Peabody city councilors signed off Thursday on a one-time transfer of $2.1 million from the city's “free cash” reserve to cover police and fire salaries, overtime and holiday pay. At the same meeting, they urged the mayor to freeze any new overtime for the rest of the fiscal year as the city wrestles with tight budget pressures.
As reported by the Eagle-Tribune, the council approved the money transfer but added a formal request that Mayor Edward A. Bettencourt Jr. suspend new overtime approvals across municipal departments. Councilors cast the move as a short-term patch to keep paychecks flowing without draining the city’s reserves any further.
Budget context behind the vote
According to the mayor's FY2026 budget filing from the City of Peabody, the operating budget comes to $208,036,797 and includes an $824,000 increase for public safety. The document notes that roughly 30 openings are slated to be filled gradually and that several positions are only partially funded as a cost-control move. The mayor also warns that Peabody is facing reduced state aid and fewer “other available funds,” a backdrop that helps explain why councilors are nervous about dipping too deeply into free cash.
Councilors say freeze will rein in spending
Councilors told the Eagle-Tribune they want tighter oversight of overtime after months of unplanned reserve withdrawals. They say a temporary freeze would give the administration breathing room to line up hiring and scheduling with the budget that is already on the books. The council’s action is designed to cover immediate payroll and holiday obligations while clamping down on new discretionary overtime through the end of the fiscal year.
Past transfers and what comes next
Peabody has gone to the reserve well for public safety overtime before. In May 2024, the council approved transfers to cover police and fire overtime, according to ItemLive. With this newest $2.1 million transfer in place, department heads will have to juggle shift coverage with the council’s request for restraint, while the mayor’s office keeps a close eye on what is left in free cash.
Next steps
The transfer shores up short-term payroll, but the long-term picture hinges on how strictly the mayor and department leaders honor the overtime freeze and how quickly they align hiring with budgeted positions. Residents can expect more debate at upcoming council budget sessions as officials track reserve levels and ongoing overtime pressure.
