Fiscal Year 2019 Budget

Beginning July 1, 2018 and ending June 30, 2019

Last updated: 7/1/18

Pensions, debt service, and other fixed costs

$28 million of the budget growth is committed to funding the City’s long-term obligations, like pensions and paying off debt incurred while building new schools, reconstructing roads and bridges, renovating police and fire stations, parks, libraries and other public assets.

The City’s pension schedule requires an 8% increase next year in order to maintain our commitment to fully fund the pension by 2025. This budget again dedicates $40 million toward reducing the City’s long term other post-employment benefits (OPEB) liability.
Actively addressing the City’s long-term liabilities is not only fiscally responsible, it is critical to maintaining Boston’s AAA bond rating. Maintaining this rating is crucial for the City’s ability to fund critical capital investments contained in BuildBPS, Go Boston 2030, Climate Ready Boston and other master planning efforts.
Debt service costs

The City borrows every year to support investments in its roads, bridges, school buildings, parks and police and fire stations. Based on its AAA bond rating, the City has continued to benefit from favorable interest rates and its position as an attractive investment. This high bond rating will be integral to unlocking a $1 billion investment in Boston schools over the next 10 years.

Even with the recent favorable borrowings, debt service costs are projected to increase by $8 million (4.4%) in FY19.