Boston Mayor Michelle Wu unveiled her budget proposal for the Fiscal Year 2027 during the annual Budget Breakfast at City Hall April 8.

The proposed figure would total $4.9 billion, only a 2.1% increase over FY26 — the lowest since 2010. The Budget Department noted “rising costs, slowing revenue growth, and economic uncertainty” as significant challenges for Boston and the greater Commonwealth. They hope the Fiscal Year 2027 budget, along with the five-year $4.4 billion capital plan, will balance restraint in the face of these hardships with investments in the city’s future.

There were many financial hurdles to overcome in the construction of the budget. Boston faces a 20.3% hike in costs for all non-Medicare health insurance plans, which is set to increase costs for the city by $97.3 million — much larger than the average rate increase of just $10.6 million. Historic snowfalls earlier this year have also plagued the city’s budget and contributed to the $48 million deficit for Fiscal Year 2026.

Wu’s proposed plan suggests methods of mitigating the impacts these challenges have wrought. The Public Employee Committee reached an agreement with City Hall that will alleviate the pressures of rising health care costs — an agreement estimated to save over $10 million for the city and its employees. The city also noted that as weather patterns shift in frequency and intensity, the costs of snow removal will vary greatly from year to year. For example, in five of the last six fiscal years, the cost of snow removal was well beneath the allocated budget, and that accumulated surplus was used during this year’s overage.

The major components of the FY27 budget include education and public safety, which takes up 58%. Fixed costs, such as debt repayment, pensions and employee and retiree health insurance, are allocated 15%. City departments and streets and public transportation constitute 11% and 6% respectively. Health insurance and public health together represent the final 9%.

Housing affordability tops the list of areas supported by the new budget. The budget statement notes that “investments by the City have helped build 6,210 new income-restricted units,” the most for the timeframe in 25 years.

Also given weight is Boston’s public realm as a whole. The city says it has helped resurface over 100 miles of roads and filled over 27,000 potholes, and its mission to “maintain Boston’s position as the safest major city in the country” remains a top priority, it stated.

City Hall recognizes education as being the cornerstone of the city’s future, thus its position as the largest chunk of each year’s budget. Amid declining enrollment and surging costs, the city has tackled turbulence with “more school facility renovations and construction projects than at any time in the last 40 years,” the city stated.

As a hub of progressive ideals, Boston may very well be in the line of fire for federal funding slashes by the Trump administration.