Finance Director Leydet expects balanced 2021 preliminary budget

By Jalen Maki

Tomahawk Leader Editor

MERRILL – The county’s wheel tax and a potential referendum to replace it were discussed at length during the Lincoln County Board of Supervisors’ Tuesday, Sept. 16 meeting at the Lincoln County Service Center in Merrill.

County Finance Director Dan Leydet told the board a balanced 2021 preliminary budget is expected to be presented to the Finance and Insurance Committee next month,

Wheel tax, potential referendum

Hake noted that in June the board voted to renew the county’s $20 vehicle registration fee, often referred to as the “wheel tax.” The wheel tax has a sunset date of Dec. 31, 2021.

Hake stated that in July and August, the Highway Committee discussed “alternative means of funding to replace the vehicle registration fee” and the committee wanted a discussion to be held at the county board level.

District 1 Supervisor and Highway Committee member Bill Bialecki said the committee discussed the possibility of a referendum to increase taxes in the county.

“The challenge of a referendum to exceed the levy limits is that you’d have to draft a resolution and a question stating what you’re funding with that increase,” Hake stated. “Also, you need to state the specific timeframe on that increase, whether it’d be one year, two years, or indefinite.”

Hake added that an additional challenge a referendum presents is the timing. The board would have to draft the resolution and referendum and approve it by Feb. 2021 for the 2022 budget. The county hasn’t yet begun its budget process for 2022, Hake noted.

Bialecki stated that by going to referendum, the financial burden is distributed more evenly by including “the heavy users, the farmers, the loggers” rather than “getting the little guy and hammering them with a wheel tax.”

District 14 Supervisor Brian Hafeman noted that the board should be sure to know what the potential fallout would be if the theoretical referendum were to fail.

The county would have to find another way to come up with roughly $500,000 if that were to happen.

The board discussed the impact the language of the potential referendum would have on its ability to be approved by voters.

“I think it has to be specific enough to describe to the taxpayer what the money is going to be spent on,” said Corporation Counsel Nancy Bergstrom. “I don’t think you can just say ‘operations.’”

Bialecki said the potential referendum would have to exceed the funds generated by the wheel tax.

“You can’t keep kicking the can down the road,” Bialecki stated. “We have to get creative here pretty soon, or you have to try to sell to the taxpayer some drastic cuts in services, and that’s the bottom line right there.”

A gas tax increase and additional sales tax in the county were dismissed during discussions as not possible.

2021 preliminary budget

The 2021 preliminary county budget took a large step towards being balanced.

County Finance Director Dan Leydet and Hake took steps to deal with a large portion out of the preliminary budget shortfall through reductions in the contingency fund and maintenance budget, along with an increase in projected revenues from housing out-of-county inmates, sales tax revenue and forestry revenue. These numbers have been estimated conservatively and exceeded in previous years, Leydet noted.

Leydet said that after the Finance and Insurance Committee’s approval of roughly $460,000 in changes, the remaining variance is $286,604. Through ongoing reorganization plans involving open county positions and other state aid revenue numbers that will be factored in, a balanced budget is expected to be presented to the Finance and Insurance Committee next month.

The board will likely vote on the preliminary budget in November.