The Town of Gibraltar got a lot of extra road work done in 2020, but taxpayers will be paying the price for it in 2021. The town spent $373,490 more than it budgeted in 2020 – much of that for paving Peninsula Players Road and Gibraltar Road.
Neither road was in the town’s budget for this year, resulting in a budget increase of more than 13 percent in 2021.
“This all revolves around paving those two roads we did this year,” said town Chair Steve Sohns. “That’s really what it all comes down to.”
Town residents will get to vote on the budget during the town’s annual budget meeting Nov. 30. In Wisconsin, residents of a township must approve that budget during an annual meeting, which is usually a sparsely attended affair. If the budget is not approved, the town board must go back to work.
To cover the budget, the town will have to exceed the state-imposed property-tax levy limit by 20.66 percent, which would have to be approved by voters in a separate resolution. State statute allows municipalities to increase property taxes only by the increase in value of net new construction. That would allow Gibraltar to raise the levy by $21,397, but under the resolution, Gibraltar will raise it by $271,990.88.
The town plans to hold the meeting in person in the tight confines of the Fish Creek Community Center, but it’s looking at ways for people to participate from the safety of their cars because of the pandemic.
In its final budget, the board proposes $3,698,730 in expenditures, up 8.83 percent from last year.
The town had budgeted $325,000 for road improvements in 2020 but spent more than double that, at $661,240. The town also went over its road-maintenance budget by $64,000.
Sohns said the town paved those roads ahead of schedule to take advantage of cost savings offered by Northeast Asphalt for doing the work this year. The company already had its blacktop plant in town as part of the highway paving work for the Department of Transportation (DOT). Town clerk/treasurer Beth Hagen said the town saved about $130,000 by performing the work this year.
Supervisor Brian Merkel said the two roads took a beating during the last year when they were used as detours during construction.
“It should have been a conversation with the DOT to get credit to fix those roads,” Merkel said.
“We’ll be over budget around $300,000,” Sohns said. “That means we did a really good job finding money to pay for that blacktop.”
But the roads weren’t the only hitch in Gibraltar’s budget. It includes $80,000 to replace aging maintenance equipment, including a salt spreader, wood chipper, leaf sucker and lawn mower. The town will also replace a high-mileage maintenance vehicle and spend $45,000 for a new sidewalk tractor to clear snow. In addition, the town is investigating hiring an administrator and has budgeted $71,000 for that position.
Gibraltar is also seeing the effect of the early-season loss of room-tax revenue. Gibraltar lodging entities collect more room tax than any other community, and the town receives 30 percent of that to spend however it decides. In 2019, that brought $230,107 to the town. For the year, room tax is down a little less than 15 percent, which means the town should end up short about $35,000 this year.
“I don’t think there’s a whole lot of fluff in the budget,” Merkel said. “I don’t want to raise taxes more than a person has to.”
The town was looking at a 34 percent budget increase before deciding to pull $125,000 from the town’s Capital Improvement Project fund.
The increase does not include costs associated with the Highway 42 reconstruction, long-term boat-trailer parking lot or beach expansion. Those costs were wrapped into the bond the town sold for those projects. The town will pay down $932,874 in debt in 2021.
Special Assessments Coming for Downtown Property Owners
Downtown business owners and residents will get another jolt when they get their first look at the special assessments the town will levy for sidewalk and streetlight improvements. The town chose to pay for the improvements solely through assessments on downtown property owners located along the highway through a formula that takes into account linear feet of highway frontage and property value.
Fifty percent of the assessment is based on the assessed land value, and 50 percent is based on the front footage of the property along Highway 42. For some property owners, it will mean a bill of tens of thousands of dollars.
The assessments will be significantly higher than originally estimated. The preliminary estimate for streetlights in 2018 put the total at $884,00. The final bill is nearly 50 percent higher, at $1,277,000.
The Wisconsin Department of Transportation contributed $156,000 to the sidewalk project and $466,560 to streetlights.
Gibraltar School, Half Mile Bridge and Fish Creek Condominiums will be assessed more than $100,000.
Sohns said property owners should have been aware that the assessments were coming, but the amounts have only now been finalized.
“That will go on the 2022 budget,” Sohns said. “We wanted to give people time to figure out how they want to pay for it and what the payment options are.”
The town has not decided how people will be allowed to pay the assessment, but it floated the idea of a 10-year payment plan.
Gibraltar chose the special-assessment route rather than spreading the cost among all of the town’s taxpayers, as Ephraim and Sister Bay did with major public-improvement projects during the last decade. Both of those communities upgraded streetlights, replaced sidewalks and embarked on major beautification projects in coordination with the repaving of Highway 42 but did not use special assessments.
“For us, we saw this as a benefit for the entire community, not just the people on the highway, so we wrapped it into one project,” said Mike McCutcheon, Ephraim village president.
Merkel and Sohns said Gibraltar has always struggled to balance the desires of taxpayers in the rural area of the town with those in the downtown business core.
“The people out in my neck of the woods didn’t feel they had to pay for that,” Sohns said. “They are paying for the frontage the town has, so the town taxpayers are kicking in for that. The downtown property owners are benefitting from it.”
Gibraltar Town Budget Hearing
Nov. 30, 6 pm
Fish Creek Community Center, 4097 Hwy 42