Hingham will return about $1 million in unused reserve funds to its fund balance after finishing fiscal year 2026 below the spending levels officials projected in the spring.
The Select Board voted July 7 to recommend approximately $1.7 million in year-end reserve fund transfers needed to balance the town's books. Assistant Town Manager for Finance Katie Dugan said those transfers came in roughly $1 million below the amount forecast during Annual Town Meeting, largely because the school department required significantly less funding for special education than expected and additional state funding reduced the town's snow and ice costs.
"When all was said and done in terms of the reserve fund request that you're going to hear today, we are actually only requesting 1.7 of that $2.7 million that we have available to us. That is a million dollars under forecast," Dugan said.
Dugan explained that the town budgeted a reserve fund of $800,000 and later added $1.9 million through Article 10, bringing the total available reserve fund to $2.7 million. Although officials expected to need most of that amount, the final request totaled about $1.7 million.
The largest reserve fund transfer approved by the board covered snow and ice expenses. Dugan said the town initially faced a $1.1 million deficit after a difficult winter, but nearly $300,000 in Fair Share supplemental state funding reduced the amount that had to be covered through reserve funds to about $805,000. She noted that the winter's costs were still roughly half of what Hingham experienced during the record snowfall season of 2015.
Town officials also highlighted progress in controlling police overtime costs. Earlier in the budget process, the town projected it might need as much as $200,000 in reserve funds to cover overtime. Instead, the final transfer totaled just $15,537.
Dugan credited department leadership with reducing weekly overtime through operational changes.
"The good news there is that we're actually only requesting $15,537 for overtime. There's been a lot of great work done by the police department in terms of proactively managing the overtime expenses down," she said.
Select Board member William Ramsey praised those efforts, saying the improvements reflected both management decisions and successful hiring.
"It's wonderful to see the police overtime budget coming down. That's been something we've been working on for years to try to get under control," Ramsey said.
The year-end financial review also identified workers' compensation as an area requiring additional attention. The town approved a $360,922 reserve fund transfer to cover higher-than-anticipated claims, which Dugan attributed to increased medical claims, additional police and fire claims, and cases that extended from fiscal year 2025 into fiscal year 2026. Town Administrator Tom Mayo said the expense has become more of a recurring trend than an isolated issue, prompting officials to examine long-term management strategies. Ramsey volunteered to work with staff on reviewing the program.
During the discussion, Dugan confirmed that the unused reserve fund would return to the town's fund balance. She also said the town expects roughly $350,000 in Article 4 turnbacks and more than $1 million in departmental turnbacks as year-end accounting is finalized.
Before the meeting concluded, Dugan shared another positive financial update. She said Hingham expects to receive approximately $343,000 more in Chapter 70 education aid and unrestricted local aid than anticipated under the governor's proposed budget, providing additional flexibility as the town begins implementing its fiscal year 2027 budget.