County supervisors question property tax hike
At a meeting last Thursday, Marathon County supervisors pushed back against a proposed 2023 budget that will cost the average homeowner an extra $74 in property taxes next year.
County board members spent a majority of the two-hour-long meeting critiquing and questioning the $218 million proposal presented by county administrator Lance Leonard and supervisor John Robinson, chairman of the Human Resources, Finance and Property Committee.
Supervisor Tony Sherfinski, Schofield, said county residents are already faced with up to 20 percent increases in home heating bills, higher gas prices and other hikes in the cost of living.
“For us to come along and add to that level of inflation is irresponsible,” he said. “I think we need to work harder on being much tighter on our increase.”
Sherfinski pointed out that a $74 tax increase is the largest in many years, and he thinks it’s “disingenuous” for the county to use rising property values as an excuse to raise taxes.
“People don’t buy homes to watch the property value go up, unless they’re speculating,” he said. “Most of us buy homes to live in them.”
Supervisor Chris Dickinson, Stratford, questioned what the average taxpayer will be getting from the increased tax levy and what “significant cuts” were made to keep the tax levy lower.
“My goal is to reduce the size of government at all levels,” he said, suggesting that maybe the county could cut its workforce from 706 employees down to 650 and still “deliver the same mandated services at a lower level and discretionary services at some level.”
Board chairman Kurt Gibbs said discussing “mandated versus non-mandated” services is a “slippery slope” because the board and its committees have made commitments to the public, such as paving 30 miles of road every year.
“When we talk about mandated versus non-mandated, it’s all about the level of service that this board adopts and the residents of the county expect,” he said.
Leonard said he asked every department to cut their operational budget by 2 percent for next year, and a “fair number” of them came in with flat or negative increases going forward. He also pointed to instances of departments sharing staff and adopting new, more efficient business models.
The highway department and sheriff’s office had the biggest increases in tax dollars, Leonard said, driven by staffing costs and vendor contracts, such as those that provide jail meals.
“In terms of cuts, we certainly have budgeted tighter,” he said. “We have evaluated opportunities to be more efficient.”
Robinson said part of the reason for the tax levy increase is the debt being paid on behalf of North Central Health Care, which the board has agreed to take on until the center can pay its own debt obligations.
Board chairman Kurt Gibbs noted that NCHC has recently presented a balanced budget to the board, which he called a “huge improvement” toward servicing its own debt.
“At some point in the future, they will repay the county for that, but in this budget year, we need to make the payments,” he said.
Several supervisors objected to funding for Family Keys – a housing program designed to help at-risk children – being put back in the budget after the board voted to reject it. Sherfinski said it was “back-doored” into the budget instead of being brought back before the full board “explicitly and openly.”
Even though the program is now 100 percent paid for by grant money, Sherfinski predicted it will eventually become a financial liability for the county.
“Grants run out and programs tend to live forever,” he said. “At the end of the grant period, we’re stuck with a program that nobody is willing to kill.”
The budget includes adequate funding, about $1.6 million in local tax dollars, to implement a new wage schedule to help recruit and retain employees, as recommended in a compensation study done by McGrath Consulting. The total cost of enacting the new wage schedule is closer to $2.7 million, but Leonard said some departments, such as Central Wisconsin Airport, are able to entirely fund their payrolls with their own operational revenue or partially from the state.
Right now, the county has 76 vacancies within its workforce of about 707 full-time positions, and an attrition rate of 16 percent, Leonard said.
“We need to adjust our compensation schedule. I’m telling you that as your administrator,” Leonard said. “There are many things I will tell you that you will not like, but I will always be honest with you.”
Leonard said county employees are also impacted by inflation, and noted that other local governments are granting eight percent across-the-board raises.
“That’s not what our system does. Our system is a pay for performance system,” he said. “We pay for progress in terms of delineated goals.”
When some supervisors suggested lowering some of the wages within the proposed compensation schedule, Leonard warned “there will be consequences.”
