Hanover Faces Critical Budget Decisions as Override Looms

Hanover officials are grappling with significant budget decisions for fiscal year 2026, balancing essential services against taxpayer impacts as they consider a potential override that could add nearly $1,000 to the average residential tax bill.

The town is evaluating two distinct budget scenarios: a base budget within Proposition 2½ limits and an override budget aimed at restoring services, particularly for the school system. The base budget would result in a $270 increase to the average residential tax bill, while the override scenario would lead to a $960 increase.

The Hanover Public Schools require at least $1.4 million just to maintain current service levels, according to Town Manager Joe Colangelo. The override scenario under consideration would provide $3.5 million to the schools, potentially helping restore some services lost in previous years.

Select Board Chair Vanessa O'Connor highlighted the reduced override amount compared to last year's failed attempt. "I think it was an excess of $1,400 per household," she noted, adding that the current proposal's approximately $500 reduction is "significant and very much appreciated."

The base budget relies on $900,000 in free cash to balance, a practice O'Connor expressed concerns about. "I do think that one of the important features of the override budget as Joe has presented it... is that it does not use free cash to infuse our budget," she said. "It's not a smart fiscal practice and it's not something we should continue to rely on."

Adding to the town's financial challenges, Hanover is facing significant staffing transitions in its finance department. The town has lost both its finance director and treasurer/collector positions. While temporary measures are in place, including contracted support and internal reorganization, Select Board Vice Chair Rhonda Nyman raised concerns about the situation's impact on budget planning.

"These aren't really entry level jobs that need to be filled," Nyman cautioned during the meeting. "It's going to take some sort of experience... to just bring people in off the street if we can find people that would take the job."

The town plans to hold a community budget forum in mid-January to present more concrete information to residents. Officials are also working on three- and five-year financial projections to demonstrate the long-term impacts of their budget decisions.

Town financial officials see some positive factors on the horizon. Advisory Committee Member James Hoye noted that excluded and non-excluded debt will begin to decrease significantly in the coming years, and tax revenue from Hanover Crossing will provide additional support as its tax exemption period ends.

The Select Board is expected to continue budget discussions in January, including a planned joint meeting with the School Committee to better understand educational funding needs and potential restoration of services from fiscal year 2024 levels.

A final decision on whether to proceed with an override, and in what amount, will need to be made before the annual town meeting in May. The outcome will significantly impact both municipal services and resident tax bills for the coming fiscal year.