By Tim Hundt – May 31, 2026
VIROQUA, Wis. -Viroqua City Administrator Nate Torres delivered what may be one of his last detailed reviews of city finances this month, telling the Finance and Personnel Committee and the City Council that the city is on solid footing about a quarter of the way through 2026 even as inflation and rising utility and fuel costs squeeze the budget
Torres, who is preparing to leave City Hall for a position with Vernon County, used the first‑quarter financial review to explain how years of disciplined budgeting and a formal capital improvement plan process have allowed Viroqua to take on major projects while keeping the city levy relatively stable.
He framed the quarterly review as a tool for both council members and department heads to understand where the city stands and where pressure points are starting to show.
Torres told the Finance and Personnel Committee that the goal of the review is to catch problems early and give department heads time to make adjustments.
“The goal here is for everybody to get a good understanding of just sort of where we are at through the first quarter,” said Torres. “And it is important for the department heads to be looking at their financial numbers so that if any mid‑year adjustments need to be made they can make them.”
Keeping city leaders and the public in the loop
“The idea of these slides is if anybody from the public ever wanted information from me I just send them this report and this gives them a good degree of information,” Torres said. “So it is a little bit wordier than what most presentations would include but it is intended to be not only a presentation but also provide an overall report for anybody from the public.”
City finances track slightly better than last year
Torres told the committee that when one‑time capital and grant expenses are stripped out of the numbers the general fund is running better than the usual 25 percent benchmark for this point in the year and noticeably better than a year ago.
With capital and grant spending removed the city has spent about 26 percent of its general fund budget through March in 2025 terms and is below that level so far in 2026.
“This right here would indicate to me right away the first test is that we are below 25 percent of dollars expended through the year and we are well below where we were at last year,” Torres said.
He cautioned that those high‑level figures can hide individual problem areas which is why he walked the committee through wages benefits contract services utilities and other major expense categories.
Wages and benefits mostly on track
Wages about 40 percent of the city budget remain the largest single expense and are generally in line with expectations once one‑time payouts and internal budgeting moves are accounted for.
Torres reminded the committee that the city created a new accrual payout reserve this year to smooth the impact when long‑term employees retire or resign and cash out their sick leave and vacation. That change makes City Hall wages look low early in the year because some of that reserve has not yet been used.
He noted that a dispatch position payout in the police department is showing up as higher‑than‑normal wages in dispatch and lower‑than‑normal wages in the City Hall line where the accrual reserve is budgeted.
“The reason that those admin wages seem really low compared to the 25 percent is because this budget year we created what I call an accrual payout reserve,” Torres said. “Anytime we lose a long‑term employee who has accrued a decent amount of sick time and vacation and then exits the city gets paid out for what they have accrued. And so this year we have budgeted $22,000 to help so that we are not taking that loss every year against our budget.”
He said a city employee payout and the City Hall reserve are looked at together they largely balance out.
On benefits Torres said health insurance is roughly where the city expected it to be in terms of enrollment but he wants more time to test whether the dollars are lining up the way they were projected under new plan options.
“Some of our health insurance numbers are tracking a little higher than budgeted,” he said. “Overall we are below 25 percent for all health insurance but it is an item I want to dig into more carefully just because it is a little complicated in the calculations who is taking insurance. Are they taking stipends? Now we have a whole new track of plans.”
Utilities and fuel emerge as major pressure points
While most day‑to‑day operating lines are within range Torres sounded a clear warning on utilities and fuel.
He told committee members that utility bills particularly for the fire station police and the public works garage are running above what was budgeted and that natural gas and electricity prices have been higher and more volatile than expected.
“Fire is struggling and this is really an area that we are going to have to keep an eye on,” said Torres. “I think MGE and Xcel bills in particular have been really high compared to what we budgeted for. And I think part of that is that natural gas prices in particular are very market rate and is a struggle to ever forecast.”
He contrasted that with the library which he said has made building changes that are paying off in lower utility bills.
Torres linked the utility concerns directly to rising fuel costs and broader inflation trends.
“Gas prices were I think hovering a little under three dollars and now they are what are they four and a quarter four‑thirty now higher,” he said. “You are talking about almost a 50 percent increase in gasoline prices and then the utilities there is a correlation between that and sometimes utility prices. So we will just have to really keep an eye on our utilities this year do what we can to cut those costs where possible and just be mindful about our limited budget.”
