The City Manager's FY27 budget proposal at a glance
Where we are in the process
presented
City Manager
opened
(hearing closes)
On May 7, City Manager Karen Conard proposed a $157.97M FY27 budget—a $7.68M (5.11%) increase. She characterized it as "carefully managed."
Of the 5.11% increase: 2.21% is health insurance costs alone; the remaining 2.9% covers everything else—salaries, contracts, and operations.
Hearing update (May 18): The public hearing opened with residents raising concerns about the budget's size, a proposed $900K fire boat, and new management hires in the School Department. The hearing was held open through June 8, when the Council is expected to close the hearing and vote on adoption.
For a median single-family home valued at $777,200:
Tax rate: $12.07 per $1,000 of value (up 56¢, or 4.88%, over FY26).
Plus: Water bills +4.5%, sewer bills +5.9% (assumes 5 units monthly use).
Residents and councilors raised three specific concerns that may shape the final budget:
How the budget breaks down — and what's driving the increase
The FY27 proposal continues a decade of steady budget growth. Adjusted figures (FY17–FY26 are adopted; FY27 is proposed):
See it both ways
How much of this growth is just inflation?
Context: From FY17 to the FY27 proposal, Portsmouth's budget has grown roughly 50% — about $53M in absolute terms. The annual growth rate has been around 4–5% in most recent years.
Context (inflation-adjusted): In real terms — all years expressed in 2027 dollars — the budget has grown roughly 7% over the decade, or about 0.7% per year. Most of what looks like "50% growth" on paper is inflation, not new spending.
→ For the 20-year window and historical context across multiple councils, see The Long View.
City Manager's proposal released May 7, 2026 • Adoption vote anticipated June 8
Proportions based on FY26 adopted shares; FY27 final allocations subject to Council adjustment.
Most spending is locked by contracts, salaries, and legal obligations. The over-9 position cuts in the proposal come from this constrained pool—which is why even modest staffing reductions are politically and operationally difficult.
Per City Manager Conard's May 7 presentation, the 5.11% increase splits roughly into two parts:
Health insurance is the single largest cost driver. The City has been in an ongoing dispute with SchoolCare (NH School Health Care Coalition) over a disputed mid-year assessment—context that has fed into FY27 cost pressure.
Property tax isn't the only line item going up. Under the proposal, the typical residential customer (5 units of monthly water use) sees:
These follow a new tiered rate structure adopted by City Council and are funded through the Enterprise Fund—separate from the General Fund tax-rate calculation.
Twenty years of budgeting, in context — and what independent auditors say about how the City has managed it
The bottom line, at a glance
That's how fast Portsmouth's budget has actually grown — after inflation — over the past two decades.
For perspective: prices themselves rose about 2.6% per year in the same period. Inflation, not new spending, drove most of the budget's growth.
Here's how that "1% a year" breaks down when you look at the cumulative totals: nominal vs. real, over the full FY07 → FY27 proposed window.
Where the extra $82M actually went
Of the $82M added to the budget over 20 years, about $51M (62%) just keeps pace with inflation — the same services at higher prices. Only $31M (38%) is real new spending.
Method: Inflation adjustment uses BLS CPI-U (U.S. city average, all items), fiscal-year averaged. Nominal growth has averaged about 3.7% per year. CPI-U is the standard benchmark but understates municipal cost pressure — compensation, healthcare, and construction have run hotter than headline CPI, so the BEA State & Local deflator would show even less real growth than shown here. FY27 figure is the City Manager's proposal, not yet adopted.
A long-term trend like ~1% real growth per year isn't determined by any single budget cycle or any single set of elected officials. Credit-rating agencies analyze municipal finances using standardized criteria applied to thousands of US cities. Portsmouth has been evaluated under that framework annually since 2013 — across multiple councils, multiple city managers, and shifting political compositions. The structural pattern they observe has remained consistent through all of them.
"The city's financial practices are strong, well embedded, and likely sustainable."
That's not an endorsement of any specific budget, council, or administration — including this one. It's an observation about long-term fiscal structure. Whether residents agree with this year's spending choices is a separate question, and a legitimate one to debate.
Source: S&P Global Ratings reports on the City of Portsmouth, NH General Obligation bonds, 2013–2026. Credit ratings reflect an independent analysis of fiscal practices and reserves, not a political judgment about specific budget decisions.
