Editors note: An earlier version of this story was missing a percentage for county cost of living (COLA) increases. That information has now been corrected. (The county also passed a wage and cost of living (COLA) increase to try to stem the loss of employees, and a position reclassification and pay grade alignment. That measure was was passed in August of 2022 with a three percent across the board COLA increase for all positions effective September 2022 and a 1.5 percent COLA increase effective January 2023.)
VIROQUA, Wis. – The Vernon County Finance committee met October 24 after months of committee and budget meetings to approved a $37.9 million balanced budget. What was unusual about this years budget was that for the first time the county moved its long-term and capitol expenditures to the counties debt levy instead of including those expenditures in the operating budget. The county still needs to hold a public hearing on the budget and the full county board has to vote to approve it on Nov. 14.
County Finance Director Bobbi Johnson explained to the finance committee that the approach is more proactive than reactive and allows the county to plan for major assets over time rather than paying for them all in one year out of the operating budget. For the first time ever the county has developed a capital improvement plan that allows the county to identify large projects and expenditures ahead of time to allow for better planning and budgeting.
In presenting the final 2024 balanced budget Johnson explained that when the numbers were all put together the county was still showing a $2.2 million deficit. Johnson said historically that would mean the county would have to make cuts to either services, or employees, or both. By pulling the large capital expenditures out of various departments the county will be able to stretch the payment for those over time and lessen the impact to the operating budget.
“If this was a typical year we would be cash funding this,” said Johnson. “$2.2 million within our budget. Now we are making sure that first we can afford the operating budget to keep providing services throughout the county, and then we are preplanning those large purchases. These normally buried in our operating budget and they are now pulled out.”
That $2.2 million included large highway projects and equipment purchases, construction projects and building improvements, sheriff’s department squad cars, computer systems and work at county parks. Johnson said the purchases can be financed using state trust fund loans or borrowing locally. Johnson also said the over levy should remain relatively flat since any payments to service the long term debt will not start until 2025 and the payments for the new sheriff’s office and jail will end in 2024.
Johnson said the idea is to be strategic about planning out the debt to avoid the roller coaster that had been taking place when the expenditures coming from operating expenses. In 2023 the debt levy is $1.5 million. In 2024 it will be $2.2 million, and because the sheriffs office and jail will be paid off, next year the debt levy is projected to go back down to $1.5 million
Vernon Counties mill rate (amount of tax per $1,000 of property value) has actually decreased more times than it has gone up in the last 20 years. The chart below shows the mill rate went down in 12 of the last 20 years. Those numbers are can be deceptive however because of the large increases in the equalized value. The mill rate can stay the same but if the value of the property increases the amount of tax owed will still increase. The equalized value increased 10 percent in Vernon county last year and 17 percent this year.
Not everyone who attended the finance meeting liked the change in budgeting approach. County Board of Supervisors Chair Lorn Goede asked about the impact to the taxpayers.
“So, Bobbi (Johnson) what you can say is that for everybody’s particular situation the taxes are going to go up $2.2 million?” asked Goede.
“That depends on how we structure our financing,” said Johnson. “We can pay this off in one year. We can pay it off in two years, three years, four years, five years. It depends on how much we would like to pay off in a given year.”
“Depends on how far we want to kick the can down the road,” said Goede.
Wage increases – employee losses
One of the large changes in the budget this year was a county wage increase for non-union employees. The county has been struggling with retaining employees and wage study completed several years ago is now already out of date because of the impact of COVID and wage increases. The county has increased wages but not enough to keep up with surrounding counties and the private sector.
According to the Vernon County Human Resources office the number of employees who left employment with Vernon County by year:
2023 – 83 so far
2022 – 151
2021 – 99
2020 – 83
The county also passed a wage and cost of living (COLA) increase to try to stem the loss of employees, and a position reclassification and pay grade alignment. That measure was was passed in August of 2022 with a three percent across the board COLA increase for all positions effective September 2022 and a 1.5 percent COLA increase effective January 2023.
Even with those increases Vernon County found itself 15-20 percent behind the wages of other counties, even with those increases. The result was the board passing a wage increase of five percent in January and another five percent increase in August the board passed another wage increase halfway through the year. Total cost to the county for those increases is about $1.1 million. The county board voted in August to pay for half of the increase with ARPA (American Rescue Plan Act) funds and half incorporated into the 2024 budget. The county is doing an adjustment to its wage study and additional increases could be needed to keep up with market rates when that study is completed by early next year.
The county did see some increase in in revenues. The county jail will once again house 50 state inmates and that will bring in about $940,000 a year and net the county about $500,000. You can read our previous story story on the jail contract with the state here.
The County Board of Supervisors will hold a public hearing and vote on the final county budget on Tuesday, November 14.