Watertown City Council looks to rainy day fund as budget season starts
Watertown is in the early stages of crafting its budget and the state-mandated 2 percent tax cap is yet again a major part of the discussion.
City manager Sharon Addison says Watertown will exceed the cap in the next budget when they factor in the cost of giving all city employees the standard annual two percent raise. The city broke the cap last year. The announcement comes as the council prepares to take on big projects like renovating the Thompson Park pool.
Councilor Mark Walczyk says Watertown is hoarding taxpayers' money with its fund balance that currently has $11 million in it.
"I’m committed to staying below the 2 percent tax cap,” Walczyk said. “The fund balance is a little bit too high now. We’ve got some room there. This is the rainy day fund in our budget. So rather than raise taxes this year, let’s use that rainy day fund to reduce taxes this year."
Walczyk says the city only needs $8-11 million in reserves. But Mayor Joe Butler is a bit more cautious about how much the city should draw on that fund.
"That can unravel very fast,” Butler said. “I’ve had years where sales tax revenue has been off budget by $1 million. Last year we had self-funded health insurance go up by a $1.4 million.
Butler says he would be willing to spend some of that fund balance but it's premature to call for that now.