Oneida County opens budget hearings facing $1M deficit

Oneida County entered its 2026 budget hearings this week with a familiar problem and a conscious choice: an opening day gap of about $4.5 million between projected revenues and estimated expenditures. 

However, context matters. In fact, this year’s shortfall is driven largely by a deliberate decision to transfer $3.6 million from the general fund to pay for capital improvement projects (CIP).

Remove that transfer, finance director Tina Smigielski told the county’s executive committee Monday, and the county’s true barrel of red ink comes to roughly $1 million in day-to-day operations. 

In addition, the expenditure estimate was based on departmental 2026 requests, which came under scrutiny this week. Supervisors thus opened the week fully anticipating the entire deficit would be wiped away by the end of budget hearings, as it has been in the past. And, in fact, as the committee opened its third and final day of budget hearings on Wednesday, the $1-million deficit had already been reduced to $337,245. Final numbers were not available for the article but will be presented in next week’s edition.

But that’s not the whole story, the finance director added.

“As currently proposed, the general fund, which is our major fund for most of the departments, is estimated to generate $33 million in revenue and have expenses of $34 million. So in the general fund, our day-to-day operating fund, we do currently have a $1-million deficit as currently proposed. But there is a $3.6-million transfer out of the general fund proposed from unrestricted fund balances to help fund capital improvement projects for next year.”

Committee chairman Billy Fried observed that the target for the week was the $1-million operating deficit, though Smigielski said the committee could also still revisit the CIP transfer.

“The CIPs can also be reconsidered at this point,” she said. “There’s no obligation to transfer funds out of the general fund to fund CIPs. If you’d like to reconsider those, this would be a good opportunity to do so. But from an operational standpoint, yes, the $1,005,855 difference in the general fund would be the focus.”

County board chairman and committee member Scott Holewinski put that number inside a positive frame.

“I think last year’s deficit was over $2 million when we started out, and we got it down, so this is a lot better than the previous year,” Holewinski said.

Not that the task would be easy, Fried added.

“We as elected officials sometimes lose our breath when we see deficits and we also get confused looking at all the numbers that are in this booklet,” he said, referring to the budget packet of agency requests and the county overview that Smigielski had prepared for the committee. “During the hearings, we’ll be asking questions of departments, looking for explanations. Sometimes it comes off as a little callous. We don’t want to micromanage, and we sometimes dwell maybe outside our realm, but we’ve had a great relationship over the years and I think for the most part department heads understand where our questions come from and why we’re asking because you allow time to get to a budget that we can present to the county board that’ll be responsible to the taxpayers.”

In the financial overview Smigielski submitted to supervisors, she emphasized that the hearings presented an opportunity to make important adjustments, if necessary.

“As currently proposed, the General Fund has an operating deficit of $1 million,” she wrote. “While there may be sufficient General Fund reserves at the end of the current year to cover such a deficit, the executive committee will use the hearings as an opportunity to press departments on their requests for funding in 2026 to ascertain if the allocation of resources meets [certain] criteria.”

She broke the criteria down into four questions: 1) Does the funding request serve essential county goals and objectives? 2) Were best efforts made to mitigate increased spending when preparing the budget request? 3) Is full use of all non-tax levy resources available to support operations being considered? 4) Are creative measures, such as digital/technology solutions, or shared human resources among departments to hold the line on personnel costs, being considered?

Healthy as she goes

At the meeting, Smigielski reminded the board that the county’s reserves were healthy at year’s end — $28 million as of December 31, 2024 — but those funds were not all available for discretionary use. Roughly $10.8 million sits in the stabilization, or rainy-day, fund. The unrestricted fund balance was at $9.9 million at the end of last year. Another $4.9 million was assigned as “continuing appropriations,” or unspent departmental funds set aside for specific future purposes. Another $2.3 million was non-spendable — the value of inventory, not cash.

Smigielski also explained how continuing appropriations work.

“So the $4.9 million — that is all of the continuing appropriations at the end of the year of 2024,” she said. “So on the balance sheet, you have assets minus liabilities, and what’s left over is what in government we call fund balance, or stockholder equity in the private sector.”

So the continuing appropriations amounts are what the departments indicate are funds left over that weren’t previously used that they ask to have set aside for a specific purpose, Smigielski said. 

“It is not necessarily legally restricted money,” she said. “Some of it may be, so, for example, the continuing appropriation amount for ambulance would be the amount that we have levied specifically for emergency medical services. That is a restricted portion of our levy. And we had, I think, it was two years that we had some ambulances on order. We still have two on order right now. So those funds are encumbered or restricted because we know we have ambulances coming and that money really is set aside for that.”

