Northampton’s surplus stands at $11.6M, leading many to call for restoration of school jobs

NORTHAMPTON — The state has certified the city of Northampton as having a free cash surplus of over $11 million — a sign that the city is in solid financial shape — although not everyone is happy with the city’s financial discipline, with some calling on the mayor to restore school jobs that were cut last budget season.

In a statement Thursday before the Northampton City Council, Mayor Gina-Louise Sciarra said the $11.6 million from free cash was broken into $5.55 million from revenues, $1.28 million from unspent budget items, $3.15 million in federal funds received from the American Rescue Plan Act (ARPA), and $1.68 million of unspent free cash from the previous fiscal year.

The mayor also stated that of the $5.55 million from revenues, $2.4 million was from investment income, which has sharply increased over the past two years due to climbing interest rates. She said that before fiscal year 2023, the five-year average income of the city’s investments was about $200,000.

“This is not a budget line the city has relied on for recurring revenues because interest rates are volatile, and the amount in the fund can fluctuate significantly,” Sciarra said. “While going forward into FY 2026 the city will increase this revenue projection, it is important to note that the Federal Reserve just cut the interest rates again by an additional quarter-percent yesterday for a total cut of 1% just since September.”

Although the surplus is a sign of the city’s good financial shape, it has drawn the ire of residents and educational staff who staunchly opposed the elimination of more than 20 jobs in Northampton Public Schools during the budget discussions for the current fiscal year. The cuts came after a protracted fight between city officials and opponents of the cuts, including parents and the Northampton Association of School Employees union, that resulted in the city increasing the school budget by more than twice what was originally planned, but not enough to completely stave off job cuts.

A press release put out by the group Support Our Schools (or SOS), consisting of city residents who opposed the job cuts, calls for the city to use some of the certified cash to restore the jobs that were lost in the school district.

“The SOS group has started a community petition calling for the city to use the newly certified free cash to restore the jobs cut across NPS and begin to repair some of the damage done in the first half of the year,” the group stated. “Other actions to emphasize the community’s support for using the free cash for schools are being discussed as well.”

Al Simon, a Northampton resident and member of the group who spoke during the council’s public comment period on Thursday, called for greater accountability on how the city allocates its free cash payments.

“It is curious that the free cash certification came so late this year and with what seems to be a rushed Capital Improvement Plan,” Simon said. “It looks like a rush to sequester the free cash from the demands of pesky public school advocates.”

Though the mayor discussed the surplus during her announcements to the council, the council did not deliberate the matter because there was no agenda item regarding the surplus. The city is expected to take up discussion of free cash allocations when it returns after the new year.

Sciarra did not comment directly on the potential of using free cash to fund school district jobs, but reiterated that guidance from the state’s Technical Assistance Bureau recommends that “as a nonrecurring revenue source, free cash should be restricted to paying one-time expenditures, funding capital projects, or replenishing other reserves.”

The mayor notes that the city’s free cash for the current fiscal year is within the state-recommended levels in proportion to the city’s overall budget, amounting to nearly 7% of the $122.8 million city budget.

She also noted that the $3.15 million in ARPA funds had been designated for underground infrastructure upgrades on Main Street, and that $1.68 million in unspent free cash is designated to road safety improvements near Northampton High School.

Ward 3 Councilor Quaverly Rothenberg, who had staunchly opposed the school district job cuts, did not attend Thursday’s meeting, but had posted on social media on Wednesday criticizing the city’s fiscal policies.

“This isn’t a surprise,” Rothenberg wrote on Facebook. “Most of that money should have been spent on teachers, on firefighters, on DPW workers, on repaying loans for brand new sidewalks, on climate initiatives around flood protection, on a long overdue raise for our great city clerk, on economic initiatives to nurture small business.”

Alexander MacDougall can be reached at amacdougall@gazettenet.com.