Taxes will continue to go up. Programs will be cut. And more city workers will be laid off.
That’s the grim reality facing Burlington, which is grappling with a budget gap of as much as $12 million — the third straight year the city has faced a multimillion-dollar disconnect between expenses and revenues. In an effort to limit layoffs, Progressive Mayor Emma Mulvaney-Stanak is searching under the city’s couch cushions for solutions that don’t involve relying on property taxes to cover the difference.
After last year’s bitter round of last-minute layoffs and grousing from Democrats that they had been sidelined in the process, Mulvaney-Stanak has been eager to start sorting out the budget earlier and share the burden of decision-making.
The mayor has asked each city department to submit spending proposals with 5 to 10 percent cuts. She’s committed, she said, to passing a budget that “does not overly rely on cuts and that does not overly rely on taxing local folks.”
One piece of the puzzle fell into place on Town Meeting Day, when Burlington voters approved a 5-cent increase to the police and fire tax, which will make up about $3 million of the projected gap.
Democrats, who hold a slight majority on the council, are eager to avoid raising taxes further while looking out for businesses and the tax revenue they generate. But the caucus has been reluctant to specify where deeper cuts should be made. Progressives, meanwhile, have warned against “austerity,” which multiple councilors in the caucus described as a “death spiral” for municipal government. Both parties recognize that, in order to get anywhere close to fiscal sustainability, layoffs will almost certainly have to be part of the equation, even as Mulvaney-Stanak pushes a “solidarity” approach to share the pain across departments.
“There is no way that we will be able to build a sustainable budget that keeps the city affordable and also living within our means … without looking at how much the city has grown in terms of its operating cost,” Mulvaney-Stanak said.
Addressing the Board of Finance on March 23, city data analyst Nancy Stetson painted a portrait of the city’s challenging fiscal future following a decade of personnel growth and use of one-time pandemic-relief funding to cover costs. A neutral tax rate would allow the budget gap to widen, while even an annual 6 percent property tax increase would come close to — but not quite cover — the rate at which costs are expected to grow.
The city’s debt obligations have grown more than 10 percent over the past nine years. Since 2017, the surging cost of paying the city’s workforce has been outpaced only by the cost of employees’ health insurance. In that same period, property taxes were increased by 70 percent; direct revenue and the payment the city receives from its largest landowners — the nonprofit University of Vermont and the associated medical center — have failed to keep up with inflation.
Despite new construction and ballooning property values, the value of taxable property in Burlington is growing at less than 1 percent annually. Mulvaney-Stanak attributes that partly to what she cast as her predecessor’s overreliance on tax-increment finance districts to encourage new construction. TIFs divert property taxes from specific neighborhoods to pay for public portions of projects, such as sidewalks. The mayor cited the massive downtown Burlington Square development as an example, noting that the city won’t see a cent in property tax revenue from it until the 2030s.
The administration wants to make up $4.6 million of the budget gap by not filling positions when people leave or retire; stepping up collection of delinquent taxes and fees; and turning to more one-time funds, such as leftover federal pandemic-relief money. An as-yet-undefined effort to “reduce government expenses,” instituting a voluntary furlough program for city workers and selling a couple pieces of city property could save an additional $3.6 million.
City Council President Ben Traverse (D-Ward 5) chairs the Board of Finance and was a loud no vote on the proposal approved on Town Meeting Day to raise the public safety tax. He also believes the mayor’s plan to go after delinquent taxes is unrealistic and worries her attempt to get across-the-board cuts from city departments will not be as effective as targeting specific departments for deeper ones.
The Progs know that cuts will be necessary but want to focus on building revenue and limiting the harm to city employees. They want to shift the tax burden from the working class to the city’s wealthier residents. Prog councilors back the mayor’s proposal to examine a “tax fairness” system that was stymied by the Dems, who opted to form a study committee for the idea instead.
“I look at our wealthier people as the people in the family who have the ability to help the grandkids, who have the ability to help people in the family that are working hard and can’t do it themselves,” Councilor Gene Bergman (P-Ward 2) said. “If we don’t do that, we have this trickle-down approach, where we’re just going to let the market do it and somehow it’s magically going to make things better.”
This multifaceted financial quagmire reminds Bergman of the 1970s, when rising inflation brought deep cuts to city hall. He’s pessimistic about the city’s ability to dig its way out without state or federal support.
