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Liquor license reductions in proposed 2021 Hobart budget

By Kevin Boneske
Staff Writer

HOBART – In what is being characterized by Village Administrator Aaron Kramer as providing temporary relief to small businesses, Hobart’s proposed 2021 budget calls for a reduction in liquor license fees.

“It’s a gesture to small businesses, small entrepreneurs, that we understand the situation with the COVID, the restrictions they’re under,” he said.

Kramer said a 50 percent cut in liquor license fees for 2021 is only estimated to have a fiscal impact of $1,350 in reduced licensing revenue, based on this year’s village budget.

“Obviously, it’s not a large amount,” he said. “It’s more an acknowledgement of their difficulties. Waiving all fees entirely in 2021, which I believe another government entity has done around here, would not do severe damage to the budget. You can opt for that.”

The list of 50 percent reductions Kramer presented to the board Oct. 6 included dropping three categories of licenses from $500 to $250 – Class A Fermented Malt Beverage Retailer, Class A Intoxicating Liquor Retailer and Class B Intoxicating Liquor License.

He said a reduction in beverage license fees for 2021 would have to be done by ordinance before the end of this year.

Stormwater fees

Kramer said a proposed 10 percent permanent reduction in the stormwater fee, which would affect residential, commercial and industrial property owners in the village, would be included in the 2021 tax bill.

He said the estimated fiscal impact would be $51,879 in less revenue, based on this year’s budget.

Kramer said a reduction in stormwater fees can be done by board action as part of approving the 2021 budget.

“The stormwater fund is very lush, no pun intended, and will continue to grow as we see more development in subdivisions in the community,” he said.

Kramer said the average annual residential savings with a 10 percent reduction in stormwater fees would be around $7.

Fund balance policy

Though Hobart has maintained a general fund balance, also known as a rainy day fund, of at least 30 percent of the annual general fund expenditures, Kramer said the village anticipates “a number of large building projects” in the decade ahead, such as a fire station and a police station, as well as the renovation of the village hall and public works building.

“It’s all going to start catching up to us as the buildings age and become smaller as we grow,” he said.

Kramer recommended, starting in 2021, the general fund balance be reduced to 25 percent of annual expenditures.

“It’s one-quarter of your annual expenditures,” he said. “That is about the norm among communities in the nation.”

For future budget surpluses, Kramer proposed designating 50 percent to the debt service fund and the other 50 percent to the capital reserve funds.

“The debt fund is to pay down existing debt or provide what I would call seed money for the future borrowing,” he said. “For example, if we socked away $250,000, and the fire station costs $2 million, we’re not borrowing $2 million. We’re borrowing $1.75 (million).”

Salary increase

Kramer said he is proposing a 2 percent salary increase next year for all employees not covered under a previously approved employee contract.

He said the proposed increase is based on the average wage increase being proposed by neighboring municipalities in Brown County and the consumer price index increase applicable to one-year collective bargaining agreements.

The board typically gives final approval to the following year’s general fund budget when a public hearing is held in November, prior to property tax bills being sent out.

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