County Board borrows for repairs
Borrowing and budget were the focuses as St. Croix County Board members met Oct. 21.
The Board accepted the best of six bids to borrow $3.18 million for building repairs and upgrades. The county will pay a true interest rate of 4.0244 percent on the money borrowed from Robert W. Baird & Company, Milwaukee.
The debt, to replace the roof and heating and air conditioning system at the Government Center and replace emergency communications base station radios, will be repaid over seven years. Interest-only payments will begin in 2009.
Finance Director Michelle Pietrick said loan repayment is set up to dovetail with existing debt service and will have a minimal impact on the property tax levy.
"Based on the volatility in the credit market right now -- money has been drying up everywhere," said Joe Murray of Springsted Inc., the county's financial advisor.
Murray said he was pleased St. Croix received competitive bids. Interest rates from the six bidders ranged from 4.0244 percent to 4.579 percent.
The Baird bid was a premium bid, meaning the County will get about $44,000 more than requested. That extra money will be applied to the 2009 payment, said Murray.
While the Finance Committee isn't ready to present a balanced budget, it's getting close and will have one to offer at the Tuesday, Nov. 11, County Board meeting, said Committee Chairman Daryl Standafer.
Because the county's growth in new construction was lower, state-mandated property tax levy caps allow St. Croix to increase its property tax and thus its spending by 2 percent.
Hudson's decertification of the tax incremental funding district for its new industrial park means $250,000 of new tax money for the county, reported Standafer.
Pietrick said the proposed levy should have a negligible impact on most homeowners, some of whom may see a tax drop as commercial property picks up more of the burden.
As preliminary budget requests and early estimates of revenues came in, the Finance Committee faced a $3.4-million funding hole, said Standafer. Early corrections cut that to $2.5 million.
The committee then asked the law enforcement, human services and highway departments to collectively come up with $1.1 million in cuts.
"Those three budgets sucked it up and came back with those reductions," said Standafer.
New health insurance bids and lower rates cut another $1 million from anticipated costs, but Finance Committee members agreed that sales tax projections were overly optimistic and cut that $5.2 million income estimate by 10 percent.
Other departments were asked for cuts and came up with another $346,000 in budget reductions.
The gap between anticipated expenses and income stands at $40,000 and the budget still doesn't have money for anticipated raises for about 80 law enforcement union workers or for raises for non-union workers countywide.
Standafer said current budget projections foresee no changes in nursing home funding, but the Tuesday, Nov. 4, referendum will give the Board direction on how to proceed there.
He said the budget also doesn't address maintenance problems with the Health and Human Services building in New Richmond and extends the Highway Department's road maintenance cycle.
Last year the County implemented a vehicle registration fee to provide more money for road work and the Highway Department was making progress on reaching its maintenance schedule goal, said Transportation Committee Chairman Richard King. Now the Finance Committee has pulled back $400,000 in property tax funding.
"So we haven't gained a darn thing," said King.
Because of the County funding cut, the department will delay work on county roads C and CC and thus lose $200,000 in federal aid, said Gerald Peterson, vice chairman of the Transportation Committee.
When the Board approved the registration fee, supervisors agreed the new money would be in addition to other highway funding sources, said Supervisor Steve Hermsen.
Instead, he said, this new budget shrinks other funding, in effect giving the registration fee money to other county departments.
The Finance Committee asked for $1.1 million cuts from three budgets, which is just about the amount of levy money set to go to the nursing home next year, said Standafer.
"If you want to restore that money -- that's where it is," he said.
The County has lots of other places it could cut to come up with the $1 million, retorted Supervisor Esther Wentz, who chairs the Health and Human Services Committee.