One bone of contention between the parties has been the gross receipts tax on meals and alcohol. The council voted to raise the tax from 2 percent to 2.5 percent in 2024 and then kept it in place for last year. But the higher levy amount is set to expire at the end of June. It’s the only revenue source that has grown at nearly the same rate as property taxes.
While Democrats consider this increase a temporary measure to help shore up revenue, Progs have consistently opposed letting it expire. Traverse said the gross receipts tax was not a “reliable” source of revenue and said there would likely be a “discussion as to whether or not” keeping it in place is a “smart approach.”
Dems worry the tax drives away businesses, and they equate the success of the business community to the health of the city. During last year’s budget debate, they pushed back on Mulvaney-Stanak’s proposed cuts to the downtown events budget to protect retailers and restaurateurs. Burlington City Arts’ other programming is another story.
Balancing the budget will feature a lot of haggling over devilish details.
“The things that BCA provides that draw the public to the city, like the downtown festivals, we need to prioritize,” said Councilor Sarah Carpenter (D-Ward 4), a member of the Board of Finance. She questioned the city’s support for “more individualized” arts opportunities, such as classes. BCA recently said it won’t replace its curator and director of exhibitions, who is leaving the post after nearly a decade.
Carpenter wants to dig deeper into which departments bring in revenue and which don’t and to consider turning to nonprofits or the private sector to assume some responsibilities. She pointed to the city’s recent decision to sign a seven-year contract with waste-collection giant Casella for recycling pickup. The city’s unionized workers supported Casella taking over the job but only with the understanding that it would be temporary.
This line of thinking puts Carpenter at odds with the Board of Finance’s lone Prog, Councilor Carter Neubieser (P-Ward 1). His primary goal is to put the union in the “best position possible” when working through potential layoffs. He’d prefer to cut funding to programs run by outside entities, such as a University of Vermont Medical Center effort that provides home health care and hospice services. He’s also proposed freezing cost-of-living raises for city employees who make more than $100,000 annually, an idea the mayor has dismissed as too detrimental to retention and recruitment efforts for the small savings it would net.
“I, along with my Progressive colleagues, am focused on protecting the needs of organized labor and ensuring that we manage the city’s finances responsibly, which … the mayor has done so even in the midst of these challenges,” he said.
Balancing the budget will feature a lot of haggling over devilish details. Deep divisions between the Progs and the Dems all but guarantee the debate will be contentious. Mulvaney-Stanak told Seven Days she believes the Dems have never embraced the “co-governance” required of them after she was elected mayor. Traverse took umbrage with the suggestion, noting that the council passed the two previous budgets with unanimous votes.
Layoffs will be one of the largest points of contention. The police and fire departments have been placed off-limits by both Mulvaney-Stanak and the Dems. And last year’s deep cuts to the Parks, Recreation and Waterfront Department, as well as the merger-reorganization of the city’s finance departments, mean they, too, have little fat left to cut.
To balance the 2026 budget, Mulvaney-Stanak laid off 18 city employees and left seven positions vacant, an unfortunate outcome for a mayor who likes to tout her pro-labor bona fides. Axed employees, including some with decades of experience, were escorted out with 90 days of pay. Some jilted workers aired their grievances at city meetings.
Mulvaney-Stanak defended her process but said she’s continued to hone her approach.
“It was still the decision of last resort last year, much like it will be this year, because no one wants to reduce the workforce,” she said.
Traverse has major disagreements with the mayor about how the layoffs were handled. He questioned whether Mulvaney-Stanak even had the authority to make personnel decisions without council consent. If they are kept in the dark until the last minute again this year, Traverse said, it may force the Dems to put their collective foot down.
The 300 city workers unionized with the American Federation of State, County and Municipal Employees are currently negotiating a contract with the city. Local chapter president Colby Delair said the sides are on the same page, for now.
“The mayor and the administration have voiced to us numerous times that they’ve learned from the mistakes of last year, which we’re very appreciative of, and that they are looking to not repeat those same mistakes this year,” Delair said.
Mulvaney-Stanak will update residents on where things stand when she delivers her annual State of the City address on Monday, April 6. After that, she and the council will dive into the budget deliberations in earnest, a full month earlier than the process usually begins. ➆
The original print version of this article was headlined “Burlington’s Budget Blues | Once again, Queen City officials must balance a spending plan that is badly out of whack”
This article appears in Money & Retirement Issue • 2026.
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