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Tax Rates To Increase As Assessments Drop, Budget Pressure Mounts

The Village Finance Committee discussed the 2013 budget assumptions. Mark Janiuk, the Village Administrator, said there's a $250,000 deficit to fill and he offered up several suggestions for the Committee to consider.

A projected $250,000 hole will likely need to be plugged in the 2013 budget, said Village Administrator Mark Janiuk.

With property values plummetting by as much as 14 percent, no matter how the Village plugs that hole—through layoffs, levy increases, or reductions in the payments it makes to the utilities—a property tax rate increase is inevitable.

Janiuk explained the 2013 budget assumptions to the Village Finance Committee at its Monday meeting. 

No formal budget has been presented; this is only the first breath of a future 2013 budget. Janiuk highlighted several problems that are contributing to the $250,000 structural deficit.

“The Village used $103,000 from the fund balance in last years budget, but you can’t keep dipping into the fund balance to balance the budget,” he said. 

Janiuk said the Village would likely need to consider cutting staff, reducing the amount of money it pays to utilities, or increase the tax levy.

“It’s too early to make a decision on that, but a $250,000 deficit isn’t going to be fixed by cutting out office supplies,” he said.

Even if the Village chooses not to increase the tax levy, the property tax rate is going to increase because of the anticipated decrease in property assessments.

“It’s my understanding that we need to come into compliance with the state guidelines,” said Lee Wishau, Finance Committee and Village Board member. “There’s an inequity between our assessments and the fair market values, especially for medium to high (priced) properties.”

If the Village Board did want to increase the tax levy to fill the $250,000 gap, they would need to raise the property tax rate by 10 cents per $1,000 assessed value, Janiuk said. “But it’s going to go up no matter what because the assessed value is going to go down.”

Village President and Finance Committee member Ron Coutts asked Janiuk what message they needed to send to department heads.

“Should we plan for zero growth?” he asked.

“That’s basically the message we’re putting out, yes,” Janiuk said.

Still, there was one option that Janiuk said may allow the Village to plug the hole, and possibly add staff to the police and fire departments – enacting a user fee for storm sewers. 

In June, Village staff presented the concept and they voted to study the issue.

Currently the  funds storm sewer projects through a tax levy, but they are considering a user fee that all property owners pay to fund capital, maintenance, operational and compliance-based projects.

This allows the Village to free up money in its tax levy.

“If you do a user fee, it frees up $750,000,” Janiuk said. “It could provide money for firefighters or more officers, but overall you have to look at where you want to go.”

Budget challenges include:

