The Ladysmith Common Council Finance Committee met Tuesday, Sept. 7, discussing the city’s financial management Compliance Maintenance Annual Report and the impact of several sewer rate hike proposals
The committee reviewed three scenarios of proposed sewer rate increases. They show the net effect of 10%, 15% and 20% increases in 2022, then small increases in subsequent years through 2026.
The 20% and 15% increases were deemed “too shocking to implement,” according to city records. It was decided to present the council with two scenarios.
The first scenario would show the effect of a 10% increase in 2022, a 5% increase in 2023, then 3% increases for 2024-26.
The second scenario would show the effect of a 10% increase in 2022, and 3% increases for 2023-26.
City Clerk Shari Kavanagh presented the budget for municipal court, advising the overall budget is relatively unchanged. Revenues are budgeted slightly higher as collections seem to be doing better. This is based on historical trends since there is no certain way to know what will be written for tickets, or what will be collected. Everything else is remaining fairly static.
Kavanagh has budgeted for four elections in 2022. There is the possibility there will not be a need for a spring primary, but historically there is one. This is also the case for the fall primary. The last year for payments on the ballot tabulator is in 2022.
Committee Chairman Marty Reynolds questioned what the state uses to calculate their reimbursement to the city.
Kavanagh advised the state no longer reimburses the city.
The city attorney’s pay has remained unchanged. Ms. Kavanagh advised special legal council is difficult to predict as it can depend on unforeseen circumstances.
The general operations budget was largely based historical averages for many of the expenditure accounts. Meeting per diems have gone down compared to 2018 and 2019 with 2020 proving that, largely attributed to halting of the All Committees meetings.
City clerk, treasurer and comptroller wages and fringes show a significant increase over 2021 due to the anticipated retirement, and related severance of the treasurer.
Reynolds questioned the “Uncollectable Taxes -Del Pers Prop” and the “Uncollectable Taxes - Tax Deed Prop” expenditure lines. The amounts budgeted in 2021 have not yet been expended.
Deputy Clerk/Treasurer Tony Devine suggested examining those closer and possibly adjusting the 2022 budget.
Devine went on to explain insurance expenditures accumulate under “General” expense lines, then get allocated to the various departments at year-end.
Last December, the Wisconsin Public Service Commission approved a city request for a water rate increase. The city applied to the PSC on March 9, 2020 for authority to increase water rates. The city filed its rate application after receiving a letter from PSC staff outlining commission staff’s concerns regarding the applicant’s financial integrity.
PSC staff computed some typical water bills for single family residential, multifamily residential, commercial, industrial, and public authority customers to compare present rates with the new rates. The overall increase in annual revenues is 49.53 percent and is comprised of a 53.32 percent increase in general service charges and a 42.03 percent increase in public fire protection charges. A typical residential customer’s bill will rise 51.95 percent, not including public fire protection charges. Rates have risen because of a 99.68 percent increase in gross plant investment and a 64.62 percent increase in operating expenses since the applicant’s last conventional rate case in 2013. The typical bills calculated using the authorized rates are above average when compared with those of similarly sized water utilities in the state.
The general service charges will increase by 53.32 percent, compared to a 42.03 percent increase in the annual public fire protection charge. The larger increase in general service charges results from a greater proportion of the annual operating costs being allocated to general service compared to what was allocated at the time of the applicant’s last rate proceeding and is based on current ratios of maximum general service demand to available system fire protection capacity. The larger increase in general service charges is reasonable, in that it reflects the cost of providing service appropriately.