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County votes to drop levy by 6% (12/03/2012)
By Sarah Squires

The Winona County Board unanimously voted to cut the 2013 property tax levy by six percent, doubling the reduction discussed by commissioners in early November.

While the board won’t approve the 2013 budget and levy figures until its first meeting in December, this decision requires that staff refine the 2013 finances to reflect the six percent levy reduction. With each levy percent representing about $169,000 in property tax dollars, the reduction will trim the levy just over $1 million compared to 2012 taxes.

Commissioner Jim Pomeroy recommended the reduction, and said after he had reviewed budget figures and cash flow updates, he felt the county could absorb the cut. “If I felt that it would have a negative or material impact on the services that we provide, I truly wouldn’t suggest this,” he said. “My read is I think our [cash] flows are strong enough, I think our fund balance is strong enough, and I think our resolve is strong enough.”

While the board agreed to cut about $500,000 more from the budget than it had previously discussed, it did not mention specifically where budget reductions would be made or reserves used to cover the last-minute reduction in property tax revenue. County administrator Duane Hebert suggested operating reserves should not be used, but that “other reserves, other adjustments [can] be made. I think it’s doable,” he told the board.

When Winona County Finance Director/Interim Auditor/Treasurer Pat Moga was questioned as to whether he felt the cuts could be made, he hesitated. “How long can we sustain those cuts?” he asked. “I’m just not sure how comfortable I am with the six percent [levy reduction].”

“I don’t know that we are here necessarily to be completely comfortable,” replied Pomeroy.

Outgoing board chair Mena Kaehler said the levy reduction was possible because of changes made to the county’s organizational structure, which have included staff reductions, cross training and other measures aimed at creating efficiencies. “We have been able to cut the levy because we are changing how we’re doing business here,” she said. “There’s no other way that we could have done this.”

Cash flow

“Cash flow” reports are prepared for each board meeting, and show monthly expenditures and revenues that are compared with the previous year's figures. From those cash flow reports, commissioners are able to note, generally, whether county spending and incoming funds are in line with budgeted amounts.

Last year, the county ended up with a surplus of about $350,000 at the end of the year, money collected in excess of expenses. So far this year, budget figures show the county has about $300,000 more in revenue than it did at this time last year, suggesting its surplus will be more than the surplus collected in 2011.

But the county budget is very complex, and the timing of when payments are made and when revenue is received can vary drastically from year to year. Hebert said trying to predict what the surplus will be at the end of this year would be “wild,” but said it would be more than $350,000.

The county also has about $4.6 million in reimbursement funds for repair work in 2007 for flood-damaged infrastructure. The county paid for the projects at that time, and so has flexibility in spending the millions received for reimbursement. Last week it voted to spend, or designate for future spending, several million dollars from the fund. The rest of the money has been added to the county Capital Improvement Project (CIP) fund.

Hebert said after the meeting last week that CIP funds could be used to help reduce the property tax levy, and that he felt there would be adequate funds remaining in the account if that route is taken. During the meeting, however, Hebert told the board that there were some building improvements that would have to be made in the coming years. While he said he didn’t expect that the county would have to construct any new buildings, he said that it should ensure that the CIP fund was well managed so that future building improvement projects didn’t require the county to borrow to cover the cost.



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