By Kellen Olshefski
Staff Writer
County Administrator David Bretl presented the 2014 preliminary budget, which effectively freezes the county tax levy for the third consecutive year, at the Sept. 5 Walworth County Committee of the Whole meeting.
With a total tax levy of $60,879,834 million, Bretl’s 2014 preliminary budget levies $29 less than last year.
The budget, the lowest tax levy since 2010’s $60.79 million, will come before the finance committee Sept. 19 for any appeals hearings and a public hearing will be held Oct. 9.
With an estimated mill rate of approximately 4.72 mills, county residents can expect to pay about .5 percent of their total equalized value, the value of all taxable property.
Property taxes are determined by multiplying equalized value by the mill rate and then dividing by 1,000. As an example, taxes on a $100,000 property in Walworth County would equate to $472 for the county portion of the tax bill.
Levy Freeze
With the county’s ability to effectively freeze the tax levy for three consecutive years now, Bretl noted several factors have been key in achieving the freeze.
Bretl said the county’s diligence in reducing debt service has been a “critical piece of the puzzle” in regards to the county’s conservative budget practices.
New facilities built in previous years, such as the judicial center and Lakeland Health Care Center, were largely paid for through borrowing.
Rising by $1 million annually for a number of years, according to Bretl, one of the county’s missions has been to pay down this debt as quickly as possible, calling $2.6 million in promissory notes last year alone.
While it’s been no small feat, he said the county has been able to reduce its debt from more than $50 million in 2008 to just more than $20 million projected for 2014.
In adopting Bretl’s preliminary budget, the county would not have to borrow funds until 2018.
In addition, a 10.04 percent decrease in the Children with Disabilities Education Board (CDEB) levy has aided in achieving the levy freeze, which Bretl said is possible due to a ten-year plan that has slowly shifted the cost of special education teachers from the responsibility of the county to its 15 school districts.
Other components that led to the levy freeze included the county’s recent changes to employee health-care, which saved the county nearly $1 million, and a reduction in Other Post Employment Benefits (OPEB) contributions.
While these factors have been effective, Bretl said they are “running their course” and will not lead to annual decreases much longer, leading to the county’s inability to freeze the levy indefinitely.
He noted the availability of extra tax capacity as significant employee and budget cuts could become a reality as early as 2015 or 2016.
The county is allowed an increase for new construction that took place within its boundaries, according to Bretl. While he said it wasn’t much, it would add approximately $50,627 from 2013 to the budget. Secondly, with a majority vote, the county Board could move an unspent $256,237 from the 2012 levy capacity to the 2014 budget.
“We’ve got to move beyond the fact that someone who wants to do that is a ‘big spender,’” he said.
However, Bretl also noted that money could be used in many “prudent and ‘conservative’” ways in the county’s future as well.
National Trouble
According to Bretl, 2008’s banking crisis essentially reset many of the assumptions previous county Budgets had been based upon.
He said he never expected the effects of the economic downturn on the county’s revenue and taxpayers would still be a big issue when he was constructing the 2014 budget.
According to Bretl, equalized value trends since 2009 paint a disappointing picture for the county.
With equalized value dropping 16 percent from 2009’s $15.61 million to $13.18 million in 2013, about $2.5 billion, the county ranks as the third largest drop among Wisconsin’s 72 counties.
“It’s been a particularly harder hit here [in regards to] property values relative to some of the other counties in the state,” he said.
Interest on county investments, which help offset the need to fund programs with tax dollars, has seen a significant decrease from about $3 million in 2007 to an estimate of less than half of a million dollars in 2014.
In addition, sales tax revenue has taken a “$1 million hit” since 2008. The half-cent sales tax the county imposes on most purchases helps reduce property taxes.
Bretl said while the lower revenue from this tax has had an effect on the county’s bottom line, it also reflects “those who pay for county government have fewer disposable dollars to spend.”
Finally, a dramatic slowdown in real estate activity has led to decreased revenue from recording and permit fees as well as a loss of jobs created by the construction industry.
While Land Use and Resource Management (LURM) zoning and sanitation fees continue to decline, Bretl noted the number of real estate documents recorded by the county’s Register of Deeds is increasing.
“Maybe this is a harbinger of more positive things to come,” he said.
While an increasing number of local governments nationwide are filing for protection from bankruptcy court, Bretl said the county has taken steps to proactively address the threats of high debt, deteriorating infrastructure and underfunded pension and benefit systems.
With a recommended contribution of $500,000 to the OPEB fund in 2013 and the county nearing it’s goal of funding the obligation, he said the county can safely skip the contribution this year.
Additionally, changes in county employee healthcare and the county’s ability to fund over $17 million in road projects over the next five years without borrowing are key factors, according to Bretl.
Major Initiatives
Bretl’s preliminary budget sets forth several key spending initiatives for the 2014 financial year.
To begin with, Bretl has included the approximately $1.91 million to acquire land from the Duane B. Clark Trust in the Town of Lyons for a county park.
Money was not included in the 2013 budget as there were four consistent votes against the acquisition and the only way to purchase the land in 2013 was through a budget amendment.
“I understand and respect the views of the opponents of this, but this is a question of roles,” he said.
“I work for the county board and there has been seven consistent votes in favor of the park and I have included it in the budget.”
Bretl also included funding for an additional prosecutor, something District Attorney Dan Necci has made a priority since taking office in 2012.
Necci had originally secured funding for an additional prosecutor through a grant, however the county’s Criminal Justice and Coordinating Committee was uncomfortable using the money to hire a full-time prosecutor.
Necci next sought help from the state legislature and his request was declined.
Bretl’s budget provides funding to hire an additional prosecutor for an 18-month period, giving Necci the help he needs until the next state budget cycle when he can once again seek help from the legislature.
In addition, Bretl has included an additional $472,000 total for Judicial Center projects, $250,000 for the addition of a second elevator and $222,000 for security improvements, such as switching from an analog camera system to digital.
Other items include a $259,000 vacuum truck for Public Works, $320,000 to update software in the LURM department, a $215,000 air chiller, and a $30,000 standby generator, both to be used at Lakeland Health Care Center.
