The Village of Caledonia will exceed a state-imposed expenditure restraint limit that will net a $1 million, or a 5.7 percent increase, in spending for the $18.6 million budget in 2018.

In a 6-0 vote, the Village Board passed the budget at its meeting held Monday. But the village won’t be borrowing to make up for the increased spending because it expects to have a surplus in 2017. The net result to taxpayers: a levy increase of $175,000 to $13.8 million.

The state controls what municipalities are able to spend and caps what they can charge taxpayers. The decision to exceed the state-imposed expenditure restraint limit would result in the village losing some state funds in 2019.

“We’re going to be losing the state funds that we would normally get in 2019… it’s a one-time deal, very thoughtfully considered,” said Caledonia Village Administrator Tom Christensen. “But we have the revenue for this, so it’s not like we’re going out and borrowing money.”

Actually the opposite is happening. All of the increased levy is going to pay off the debt from tax incremental finance district #4, which is where much of the new development is expected to happen over the next few years.

Caledonia Revenues and Expenses

The 2018 budget includes spending for the day-to-day operations of the village, debt service, capital projects, joint health, joint parks, the cemetery, parks, and utilities.

The village saw increases in its health insurance costs this year. Over the past few years, insurance rates had increased about 2 percent. But because they had several large claims, this year the cost is expected to increase by 15 percent.

Village officials also pulled the cost of the Wind Point Fire protection services into the general fund, just in case Wind Point decided to pull out of the contract. In prior budgets, those expenses were separate from the general fund. Christensen said they wanted to make sure those expenses were included to avoid losing the funding.

“Once we go through this, we’re going to bring everything back in line and get it over with,” Christensen said.

On the revenue side, construction permits are up by about 60 percent. The largest increases were realized in building permits, erosion control fees, and engineering permit fees. Ambulance fees also increased by 22 percent and court penalties and fees increased by 51 percent to $344,357.

What does this mean to property owners?

While the village has the money “in the bank” per say to cover most of the increased expenses, there are still a few unknowns that would impact property owners on the village portion of their tax bill.

The mill rate — the amount of money per $1,000 in assessed value property owners pay on their taxes — has not been set yet. That’s because the village does not have the final numbers from the state for its assessed value. So property owners won’t have a final tally of what their tax bills will be for a few weeks.

“This is actually a tighter budget than we’ve had,” Christensen said.

 

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Denise Lockwood has an extensive background in traditional and non-traditional media. She has written for Patch.com, the Milwaukee Business Journal, Milwaukee Magazine and the Kenosha News.