DC Board reviews preliminary $92.5 million budget for 2024
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By LeAnn R. Ralph
MENOMONIE — The Dunn County Board has reviewed a preliminary budget for 2024 of $92.5 million, which compares to the 2023 adopted budget of $92.6 million.
Before the executive committee recommended several adjustments, the proposed 2024 budget was $99.4 million with a deficit of $6.9 million of revenue over expenditures, said Dr. Beata Haug, Dunn Count’s chief financial officer, at the Dunn County Board’s October 18 meeting.
The proposed 2024 revenue budget includes $24.56 million in property tax levy; $1.59 million in in Capital Improvements Plan (CIP) fund balance; $5.04 million in sales use tax; $787,879 in vehicle registration fees; $1.57 million in American Rescue Plan Act (ARPA) funds; $19.8 million in federal and state allocations; $38.5 million in billable services and fees; and $1.1 million in other revenue — for a total of $92,529,149 in revenue.
The proposed 2024 expense budget includes $49.29 million for wages and fringe benefits; $3.26 for CIP; $36.68 million for operations; $5.13 for highway construction; and $5.08 million in debt service payments — for a total of $99,453,355 in expenses.
The difference between revenue and expenses leaves a gap of $6,924,206 to close, Dr. Haug said.
Balanced budget
The Dunn County Board’s Executive Committee met and recommended several ways to eliminate the deficit between the revenue and the expenses, Dr. Haug said.
One position request was eliminated from the sheriff’s department, and one position request in administration was eliminated and replaced with $25,000 for total annual wages, she said.
Of the two position requests for Human Services, one position request would begin in the middle of 2024, Dr. Haug said.
In addition, the state revenue and operating expenses were updated based on currently available data, and all vacant positions were analyzed for health benefits, she said.
Current trends show that of the people who might be newly hired by Dunn County, not all of them will choose a family health insurance plan. Based on current trends, 50 percent will choose a family health insurance plan, 25 percent will choose a single plan, and 10 percent will not sign up for health insurance, Dr. Haug said.
As of December 31, 2022, the county’s unassigned general fund balance was $14.18 million, and the percentage of unassigned fund balance to general fund expenditures is 56.64 percent, she said.
The Government Finance Officers Association (GFAO) recommends that the percentage of unassigned fund balance to general fund expenditures remain between 25 to 33 percent, she said.
The Dunn County Board recently approved keeping no less than 35 percent in the unassigned fund balance and no more than 50 percent, Dr. Haug said.
The unassigned fund balance comes from money that was in the budget for any particular year that was not spent, and after the year has ended, is transferred into the unassigned fund balance.
To reach the 50 percent of unassigned fund balance to general fund expenditures that was approved by the county board, the 6.64 percent decrease would amount to $1.66 million that can be applied to the shortfall, Dr. Haug said.
Reductions
All together, $6.9 million was needed to balance the budget, so $2.07 million in wage variance was applied, Dr. Haug said.
The wage variance refers to the difference between the situation where every open position in Dunn County is filled by hiring employees, and is included in the budget, and the actual number of employees who are hired, she said.
In 2020, the wage variance was $1.8 million; in 2021, the wage variance was $3.6 million; in 2022, the wage variance was $4.8 million; and in 2023, the wage variance was $5 million, Dr. Haug said.
Using a wage variance of $2.07 million is a conservative number, she noted.
In addition, $1.52 million of fund balance was applied to the deficit out of the $1.66 million available that was approved by the Dunn County Board when the board adopted the policy of keeping no more than 50 percent of the general fund expenditures to unassigned fund balance in the fund balance, Dr. Haug said.
A total of $304,389 remaining in the capital projects fund was applied to the deficit for capital projects, and $3 million in new debt for the 2024 budget would close the gap of $6.9 million, she said.
Earlier in the meeting, Brian Della of PMA Securities explained that each year, Dunn County is paying off more debt than would be incurred by borrowing another $3 million each year.
Per capita
Larry Bjork, county board supervisor from Menomonie, said he was “having a hard time following the numbers.”
Bjork said he realized that counties with a higher population than Dunn County would have less debt per capita, but that Chippewa County, with more population, had a debt per capita of $131, and Eau Claire County, with more population, had a debt per capita of $989, and Pepin County, with a smaller population, had a per capita deb of $1,635.
Dunn County, he said, had a debt per capita of $1,061.
Pepin County has a population of about 7,400. Chippewa County has a population of nearly 67,000. Eau Claire County has a population of about 106,500. Dunn County has a population of of about 45,500.
If the debt is calculated according to the per capita, Pepin County has debt of $12.1 million; Chippewa County has a debt of $8.8 million; Eau Claire County has a debt of $105.3 million; Dunn County has a debt of $48.3 million.
The actual amount of debt for Dunn County as of December 31, 2022, was $32.7 million, according to Della’s presentation.
