VIROQUA, Wis. — On Tuesday, Nov. 25 the Viroqua Common Council will vote on adopting a $2,945,968 property tax levy as part of its proposed 2026 budget, navigating tight state-imposed restrictions while attempting to address critical infrastructure needs and competitive staff compensation.
City finances remain robust due primarily to the timing of major grant-funded projects and borrowing, which led to a $2.8 million surplus at the end of 2024, though officials caution against expecting that performance annually. The challenge for the upcoming fiscal year is absorbing rising costs while operating right “up against” state levy limits.
For most Viroqua households, the city’s 2026 budget story is about living within hard limits while keeping core services steady. City staff repeatedly stressed two ideas through the fall: keep recurring costs tied to recurring revenue, and use one-time dollars for one-time needs. “We’re essentially at our levy ceiling,” City Administrator Nate Torres told committees as they weighed tradeoffs, noting that inflation, wage adjustments, and timing of insurance and state aids leave little slack to absorb new ongoing costs.
That stance grew from experience. “We can’t be overly optimistic and then fix things midyear,” Torres said, pointing at lines like fuel, maintenance, and communications that historically ran hot in public safety. “Baseline what it really costs, fund it honestly, and don’t pretend that one-time dollars fix structural needs”. In practical terms, that meant a sober scrub of each department’s operations and a sharper focus on wages and benefits where retention risk is real.
Financial Pressures and Priorities
Torres described the 2026 budget process as “incredibly challenging”. The administration’s primary goal was improving the “competitiveness of wages across the City,” a sentiment echoed by Mayor Justin Running, who argued the city must “take a more dramatic approach to wage adjustments” to support long-tenured staff impacted by inflation.
Departmental draft budgets initially overshot the allowable levy limit by $165,600. The budget team subsequently focused on absorbing inflationary increases, maintaining flexibility, and securing the projected $89,449 in annual Expenditure Restraint Incentive Program (ERIP) revenue.
Torres’s presentation outlined several key strategic adjustments:
- Implementing adjustment wage increases across departments, notably seeking wage equity in the Library.
- Funding technology upgrades, including the replacement of the critical city server.
- Preparing the operational budget for the new fire station.
- Seeking major cost savings by going out to market for city-wide health, property, and liability insurance.
The proposed 2026 City of Viroqua budget prioritized increasing staff compensation city-wide, driven by the goal to “Improve the competitiveness of wages across the City”. The overall budget for wages across all departments is proposed to be $2,514,109, an increase of $194,781 compared to the 2025 budget of $2,319,328.
A key factor influencing the large increase shown in the wage line item across departments is the reclassification of the health insurance opt-out stipend. This stipend is now recorded as a wage expense rather than a health insurance benefit, which significantly inflates the reported wage increases while correspondingly causing the benefits line item to decrease.
Wage Changes by Department
The wage adjustments varied significantly across departments based on market comparisons, internal equity goals, and necessary staffing restructuring:
Department Key Wage Changes or Adjustments Administration Wages for City Hall staff generally proposed a 5–9% increase. Specifically, the Clerk/Treasurer received a proposed 6% increase, and the Deputy Clerk received a 5% increase. The City Administrator received a proposed 10% increase (appearing as 16.79% when factoring in stipends). Police Full-time staff sought competitive wages. Increases for Sergeants and Patrol officers were proposed between 5.2% and 12.87%. Dispatch and Administration staff received a proposed 3–5% increase. The cost of these wage increases was partially offset by the planned elimination of the Second Shift Police Dispatch Position by February 2026. Fire The budget required a major operational shift: the Fire/Zoning Admin Assistant position was converted into a full-time Fire Officer position. The conversion was deemed a “hard decision” necessary to prioritize fire response capacity but required a significant wage increase to attract qualified candidates. The Fire Chief received a 7.5% increase. Firefighter wages (hourly) are budgeted to compensate for a 2% increase. Library The primary goal was achieving wage equity aligned with Winding Rivers Library System (WRLS) recommendations. Full-time staff received an average increase of 12.2%. The Library Director noted that the compensation for their role and other director-level positions was substantially lower (15–29%) than comparable libraries. Two part-time clerks specifically requested the restoration of hours that were cut in 2025 (totaling 338 hours restored), electing this over a wage increase for the year. Public Works Full-time staff received increases of 5% to 7.5%. The Public Works Director was constrained to taking only a cost-of-living increase, while other staff saw higher percentage increases. The Director was “more than happy to accept” internal cuts to fund the overall wage objective. Parks & Rec Full-time staff received an increase of 5–6.5%. Seasonal staff were proposed a $1.00 per hour raise. This would raise the hourly wage for park staff from $12 to $13, and for summer recreation instructors from $10 to $11.
