City Manager Mark Rohloff said Oshkosh had to raise its overall tax levy by 3.99% to close the revenue-expenditure gap and balance the budget.
Rohloff gave the explanation during a recent presentation at the Oshkosh Chamber’s State of the Community Address, where he outlined some of the financial challenges facing the city.
“The property tax is far and away the largest revenue source, so when the other revenues are short, we have to make up for it in property tax,” Rohloff said.
“This demonstrates we do have some revenue challenges ongoing as we don’t get enough support from the state for the services we provide.”
Adopted last November, the city is operating with a total budget of is $174.3 million for 2024 with a 3.37% increase in expenditures in the general fund.
That increase translates to an additional $1,842,000 being spent on public safety, public works, parks and “unclassified expenditures.”
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And like last year’s budget, no staff increases were included in the general fund budget as a result of increased spending in debt service and commodities.
Rohloff still reported a growth in revenue of 8.3% while the city gained another $2 million in shared revenue as a result of the Wisconsin Legislature’s adoption of Act 12.
Under Act 12, the state provides unrestricted aid payments to counties and municipalities under the county and municipal aid program, and creates a new trust fund from which the Department of Administration can make those payments.
However, Rohloff explained that sum equates to shared revenue losses occurred over the last 30 years.
“That’s how much state shared revenue had not been shared, so we’re really catching up after 30 years — and when you adjust that for inflation, then we’re still behind,” he said.
Rohloff also pointed to another shortfall in the Municipal Services Payment Program, where the state reimburses the city based on the value of state properties it holds.
According to the city manager, Oshkosh is the third largest holder of state-owned property in Wisconsin behind Milwaukee and Madison, and the state only funds the program at 40 cents on the dollar.
“We should be getting about $2 million more from the state if they were truly funding this program the way they should be,” Rohloff said.
“Of course, the easy thing to say is we should cut back on programs and services we provide, but I think that becomes more of a policy decision for the council and I think the council recognizes that people are asking for more services than fewer.
“We’re constantly looking at ways to be more efficient, so what we try to do is analyze within our strategic plan what our priority goals are, and when we see something that has naturally run its course, then we’ll eliminate it,” he added.
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The 2024 general fund was adopted at $56,560,300 while the tax levy was set at $47,556,800.
The city recently added a new $35 vehicle registration fee and increased the cost of three utilities — water, sanitary sewer and storm sewer utilities — between 0.25% to 0.5%
The new wheel tax and utility increases are expected to raise $3.75 million annually to fund road and sidewalk reconstruction and will eliminate any future pavement-related special assessments on properties for 2024 and beyond.
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This article originally appeared on Oshkosh Northwestern: Oshkosh has a revenue-expenditure conundrum and a growing tax levy