Hearings, work sessions, and the path to adoption
✓ Joint City Council & School Board Work Session
📍 City Hall Council Chambers • ⏰ 6:00 PM — Completed
✓ Fire Commission Budget Hearing
📍 Fire Station 2 • ⏰ 6:00 PM — Completed
✓ School Board Meeting — Budget Hearing #2 & Adoption
📍 City Hall Council Chambers • ⏰ 7:00 PM — Completed
✓ Police Commission Budget Hearing
📍 School Board Conference Room • ⏰ 5:00 PM — Completed
This is when the Council debates department budgets and the public hearing opens. Public comment is welcomed at every session.
General Fund Budget Work Session
📍 City Hall Council Chambers • ⏰ 6:00 PM — General Govt, Police, Fire, School Depts
Enterprise & Special Revenue Funds Work Session
📍 City Hall Council Chambers • ⏰ 6:00 PM — Water/Sewer, Parking, Stormwater
✓ Budget Public Hearing Opened
📍 City Hall — Hearing held open through June 8. Read coverage at Seacoastonline / Portsmouth Herald.
Budget Review Work Session
📍 City Hall Council Chambers • ⏰ 6:00 PM — Final work session before the hearing continues June 8
⭐ Public Hearing Continues & Anticipated Adoption Vote
📍 City Hall Council Chambers • ⏰ 7:00 PM — The Council is expected to close the public hearing and vote on adoption. Public comment still on the record before the vote.
Four ways to make your voice count before the June 8 vote
You don't need to be an expert. Share your perspective as a resident—that's what councilors need to hear.
Attend a Meeting
Show up to City Council meetings, especially the June 8 hearing continuation and adoption vote. You don't have to speak—councilors notice how many residents care enough to attend.
Speak at Public Comment
You get 3 minutes to address the council. Introduce yourself, explain what matters to you, and ask for specific action.
Email Your Councilors
Can't attend in person? Send an email before budget meetings. Personal stories are more effective than form letters.
Spread the Word
Share this guide with neighbors, post on social media, talk to your community groups. The more residents engaged, the better.
Four things to keep in mind
- The City Manager has proposed a 5.11% increase—the Council can still amend before the June 8 vote
- The public hearing remains open through June 8—still time to comment on the record
- The Council is expected to close the hearing and vote on adoption at the June 8 meeting
- Property tax, water, and sewer all increase under the proposal—add your voice if affordability is your concern
How Portsmouth's tax rate stacks up against 19 peer NH communities
Enter a home value to see what the annual property tax bill would be in each community at current posted tax rates. Portsmouth's median home is $777,200.
Sorted by lowest tax rate. Portsmouth highlighted.
| # | Community | Rate per $1K | Annual tax on your home |
|---|
Portsmouth's tax rate is anchored by a few structural advantages:
- Strong commercial tax base. Commercial properties make up 15% of parcels but 38% of total assessed value. That shifts a meaningful share of the tax burden away from residential homeowners.
- High property values. Portsmouth's total taxable valuation is over $10.3B. A lower rate on higher values can still raise the revenue the city needs.
- Pease and waterfront economic activity. Major employers at Pease and downtown contribute to the commercial base — and to non-property revenues like rooms and meals tax (returned via the State).
- Lower-than-typical local school rate. Portsmouth's local education portion ($4.57) is below many comparable cities, partly reflecting state aid formulas.
This explains why Portsmouth can be one of NH's lowest-rate communities even with a 5.11% proposed budget increase.
- A lower rate doesn't always mean a lower bill. Tax rates depend on assessment ratios. A community assessing at 70% of market value with a $20 rate may cost the same as one assessing at 100% with a $14 rate.
- Rates change annually. These TY2025 (FY26) rates were set by the NH Department of Revenue Administration in late 2025. FY27 rates won't be finalized until November 2026.
- Portsmouth's FY27 rate of $12.07 is an estimate. The actual rate is set by DRA in the fall, after all State revenues, property valuations, and County tax obligations are finalized.
- Rates aren't the whole story. Higher-rate communities may offer different service levels, school quality, infrastructure, or amenities. This comparison is a starting point, not a complete picture.
Where to dig deeper — official documents, recordings, and contacts
View the preliminary budget presentation and supporting materials from the City of Portsmouth.
View Budget Documents →Can't attend in person? Watch live broadcasts and recorded meetings on the City's official YouTube channel.
Watch on YouTube →Agendas, packets, minutes, and archived materials for all council meetings.
View Archives →Estimate your property tax bill using the city's online calculator.
Calculate Taxes →Can't find what you're looking for? Contact the City Clerk's office.
(603) 610-7245