With recently enacted legislation addressing under their belt, Shorewood trustees approved a budget Monday that calls for a 1.75 percent increase in the property tax levy — the lowest hike in a decade.
After months of workshops and navigating the error, which could have added more than $1 million to the levy, the Village Board adopted a $24.1 million budget, a decrease of 1.9 percent from last year, and a $9.6 million levy.
Including the levy from four tax incremental financing districts — special taxing districts established as a tool to help spur development — the village tax levy will grow 1.75 percent, up $178,188 from last year. The increase translates into an increase of $36 on the tax bill of a home assessed at $300,0000.
According to the village, the entire tax bill — including all taxing bodies within the village — would increase by $103 on a $300,000 home, though officials caution the Milwaukee Metropolitan Sewerage District hasn't set finalized numbers.
Estimates initially had the assessment error — which overstated the value of Shorewood’s Tax Incremental District No. 1, covering the business district — forcibly increasing the levy by $2 million. That figure decreased to $1.465 million after other taxing bodies released their levies.
To avoid an artificial spike in property taxes, Shorewood officials decreased the levy by $1.465 million, plan to borrow to fund the difference, and then will raise the levy the following year by the same amount.
A bill that was signed into law by Gov. Scott Walker Nov. 9 excludes Shorewood from state law, which prohibits municipalities like Shorewood from increasing its tax levy for any reason other than through development or referendum.
Along with many municipalities across the state, Shorewood attempted to balance its budget after $207,000 in cuts to state aid from Gov. Scott Walker’s 2011-13 budget bill. However, it will actually start in the black with $234,000 in savings from village employees — except for some police employees — contributing 12 percent to the cost of their health care premiums and 6 percent toward their pensions, all provisions outlined in the Act 10, or the budget repair bill.
"When you are dealing with a more than $207,000 cut in state aid, these things start to add up," Swartz said at a previous meeting.
Ins and outs of the 2012 budget
Among the largest expenses for next year for Shorewood are $9.2 million in major road reconstruction and sewer projects — including water main replacement, sewer lining, and sanitary sewer improvements.
But in addition to budget repair bill savings, Shorewood will cut costs after with other North Shore communities, which would save $27,000 from last year. And, the village estimates saving $12,000 after agreeing to contract out to Bayside.
Additionally, the reorganization of a Planning and Development department within the village, resulting in two inspectors who can process residential building, electrical, plumbing and HVAC inspections, rather than contracting out for the electrical, plumbing and HVAC inspections, is expected to save the village $38,000.
With most of the summer, officials removed funding for lifeguards, but now anticipate replacing the $15,000 in this year's budget for lifeguards for next year. Furthermore, they added $55,000 for landscape improvements and ramped up security at the Lake Michigan beach.
Shorewood police will get a new squad car for next year, at a cost of $42,000, and replacing police radios will cost $40,000. Village will also spend $139,000 for new fire department equipment. Police Chief David Banaszynski pulled out the needed replacement of a second squad car from the budget in order to . Furthermore, with a shorter crosswalk trip and the addition of a traffic control signal at North Murray Avenue and East Capitol Drive, a crossing guard is no longer needed, Banaszynski said. These reductions would result in savings of around $14,000.
Some village buildings need roof and HVAC repairs — officials allocated $128,000 to infrastructure repairs under the adopted budget. Replacing public works vehicles and other equipment will cost $281,000.
Replacing outdated technology and software will cost Shorewood $150,000.
The village has 15 employees eligible for retirement in 2012, which officials estimate could cost an additional $20,000 a year to fund retirement benefits. Shorewood has funded retirement of two retirements in this budget. Village Finance Director Stephanie Walker said employees aren't required to give advance notice they plan to retire, once eligible.
Shorewood budgeted extra election funds in anticipation of . Additionally, officials say they kept the recycling program intact this year, but may need to revisit funding in future years.
Didn't make the cut; explaining the assessment error to taxpayers
Additional requests, which were not included in the budget, include repairs to the exterior of the Village Hall building columns, a new security fence at the Public Works building and replacement of the roof on the scout cabin at Hubbard Park.
Shorewood officials are now spelling out the effects of the assessment error in literature accompanying tax bills.
For example, in its levy from last year, putting it at more than 5 percent when in actuality it only increased 0.5 percent.