The Story
The February 14 Common Council meeting started off with a presentation on financing and debt issues.
Why it matters:
Cities around the State of Wisconsin have been incentivizing cities to borrow money rather than raise taxes. This is because of an incentive called “The Expenditure Restraint” program. It basically says that if a city can keep its budget under a predetermined amount, the State will give you money back as an incentive. It’s like your dad telling you if you don’t spend your allowance for a while he will give you an extra $50. (There’s more to it, as with anything in government, but there’s the very basic explanation.)
No one wants their taxes raised unnecessarily, but sometimes push comes to shove and the City is left with no other option. What’s interesting about this is the fact that when Cities borrow for projects, it ends up costing the citizens more “tax” dollars to pay back the loan than it would to just increase taxes to pay for improvements. With that being said, the City needs to begin the discussion of how much it can borrow before it becomes an issue. The City is graded on its debt status. It’s kind of like a credit score for the City (sort of). Marshfield’s rating is currently an Aa3. It is like golf where the lower the score, the better. The best score is Aaa, which only 4 cities in the state of Wisconsin have, then Aa1, Aa2, etc.
Marshfield’s rating has been slowly declining over the past 2 years. This is because the City has been doing more borrowing lately than in years past. It is not necessarily a bad thing- again, the State is basically asking the City to borrow more to qualify for the Expenditure Restraint program. Marshfield has to borrow in order to keep tax rates flat, while still maintaining roads, parks, police & fire protection, etc.
Other News
The City took action on 3 issues that went into closed session:
- A claim by Menard’s to refund some of the tax money they pay because of the stores “black store” approach that many stores have been taking. The claim was denied by the City.
- Second was to review lease space for the Job Center to go in the community center. This was approved at a rate of $10.15 per square foot.
- Lastly, Council had to vote on the proposed collective bargaining agreement with Marshfield Professional Police Association, WPPA. The motion to agree passed 10-0.