“We have many employees in many departments who have expressed very clearly that they are waiting for this, because we have asked them to wait,” he said.
Gibbs noted that that it has been 10 years since the county last did a wage market study. He said not having a competitive wage scale has had real consequences, such as not having enough deputies in the jail, which has led to a $1 million budget for out-of-county inmate placements.
“We have to be competitive with the market, but we don’t need to be above market,” Gibbs said.
Supervisor David Overbeck, Wausau, said he would like to see an analysis done on the impact of tax-incremental financing (TIF) districts, to see how they are affecting new tax revenue. If approved by the county and other taxing jurisdictions, TIFs divert all the property taxes on any new developments into a special fund to pay for infrastructure improvements and developer incentives.
“As we’re making decisions on TIFs, we should be looking at how our budget is being restricted by that approval,” he said.
Robinson said TIF concerns have been expressed by multiple members of the finance committee, which is planning a closer look at how TIF districts are affecting the county’s finances.
Leonard said he believes the budget proposal “really does address the community’s priorities, as identified by this board.”
“It ensures the organization functions as efficiently and effectively as possible moving forward,” he said.
Some supervisors, however, said there was still room to make cuts.
Jacob Lagenhahn, Marathon, referenced board decisions made several years ago to reduce funding for outside non-profit organizations. He said those decisions were made after long, hard public hearings.
“There is plenty of political will on this board to cut things,” he said. “I wanted to cut more that what those non-profits were allocated during that year. If that political will leads you to 1 a.m. meetings, so be it.”
Mil rate drop
Although the county’s mil rate will drop by eight cents, down to $4.47 per thousand dollars of property value, an 11.34 percent increase in property values countywide will drive up the amount of money collected from residents. If the mil rate had not gone down this year, average residents would have seen their county taxes go up by $87.87, according to a report from Leonard.
“Despite the significant increase in equalized value, due to Wisconsin’s levy limits, Marathon County’s operating tax levy is limited to increasing by $856,069, our net new construction value,” Leonard wrote.
An “average” county homeowner is defined as someone with about $193,000 in property value as of 2023, an increase of $19,658 over the year before.
Equalized property values went up by about $1.3 billion over the past year, putting the total value of all property in the county at just over $13 billion. From these properties, the county plans to collect $58 million in taxes, an increase of just under $5 million over this year. These property taxes will provide about 27 percent of the funding for the county’s $218,478,022 budget planned for next year.
In addition to the $50 million general operating budget, the 2023 levy also includes $612,500 for bridges, $3.3 million for county libraries, and $4.8 million for North Central Health Care Facility (NCHC).
The budget was balanced without needing to dip into capital reserve funds, and no new borrowing is anticipated, Leonard noted. The county is planning to use a small portion (1.5 percent) of its funds from the American Rescue Plan Act, $404,200, to offset inflationary increases in operational costs, especially for natural gas. ARPA funds are also being used to pay the county’s portion of a new victim witness coordinator position in the district attorney’s office, which will partially be paid with state funds.
The victim witness coordinator, a limited term position terminating at the end of 2024, is one of only two new positions being added to the county payroll as a result of next year’s budget. The other is a full-time data officer, who will work in the administrator’s office.
Leonard said the data officer will help the county make better use of the information it has on record to answer the question “what does the data show?”
“We have a lot of databases,” he said. “I’m not sure we gather a lot of insight from that data.”
A full-time property listing position that had previously been added to the corporation counsel’s office was eliminated, so Leonard said the county’s net workforce will stay at the same number.
On Thursday, Nov. 3, the county board will hold a public hearing on the proposed budget, and on Thursday, Nov. 10, the board will approve the 2023 annual budget, including funding for the 2023 Capital Improvement Program (CIP).
“If you do want to offer an amendment, please, my door is always open,” Leonard told the board. “If you have a goal you want to accomplish, I’m happy to sit down with you and try to understand what that is and offer my thoughts on how best to accomplish that.”
