Facing uncertainty over federal funding under President Trump, Mayor Martin J. Walsh proposed Wednesday a “smart” $3.14 billion operating budget that he said better positions the city for any future financial instability.
Walsh and members of his budget team presented the city’s new spending plan for fiscal year 2018 at a breakfast meeting to city councilors, who must approve the proposal. The council is expected to host budget hearings before voting in June. The city’s capital budget will be presented next week.
“Much of this work puts us in national conversations. . . but it all starts in Boston neighborhoods,’’ Walsh said. “You don’t have to cut the budget by swinging an ax, cutting lifelines like what the White House is doing. That is not what we are doing here in the city of Boston.”
City officials said the proposed budget has data-driven investments that include extending learning time for 15,000 students, improving public safety, adding another police cadet class, and renovating neighborhood ball fields.
Projected funds from the federal government to Boston were about $500 million for fiscal year 2017, city officials have said previously. Federal grants have been used to help fund housing, schools, public health, and public safety initiatives, they added.
But instability at the federal and state levels requires strong fiscal management from the city, said David Sweeney, the city’s chief financial officer, at the budget presentation that also included members of the mayor’s administration.
Federal budget proposals would eliminate Community Development Block Grant funds and reduce education grants serving students in poverty, he said.
He noted that Trump signed an executive order aimed at cutting funding for so-called “sanctuary cities’’ like Boston that vow to protect undocumented immigrants from deportation.
Further federal divestment from public housing is possible, Sweeney added, as Boston continues to struggle with the state’s underfunding of the charter school tuition reimbursement.
Although cities cannot afford to replace this level of funding cuts, Sweeney said, the city’s “disciplined financial practices” have put Boston in a better position to manage down the road.
“This budget proposal . . . reflects reality,’’ Sweeney said, adding that “instability at the federal level is playing a role in how we plan for the coming fiscal years.’
Samuel R. Tyler, president of the Boston Municipal Research Bureau, said the budget proposal is prudent and conservative.
“It looks at ways to create more savings,’’ he said. “It’s a budget built on the revenue estimates.”
But, he added, the city has to contend with fixed costs such as pensions, debt service, and state assessments — including the charter school tuition assessment — that are growing at a much faster pace than other city services.
Twenty-three city departments received no increases in their budget in the plan, an indication that the city is trying to be conservative as much as it can, Tyler added.
Boston — in the middle of a massive building boom — has enjoyed steady economic prosperity over the past three years and maintained its AAA bond rating. Ninety-three percent of the city’s revenue growth comes from locally derived sources, such as property taxes and local receipts from motor vehicle excise taxes, meals and hotels taxes, and license and permit fees, officials said.
The officials said that property tax growth is expected to be hampered by sluggish state revenue, which has not recovered since the last recession. State revenue is the city’s second-largest revenue source.
Walsh said he is presenting a balanced budget that represents a $144 million increase over fiscal year 2017. Forty percent of the budget is dedicated to public education, 38 percent will go to police, fire, public works, the health commission, and other city services. The remaining 22 percent will be consumed by pension, debt services, and other fixed costs.
The recommended school budget includes a projected $40 million increase since last year, officials said. The total appropriation is projected to be at $1.061 billion prior to collective bargaining, which is continuing, and $1.081 billion after a deal is reached, officials said.
The recommended school budget, approved recently by the School Committee, also invests in extending the school day and maintains the current school funding formulas. The district will provide lower-performing schools with wide-ranging support, which totals over $16 million.
Officials said public safety costs are rising by $21 million to $606 million. The budget accommodates increases from settled union contracts. Officials also noted that police and fire overtime reduction reforms launched in fiscal year 2017 will avoid almost $13 million in costs.
The proposed police budget appropriation increased to $373 million from $364 million in the past year. The Fire Department’s budget also went up, to $232 million from $221 million last year.
The budget makes room for a fresh class of police cadets in a program that aims to provide a “stable pipeline of diverse candidates’’ on the force. A new class of 100 recruits is to begin training in August.
The Fire Department will also get 13 new engines and ladders, and money is available to conduct industrial cleaning at some fire houses to remove potential carcinogenic compounds, officials said.
Other budget highlights include a long-term citywide campaign to bring all crosswalks, lane markers, and bike lanes into good repair.
Meghan E. Irons can be reached at email@example.com.