Much-anticipated figures are now in from Group Insurance Commission, the state-backed insurance plan the town uses to purchase employees’ health insurance. The increase for fiscal year 2027 will be 11%, down from the 15% feared earlier but not as low as recently hoped.
“Pretty much the same,” Marblehead Finance Director Aleesha Benjamin wrote in an email to the Current Saturday night about the final impact. “No real change.”
That means the town’s projected $7.7 million deficit will likely not decrease significantly.
On March 11, Town Administrator Thatcher Kezer is expected to reveal several override proposals to help bridge the shortfall.
A week earlier, Kezer presented two stark budget scenarios that would either dramatically shrink town government or introduce new fees and additional cuts to maintain some services.
“This is not a surprise, but it is shocking what we’re facing right now,” said Town Moderator Jack Attridge at the March 4 presentation.
The deficit is due to rising health insurance and trash costs, inflation and limited revenue growth under the state’s property tax limits, Kezer said.
Scenario A: Major service reductions
Under Scenario A, the town would balance the budget mainly through cuts.
“In order to balance our budget on the town side, we had to prioritize functions that protect life and property,” Kezer said. “And the end result is we had to defund six departments.”
Those departments are: Community Development & Planning, the Cemetery Department, the Health Department (except for the required health agent), the Council on Aging, the Abbot Public Library and Recreation and Parks.
Those cuts would eliminate 56 positions out of the town’s roughly 185 to 190 municipal jobs, according to Kezer.
Scenario B: Fees and shared cuts
Given the severity of those reductions, Kezer also presented Scenario B, which seeks to maintain most municipal services through a combination of new revenue and additional cuts.
The plan includes:
- A new curbside trash fee, expected to generate about $2 million annually
- An additional $1.5 million reduction in the school budget
- Additional municipal spending cuts
The trash proposal would shift the cost of curbside trash, recycling and disposal to residents through a fee of about $254.64 per household per year, or roughly $21 per month, based on an estimated 8,000 households. Residents who qualify for tax exemptions would receive discounts, and households could opt out by using the Transfer Station instead. (Residents would still need to purchase Transfer Station stickers.)
“What this would do is make available just over $2 million in the general fund to allow us to use those funds to go back and fund those departments that are defunded in Scenario A,” Kezer said.
Read more about the proposed trash fees on Page 7.
The additional school reduction would bring the district’s total proposed cuts to about $3.4 million, after the district had already reduced its fiscal 2027 request by $1.9 million.
Read more about the schools’ budget on Page 7.
Library closure with both scenarios
Even with Scenario B, the town would still lose at least one major service.
Abbott Library Trustee Gary Amberik said the library would likely close in December under both scenarios, unless voters approve a tax override.
Even with the less draconian Scenario B, the positions of Marblehead’s director of community development and planning, grant coordinator and sustainability coordinator would all be eliminated.
Financial pressures
Kezer said the town’s budget challenges are not caused by an expanding workforce.
From 2018 to 2026, the town’s employee count has remained relatively stable, declining from 199 positions to about 190.
“Our budget challenges are not a result of huge increases in the number of employees,” Kezer said. “It is driven by health costs, inflationary costs, trying to keep employee salaries at the market rate.”
‘Perfect storm situation’
Several Select Board members signaled early support for Scenario B as the less disruptive option.
“My vote would be for us to proceed with Option B, minimizing the drastic change and disruption of service levels that Option A would dictate,” said member Erin Noonan.
Select Board member Moses Grader wasn’t sure that voters would agree to paying $250 a year for trash pickup, in addition to an override.
“We’re in a perfect storm situation,” Grader said. “Dramatic increases in health care costs, big reduction in free cash.”
But some residents raised concerns about shifting costs to residents through trash fees.
“All I can think of is, now we have a system in place that’s just going to get hiked,” said Jonathan Klopman. “We’ve opened the door to another massive program that is going to affect people.”
Resident Al Jordan also criticized the approach, saying it could hurt working residents and seniors.
“Real Marbleheaders don’t like spending money… unless it’s spent wisely,” Jordan said. “This isn’t a wise plan.”
