The 2025 budget for Douglas County was passed at the county board meeting on October 29. The agenda and minutes for this meeting are available on the Douglas County website, at the agendas/minutes center.
The 2025 budget book will be available for members of the public to view on the Douglas County website, under the Finance Department page, before year-end 2024. The 2025 budget represents approximately $72 million in expenditures, a tax levy of almost $19 million, and a mill rate of 3.09, the lowest mill rate in the last 10 years.
2024 Review
Douglas County uses components of Priority Based Budgeting (PBB), and has done so for several years. PBB is an approach that results in local governments spending within their means by continuously focusing on results most relevant to their communities, and programs that influence those results to the highest possible degree. This process involves a systemic review of existing services and how those services are meeting citizen demands.
The Douglas County board identified six priority areas in 2024: Public Safety, Sustainable Infrastructure, Investment, Professionalism/Service/Efficiency, Responsible Development, Natural Resources and Compassion. The allocation of resources in 2024 reflected these priority areas, and will continue to do so in 2025.
2024 Capital Project Funding
In 2016, resolution #3-16 was adopted regarding the disbursement of any unassigned general fund surplus from a previous year’s operation. In adopting this policy, the board reaffirmed the establishment of a minimum balance in the Unassigned General Fund, as indicated in a previous resolution, #39-12. According to this resolution, the unassigned general fund balance compared to governmental expenditures will be maintained at a minimum ratio of 12%, or about eight weeks of working capital for operations. After the minimum ratio is maintained, general fund surplus is distributed in the following ways:
• 50% Capital Improvements as defined in Douglas County’s Capital Improvement Plan
• 15% Timber Sales Revenue Reserve (capped at $2 million)
• 15% Courthouse/Government Center Maintenance Fund
• 20% Discretionary allocation recommended by the Administration Committee to the full county board to fund special projects and allocations
Following policies established by Resolutions #3-16 and #39-12, and in consideration of available American Rescue Plan Act (ARPA) funds, the County Board approved funding in March and June of 2024 for capital projects totaling approximately $3.8 million.
Economic Conditions
Douglas County will see growth in new construction in the amount of $164,000 of the allowable operating levy increase. New construction growth includes all new construction that’s occurred within the county. The rate of net construction activity in the county determines the level to which the county can increase its tax levy.
Sales tax revenues were presented as of the end of September. Year-to-date sales tax revenues are $4.2 million, which is 4.5% below 2023. Sales revenue was at a record high in 2023 and is trending slightly downward. Sales revenue can fluctuate if large construction projects occur. This is because sales tax includes large purchases for construction projects as well as everyday transactions. The State of Wisconsin’s Department of Revenue compiles information about which areas sales tax comes from. Total revenues for 2025 are budgeted at approximately $71.7 million, an increase of 7% over 2024.
Local Economic Impact
The health of the local economy majorly impacts several revenue sources of Douglas County. Revenue is received from a one-half percent sales tax that’s applied to all taxable sales within the county. We also receive a portion of the occupational tax charged on commodities shipped through the port of Superior. Commodities include raw materials such as coal and wheat.
Another important revenue source unique to Douglas County is obtained from timber sales. Douglas County employs a comprehensive forestry management plan for the approximately 280,000 acres of county forest land. Recently, timber sales revenue and revenue from other fees related to the County Forest have equaled approximately 5.2% of the county’s total budget. Factors impacting timber sales revenue include the condition of wood, pulp and paper industries purchasing the materials, and the status of local paper mills. Throughout the next year, Douglas County Forestry will continue its long-term commitment to sustainability. DC Forestry will maintain the county’s forest resources by promoting management practices that are scientifically credible and economically, environmentally and socially responsible.
Looking Ahead
Government entities continue to struggle with attracting and retaining top talent in the workforce. To compete with the private sector and firms in Minnesota, Douglas County decided to incorporate a on- percent increase to the overall pay grid for 2025, and offer employees an additional day and a half of paid time off. Health insurance premiums are also increasing due to a number of factors, including a substantial increase in claims. Rising inflation, increasing costs of energy, supplies, contracted services and other fixed costs are projected, and those projected increases are absorbed into the 2025 budget.
Creating a balanced budget is a unique challenge due to the state-imposed levy limit restriction. The county’s operating levy can only be raised by the percentage of net new construction in the county. For 2025, the increase is 1.22%, equating to the aforementioned $164,000 new construction growth.
Douglas County depends on other general revenue sources to achieve a balanced budget, including sales tax proceeds, interest income, timber sales and state shared revenue. All general revenue sources remained relatively stable 2024-2025.
Overall, Douglas County remains one of the most fiscally sound counties in Wisconsin. Through the combined work of our exceptionally well-qualified department managers and staff, we continue our commitment to serving our taxpayers to the highest capacity.
Melissa Pratt is a human resources generalist with Douglas County.