  • Insurance and retirement costs are expected to increase by 5 and 2 percent respectively, but the village expects to see an increase in the amount collected from building permits. 
  • High overtime costs in the Police and Fire departments could increase the structural deficit. As of Aug. 1, the police department has used about 80 percent of its overtime budget and the fire department has used 73 percent of its overtime budget, according to department heads.
  • Unsettled police and fire union contracts are the biggest unknown. The in April and the firefighter contracts haven’t been settled either. The Village Board was expected to discuss the police contract in closed session following the Finance Committee meeting.
Tansandy August 14, 2012 at 11:39 AM
Andy from Mayberry tells us they have no money. But the next article, Barney said they will buy Ipads for the board members. Things never change in good old Mayberry!!
oak creek resident August 14, 2012 at 12:42 PM
90% of the budget goes toward Police and Fire. Let them chip in a small percentage into their pensions, that deficit will quickly turn into a surplus, and we all get lower taxes too. Fair is fair, and these prima-donas need to get with the program.
Denise Lockwood August 14, 2012 at 01:01 PM
@Oak Creek -- between the Village's offer and the police union offer, neither asks them to pay the 5.9 into their pensions. Here's the story I wrote back in April. http://caledonia.patch.com/articles/village-police-union-headed-to-arbitration-over-new-contract
Frances Martin August 14, 2012 at 01:06 PM
I don't think calling the fire and police "prima donnas" is fair--they work hard and are dedicated. However, I do agree that in these hard times they could be expected to look carefully at what they're asking for. Another approach might be delaying some road repair-not sure how much is in the budget for it,but if we have to drive a little slower on potholed roads, so be it.
Tuco August 14, 2012 at 02:35 PM
I almost fell out of my chair laughing at the paper today. We will have a $250,000 deficiet but we can buy $4,000 of laptop computers. Let's cut the laptops! And the real question is WHY do we need the laptops? Times are tough, times are hard. Everyone needs to tighten their belts. We are so used to getting almost everything we want, it's time to change the mind set. No one wants to pay more taxes. I sure don't! I see too much waste and that's what crawls up my ***! One look at RUSD, which we finance, will turn your stomach. A user fee for sewer and water is a nice way to bring in $$$ from the non-profits and those not paying property taxes. It may be the way to go. I have not studied the proposal, but it sounds more fair on the surface. Also, deferring some of the projects may help in the shrt term, but eventually, the roads will need to fixed. If not now, later at a higher cost.
Denise Lockwood August 14, 2012 at 03:27 PM
We published the laptop story in July. We've also got a poll. Here's the link for that: http://caledonia.patch.com/articles/too-much-paper-village-may-consider-laptops-or-tablets-for-trustees Also had the story on the healthcare rebates last week: http://caledonia.patch.com/articles/village-employees-to-receive-health-insurance-premium-rebates
Tansandy August 14, 2012 at 07:14 PM
"Another approach might be delaying some road repair" As a retired engineer from a highway construction firm, I just love your type of thinking. It really makes for big contracts for us later down the road when we have to totally rebuild rather than maintain your streets and highways. Check with other Municipalities that have tried that approach. They will tell you they can not come out from under the terrible shape the streets have roads have turned into. And have you looked at the present road budget? The village has done 0 paving this year. Just barely enough to cover snow plowing. You want to start saving money? Take a look at our engineering dept. Could use a lot of streamlining!
Caledonia Retiree August 15, 2012 at 12:24 AM
I'm still waiting for my property assessment to go down. I'm also waiting to see this so-called property tax reduction. My property tax went UP last year (like it always does). I suppose I should shut up. I COULD live in Mount Pleasant!!!
a quiet conservative August 15, 2012 at 01:43 AM
Look close at your tax levy...Gateway Tech & Racine Unified were the largest increase last year of 8% and RUSD is looking at ANOTHER 7%. How much did RUSD get back due to the Obamacare mandate?
Edgeman August 15, 2012 at 02:31 AM
Hey Andy maybe tax haircuts at Floyds barbershop.
my1756 August 15, 2012 at 02:45 AM
Boy it's funny how soon people forget. I bet the police officer in Oak Creek that was shot NINE times doesn't feel he's a "prima-Dona"! And if you think "That couldn't happen here." Just remember thats what they said in Oak Creek 2 weeks ago before the shooting. Why don't you get off your high horse and show a little respect for the people who risk their lives every day to protect the lives of people in the community.
Denise Lockwood August 15, 2012 at 03:37 AM
Here's a primer: http://caledonia.patch.com/articles/commentary-i-give-a-little-primer-on-property-taxes
Eric August 15, 2012 at 05:57 PM
Without resulting to insults it is hightime all public employees start to contribute more to there pension and helathcare costs to bring them closer to what the rest of us in the private sector pay. Nevermind pensions virtually don't exist in the private sector most of us pay a heck of alot more to our 401k's and other IRA's then our counterparts in the Public sector. We as a society simply cannot afford that any longer. Look at California for proof.
Avenging Angel August 15, 2012 at 06:01 PM
Eliminate the Village Administrator position.
OC misfit August 16, 2012 at 01:34 PM
Remember that professional police officers and firefighters risk their lives everyday to save yours! It's ignorant people who comment on here that they deal with every day! Give credit where credit is due! Remember that next time you need help! Grow up!
YAMATO August 18, 2012 at 02:09 PM
LIVES ON THE LINE, YES..SOME MORE THAN OTHERS. USING THAT LOGIC TO JUSTIFY THE MEANS IS OUT DATED. EITHER YOU HELP OUT OR THE SYSTEM COLLAPSES. PROBLEM IS, HAS, AND WILL BE, THE STAFFING PRIORITIES AND STAFFING CON JOB PUT ON THE VILLAGE BY PAST DEPT HEADS. ALOT OF INTERNAL COSTS CAN BE REDUCE BY PRIVATIZING SOME SERVICES AND SERVICE CALLS. WHEN THE HEAD OF THE VILLAGE IS A EX FIREMAN...GOOD LUCK GETTING REAL JOB DONE WHEN IT COMES TO MONEY.. HE'S USED TO GETTING IT FROM TAXPAYERS AND GIVING IT BACK TO HIS BUDS
Scott August 18, 2012 at 03:02 PM
I strongly disagree with the "prima donna" comment. Although I believe the Police Dept. Is over staffed and over funded. IMO, lose some cops and gain some firefighters.
a quiet conservative August 19, 2012 at 12:26 AM
Got my assessment...nice 30% drop on the value of my property and I am sure RUSD will come beggin with their hands out.
caledonia resident August 21, 2012 at 10:07 PM
As a Home owner and a tax payer to the Village of Caledonia Wi ,,We took a bath of the Village assement 2012 a large amount of """""""40 thousand """""from last assement . Our home is perfect inside and Out lawn is always taken care of . Never late on Our Mortage to keep our home and Never late or behind to pay our taxes every year since we've been here , For all those owners who have vacant homes for thier own personal reasons and left it standing empty and not coming Back has put a dent for all of us to pay the price on our very own HOME . I sure wonder what that complete total is for the village of CALEDONIA for all of us who took a big dip this year on every home ... start with mine at 40 Thousand .that total sure isnt a ecomony excuse
Amanda Goldberg August 28, 2012 at 03:08 AM
14% drop in property value? Mine went down 36%! My taxes have gone up yearly, 2x what they were when I moved here 8 years ago. Where is the money going? The crime rate in my area keeps increasing, roads close for repairs that never get done (FYI its because they are too cheap to hire certified railroad workers), the people in this town refuse to let new businesses come in to establish a tax base to ease the pain on residents (& god forbid provide more jobs to the always high unemployment in Racine Cty), & why do we have 31 full time police officers in a town of under 25000 residents (they sure as hell are not keeping the crime rate from going up)? The county will not let me make inprovements on my home because on one side my main dwelling is within 6 feet of the property line. I bet if they eliminated this rule the village would pull in a lot more money off of building permits. With our property values putting us all at rock bottom & this idiotic law condemning our homes may make more sense. How will the village survive then with a bunch of abondoned and forclosed properties. Oh wait my neighborhood has been filling up with those for years so lets just make it even harder on those of us trying to stick it out. If my taxes do not lower according to the amount my property value was lowered you bet I'll be pounding down the doors at the village hall. We bust our butts to own a home and they won't let us fix it & then tell us its worth nothing but expect us to keep paying them.
Colleen Geraghty August 31, 2012 at 06:04 PM
How much does the Vil-jmahall take to keep running over the old facility? Where any alternative energy sources built into that thing?
Colleen Geraghty August 31, 2012 at 06:08 PM
Is all of the space REQUIRED ? Or can some of it be shutdown to save energy. Some Corporations are squishing employees together into rows of desks to close other areas of their buildings down to save energy or putting 2 people into 1 cube. It's a wonderful work environment - just ask me.

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