Boston City Budget FY2027 Breakdown

Last updated: Oct 25, 2026. Figures come from the City of Boston’s adopted fiscal 2027 budget documents and will be updated when the fiscal 2028 proposal is released.

Featured image: Boston City Hall at Government Center. Photo: Daderot via Wikimedia Commons, CC0 public domain dedication.

Where does Boston’s money go? The city’s fiscal 2027 operating budget, which runs from July 1, 2026, to June 30, 2027, totals about $4.9 billion. The Boston City Council gave final approval on June 24, 2026, after a contentious spring. This explainer breaks down the largest spending areas, where the revenue comes from and what was fought over, using the city’s budget documents and its Analyze Boston open data portal.

How big is Boston’s budget?

The adopted operating budget is $4.94 billion, an increase of $29 million, or 0.6%, over fiscal 2026, according to the city’s executive summary. The city says the increase is $99 million, or 2.1%, when one-time fiscal 2026 supplemental spending, including extra snow and winter costs, is excluded. All of the operating budget runs through the city’s general fund.

Separately, the city adopted a $4.5 billion five-year capital plan for fiscal 2027 through 2031, which pays for buildings, streets, parks and schools. WBUR reported that the plan funds 321 projects.

Where does the money go?

Boston Public Schools: about $1.73 billion. That is the single largest item, roughly 35% of the budget. The city says the school budget rose $64.4 million, or 3.9%, and 5.3% after adjusting for one-time fiscal 2026 costs. WBUR reported that the district still planned to cut more than 400 student-facing paraprofessional and teaching jobs.
Fixed costs: about $1.16 billion. These include pensions, debt service and state assessments. Pension costs fell $24.7 million and debt service fell $13.1 million after refinancing, the city says. Charter school tuition assessments grew $9.8 million and the MBTA assessment grew $2.7 million.
Police: about $484.5 million. The Boston Police Department budget is down $2.9 million, or 0.6%, from fiscal 2026, according to the city’s operating budget chapter. The overall Public Safety Cabinet, which includes the Fire Department, grew $4.5 million, or 0.5%.
Health insurance: The central health insurance appropriation grew $43.8 million, or 17.5%, which the city attributes largely to the cost of prescription drugs.
Other city departments: Streets, housing, parks, libraries and other services together fell $20.2 million, or 1.1%. The budget also holds a $21.9 million reserve for union contracts still being negotiated.

Where does Boston’s revenue come from?

Property tax is the city’s main source of money. The Boston Municipal Research Bureau calculated that the property tax levy made up 71.7% of operating revenue in fiscal 2026. Proposition 2½ limits growth in the levy on existing property to 2.5% a year, plus new construction. The city says property values have grown 59% over 10 years while property tax revenue grew 41%.

State aid is expected to total $538 million, or 10.9% of the budget, compared with about 30% in 2002. After subtracting state charges for charter school tuition and the MBTA, the city projects net state aid of $119.6 million. Other local receipts include hotel and meals excise taxes and payments in lieu of taxes from tax-exempt institutions. To cover lower interest and permit income, the city is drawing on Parking Meter Fund reserves.

Homeowners can read how rates are set in our explainer on Massachusetts and Boston taxes.

Why was the fiscal 2027 budget so contested?

WBUR described the fiscal 2027 process as “one of the most fraught budget cycles in years.” Mayor Michelle Wu filed her proposal in April. Several councilors objected to projected cuts to programs for seniors, veterans, youth jobs, housing and immigrants, and in May an effort to reject the proposal fell one vote short. Ways and Means chair Ben Weber led the council’s $11.8 million in amendments, about 0.2% of the total.

According to WBUR, Wu accepted all but $1.4 million of the amendments, saying that portion would force layoffs in the Transportation Department. The council then let her modified budget stand without an override, according to the council’s legislative record. Councilor Erin Murphy said she hoped next year’s process would include “far more transparency and genuine collaboration between all 13 councilors.”

School spending remains under scrutiny. The council recently held a hearing on BPS bullying and misconduct, and the state’s finances are tracked on our Massachusetts state budget page. More city government coverage is on the Boston politics hub.

How can residents follow the budget?

The city publishes department-level spending on Analyze Boston, released under a public domain license, and an interactive version at budget.boston.gov. The fiscal 2028 proposal is expected to be filed next spring, followed by council hearings that are open to the public.

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Boston’s City Budget: Where the $4.9 Billion Goes in Fiscal 2027