By Geena Monahan—For the North Star Reporter
Addressing a room of over 50 residents, teachers and town officials at the North Attleborough Middle School on Monday, Jan. 12, Town Manager Michael Borg outlined a fiscal picture defined by disciplined planning and mounting cost pressures – most notably in health care.
Borg’s presentation offered a snapshot of fiscal year 2026 using data current through November 2025. He said that personnel costs remain predictable and the town’s financial fundamentals are sound.
“Tonight is about where we stand as a community,” said Borg. “We enter in a position of stability, but stability does not mean standing still.”
Education and health care pressures
Education accounts for 51.9% of the town’s FY26 budget, followed by nondepartmental spending at 26.2% and public safety at 13.3%. When costs such as employee health insurance, liability insurance, pensions and Tri-County payments are included, education-related spending rises to 61.6%.
“Transparency builds trust,” said Borg, adding that the breakdown reflects community priorities. “North Attleborough values education, and this shows that.”
While expenditures remain controlled overall, rising health care costs continue to shape the town’s long-term financial outlook. Borg described health insurance as the single largest cost driver in the budget, one that will influence fiscal planning well into the near future.
Claims have exceeded premium levels in recent months, reaching 110% in August 2025, 103% in September 2025, and 140% in October 2025. During the first four months of FY26, 15 high-cost claimants exceeded $50,000, totaling $1.38 million.
Prescription drug costs – particularly GLP-1 medications – jumped by $110,000 in a single month between September and October 2025. Looking ahead, the town projects a 9.5% increase in medical costs and a 16% increase in pharmacy costs for FY27.
“Health insurance costs are growing two to three times faster than Proposition 2 ½-constrained revenues,” said Borg.
Predictability within the budget
Pension obligations remain planned and predictable, Borg said, with town and school employees accounting for roughly 78% of total pension costs. FY27 will see a pension appropriation of $6.08 million, with costs increasing about 8% annually, expected to peak before the town fully funds its pension obligation in fiscal year 2034.
On the revenue side, Borg said local receipts are performing as anticipated. Of the $9.33 million projected this fiscal year, about 27%, or $2.5 million, had been collected as of November 2025. He added that the town’s largest local receipt – motor vehicle excise tax – is not yet reflected in those figures, as payments typically arrive in March.
“The town’s revenue base is doing and behaving as expected,” said Borg, adding that there are no irregularities in core local revenues.
Borg estimated $800,000 in new growth for FY27, the highest level since a post-COVID boom in FY22, when new growth exceeded $1 million. By comparison, FY26 brought in just under $600,000.
“The town can’t absorb structural costs on its own,” Borg said, emphasizing that new growth is incremental by nature, not a cure-all.
Borg also highlighted rising assessed home values, which now average $636,634 in North Attleborough, up from about $400,000 in 2020. He stressed that assessed values affect taxes, not the town budget.
State aid and stabilization funds
Turning to state aid, Borg said projections remain uncertain until Gov. Maura Healey releases her budget, expected on Jan. 28. Historically, he noted, state aid growth has lagged behind rising costs for communities.
Borg pointed to continued private development interest across multiple sectors as a positive economic indicator, along with a recent multi-use zoning bylaw amendment crafted by the Planning Board.
“Signals are positive,” he said, “but growth looks to be incremental.”
Capital planning, however, remains a challenge. The town received approximately $26.4 million in capital requests for FY27, split nearly evenly between general fund projects and enterprise fund projects, which are paid for by ratepayers.
“Strong demand for capital investment means disciplined prioritization is required,” said Borg.
Borg also provided an update on stabilization funds and free cash. As of FY26, the town’s general stabilization fund stands at $8.1 million, with $3.6 million in capital stabilization and $74,700 in special education stabilization.
FY26 free cash totals $6.17 million, with $5.32 million allocated for the capitalization stabilization fund, allowing money to earn interest.
Free cash allocations include $350,000 for capital improvements, $2 million for health insurance stabilization, $2.7 million for Tri-County capital improvements, $600,000 toward OPEB liabilities and $500,000 reserved for potential snow and ice expenses.
“Free cash is being used deliberately to stabilize costs, reduce long-term liabilities and strengthen capital capacity,” said Borg.
As the town begins shaping its FY27 budget, Borg stressed the importance of continued coordination between town and school officials.
“These decisions will be deliberate, data-driven and disciplined,” he said. “Not to sound the alarm, but to set expectations.”