Peabody May Have To Cut Staff To Balance Budget

PEABODY, MA — Mayor Ted Bettencourt could not rule out staff reductions as Peabody tries to balance its budget for the coming fiscal year. In a video message released Wednesday, Bettencourt said a the city would try to reduce payroll, which accounts for 70 percent of the city's $175 million budget, through attrition and payroll wherever possible. The tight budget comes as costs rise in a number of areas.

Among the areas where Peabody is facing higher costs:

• $1 million increase for health insurance premiums.
• $500,000, or 4.5 percent, increase for payments to the city retirement program
• $650,000 increase in debt service

There are also several increases in the school budget, which makes up about half of the city's total expenditures. Those increased costs include:

• $1 million for special education tuition increases
• $270,000 increase for transportation for special education students outside of the district
• $400,000 increase for transportation costs for homeless students and students in foster care
• $250,000, or 6 percent, increase in assessment for sending students to Essex Vocational Technical High School in Danvers. Bettencourt had opposed joining because he thought Peabody could better serve those students within the district. "However, we are now part of the district and we are obligated to pay," he said.

"As a result of these and other rising costs, we are forced to make some tough decisions during the budget process," Bettencourt said. "To use a phrase familiar to many managing a household budget, we need to tighten our belts."

At Monday night's meeting, the school committee outlined some of the cuts the school system may be forced to make as a result of the belt tightening. They include elminating reading specialist positions at all eight elementary schools, ending the intramural sports program and extracurricular programs at the Middle School. There are also likely to be cuts to the ranks of teachers and paraprofessionals.

"We will try to reduce payroll through retirement and attrition wherever possible," Bettencourt said, while acknowledging he is likely to face opposition when he presents his budget proposal. "However, we must be prepared to face the prospect of staff reduction and other difficult cuts."

Dave Copeland can be reached at dave.copeland@patch.com or by calling 617-433-7851. Follow him on Twitter (@CopeWrites) and Facebook (/copewrites).