A library expansion, a public works campus, road maintenance, and other projects has the city looking at how it’s going to pay for future big-ticket items.

Following a 5-4 vote, with Mayor Paul Esser breaking the tie, the city council OK’d a policy change on Tuesday Oct. 1, that would allow the city to increase its debt levy. City staff recommended the change saying that it wasn’t possible to stay tied to 2017 debt limit — a policy alders set two years ago--and still be able to maintain city infrastructures.

The new debt policy will allow for the city’s rapid growing tax base.

The new policy will remove the annual cap of the 2017 debt levy ($6.6 million) and modify the percentage of debt levy to total levy to no more than 27.5 percent.

City Council President and District Alder 2 Bill Connors recommended the lowering 25.7 percent benchmark from 30 percent at the Sept. 24 Finance Committee saying, “We need some discipline in the near term.”

City staff says the percentage of total tax levy allocated for debt service metric helps protect the operating limit. If the city council doesn’t have the appetite to raise taxes, the debt levy will increase and there will be less levy for operating expenses. City officials say that may not be the case in Sun Prairie's current high growth period but would relevant in a recession or non-growth period.

The previous policy kept direct debt burden at or under 1.75 percent of equalized value. The legal state limit is not more than 5 percent. The percentage of total tax levy allocated for debt service could not exceed 30 percent, under the previous policy.

The new policy will help city staff forecast future debt requirements that will help the city council during budget and capital improvement plan discussions.

For 2019, the City of Sun Prairie general outstanding debt is $89.9 million. With a population of 35,838, that an estimated $2,510 in debt for every resident.

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