Facing $8.4M Deficit, Salem Eyes Budget Cuts, Tax Hikes

SALEM, MA —The city will likely need to slash its budget and raise taxes as it looks at an $8.4 million budget deficit for the fiscal year that starts July 1.

At a remote budget retreat Saturday, Mayor Kim Driscoll told city councilors that Salem officials are projecting a $3.2 million drop in local revenue and $5.2 million in state aid in the next fiscal year.

Don't miss updates about precautions in your area as they are announced. Sign up for Patch news alerts and newsletters.

The coronavirus pandemic has cut into city revenues coming from hotel and meals taxes, as well as the local sales tax on cannabis and parking fees. "Just about every item outside of property taxes have had major revenue downturns for us," Driscoll said.

The city has already put a freeze on spending but has yet to lay off or furlough any workers. A day after the retreat, at least one city councilor suggested the body should lead by example by taking a pay cut.

Driscoll said increased development in Salem could offset the deficit. Other city councilors suggested putting a hold on some capital projects and offering buyouts for city workers.

Watch the complete city of Salem budget retreat.

More Coronavirus Coverage On Massachusetts Patch:

• What Return To Work Will Look Like For Office Workers
• MA Coronavirus Case, Death Count Higher Than Most Countries
• Coronavirus Case Counts For Every Massachusetts Town (Updated May 13)

Dave Copeland writes for Patch and can be reached at dave.copeland@patch.com or by calling 617-433-7851. Follow him on Twitter (@CopeWrites) and Facebook (/copewrites).