So, if you look at the 2008-2017 before the jail was in the the county capital budget, the capital budget averaged $35,851,962 per year. Now, they want one project to cost 4-5 times the amount of all capital costs. What will that do to our taxes? I haven’t seen the answer to that question.
Capital Budget Borrowing since 2001
Here is what has been budgeted and budgeted to be borrowed since 2001. If you click on the links, in most cases the capital budget information starts around page 30-32.
| Year | Budgeted Expenditures | Borrowing Budgeted |
| 2001 | $27,777,700.00 | $9,959,400.00 |
| 2002 | $27,888,650.00 | $21,292,400.00 |
| 2003 | $22,969,100.00 | $22,341,100.00 |
| 2004 | $18,066,100.00 | $16,703,100.00 |
| 2005 | $16,465,715.00 | $14,308,200.00 |
| 2006 | $23,909,160.00 | $17,821,860.00 |
| 2007 | $29,288,799.00 | $28,038,339.00 |
| 2008 | $20,897,549.00 | $18,769,239.00 |
| 2009 | $41,894,183.00 | $39,884,783.00 |
| 2010 | $29,030,156.00 | $27,334,456.00 |
| 2011 | $26,146,811.00 | $21,620,211.00 |
| 2012 | $22,882,412.00 | $22,145,997.00 |
| 2013 | $32,649,375.00 | $29,816,575.00 |
| 2014 | $51,625,950.00 | $49,739,381.00 |
| 2015 | $42,361,985.00 | $39,102,585.00 |
| 2016 | $40,478,400.00 | $37,406,100.00 |
| 2017 | $50,552,800.00 | $47,085,900.00 |
| 2018 | $114,953,116.00 | $113,878,716.00 |
| 2019 | $71,452,300.00 | $68,937,000.00 |
Note: they budgeted for borrowing the original $76M in 2018, but never actually borrowed for it as far as I can tell.
What does it cost to borrow?
I’m going to say up front, I’m not an expert on the county board budget. It’s taken 20 years for me to figure out the little I know because they do everything behind the scenes and share very little actual knowledge with the public. My very, very basic understanding of the opaque county budgeting process is as follows:
The county used to borrow for 10 years until, if I’m recalling correctly, they borrowed for the DaneCom communications system. At that point they went to borrowing over 20 years. I believe that was around 2010.
In 2018 the interest rates were 2.483%, 3.2285%, 3.2355% and 2.5735% for the various types of bonds. I’m unclear about the exact terms of the county borrowing with their various bonds and the interest rates that need to be approved the day of the resolution because they are constantly changing. So, this is all just in theory and actual numbers will vary, but using an internet loan calculator here’s some ballpark numbers to think about.
At 2.483% we’d pay $40,467,036 in interest over 20 years. Our monthly principal and interest payment would be $793,612.65 per month.
If borrowed at this rate over 10 years it would be payments of $1.4M every month and we’d only pay $19M in interest.
At 3.2355% we’d pay $53,925,790 in interest over 20 years. Our monthly payment would be $849,690.79 per month.
If borrowed at this rate over 10 years it would be payments of $1.4M every month and $25M in interest over 10 years.
Any which way, it boggles the mind.
Current Debt Service
Debt Service is what the county is paying back on all their borrowing.
In the 2019 budget, Debt Service was $46,245,770. This is $7,511,812 in interest and $28,723,958 in principal. Roughly 8.2% of the budget expenditures. This doesn’t include the $76 in borrowing approved in the 2018 budget, because they haven’t actually borrowed that money yet.
Compared to 10 years ago, in the 2009 budget, Debt Service was $15,156,200. That was $5,525,200 in interest and $9,621,000 in principal. Only 2.4% of the budget expenditures.
What will it be when they finally borrow the $150,000,000 to build this jail?
What will this cost the taxpayer?
I haven’t seen the county board projections on what this borrowing would cost or how it will impact the budget. Perhaps we’ll see when the county board has their “Committee of the Whole” meeting at 6:00 on Thursday. Currently, that information is not in either of the attachments to the agenda.
In 2018 when they approved the $76M jail, taxes went up $57.11 on the average home and we got a $28 wheel tax. Debt service that year was only $41M. Debt service went up another $4M between 2018 and 2019. However, the cost of the jail didn’t hit taxpayers yet, but it will over time when they actually borrow the money. That hasn’t happened yet as far as I can tell. It looks like they only borrowed $3,000,000 for the jail consolidation project in 2018 even tho they put the entire $76M in the 2018 budget.
As a side note, that never made sense to me to put the entire $76M in the budget in one year. Clearly they weren’t going to spend all $76M in one year. Especially not in 2018. When the city creates their budget, they budget the money in the actual years the money would be spent. For instance, the first year they might spent several million on more architecture and planning costs. The second year they might spend money on demolition, digging a hole and more planning costs. Then, in a huge project, they might spend half of what’s left in one year and half in another year. This spreads the costs out over 3-4 years and, you know, is actually realistic. And that way they aren’t budgeting to borrow (and taxing for) money that isn’t going to be borrowed.
Anyways, I’m hoping they have time for questions on Thursday (they only have one hour) and someone asks what this is going to cost the taxpayer and what impact it will have on taxes over the next 20 years. I keep thinking, it really seems like with a project this huge, they should have to go to referendum. Or, perhaps the referendum will be the next election?
