Jeff O’Neil, Norwood’s director of finance and town accountant, told the Board of Selectmen on Feb. 25 that the town’s general‑government budget as initially presented is projected at about a 5.4% increase for fiscal year 2026 and that the town’s free‑cash balance currently is “right about 29” million dollars.

O’Neil said investment income has outperformed initial estimates because interest rates stayed higher than expected, but building permit revenue that boosted recent free‑cash balances has slowed and will likely remain below the extraordinary recent levels unless a significant project arrives. “Unless we have some sort of excellent project that comes in in the very near future, we’re probably not going to see the outperformance that you’ve seen in the last couple of years,” he said.

On expenditures, O’Neil said most lines are within normal timing variances; he described ambulance‑billing contract costs that may show over budget on an expense line but are offsetting revenue. O’Neil said the town currently has room in operating expense lines and that some transfers (for example, water/sewer indirect charges) will be decided later in the fiscal year. He also highlighted that the Blue Hills regional assessment looks likely to fall modestly and that pension and health‑insurance costs remain pressure points.

Selectmen discussed budget strategy, the tradeoffs of using free cash to balance the budget and the practical limits of cutting line items that would reduce the town’s ability to generate surplus. Several members urged keeping capital and operating priorities visible during the capital‑outlay and FinCom review cycles. The board agreed to wait for the budget‑balancing committee’s meeting and to continue deliberations at future sessions rather than make a final vote immediately.

Why it matters: The finance director’s outlook frames the fiscal choices the board will consider in the coming weeks — how much to rely on free cash, whether to accept a mid‑year transfer for specific programs, and how to prioritize capital projects.

The selectmen left the budget under study; staff said a more final vote on a general‑government number could be possible in March after the budget‑balancing committee and FinCom complete further review.