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Sauk County Flooding (copy)

Sherry Tarnowski walks past her flood-damaged home in North Freedom last week. The property is expected to be declared a total loss.

Sauk County government’s chief financial officer said Monday she expects at least one agency to end the year in the red due to recent flooding.

Finance Director Kerry Beghin told members of the Sauk County Board’s Finance Committee there is a “high likelihood” the county’s Emergency Management Department will exceed its budget in 2018.

If President Donald Trump issues a disaster declaration for Wisconsin, Beghin said, the federal government would reimburse the county for a high percentage of its flood-related expenses.

If there is such a declaration, it may not be issued until October, with reimbursement funds becoming available next year.

The report on excess flooding expenses came just before an outside auditor reported the county’s financial position is healthy due to an unusually large reserve fund.

“This is the poster child for why you keep a healthy reserve,” Beghin said of the likely budget overrun.

Assessments continue

Sauk County Emergency Management Director Jeff Jelinek said Monday that damage to homes and businesses within the county has reached $8 million, and is expected to grow as assessments continue.

Jelinek said his department likely will incur additional expenses related to providing home cleanup supplies, sandbags, sand and the establishment of a disaster recovery center. The estimated impact on various county agencies has not yet been tallied.

Assessment teams found multiple severely damaged homes Monday that had not yet been reported, Jelinek said. As cleanup gets underway, assessments are expected to continue through Wednesday.

Savings exceed recommendation

Also during Monday’s meeting, Amanda Blomberg of Baker Tilly Virchow Krause, the county’s auditing firm, reported the county’s general fund — a key marker of financial health — is unusually large and growing.

The reserve fund has a balance of $40.9 million, of which $39.4 million is unrestricted.

That’s 112 percent of the county’s tax levy expenditures. The Government Finance Officers Association recommends that government entities similar to Sauk County maintain an unrestricted general fund equal to about 17 percent of tax levy expenditures.

“I would say it’s pretty high compared to a lot of like-sized counties,” Blomberg said. “Although being a smaller county, I think we often see that reserve amount pretty high. I don’t know that I’ve seen it over 100 percent at another county. But I would have to do some digging to find that. None of my (other) current clients have that.”

Since 2013, the county’s general fund balance has grown from $31.8 million to $40.9 million, according to a report Blomberg distributed to committee members Monday.

In 2017, the county budgeted to spend $6.4 million from its general fund, and instead added $1.7 million to it.

The unusually large savings account is in part what allows the county to enjoy an AA1 bond rating, the second highest rating possible, Blomberg said. It also has allowed the county to pay for certain large expenditures without borrowing.

The general fund has been a source of debate among county board members.

Critics have argued certain budgeting practices have caused the county to collect more in property taxes than it truly needed to make ends meet and maintain a healthy savings.

Others say collecting the maximum amount in property taxes allowed under state-imposed limits has protected taxpayers by increasing the county’s fiscal stability.

Follow Tim Damos on Twitter @timdamos or contact him at 608-745-3513.

Reporter for the Baraboo News Republic.