Towns Look to Overrides to Meet Rising Costs

Faced with rising costs across the board that are inflating municipal budgets, several Island towns are asking voters to approve general overrides of Proposition 2 1/2 this spring.

Oak Bluffs, West Tisbury and Edgartown, the first three communities to hold their town meetings this spring on the Island, have a combined $6.2 million in general override requests to bridge the gap in the budgets for the upcoming year.

Much of the proposed borrowing isn’t for once in a lifetime projects or new services, but to cover the increasing costs to fund the everyday needs of the governments and schools, officials said. Health insurance has increased, legal bills have stacked up and education expenses continue to rise.

Oak Bluffs, faced with a $1.8 million gap between projected revenue and expenses for the upcoming year, is asking for a $1.9 million override, Edgartown is requesting to borrow $900,000 and West Tisbury officials say they need an extra $3.49 million.

At a meeting on Saturday, Oak Bluffs officials said they had already sliced the shortfall down from $2 million and had little room to cut deeper.

“If you don’t want to pay for these things, then the select board needs to come up with the departments they want gone,” said town administrator Deborah Potter.

It’s a problem many Massachusetts towns have faced in the wake of the Covid-19 pandemic, caught between inflation-driven increases and a state law that limits municipalities’ ability to raise revenue.

In Massachusetts, town budgets are largely reliant on property taxes. Under state law, municipalities are only allowed to raise those taxes by 2.5 per cent each year, unless they get special permission from the voters at town meeting and then again at an election.

Known as Proposition 2 1/2, the law was passed in 1980 as a way to check towns from rapidly increasing budgets. According to the Massachusetts Municipal Association, a nonpartisan nonprofit that works to aid local state leaders, staying within the 2.5 per cent cap was more manageable when inflation was about 1-2 per cent per year.

“When costs grow over 3 per cent per year, as they have since COVID, cities and towns are effectively obligated to cut real spending every year,” the association wrote in a report from October on the fiscal pressures towns face.

Many of the Island towns have staved off the need to exceed Proposition 2 1/2. The last override in Oak Bluffs took place in 2018 to pay for education costs, and Edgartown’s was in 2019. In Oak Bluffs, for years the town has put off the need for the extra tax on voters by using the town’s free cash fund, which is made up of money when revenues exceed the budget.

But that’s not sustainable in the long run, officials say.

“The last two years’ fiscal budgets have been propped up by infusions of roughly a half million dollars each year from free cash, which is allowable but not advisable,” said Bob Malecki, the chair of the Oak Bluffs finance committee. “So to some extent, we’ve kind of kicked the can down two years.”

In West Tisbury, the biggest expense is the town’s assessment for the Up-Island Regional School District, which has increased by $1.23 million from last year, according to town accountant Chelsea Joiner.

West Tisbury’s override does include creating new positions, as well as shifting some roles, such as the fire prevention officer, to full-time. Expenses also include increased assessments from the high school, increased staffing needs in government and public safety, and a new budget item of $475,000 related to PFAS remediation.

If the West Tisbury override is approved it would raise taxes on a median home by 20 per cent, allowing the town to meet increased budget demands in the face of a growing population, officials said.

“This is about achieving the proper scale to address the growth, and the needs of that growth,” said select board chair Cynthia Mitchell at last week’s select board meeting.

If approved, the taxes for a home valued at $1 million dollars would increase by about $1,000, from about $5,000 last year to approximately $6,000, according to town estimates.

Last year, West Tisbury approved a $1.6 million override, raising taxes by 8.5 percent. Residents in the up-Island town also approved overrides in 2024, 2021 and 2018. The last override before 2018 that was approved was in 2004.

The recent uptick in override requests, five in the last eight years, is likely due to lean budgeting that intentionally avoided overrides, said West Tisbury town administrator Jen Rand. Overrides are not exceptional scenarios, with Island towns frequently posing the option to voters to account for inflation, increasing populations, education expenses and town expenses such as repairs and new building projects.

“The fact that we have such a big override is proof that we have budgeted so tight for so long,” said Ms. Rand. “There comes a point where you’re not a small town, we’re a $30 million corporation and that requires humans to do the work.”

In Edgartown, which has one of the lowest tax rates in the entire state, the override was driven by school costs, increases in health insurance and a growing budget for the Martha’s Vineyard Commission, which is paid for by all six of the Island towns, according to town administrator James Hagerty.

Those are costs that the town doesn’t have much power over, he said.

“The school is collective bargaining agreements, the commission is legal fees,” he said.

If approved, Edgartown’s override would add about $54 on a tax bill for a $900,000 home.

In Oak Bluffs, the override is covering the rise in education costs, spiking health insurance premiums, a new school resource officer, firefighting services and assessments to regional services such as the Martha’s Vineyard Commission.

It’s not clear yet if the other towns, Tisbury, Chilmark and Aquinnah, will require overrides this year. Those town meetings are held later in the spring and warrants are still being finalized.

Towns are also proposing debt exclusion questions, which would allow them to borrow extra funds to pay for special projects.

In West Tisbury, the town is asking for permission to borrow money to make repairs at the police department; Edgartown is looking to purchase the Boys & Girls Club facility; and Oak Bluffs needs money for upgrades to a pump station and sewer system, in addition to funds to potentially purchase the aging Island Theatre.

Leaders said these are costs that need to be covered; they are also arriving as the largest capital project in Island history looms over the horizon. This June, a special election will be held in all six towns to decide on the future of a new regional high school building.

The project is currently estimated at $380 million when all the interest is paid off, and the towns are expecting to have to pick up more than $260 million of that price tag.

Financial meetings to talk about how the towns would cover that sum are ongoing, and Mr. Hagerty said it’s something that voters will need to consider when headed to town meetings this year.

“It’s something people should definitely be taking into their capital planning,” he said. “The tax rate is going up.”

To aid residents, Oak Bluffs select board chair Dion Alley said his town will need to consider the residential tax exemption, which allows some of the tax burden to be moved to seasonal properties.

“We’ve got to look at how we’re going to help our residents as we go through this,” he said.

Town meetings in Edgartown, West Tisbury and Oak Bluffs will be held on April 14. Chilmark, Aquinnah and Tisbury will hold theirs later this spring.

This article appears in March 13, 2026.