Council member Tanja Birke pressed Torres on whether city leaders and statewide municipal groups are looking ahead to how continued inflation and potential changes in gas‑tax policy could affect local budgets.
“As we notice that inflation is on a very steep upward climb right now I am wondering if we have done any sort of looking ahead to how what that might mean for us and where we can try to save money,” Birke said. “Every day it seems like there is another thing that is becoming harder to get a hold of or is becoming outrageously expensive.”
Torres replied that the quarterly reviews are designed to give department heads time to adjust as those pressures appear.
“This is quarter one so this is the part where we get our first true look at where the trends are at and forecasting inflation especially in these days is a challenge,” Torres said. “Certainly the general understanding of each department head is that our budgets are our budgets and part of the reason we do financial reviews on a quarterly basis is for them to really see, and say like, I am running out of money in a particular category I need to be prepared to tighten up or make those contingency plans.”
Committee member Cyndy Hubbard asked what “mid‑year adjustments” might look like if a line such as health insurance or utilities runs far over budget. Torres pointed back to 2024 when a jump in health insurance enrollment forced the city to move money between lines to close a roughly $140,000 gap.
“We sort of carved up from different budgets and figured out how to get ourselves back so that we did not go into the end of the year with a negative $140,000 budget performance,” said Torres. “Now, how do we do that again if we need to do that? That is what we need to identify. We have three months worth of data and what is hard with utilities in particular is that gas usage is heaviest in the first three months and the last three months.”
Clerk‑treasurer Lori Polhamus told the committee one option would be to work with utilities on levelized “budget” billing to smooth out monthly swings.
“A lot of the utilities have budget programs where you can pay the same amount every month,” Polhamus said. “Looking at it that way would help streamline the budget if you know from year to year.”
Revenues stable with taxes and state aids on track
On the revenue side Torres characterized the first quarter as solid with some categories running slightly behind last year but no major red flags.
He noted that general property tax collections are showing up lower than the same point a year ago because more taxpayers chose to make December prepayments in 2024 which are not booked as revenue until the final settlement with Vernon County in August.
Polhamus explained that timing issue for the committee.
“We have to put it in a prepaid tax account and so it looks like it is in 25 but when I do the settlement in August is when I move it into 26,” she said. “So it is just a timing between December and January.”
Torres said shared state revenues and other intergovernmental payments are arriving “like clockwork” later in the year and do not concern him at this point. He highlighted a correction he and Polhamus made after last year’s miscalculation of the municipal utility’s equivalent tax payment.
“That issue from last year with me miscalculating the Viroqua Municipal Utility equivalency payment has been corrected ” Torres said. “ Now you can see that we are directly on track for meeting budget this year where last year we were continually behind because I over‑budgeted for the payments that they were going to make.”
Torres said building‑permit revenue is running ahead of last year with the building department reporting a strong start to the season but parks revenue has been more uneven. Shelter rental income is expected to fall this year while Eckhart Park is torn up for a major playground replacement but recreation program registrations are ahead of last year.
“I think shelter rentals are down,” Torres said. “ On the other hand right now recreation income is really strong. There was a good jump in registration for a few programs and it feels like maybe there is a little bit more people registering earlier versus last year.”
He said interest earnings on city cash balances will again exceed budget although not at the unusually high levels seen when the city was temporarily holding large capital‑project balances and North Point (Main Street Apartments project) proceeds in previous years.
As of the end of March the city held just under $510,000 of general fund cash in higher‑yield investments outside its regular accounts.
“From cash position we are in good and we have plenty of other investment money hanging out there,” Torres said. “Lori and I keep an eye on it and anytime our cash position gets a little lower than what we would want we work with the mayor and make a decision to pull the money to make large pay requests or anything.”
Capital improvement plan credited with “big things” on flat levy
At the council meeting later the same day Torres turned from the quarter‑by‑quarter numbers to the longer‑term capital improvement plan that he argues has been key to Viroqua’s ability to tackle large projects while holding the levy relatively steady. He reminded the council that the last five‑year capital plan expired and that work on a new 2025‑29 plan was interrupted when the methane leak issue at the old city dump emerged and threatened to add as much as $3 million in unplanned costs. The estimated cost to install an active methane extraction system is now projected to be between $2.2 million and $2.5 million.
“The capital improvement plan should have been approved over a year ago,” Torres told the council. “The city and department heads had put a lot of work into putting together a draft sort of plan and then the landfill happened and things kind of came to a screeching halt because we had no concept of what that was going to end up costing us.”
