Mayor James Donchess presented his $474.5 million budget request to the Board of Aldermen on April 8. Courtesy photo/Nashua GTV

NASHUA – Mayor James Donchess recently released his budget proposal for fiscal year 2026 totalling $474.5 million.

The proposal represents an increase of $17.8 million over last year.

Within the total figure, $360.6 million would be allocated to the General Fund, for an increase of 5.8 percent. Another $50.3 million would be allocated to the Enterprise Fund and $63.4 million would be allocated to the Special Revenue Fund, which includes grants.

During his April 8 presentation to the Board of Aldermen, Donchess said healthcare costs for city employees are expected to climb by $4.1 million. He also said $2.5 million would be transferred to the Capital Reserve Fund.

Although most department heads complied with Donchess’ request to limit budget increases to three percent, the School Department proposed an increase of 4.7 percent, which the mayor reduced to four percent.

“It provides enough funding to keep all the employees they have,” said Donchess.

The School Department’s budget, which includes a seven percent increase in the cost of benefits, currently sits at $191.2 million. That figure is $8.9 million higher than last year and includes a $1.8 million boost for the transportation contract with First Student.

Donchess said the current contract with First Student expires this year. Therefore, the district sent out a Request for Proposals to find a provider with a lower cost. However, First Student was the only company who responded to the RFP. Donchess said First Student would not entertain the option of a one-year contract and is only interested in a five-year deal.

The budget for Nashua Fire Rescue has increased by $1.3 million for a total of $33.7 million. Within that figure, $17.1 million is earmarked for salaries, an increase of $754,155. The cost of benefits is also expected to climb from $4 million to $4.4 million.

Donchess said an additional $1.6 million would be allocated for anticipated workers’ compensation claims after the state legislature amended the Workers’ Compensation Statute to include cancer as a work-related injury for firefighters.

The Police Department budget came in at $42.1 million, an increase of $1.5 million. Within that figure, $22.9 million is earmarked for salaries, an increase of $676,647. The cost of benefits is also projected to go from $5.4 million to $5.9 million.

The budget for the Division of Public Works is $15.8 million, an increase of $693,850. Within that figure, $7 million would be used to fund salaries, an increase of $334,307. Benefits are also expected to climb by $193,541 for a current amount of $2.1 million.

In a follow-up interview, Ward 6 Alderman Christopher Thibodeau said he agreed with Donchess’ decision to reduce the school budget.

“I am also of the opinion they need to cut it more than they have presented thus far,” he said. “I will not be voting for the budget at the increased level that it is currently at, but I will wait to see how the Budget Committee does and let the process run through.”

Ward 8 Alderman Derek Thibeault said he did not object to the mayor cutting the school budget as the aldermen were assured that no jobs would be lost.

“This is a good compromise, I want to avoid job loss,” he said.

Thibeault said making further reductions to this year’s budget will be difficult as the cost of healthcare is going up by 10 percent and the cost of school transportation is up by 20 percent.

“Anyone expecting no budget increase in this climate does not understand city management. This would result in 100-plus jobs being lost, something I am not for,” he said. “It’s sad but we will also have to make up for lost grants from the state and fed and a disastrous state budget from the governor. Also remember, the budget increase amount does not equal the tax increase amount. We will do what we can to pass a tight budget and I will put out a challenge to any alderman that is going to vote no to put out their own amendments to reduce it.”