Some continuing appropriations are related to grant funding that may have been received upfront by the department, but not fully expended for that program, the finance director said.

“So they’re rolling that money over for a future year,” she said. “And some of it, frankly, are funds that a department may have had in their budget that they didn’t use in a current year, so they’d like to keep it for use in the next year. That is not legally restricted. So that’s why these are, from an accounting standpoint, considered committed funds. They’re not non-spendable from a governmental accounting standpoint.”

Those distinctions — between restricted, assigned, and unrestricted money — has become an annual education point in Oneida County’s budget process, as supervisors try to balance the desire to invest in infrastructure, balance the operational budget, and avoid pitfalls such as using one-time revenues for ongoing expenditures. 

70 million what?

Across all funds, the proposed 2026 budget anticipates $70 million in revenues, a slight decrease from 2025, and $74.5 million in expenses, also a decrease. 

Of that revenue, taxes account for $26.8 million, or 38 percent of total revenues — a three-percent increase from last year. Property taxes make up $15.5 million, with another $7.3 million coming from the county’s half-cent sales tax and the remainder from smaller levies and collections. 

Intergovernmental and intergovernmental charges for services account for a combined 37 percent of total revenues proposed for 2026, or $25.7 million. 

“This includes federal and state grants, charges to other government bodies for services provided (housing inmates, human services for Vilas and Forest counties, WDOT highway maintenance), etc,” the overview states. “The 2026 proposal is $2.1 million, or 8 percent lower than the 2025 amended budget in this regard. This reflects the continued trend downward of federal and state funding as well as a more refined estimate of revenues associated with human services to outside agencies.”

Public charges for services account for 15 percent of the county’s 2026 proposed budget, or $10.8 million, and include over $1 million from the public health department and $4.5 million from the Human Service Department, Smigielski states in the budget overview.

“As currently proposed, the total of public charges for services reflects a $3.2 million, or 23 percent, decline from the prior year amended budget,” she wrote. “The balance of the revenue accounts for 10 percent and includes fines, licenses, permits, and interest income, among other miscellaneous revenue.”

The $70 million in revenues includes all funds, not just property tax, Smigielski assured in the executive committee meeting. It includes the social services fund, nursing funds, the Women, Infants, and Children fund, the public health fund, the highway fund, opioid settlement dollars, capital improvement funds, and solid waste and highway, she said: “The 70 million is all of our funds combined.”

Continuing appropriations are included in that number only if departments tap some of their continuing appropriations as a budget-only revenue, Smigielski said.

“For the most part, no continuing appropriations are part of fund balance,” she said. “So they are not considered a revenue unless departments specifically indicate that they’re going to use some continuing appropriations to help fund their operations.”

The broad totals paper over significant differences between departments. The Human Service Department — now entering its second year as a unified county department following the dissolution of the tri-county Human Service Center — continues to reshape Oneida County’s financial profile. 

In 2026, the category encompassing human services (including aging and disability, human services, social services), public health, and veterans’ services will account for $21.3 million in spending, or 29 percent of the county’s total expenditures — the county’s largest spending category for the second year in a row. Before 2025, the financial executive summary stated, the human services category represented approximately 20 percent. 

The change reflects both the consolidation and inflation.

Public safety follows at $17.2 million, or 23 percent of total spending, while public works — including the highway and solid-waste departments — comes in at $15.9 million, about 21 percent. General government functions are budgeted at $13.4 million, roughly 18 percent of total expenditures. All other categories combined account for the remaining 9 percent of the proposed budget, the overview stated.

As in nearly every local government budget across Wisconsin, personnel costs dominate the ledger. Wages, pensions, and insurance together make up 52 percent of Oneida County’s total expenses — $39.1 million in 2026, up from $37.8 million in 2025. 

“Wage and benefit adjustments related to inflationary increases account for this 3 percent increase,” the overview stated. “Contractual and supplies are proposed for $26.9 million, an overall reduction from the $31.1 million in the 2025 amended budget. Capital outlay is estimated to be $8.4 million, lower than the prior year budget of $13.3 million, due in part to ARPA funds no longer being available for one-time project funding.” 

The balance of the county’s budget for contributions and miscellaneous spending also reflects a slight downward trend, the summary stated.

Regarding capital improvements, the planned $3.6 million transfer from the general fund will support next year’s capital plan, which includes projects for highways, buildings, grounds, and forestry. 

