The city of Waupaca’s 2015 budget is expected to include capital projects.
That is after the Common Council voted 7-2 earlier this month to move forward with borrowing for capital as part of next year’s city budget.
Deb Fenske, Steve Hackett, Paul Hagen, John Lockwood, Paul Mayou, Eric Olson and Dave Peterson voted yes.
Jillian Petersen and Scott Purchatzke voted no, and Alan Kjelland was absent.
“I don’t think it’s responsible or feasible at this time,” Petersen said prior to the vote.
She said when Waupaca is compared to municipalities of similar size in the state, its municipal tax rate is the highest.
However, Hagen noted that for many years, the city had no tax increase and in some cases, a tax decrease.
During that same period, other municipalties, such as the school district and county, had annual tax increases, he said.
Four funding scenarios were before the council, and the council voted in favor of Option 4, which includes long-term borrowing of $1.05 million and short-term borrowing of $100,000.
This option would have a 2015 budget impact of $229,752. The tax impact on a $100,000 home would be $55.10 per year.
Of the four options, this one includes the highest long-term borrow.
Option 1 was a long-term borrowing of $275,000 and a short-term borrowing of $35,000.
The second option was a long-term borrowing of $275,000 and a short-term borrowing of $155,000.
Option 3 included a long-term borrowing of $755,000 and a short-term borrowing of $135,000.
Petersen said she was uncomfortable with both the third and fourth options because of their tax burdens on city taxpayers.
Olson said he appreciates her comments but said the city also needs to keep up with capital needs.
“To me, it’s either Option 1 or 4,” he said.
The proposed capital items in the fourth option’s short-term borrowing of $135,000 are a $35,000 police squad, $10,000 for street signs, $30,000 for financial/utility software, $15,000 for engineering services and site analysis for a public works facility, $25,000 for concept planning for the rehabilitation of downtown and $20,000 for Phase 2 of the South Park plan.
City Administrator Henry Veleker said the short-term borrow would be paid off within 90 days.
Following the council’s vote to go with Option 4, Veleker planned to ask Brad Viegut, the city’s financial adviser, to structure possible short and long-term loans.
Noting the city’s debt drops off in 2018-19, Veleker said future decisions about short-term borrowing would be part of the city’s budget development.
“You don’t want to borrow long term for a squad car,” he said. “Our financial adviser would figure out the best way to layer it in.”
Mayor Brian Smith told the council its action gives city staff direction as it puts together next year’s budget.
The long-term borrowing amount of $1.05 million in this option includes $75,000 for the Augie Austin Gym roof, $200,000 for the reconstruction of West Fulton Street (Hillcrest Drive to Western Avenune) and Hillcrest Drive (Harrison to West Fulton streets), $25,000 for a new skidsteer, $85,000 to replace a 1990 hauling truck, $118,000 for a new floor in the Augie Austin Gym, $150,000 to replace the 2001 snow plow, $200,000 for the renovation of city hall and the library and $200,000 for other road rehabiliation projects.
John Edlebeck, the city’s director of public works, told the council Granite and Lake streets are among the streets being considered as part of the $200,000 for road rehab.
The mayor said the council is saying it wants to see how the short and long-term borrowing will fit into the budget.
“We don’t want to move forward with something the council doesn’t want to do,” Smith said. “This will give us the ability to look at the prospectus now as we go through the budget process.”