Dunn County has remaining debt of $23.7 million or 10 percent of debt capacity
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By LeAnn R. Ralph
MENOMONIE — Dunn County had $23.7 million in outstanding debt as of the September 18 Dunn County Board meeting, which is 10 percent of the county’s total debt capacity.
As of December 31, 2023, Dunn County had outstanding general obligation debt of $28,165,000, which represents 11.07 percent of the county’s legal debt margin, said Dr. Beata Haug, Dunn County’s chief financial officer, during a presentation to the county board about the outstanding debt and repayment schedules.
As per state law, Dunn County has a total debt capacity of a little over $254 million.
The debt capacity — or debt margin — of municipalities is based on 5 percent of a municipality’s total equalized value.
Dunn County has a Standard & Poor global rating of AA/Stable, Dr. Haug said.
The financial rating helps the county obtain lower interest rates on debt.
The information presented to the Dunn County Board was for “educational purposes” to help the board in making decisions for the 2025 budget, Dr. Haug said.
Not counting the $3 million that had been borrowed the day of the meeting, Dunn County currently had $24 million in outstanding debt, she said.
Comparisons
By way of comparison, St. Croix County ended 2023 with $122 million in general obligation debt (or $94 million more than Dunn County), representing 15 percent of the county’s total debt limit of $819 million, according to St. Croix County’s 2023 audit report.
St. Croix County has a population of about 96,000, which is a little more than twice the population of Dunn County at 45,000.
Eau Claire County ended 2022 with $97 million in outstanding general obligation debt and added $30 million in debt in 2023 for building a new highway facility (for a total of $127 million) (or $99 million more in debt than Dunn County), according to a news article from the Leader-Telegram in October of 2022.
Eau Claire County has a population of about 107,000.
At the end of 2023, Barron County had outstanding debt of $89 million (or $61 million more in debt than Dunn County).
The population of Barron County is nearly 47,000.
Outstanding debt
St. Croix County’s outstanding debt at the end of 2023 amounted to about $1,270 per person.
Eau Claire County’s outstanding debt amounted to about $1,186 per person.
Barron County’s outstanding debt amounted to about $1,893 per person.
Dunn County’s outstanding debt at the end of 2023, amounted to about $622 per person.
Another way to look at it is that St. Croix County and Eau Claire County have about twice the amount of outstanding debt per person compared to Dunn County while Barron County has about three times the amount of debt per person.
Yet another way to look at it is that Dunn County would have to add another $30 million in outstanding debt to reach the equivalency per person in debt as St. Croix County and Eau Claire County — or would have to add another $60 million in outstanding debt (for $88 million in total debt) to have the equivalency per person as Barron County.
Synopsis
Dr. Haug presented a synopsis of the county’s outstanding debt to the county board.
The original debt of $43 million going back to 2014 is now at $24 million.
In 2013, Dunn County borrowed $1.4 million for facility improvements, and the remaining debt amount now is $345,000.
In 2014, the county borrowed $7 million for facility improvements and to implement the current financial system software — that by all accounts is difficult to use and creates job stress for county employees — with $2.4 million of that debt remaining.
In 2019, the county borrowed $8 million for remodeling the current government center (former Dunn County Health Care Center), for the highway department and for information technology, with $4.2 million in debt remaining.
In 2020, the county refinanced the remaining general obligation bonds for the Neighbors in the amount of $13.9 million, and currently $11.3 million of that debt remains.
In 2021, the county borrowed $6.6 million for capital improvement projects and refinanced loans from 2013 and 2018, with $3.1 million of the debt remaining.
In 2022, the county borrowed $3.05 million for capital improvement projects with $2.4 million of the debt remaining.
In 2024, the county borrowed $3 million for highway projects and will begin making debt service payments on that amount next year.
Ceiling
The Dunn County Board could continue with a “ceiling” of $5.3 million in debt service payments every year, Dr. Haug said.
The county could borrow between $3 million and $4.2 million every year for the next 10 years and still continue with the same debt service payment of $5.3 million per year, she said.
If the county does not borrow any more money, all of the current debt will be paid off in 2033, although some of the debt will be paid off 2027-2028.
The county board will have to decide if it is time to take on additional projects, Dr. Haug said.
Dunn County could borrow $3 million every year and would still pay off more in debt than was borrowed and would have the debt paid off in 2042, she said.
The county would have an opportunity to borrow $4 million in 2026 if the county board decides to maintain the ceiling of $5.3 million in debt service payments, Dr. Haug said.
Equalized value
As the equalized value increases, the legal debt margin will increase, Dr. Haug noted.
If the county board decided to borrow $3 million every year, because of the increases in equalized value, the county would still be able to maintain the current 11 percent of the total debt capacity, she said.
Korpela presented information on the equalized value and the debt limit going back to 2017.
In 2017, Dunn County had an equalized value of $3 billion, with debt of $37 million, representing 24 percent of the county’s total debt limit.
In 2018, the county’s equalized value was $3.2 billion, with debt of $35 million, representing 22 percent of the county’s debt limit.
In 2019, the county’s equalized valued was $3.3 billion, with $33 million in debt, representing 20 percent of the county’s debt limit.
In 2020, the county’s equalized value was $3.6 billion, with $47 million in debt representing 26 percent of the county’s debt limit.
In 2021, the county’s equalized value was $3.8 billion, with $32 million in debt, representing 17 percent of the county’s debt limit.
In 2023, the county’s equalized value was $5.1 billion, with $28 million in debt, representing 11 percent of the county’s debt limit.
In 2024, the county’s equalized value was $5.5 billion, with $26 million in debt, representing 10 percent of the county’s debt limit.
Projection
The projection of maintaining debt payments of $5.3 million per year would keep the debt service flat with no increase in property taxes for increased debt service, said Kelly McCullough, county board supervisor from Menomonie and chair of the Dunn County Board.
The reason that the debt is being projected at a stable level is because the mood of the Dunn County Board in recent years has been to have no increases in property taxes, he said.
The goal is for the Dunn County Board to have enough information to be able to make good decisions, McCullough said.
