Middleton committee assigns $2.1 million 2023 surplus to reserves, capital and studies

The Middleton Finance Committee on a voice vote approved Resolution 2024-18, assigning a little over $2.1 million in 2023 general-fund year-end surplus to reserves, capital accounts and one-time projects.

Bill, the city finance staff member who presented the audit and the year-end summary, told the committee the largest single contributor to the surplus was higher-than-budgeted investment income — about $752,000 above the $500,000 the budget assumed — driven by higher interest rates and maturing investments. He also identified salary savings from vacancies, principally in the Police Department, of roughly $360,000 as another key contributor.

The staff recommendations approved by the committee include increasing the compensated-absences reserve by $395,000 (bringing the balance to about $2.6 million, roughly 80% of the estimated liability based on the city’s history), bolstering public-safety capital reserves (fire reserve just under $1.4 million; EMS ambulance replacement about $460,000), and carrying over unspent items such as a tree-pruning allocation and personnel-retention payments. Bill also proposed a copier/technology sinking fund and initial savings for an integrated ERP system.

The package includes $10,000 for Middleton’s contribution to a shared EMS services study with Waunakee Area EMS and the Wisconsin Policy Forum and a proposed $100,000 transfer to the transit fund to supplement the $120,000 transfer made in 2023. After the recommended assignments, staff said unassigned fund balance would increase by about $611,000 to roughly $7.5 million, which staff noted is about 30% of next year’s budgeted expenditures.

Committee members asked procedural and timing questions. Bill said the city will receive draft audited financial statements in May and the auditors will likely present the final statements at the committee’s first June meeting. When asked whether state rules require any particular funding level for compensated absences, Bill said there is no state requirement and the city’s $2.6 million target is an internal funding policy.

The record shows a motion to approve the resolution was made and seconded and the committee approved it by voice vote. The committee also asked staff to clarify one line-item (special assessments for street improvements) offline; staff agreed to follow up.