Adding more debt for Dunn County seems to be going “in the wrong direction,” Bjork said.
The recommendations from the executive committee resulted in a balanced budget that will be presented for the county board’s consideration November 14, said Kristin Korpela, county manager.
If individual county board members want to see something else in the budget, they should come and talk to her and to Dr. Haug, she said.
Borrowing
Mike Kneer, county board supervisor from Menomonie, asked if borrowing the $3 million was in addition to borrowing $3 million for capital improvement projects in 2024.
Dunn County is not borrowing any money in 2024 for capital improvement projects. The capital improvements will be funded by ARPA money as well as Information Technology fund balance and highway fund balance, Korpela said.
Most of the capital improvements are highway projects that will have a federal and state match for funds, said Kelly McCullough, county board chair.
If Dunn County does not complete the highway projects, Dunn County will lose the federal and state reimbursements, he said.
Dunn County’s highway projects in 2024 will include the county Highway B project from Exit 45 to Highways 12/29.
The south portion of the Highway B project is a $6.5 million project, and the north portion is a $2.5 million project.
The cost of the south portion of the county Highway B project is expected to include $5.1 million in Wisconsin Department of Transportation funding from Highways 12/29 to I-94 covered by an 80/20 State Transportation Aid grant (STP).
From I-94 to the area near the railroad tracks by the Exit 45 truck stop, the cost is expected to be $2.48 million with $1 million in WisDOT funding through Multimodal Local Supplement (MLS) and Local Road Improvement (LRIP) grants and $1.48 million for the county’s portion.
The total expenditure for new construction is expected to be $11.1 million, with $6.6 million from WisDOT and $4.4 million from Dunn County.
If Dunn County does not complete the Highway B project in 2024, the county will lose $6.6 million in reimbursements.
If the county decides to do the Highway B project in another year, Dunn County residents could end up paying the entire cost of $11.1 million, which would likely be more if the projects were delayed by a year or two.
The exact cost of the Highway B project will not be known until the project is bid out and the bids have been accepted.
Luke Wilsey, county board supervisor from Boyceville, asked about the percentage of the county board required to vote for borrowing in order for the borrowing to be approved.
The budget requires a two-thirds approval, and borrowing requires a three-quarters approval, McCullough said.
A total of 22 of the 29 county board members must approve borrowing for the borrowing of money to occur.
A total of 20 of the 29 county board members must approve the budget for the budget to be approved.
Paid off
Is it correct to say that every year, Dunn County keeps paying off general obligation debt, so the amount of debt is being reduced, asked Gary Bjork, county board supervisor from Colfax.
In general, every year, the county pays off about $5 million in debt, Korpela said.
At the start of 2023, Dunn County had $32.6 million in debt. Dunn County has already paid off $4.5 million in debt this year, so the county now has $28.1 million in debt, Della of PMA Securities said.
Dunn County will pay off another $4.5 million next year. So in two years, between 2023 and 2024, the county will pay off $9 million in debt but will be adding $3 million in debt, for an overall reduction in debt of $6 million, he said.
By the end of 2024, Dunn County’s debt will be $6 million less, even if the county borrows $3 million in 2024, Della said.
In 2020, Dunn County had $49.2 million in debt, so the county has paid off $20 million in debt in the last three years, according to information Dr. Haug had provided earlier in the meeting.
Dunn County could borrow $3 million each year over the next 10 years and still have a “sustainable borrowing pattern” because the county is paying off more debt than that every year, Della said during his presentation.
If Dunn County borrows $3 million each year for capital improvements, the county will still reduce the overall debt and not raise taxes on county residents for debt service, McCullough said.
The goal is to be as conservative as possible but still meet the county’s infrastructure needs, he said.
Decreasing the overall debt gives Dunn County the flexibility to borrow some money if it is needed, Gary Bjork said.
The Dunn County Board will consider whether to approve the proposed 2024 budget at the November 14 meeting.
The county board’s November meeting is on the first Tuesday following the first Monday, which is set by state statute, Korpela said.
New board member
At the beginning of the October 18 meeting, McCullough announced that Don Kuether, county board supervisor from Menomonie, had resigned from the county board and had gone into Hospice.
Kuether had been talking to his neighbor, Barbara Lyon, about running for his position in the spring election in April of 2024, he said.
All 29 county board members will come up for election next spring.
Diane Morehouse, county board supervisor from Menomonie, said she was very much in support of Lyon being appointed to fill Kuether’s position until the next election.
Lyon covered the Dunn County Board for the Dunn County News for about 20 years, she said, adding that Lyon is very well acquainted with Dunn County’s operations and is highly qualified to fill Kuether’s position.
McCullough appointed Lyon to the Dunn County Board, and Andrew Mercil, county clerk, administered the oath of office.
Lyon was then seated to fill Kuether’s position.
