Middletown Mayor: 'Budget Built With Discipline, Honesty And A Clear Understanding Of Responsibility'

MIDDLETOWN, CT — Middletown Mayor Gene Nocera Wednesday issued a 2026-27 fiscal year budget proposal narrative to residents.

The proposal totals about $252.2 million, and, within that overall figure, the education portion alone totals about $107 million, representing the largest share of spending in the city’s budget.

A PDF version of the spending plan can be found through: https://middletownct.gov/budget.

Here is the mayor's budget message:

"To My Fellow Middletown Residents,

"When I took office in June 2025 as Acting Mayor, and then had the honor of becoming your Mayor following the November 2025 election, one of the first issues placed before me was a looming projected deficit driven by several fiscal shocks occurring at the same time, each reinforcing the other. The financial challenges we face are not unique to Middletown, but they are very real, and they require a clear and honest explanation.

"Over the past two years, we have experienced revenue erosion combined with significant spending pressures and persistent inflation, creating a very difficult budget environment. A major factor has been the minimal growth of our Grand List, something Middletown has not seen in recent memory. Because property taxes generate the largest share of the City’s revenue, even small changes in the Grand List can have a significant impact on our budget.

"Despite a slight change in our S&P bond rating this year going from AAA to AA+, we enter the 2026–2027 budget cycle with a fundamentally sound fiscal foundation, but with intensifying cost pressures. Even after this adjustment, our bond rating remains rare among mid-sized Connecticut cities that do not have the advantage of a large suburban tax base. It reflects Middletown’s long-standing fiscal discipline, responsible debt management, strong reserves, and our continued commitment to meeting pension obligations.

"However, the convergence of several factors that include rising healthcare costs, the exhaustion of federal relief funds, the minimal growth of our Grand List, and persistent inflation has created what can fairly be described as a serious structural fiscal challenge.

"Healthcare costs in particular have risen sharply and are a major driver of the current budget increase. Middletown is self-insured, with Cigna serving as our third-party administrator. After several years of relatively modest increases, the City is facing a significant rise in insurance costs for fiscal year 2026–2027. This reflects a statewide trend affecting both public and private employers, as healthcare expenses continue to climb across Connecticut.

"At the federal level, the biggest impact has been felt in the Board of Education budget. The one-time federal pandemic assistance provided through the American Rescue Plan and related programs has largely expired. Unlike some communities that used these funds for ongoing expenses, Middletown Public Schools directed most of the aid toward non-recurring needs and one-time projects. I commend the Board of Education for this responsible approach. Even so, the loss of this temporary funding has come at a time when the cost of nearly everything — from school supplies to transportation, healthcare, and building materials — is significantly higher than it was just a few years ago.

"Labor costs have also increased during this same period. In mid-2025, five of our seven major union contracts expired at the same time, including AFSCME Local 466, UPSEU Local 6457, Police Union Local 1361, Middletown School Administrators Association Local 70, and the Russell Library employees. Only the firefighters’ contract, which runs through 2027, remains in effect. Negotiating so many contracts at once created unavoidable cost increases. While the agreements reached were responsible and fair to both employees and taxpayers, they nevertheless added pressure to this year’s proposed budget.

"It is important for residents to understand that approximately 80% of the City and Board of Education budget is tied to essential services and contractual obligations including education, police, fire, public works, library services, and employee benefits. Because these costs are largely fixed, the portion of the budget that can be reduced without layoffs or significant service cuts is extremely limited.

"Across Connecticut, municipalities are facing the same conditions: rising healthcare costs, contractual salary increases, pension obligations, persistent inflation, slowing or declining Grand Lists, the exhaustion of federal relief funding, and flat or uncertain state aid, including PILOT grants. These pressures are occurring at the same time across cities and towns throughout the state. Middletown is not alone, but we are determined to manage these challenges responsibly, and my proposed 2026–2027 budget reflects that commitment.

"This budget includes a proposed General Fund expenditure increase of 5.49%, of which the Board of Education is receiving a 3.11% increase, no reductions in core services, and strategic attrition in selected positions. Departments were asked to reduce proposed supply budgets by approximately 5%, and every effort was made to control spending while protecting essential services and maintaining long-term financial stability.

"My administration remains committed to maintaining a high level of service for our residents while protecting taxpayers as much as possible. We will continue to look for efficiencies, make careful choices, and plan responsibly so that Middletown remains fiscally strong not only this year, but for many years to come.

"I am proud of the budget we have assembled, and I am optimistic about our City’s future. I asked every department head — from the Superintendent of Schools to the Chief of Police to every City division — to be honest about what they need, and to dig deeper than ever before, not only for reductions, but for ways to build capacity while saving money at the same time. The budget I am proposing today is significantly leaner than the first draft my team and I began with, yet it still makes priority investments in the services our residents depend on every day. In particular, I want to thank Superintendent Dr. Alan Addley, Board of Education Chairwomen, Sheila Daniels and the Board of Education for their cooperation and shared commitment to both our students and our community.

"I want to thank the Common Council for their continued faith in the City of Middletown and for their willingness to work with me through a difficult budget cycle with seriousness and integrity. Together, we are committed to delivering a budget that is fair to taxpayers, responsible in its spending, and forward-thinking in its vision for the future. I also want to thank our legislative delegation Senator Matt Lesser, Senator Jan Hochadel, Representative Brandon Chafee, and Representative Kai Belton for their ongoing efforts to secure fair funding for Middletown.

"Additionally, I want to thank all those who have spent and will continue to spend long hours crafting this proposal. Our Finance Department and staff, led by Director Carl Erlacher and Diana Doyle, my Chief of Staff Steven Kovach, and the staff of the Mayor’s Office Linda DeSena, Joy Collins, and Tina Mejias worked tirelessly for months to prepare this budget.

"This budget was built with discipline, honesty, and a clear understanding of the responsibility we carry as stewards of the taxpayers’ trust. The decisions included here were not always easy, but they were necessary to protect the financial stability of our City while maintaining the essential services our residents expect and deserve.

"I remain confident in Middletown’s future because I see every day the dedication of our employees, the commitment of our community, and the willingness of our residents to work together when challenges arise. That spirit has carried this City forward for generations, and it will continue to do so.

"Lastly, I leave you with this, as the State of Connecticut continues to review their budget, Middletown may get promising news. The Connecticut General Assembly is currently considering budget adjustments during the 2026 legislative session, which runs through May 6. Early discussions indicate the possibility of additional funding that could benefit municipalities and public education. If adjustments move forward as we hope, they could provide meaningful relief for Middletown — helping support our public schools and assisting the City as we work to close this year’s budget gap without placing the full burden on local taxpayers. Although nothing is final yet, we are actively engaged with state leaders and will continue advocating for every dollar Middletown deserves!!

"The budget I am proposing today keeps Middletown strong, keeps Middletown stable, and keeps Middletown moving forward."