insurer after it reported insufficient funds to cover member communities. The town received state permission to use its Available Funds Balance to cover the unexpected cost.

Article 16 would create an Accrued Benefit Liability Expendable Trust Fund with a $100,000 appropriation from the Unassigned Fund Balance to cover payouts for accrued leave and associated retirement and payroll taxes when employees leave town service.

Article 17 proposes establishing a Peterborough Community Power Expendable Trust Fund, funded with $250,000 from the Community Power Discretionary Reserve Fund, to support municipal renewable energy and energy-efficiency projects.

Articles 18 and 19 would add funds to existing trust accounts. Article 18 would appropriate $751,488 to the Greater Downtown District Expendable Trust Fund, and Article 19 would allocate $1.13 million to the South Peterborough District Expendable Trust Fund.

Article 20 addresses recent state legislation preventing qualified veterans from receiving both the Optional Property Tax Credit and the Optional Total and Permanent Service-Connected Disabled Property Tax Credit. The article would ensure affected veterans — fewer than 50 residents, according to MacStay — do not see a reduction in benefits.

Article 21 would prohibit keno games in Peterborough ahead of a 2027 state law expanding gambling. MacStay said the proposal is specific to keno, noting that bingo has been legal since 1972. She added that casino revenue would not benefit the town.

Residents can comment on the proposed budget at a public hearing March 3 at Town Hall.