Work begins on 2024 Oconto County budget

County board approves budget guidance letter with goals and recommendations
By: 
Warren Bluhm
News Editor

The process of creating an Oconto County budget for 2024 is officially launched with the county board’s July 20 approval of the annual budget guidance letter.

The letter, submitted by County Administrator Erik Pritzl and the board’s administration committee, is an outline of budget-making goals and recommendations for the year ahead.

The overall economy will have an impact on that process, Pritzl said.

“The past year has seen inflationary increases that were significant, along with supply chain issues that reduced availability of equipment and supplies or delayed projects,” he wrote in the introduction of the letter.

The recently passed 2023-25 state budget will provide some help, Pritzl said in his presentation to the board. Under separate legislation, the county is due to receive $477,412 in supplemental funding, Pritzl said.

“That legislation that was passed and now funded provides additional revenue to the county for specific services,” he said. “It would include emergency medical services if you operate those, law enforcement, fire protection, first response, communication, public works and transportation.”

Under state law, counties are limited in how much they may increase the property tax levy based in part on net new construction in the county, a figure that is not available until August, which Pritzl estimated would be between $250,000 and $300,000.

The county also depends on the local 0.5% sales tax implemented in 1994 to fund debt service and capital improvement projects. The 2023 budget estimates about $2.492 million in sales taxes.

“As long as sales tax continues to go up — and I heard yesterday it’s very rare for sales tax to go down — the increase could be 2%-3% per year,” Pritzl said. “That’s extremely helpful to have this additional funding available to us.”

The mill rate for county purposes decreased 11.3% in 2022 from $4.696 per $1,000 of equalized value to $4.167, largely because of a 15.4% increase in the county equalized value.

“That’s a pretty significant outlier. I don’t expect to see that kind of increase again,” Pritzl said.

Overall, he expects to have about $750,000 to $800,000 available for budget increases in 2024.

The county is asking department heads to compile budgets that have a zero percent increase in the portion of their operating budgets that is funded by the tax levy. In addition to step increases and merit increases, a 2% wage and salary increase is planned, along with a 1% “retention incentive.”

“This is going to be awarded later in the year, at least conceptually, as a lump sum, so during this whole increase the people that remain employed with us in 2024 get 3%,” Pritzl said regarding the retention incentive.

Wages and fringe benefits are expected to increase about $671,152 in 2024, he said. That includes a health insurance premium increase of no more than 9.5% or $427,000.

Going into the budget process, the county is expecting to set a 2024 contingency account budget of $200,000 and plans to apply $750,000 from its general fund toward balancing the budget, according to the budget guidance letter.

All capital projects previously approved in the county’s current five-year plan will be reviewed to determine if the project can be reduced, delayed or eliminated, the letter says. It concludes that the 2024 budget is expected to closely mirror the 2023 adopted budget, and the various economic pressures will make balancing the budget a challenge.

“It is imperative that all departments find ways to comply with these guidelines in order to arrive at a balanced budget,” the letter reads. “The goal is to adopt a 2024 budget with a minimal increase in tax rate and levy that complies with any state-imposed rate/levy limits as well as fund the essential services that the residents of Oconto County expect.”

wbluhm@newmedia-wi.com