“The highway fund has a $1.4 million deficit,” Smigielski told supervisors. “Those are CIPs so that would be covered with the general fund transfer. That is the roadway project, and, historically, something that the county has done, has contributed funds to that. The capital improvement fund is where the non-highway, non-solid waste CIPs come from, i.e., buildings and grounds, forestry. So that’s $1.86 million. Again, it’s CIPs.”

Smigielski said the Winnebago Street Fund was a new fund that was created this year for the Koinonia facility. 

“So that rent is budgeted at $168,000 and, as of this point, we only have $31,000 in expenses budgeted,” she said. “So that standalone fund would have a surplus. And then the highway internal service fund, that again is a CIP; that is the electrical CIP and that’s in a different fund than the roadway highway fund. So after transfers in and out, you can see that the majority of that deficit then moves up to the general fund because of transfers out of the general fund.”

Bottom line, as Fried summarized the conversation, the $4.4 million deficit is attributed mainly to the CIP, where $3.6 million was transferred from the general fund to the CIPs.

Long-term strategy

There was some talk during the meeting about long-term strategy.

Supervisor Robb Jensen recalled that the county had once encouraged departments to build continuing appropriations to avoid borrowing for recurring equipment purchases. 

“For instance, let’s say the department purchased a car and that, rather than have that continuing to come through capital improvement, we asked them to set some money aside each year so that when that new vehicle came up, they had the funds for that,” Jensen said. “I’m assuming that there were detailed sheets indicating what that money was set aside for. So to me that is a good use of a continuing appropriation.” 

What needs to be watched are the ones without a clear designation, Jensen said.

“I wouldn’t want to get into a borrowing situation, and I’m borrowing for a vehicle that lasts 10 years and you’re borrowing for 20,” he said. “Doesn’t make much sense, but as long as we can do that, I think it makes sense. But there might be some on here that there’s a little more flexibility.”

Smigielski agreed, noting that while some appropriations are flexible, others are locked in by previous commitments. 

Beyond the internal accounting, the supervisors’ conversation underscored the external constraint that looms over every Wisconsin county budget: the state’s property-tax levy limit. Under state law, counties may increase their operating levies only by the percentage of net new construction, not by inflation or rising valuations. The intent of the law is to curb local spending growth by tying levy increases to physical development, rather than rising assessments.

For Oneida County, that limit is 1.3 percent for 2026 — about $207,000. Smigielski said she had already built that into the budget. 

“Our allowable limit can only go up 1.3 percent, or $207,000,” she said. “So I’ve placed what human services, public health, and the highway department requested without any modification. That leaves for our general corporate purposes $9.7 million, which is actually 3.4 percent less than the current year.”

In practical terms, the county’s ability to raise new tax revenue lags well behind the rate of inflation and the cost of services. There are some funding categories not bound by the levy limit, such as bridge aid, emergency medical services, and the library; however, for other departments, there is a tension between demand and the ability to raise revenue.

“So as we get into the departments that receive levy funding, something to bear in mind is that there is this pressure, not just us but statewide, that our demands on our funds are going up at a rate of inflation, but our ability to levy property taxes is capped, for us at least, at a level lower than inflation,” Smigielski said.

The question of whether to use general fund balances to pay capital costs, or to bond for such costs, is also an age-old argument that transcends geographical boundaries. Bonding supporters say borrowing matches the financing to the life of the project and protects the government’s financial flexibility. Others argue that using reserves for one-time projects is precisely what those balances are for and avoids interest payments that inflate project costs for taxpayers.

The dynamic is one familiar to counties across the state. Oneida’s capital improvement plan covers projects that are too large to absorb in a single year’s operating budget, but officials are wary of issuing long-term debt unless absolutely necessary. For years, Oneida County has taken pride in remaining debt-free. 

Throughout the session, Smigielski emphasized the importance of context. 

“Both revenues and expenses are lower than last year’s budget,” she said. “The largest decline is in the social services fund, which is where our human service department is budgeted, and this simply reflects more refined estimates. It was our first year, we are still in our first year with the human service department, so it was kind of a best guess taking on those operations.” 

So some of those revenue and expenditure adjustments were related to that, Smigielski said, along with shrinking state and federal aid.

It didn’t take long on Monday for the committee to feel justified in its positive outlook. The first department up for consideration after the broad overview was the public health department, which delivered the good news that the department was reducing its levy request for 2026 by $100,000 — a tenth of the operating deficit right off the bat.

“I think we’ll always have your department go first,” Fried jokingly told public health director Linda Conlon.

Richard Moore is the author of “Dark State” and may be reached at richardd3d.substack.com.