Council Approves $7,855,820 Tax Levy

After holding a public hearing Oct. 31 on the 2023 city budget, during which no one spoke, the Sturgeon Bay Common Council approved a $7,855,820 tax levy.

The adopted levy – an increase of $522,510, or 7.1%, from the previous year – includes $5,754,927 for the operating budget, $1,823,385 to pay off debt and $277,508 for the capital fund.

City finance director Val Clarizio said the increase in the levy is attributable to a mixture of operating expenses and debt payments, with the latter not subject to levy limits.

Prior to the council adopting the tax levy during its special meeting lasting about seven minutes, it approved two other motions.

One motion increased the general-fund contingency line item by $400,000 and also offset the increase to the contingency by increasing the appropriated general-fund balance by $400,000.

Clarizio said that motion related to the city receiving its final Expenditure Restraint Program (ERP) information from the Wisconsin Department of Revenue, indicating the city is allowed to increase its general-fund budget next year by no more than 8.8% over the 2022 budget to qualify for an ERP payment for shared revenue in 2024.

“The budget prepared for the public hearing was based on estimates and needs to be adjusted slightly in order to protect the city’s expenditure base/capacity in future years and comply with the state mandate,” Clarizio stated in a memo to the council. “Adjusting the general-fund contingency line item by $400,000 will accomplish this task without impacting the tax levy.”

The other motion updated next year’s budgeted tax-increment numbers and transfers for Tax Incremental Districts (TIDs) 1-5.

Clarizio said the city did not have all the information it needed to calculate the TID tax-increment numbers Oct. 10 when the council scheduled a public hearing on next year’s budget.

“The tax-increment numbers are a mathematical equation using levies from all the taxing jurisdictions,” she said. “So, I had estimated those levies and prepared the packet that went to the public hearing [Oct. 31] based on those estimates.”

Though the tax-increment worksheet provided by the state to the city was still unavailable as of Oct. 31, Clarizio said city staff had enough information to calculate a more accurate estimate than what was previously provided to the council.

“The increment is down a little bit because it’s based on levies, and I had estimated the county and the school district a little higher than the current estimates that I have,” she said.

Property taxes generated in a TID from development in the district, once it is created, are able to go directly for infrastructure improvements, rather than being split among the various taxing entities where a TID is located.