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Common Council passes $5.5 million budget
Boscobel City Hall

BOSCOBEL - Boscobel’s City Council breezed through a final-hour hearing on Tuesday night to pass a $5.5 million budget for 2023.

“There’s nothing extravagant,” City Administrator Patricia Smith told the council and a half-dozen members of the public. “We need to retain the people that we have, so what you’re seeing in here is for salaries and benefits. There are a lot of people costs here.”

Early in budget talks, city leaders had hoped to beef up both the street department, which has operated short one worker for some years, and the City Hall staff. Instead, according to Smith, the current focus is on containing costs amidst rising inflation, building up the city’s cash reserves, and shooting the rapids of state rules that strictly control local government’s fundraising.

The budget passed with seven votes and no dissent. Alderman Brian Kendall had stepped out of the room at the time of the vote.

Deficit fix

As most of us know, “nothing extravagant” costs a lot at current prices. Boscobel is no different, Smith told the council, and the 2023 budget includes a $174,000 deficit, in part to cover the cost of a new police officer hired last year.

As previously reported in these pages, the city will plug part of that hole with a loophole in state laws. Wisconsin statutes strictly limit how much real estate tax any municipality can collect—but excludes payments on debts from those limits.

By reporting more of its debt to the state, the city can raise property taxes without violating these statutory limits.

Without this accounting shift, the city would have been limited to about $3,000 in increased taxes, but by deploying it, it can raise some $98,000, Smith told the council. That will put property owners on the hook for $14.23 per each $1,000 of real estate they own.

The remaining balance of the deficit will float for now, Smith said, with the hope that opportunities for savings arise to whittle away at the additional $75,000.

Expenditure limits

The other limit imposed by the state is on the overall growth of municipal budgets, known as “expenditure restraint.” The state uses the Consumer Price Index, which measures a shopping-basket of basic expenses to determine the inflation rate, to set the maximum growth rate for Wisconsin municipalities.

Expenditure restraint rewards municipalities that keep the growth of their budget within an amount determined each year by authorities at the state level. Spend too much, and you won’t receive additional state aid.

But since these numbers are re-calculated each year, cities that spend too little are also punished in the following year because their baseline for the calculation is too low to allow for growth.

Confused yet?

The bottom line is that Boscobel’s conservative budget would put it at a disadvantage when it comes to figuring how much it is allowed to grow in 2024.

To this end, Smith told the council, the city is deploying a strategy recommended by financial consultants from Ehlers Public Finance Advisors, who assisted the city in budget planning: $178,413 of the total budget is set aside as a “contingency.” It’s not to be spent, it’s simply on paper to inflate the city’s budget when it comes time for the state to determine our allowable growth next year.

Delays addressed

Smith also responded at the hearing to delays in the budget process reported in last week’s Dial, which were brought to light by a letter to the council from former City Administrator Misty Molzof.

State statutes require that tax bills be mailed the third Monday in December. When Boscobel missed that deadline, Smith had previously said that taxpayers would be required to visit City Hall to pay taxes.

At the meeting, she clarified that tax bills had in fact been sent on the twenty-first and said the delay had been necessary to include input from consultants at Ehlers.

“We didn’t get our analysis from Ehlers until November,” she said. “That engagement has been extremely critical for us for our long-term view, and they are going to give us a model that we can use year after year.”