Frequently Asked Questions

The City of Melrose is responsible for presenting a balanced budget every year. As of March 2025, the city council is in the process of developing its Fiscal Year 2026 (FY26) budget for July 1, 2025 to June 30, 2026.  

Just to maintain the city’s current services, they are looking at a budget shortfall of around $6.1 million.

While the city council is considering fee increases and other options to help bridge the gap and preserve services, these measures fall far short of the funding necessary to maintain our schools, public safety, and municipal services. This is where a tax override becomes essential.

The city has dedicated a page to share all FY26 budget documents with the community. Check it out here.

The city budget process typically involves several key steps:

1. Departmental Requests: City departments assess their financial needs and submit budget requests for the upcoming fiscal year. << We are here
   
   

2. Executive Review: The mayor reviews these requests, balancing them against projected revenues and priorities, and then drafts a proposed budget.
   
   

3. Legislative Approval: The city council examines the proposed budget, holds public hearings for community input, and makes necessary adjustments before approving it.
   
   

4. Implementation and Monitoring: Once approved, the budget is implemented, with ongoing monitoring to ensure funds are used as intended.

The mayor has created a task force to advise on options for a November vote on a Proposition 2 ½ override, and they’re currently developing one or more override questions to address the city’s revenue needs in the years ahead.

The mayor will present an override request to city council. If they approve the request, the question(s) will be put on the ballot for a citywide vote.

We’ll update this page as we get more info, most likely in May 2025.

Inflation has hit budgets hard in recent years, especially in key areas like transportation, healthcare, and construction—major expenses for every city.

Massachusetts Proposition 2 ½ limits the amount of property tax revenue a city can collect to a 2.5% annual increase (plus new growth). This limit has not kept pace with inflation for many years.

Lagging Chapter 70 funding - the primary source of education funding from the state of Massachusetts to Melrose - has not kept up with our required expense increases.

A low commercial tax base in Melrose means we rely heavily on residential taxes. Another contributing factor is the expiration of pandemic-era federal funding, but without a corresponding drop in required expenses.

Proposition 2 ½ is a Massachusetts law designed to keep taxes predictable, while giving the voters the power to approve local tax increases to fund the services they believe are necessary and valuable.

Proposition 2½ was passed in 1980 and limits the amount of property taxes a city or town can collect, called the total tax levy.  But over time, it’s made it difficult for cities and towns to keep up with inflation and rising costs for schools, public safety, and services. Here are the limits:

• Levy Ceiling: A municipality cannot collect more than 2.5% of the total assessed value of all taxable property in a given year. (This is not affecting us in Melrose - we are at 1.03% for fiscal year 2025.)

• Levy Increase Limit: The total amount a city or town can increase its property tax revenue each year is capped at 2.5% over the previous year's levy, plus additional revenue from new property developments (referred to as "new growth"). This is what is constraining us in Melrose!

If a community needs to raise more funds than these limits allow, it must seek approval from its voters through a process known as an "override" or "debt exclusion." An "override" is an increase, or bump up, to the total tax levy amount, and a "debt exclusion" is an increase that only lasts as long as it takes to pay off a specific large expense, like a building.

You can watch an explainer video here and read about it here.

We’ve all felt the burden of inflation, and we understand that when costs rise and budgets can’t keep up, a certain amount of “belt tightening” must occur.

But Melrose has been operating with a very tight budget for years, and at this point, further cuts jeopardize our safety, basic public services, and our ability to fulfill contracts and meet state education standards.

In fact, in FY2025, Melrose per capita revenue and spending was in the lowest third of communities statewide (27th percentile), and was lower than that of peer communities like Stoneham, Saugus, Wakefield, Reading, Lynnfield, and Winchester.

At this point, a lack of appropriate funding could even end up costing the city more money in the long run due to out-of-district student placements, lack of efficiency, and more.

Yes. In anticipation of increasing shortfalls, an operating override for $7.7 million was put to a vote in June 2024 but was voted down, 55% to 45% (roughly 900 votes). Because of this, our city has already eliminated jobs and services, and is proposing further cuts for FY26 (July 2025 - June 2026).

We recognize that some voters wanted more information or more time to decide in 2024. This time, we’re providing even more transparency, education, and community engagement to ensure every resident understands what’s at stake. We’re hopeful that this time around, voters will have more time to learn about the issues and come together to fund our city.

Across virtually every metric—school spending, city spending, and tax rates—Melrose lags behind neighboring communities, and in many cases behind state averages.

Per-student spending

In FY2023 (the most recent year for which compiled statewide data is available), Melrose spent $16,293 per pupil. That’s 14.9% less than the average in this list of our peer communities, which average $19,147 per pupil.

• Melrose: $16,293

• Saugus: $18,564

• Reading: $19,058

• Winchester: $19,015

• Lynnfield: $19,534

• Wakefield: $20,658

• Stoneham: $20,910

City spending

We spend less per capita than neighboring comparable communities (2025 data):

• Melrose: $3,889

• Stoneham: $4,122

• Saugus: $4,342

• Wakefield: $4,646

• Reading: $5,003

• Lynnfield: $5,681

• Winchester: $7,301

Sources: The Massachusetts Department of Elementary & Secondary Education and The Massachusetts Department of Revenue – Division of Local Services.

We don’t have the numbers yet. Once the mayor’s override proposal has been submitted and approved, we’ll update this page with more information.

There are a number of programs for homeowners who need help. You can access this list of Property Tax Exemptions and Deferrals through the City of Melrose website, as well as the Water, Sewer, and Trash Discount program.

We should all spread the word about these programs to make sure that our neighbors feel comfortable with their options.

Melrose has three news sources:

• The Melrose Weekly News—online or delivered each Friday

• The Patch (Melrose)—online only

• The Melrose Messenger—online only

For non-news sources:

• From the City of Melrose, sign up for emails or see all options here

• To get Yes for Melrose updates, sign up here!

Head to our Get Involved page for more info.