Context on Budgetary Constraints
City Administrator Nate Torres noted that staff had already achieved a 3% wage increase across the board but lamented that previous COLA increases had not kept up with the Consumer Price Index (CPI). Due to operating “right up against” levy limits (leaving only about a $1,600 cushion), the city was forced to look at “comprehensive budgeting” by reassessing priorities and moving funds between departments “taking from Peter to pay Paul” to afford the necessary wage adjustments.
Tensions Over Departmental Cuts
The pressure to fund necessary wage increases while adhering to the levy limit ceiling necessitated internal cuts across city departments, sparking debate during committee reviews.
The Fire Department addressed its shortfall by eliminating the Fire/Zoning Admin Assistant position to fund the creation of a second Fire Officer position, a “hard decision” made to prioritize fire response capacity.
The Police Department budget faced scrutiny with the elimination of the Second Shift Police Dispatch Position. This proposed cut generated significant tension during public safety discussions.
You can read our previous story about that discussion here.
At later meeting Mayor Running clarified that while he was hoping not to cut the position the staff member holding the position was retiring, meaning “no one lost their job”. He also clarified that Viroqua’s dispatchers do not take 911 calls, which are traditionally handled by Vernon County Dispatch, thus limiting the core emergency impact of the position’s elimination.
Police Chief Rick Niedfeldt and the dispatchers strongly defended the position, arguing it provides essential public services beyond emergency coordination, including handling DMV services and open records requests during evening hours (4 p.m. to 8 p.m.). Dispatcher Annette Olsen noted that without the second shift, citizens who work late would struggle to pick up and pay for records requests in person, as online payment is not currently an option. Sheriff Roy Torgerson also weighed in, confirming that eliminating the city position “is going to be a lot busier at the county”.
Alderperson John Thompson who has long ties to both the fire and police departments said the city has been talking about possibly eliminating the position for years, possibly decades.
The conversation also included historical context regarding the Police Department’s financial performance. Alderperson Kristal Welter raised concerns that cutting necessary line items could lead to issues similar to past years:
“I remember a time Rick (Chief NNiedfeldt) when you came back and made a lot of cuts and then when it came time at the end of the year you were over budget and my concern is that you’re going to do that again”.
Welter stressed the risk of creating an unsustainable budget, worrying about the accuracy of the proposed reductions:
“I’m worried that we’re kind of getting into a cyclical pattern here where I think you’re doing your best to prioritize i’m just worried that some of those things that like your cars the maintenance the fuel on them… I worry about how much we can really say they’re going to be lower but truly can we expect them to be lower”.
Chief Niedfeldt countered that past budget overages were due to “unforeseeable things” like overtime, two officer resignations, and subsequent large payouts, arguing that budget items under his direct control, such as uniforms and fuel, were generally managed close to the budgeted amount.
Public Works Director Sarah Grainger, however, accepted the mandate to find cuts internally to achieve the city-wide objective for staff compensation:
“I am more than happy to accept that like looking across the board we have to just do things differently and it’s not fair if I’m asking more than others”.
Hansen Property Development and Borrowing
The budget incorporates infrastructure expenses for the Hansen Farm development on the north side, which falls under Tax Increment District (TID) 7. To cover the initial cost of infrastructure, including roads, underground water, sewer, and road improvements, the City Council approved borrowing $3,765,000 through a State Trust Fund Loan.
The need for initial borrowing is due to the fact that the project is “not yet in a position where we will make our money back on the infrastructure” based on current development agreements. The financing strategy assumes that the TID will be self-sustaining, with tax increment generated by “the new buildings that will be going up” intended to repay the debt. The city expects to refinance the interim debt with a revenue bond within the next three years.
Dragon Park Renovation and Funding
The renovation of Eckhart Enchantment Playground (Dragon Park) is moving forward with a design from Play By Design, selected after public input led to a scaling back of initial modern design. The total cost is estimated at $776,000, which can be reduced by $75,000 if the community executes a “community build” for labor.
The project will be funded primarily by $375,000 allocated from Tax Increment District (TID) 6 funds and a community fundraising target of $291,000. Because the renovation relies on set-aside funds and donations, it is expected to have a minimal impact on the General Fund operating budget.
Tax Impact Summary
Despite the complexity and difficult cuts required in various departments, the overall tax burden on Viroqua property owners is projected to decrease.
The city’s total equalized value increased by 13.11%, partially due to the closure of TID 3 . This increase, combined with the proposed 4.7% increase in the levy, results in the City Mill Rate dropping significantly from $7.344 per $1,000 of equalized value in 2025 to $6.415 in 2026. Consequently, the annual City property tax bill for the average homeowner (valued at $282,768) is projected to decrease by approximately $20. However if the value of a property increases the assessment would in include that increased value so overall tax amount may not go down.
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