Now that the city has a better handle on landfill costs he urged council members to restart the process even if that means approving a shorter two‑year plan before the end of June when he leaves office.
“What I would recommend is that in my time that I have left here we enter into a little bit more of an abbreviated process to get at least a two year plan set up and then that would give us time to do further homework on the following plan,” Torres said.
He described the capital plan process as a counterpart to the annual operating budget. Department heads develop project lists and priorities with their committees. The council sets financial guidelines for how much the city can afford to borrow without putting too much pressure on taxpayers. A staff capital‑planning team then tries to fit the priorities into those guidelines before the plan goes to the city’s financial advisor Ehlers for a stress test.
“It is very similar to the budgeting process for reason because they are very similar types of processes where you have scarce resources and you are trying to figure out how to make the budget work without having an undue impact on taxpayers,” he said.
Council member Steve Willis asked how long the Ehlers review would take. Torres estimated two to three weeks once a draft is ready. Council member Todd Spaeth said the process mirrors what the city has done in the past and argued that restarting it now is necessary to keep projects moving.
“It sounds like that is what has always been done in the past only this time it has to be rushed a little bit,” Spaeth said.
Torres told the council he when the new capital plan is fully approved but wants to leave a clear playbook his successor and department heads can follow.
“My job here is not necessarily to see everything to its end because that is not going to be the reality but to get it moving far enough along that it is in a good space where people here can just run the playbook that we have all decided on.” said Torres.
The council voted to authorize staff to move ahead with a two‑year capital improvement plan using the framework Torres described. That planning framework and the discipline of matching projects to long‑term borrowing capacity are a significant part of why Viroqua has been able to rebuild and add facilities from the new fire station and upcoming welcome center to playgrounds and street work without sharp jumps in the levy. Torres did not quote the levy rate directly in these meetings but repeatedly tied major projects back to multi‑year plans that spread costs out over time.
Preparing to leave and managing the transition
Behind the numbers and planning charts is the reality that the architect of much of this financial approach is leaving City Hall.
At the finance committee meeting Torres told members he has been using his remaining weeks to document recurring tasks and to map out who will handle them during the vacancy. He said he is drafting a transition plan for department heads and the mayor and trying to get the 2027 budget “builder” set up so the next administrator can plug in assumptions and start the process on time.
He also reassured council members that he will still be nearby as he moves to the county.
“ What is going to make this easier is I am right down the road and as I have said before I am very happy to answer phone calls and be available to people to help make the transition as seamless as possible,” Torres said. “ I want to set people up for success as much as possible and not be super dependent on calling me.”
Spaeth thanked Torres for working ahead to give the city a smoother handoff.
Overall verdict from Torres
After nearly an hour of charts and back‑and‑forth questions at the quarter‑one review Torres closed with a plain summary of how he sees the city’s finances at this early point in the year.
“Revenue is doing fine,” said Torres. “Revenue is great. I have no concerns over it at this point. On the expense side the two things that I do have concerns about the major one is gas and utilities. Health insurance projections appear to be close to what we budgeted but we will need to do a deeper dive into it. Overall quarter one financial review is very positive I would say and we will just keep looking at a few items that will likely pose a challenge to us.”
For residents the message is that Viroqua’s day‑to‑day budget remains stable that the city’s long‑term capital plans are being rebuilt around clearer cost estimates and that the administrator who helped put those systems in place is trying to leave behind not just a clean set of books but a roadmap for the next person who takes the seat.
Torres replacement process and timeline
The city has formed a search committee to find a replacement for Torres and hired an outside firm to assist in recruiting a new administrator. The recruitment firm will use the public survey results and interviews with city department heads to craft the official job posting which will be advertised for four weeks. The firm will then conduct an initial round of video screenings to narrow the applicant pool to three to five finalists.
Those top candidates will be brought to Viroqua for a two day assessment. The assessment will feature a public meet and greet, a tour of the city and formal interviews.
To conduct the initial formal interviews the city established a seven member local search committee. The hiring team includes Mayor Krista Browne, Council President Steve Willis, Alderperson Cyndy Hubbard, Alderperson Tanja Birke, Public Works Director Sarah Grainger, Fire Chief Chad Chad Buros, and former Mayor Justin Running who will serve as the public member at large.
Once the search committee completes its evaluation the entire Viroqua Common Council will conduct the final interviews in a closed session to make the ultimate hiring decision. Torres will officially step down from his role on June 19 and city officials expect the recruitment timeline could result in a new administrator starting by early August
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