AFTER WARNING ABOUT the “perfect storm” on the horizon, the organization representing Bay State cities and towns has ideas on how to chart a course through the fiscal rains and winds.

The Massachusetts Municipal Association on Thursday offered up a package of steps it wants Beacon Hill to take in support of strained city and town hall finances, including a gargantuan increase in local aid and reforms to loosen — but not eliminate — the property tax cap law known as Proposition 2½.

The 10-page report formalizes a major request for action on behalf of all 351 cities and towns, adding more pressure on the Legislature to come to the rescue of their municipal counterparts and constituents.

But local officials are likely to face an uphill climb, especially as state government navigates an increasingly precarious budget cycle of its own fueled in part by federal funding cuts.

The report pitched the need as “an issue of competitiveness and affordability,” featuring — in bold — the two buzzwords that state officials seem to mention in virtually every speech these days.

“This is an urgent issue not only for local taxpayers, but also for the Commonwealth as a whole,” authors wrote. “Ultimately, the success of Massachusetts depends on the fiscal strength of its cities and towns. When municipalities are stable and resilient, the Commonwealth is better positioned to grow, innovate, and support its residents.”

In October, the MMA published a report warning that a combination of factors over the years have riddled city and town finances with deep cracks. At the time, MMA executive director Adam Chapdelaine said local leaders were at the limit of what they could manage on their own, and that any additional trimming would amount to “cutting bone.”

Now, Chapdelaine said in an interview, municipalities need the state to empower them with “financial flexibility to be able to close the structural gap.”

A primary factor MMA identified behind the growing strain is the state’s approach to unrestricted general government aid, an important funding stream often referred to as UGGA. Beacon Hill pared back UGGA during the Great Recession, and modest increases since then have not kept up with cost growth.

As a result, municipalities have had to lean much more heavily on property taxes.

Communities collected about 11.5 percent as much from unrestricted local aid as all local taxes in fiscal 2007, according to MMA’s analysis. By fiscal 2024, that ratio dropped by more than half to 5.4 percent.

The group’s new report calls on the Legislature to approve a $351 million increase in UGGA, a massive sum that would represent a more than 26 percent jump over current levels. (The state fiscal 2026 budget featured roughly $15 million more in UGGA than the prior year.)

That shift, the MMA argues, would push the balance of state aid and local taxes closer to the historic norm.

Chapdelaine said the requested infusion might need to be deployed over multiple years given its size, and he argued the state should find a way to make it work despite headaches over how to navigate federal funding cuts.

“We fully acknowledge how robust a $351 million investment would be in any context, never mind the context we’re currently operating in, with an uncertain financial picture for the state,” he said. “But at the same time, we feel like suggesting to go back to a [state aid to local tax] ratio that really only meets in the middle from where the ratio was before the Great Recession still underscores a modesty in [the request].”

MMA also wants Beacon Hill to revisit the voter-approved law known as Proposition 2½, which limits property tax levy increases to no more than 2.5 percent per year unless voters approve an override.

The report calls on lawmakers to loosen some of the measure’s strictest limits, perhaps by allowing a single vote that would phase in multiple years of overrides, or by allowing local referenda to raise the 2.5 percent levy limit temporarily or permanently.

Chapdelaine stressed that the organization is “absolutely not proposing a repeal” of Proposition 2½, and that MMA wants to keep higher tax increases tied to municipal ballot questions.

“That’s the trust lever that’s built into Prop 2½ that works so well,” he said. “Whatever the taxation level is that a local government leader wants to pursue, historically, has been tied to a ballot question. We’re proposing that there may be some changes made to those levers, or the mechanics of the levers, but the lever remains in place.”

The group also suggested it’s worthwhile to give communities more power to shift the balance of commercial, industrial, and residential property tax rates.

Those limits are at the heart of a long-running feud between Mayor Michelle Wu in Boston and Senate Democrats, including Boston Sens. Nick Collins and Will Brownsberger.

Chapdelaine said only a few communities might need to rebalance their tax splits, but in those that rely heavily on commercial tax bases like Boston and Cambridge, local leaders would benefit from more flexibility to respond to “large swings in valuations” without needing to embark on the arduous home-rule petition process.

Other ideas MMA backed include authorizing real estate transfer fees, or additional taxes charged to high-value property transactions with revenue directed to affordable housing, and greenlighting new local-option tax increases.

Gov. Maura Healey has sought to grant that additional taxation authority through a bill she dubbed the “Municipal Empowerment Act,” but legislative leaders do not seem interested.

Chapdelaine said state leaders have “made no commitments” on the report’s recommendations during preliminary conversations with MMA.

“[They] have acknowledged the reality of the challenges facing local government, while also acknowledging the serious financial challenges facing state government,” he said.