Newton has until Dec. 31 to spend its remaining $2.5 million in federal pandemic relief funds or send the money back to Washington.

Comptroller Stephen Curley told the city's Financial Audit Advisory Committee (FAAC) on Oct. 7 that of the roughly $63.6 million Newton received through the American Rescue Plan Act (ARPA), $2.5 million remained unspent. Curley said all of it is expected to be fully spent before the deadline, according to the committee's meeting report.

The ARPA update was one of several financial findings auditors from CliftonLarsonAllen (CLA) presented to the committee, chaired by Councilor Martha Bixby.

Pension liability drops $27 million

The city's net pension liability fell $27 million in one year, from $275 million to $248 million, driven by strong investment returns. Auditor Zack Fentross reported that Newton's retirement system carries a total pension liability of $919 million against a fiduciary net position of $671 million.

The improvement comes as Newton's broader pension strategy remains in flux. The Newton Beacon reported Oct. 5 that the city's plan to issue a pension obligation bond is on hold because of high interest rates.

Chief Financial Officer Maureen Lemieux said at an Oct. 6 presentation that "…the current market is such that a pension obligation bond is not viable at this point in time."

The City Council voted unanimously in April to let Mayor Marc Laredo seek state approval for the bond. State Sen. Cindy Creem and State Rep. Amy Sangiolo are still working on enabling legislation. The Laredo administration has pushed the pension repayment date to 2035, a move the mayor said Oct. 6 provided roughly $5 million in budget relief.

Federal spending up, auditors find no red flags

CLA estimated Newton's total federal expenditures at $23.5 million for fiscal year 2026, up from $20.7 million in fiscal year 2025. The single audit will cover $15.6 million of that total, or 66 percent, spanning ARPA ($11.5 million), special education ($3.7 million) and assistance to firefighters ($392,000).

Auditor Jim Piotrowski told the committee that changes in federal funding under the Trump administration would have "little impact" on Newton.

Auditors also reported no recommendations, anomalies or areas for improvement on three special projects: the city's tree preservation program, Newton North High School and Newton South High School.

Newton must also implement a new accounting standard this year. Governmental Accounting Standards Board Statement 103 (GASB 103) changes how financial results are reported. CLA said the ARPA and City Hall Improvement funds will shift from major to non-major governmental activity in this year's financial statements.

The committee's next meeting is Dec. 9.