Village losing money on inspection deal with Grafton

The Village of Saukville received a clean bill of health in its 2021 audit. The village maintains a strong fund balance and is in the green on utility operations, though it did see a $18,919 deficit in its building inspector fund last year, auditors said.

Scott Sternhagen, a principal with CliftonLarsonAllen Wealth Advisors, LLC, presented the findings to the Finance Committee on April 19.

Sternhagen said the auditor was satisfied with the financial statements and that the statements met regulations.

The village’s general fund stayed consistent through 2021. In 2020, the general fund was $1,936,264, and in 2021 it was $1,934,764.

“The village did well in its general fund,” Sternhagen said.

Special revenue funds, such as money generated through room tax, the library and impact fees, also remained steady. The amount was $440,331 in 2020 and rose to $451,821 in 2021.

One budget line item stood out however.

Sternhagen noted that there was an $18,949 deficit in the building inspection fund, while all other revenues were positive. It was a $380 deficit in 2020.

“The one to be aware of is that building inspection fund,” he said. “That might be something you have to modify in 2022.”

Under a five-year contract between the villages of Saukville and Grafton that started in 2020, Saukville pays Grafton $600 a month for building inspector services, plus $600 per month plus 60% of the building, plumbing, electrical and other permit fees.

The Grafton building inspector is also paid $65 per hour to attend Saukville meetings or testify in court hearings as needed.

Sternhagen said that in 2021 the fees paid to Grafton were greater than those collected in building inspector fees.

Village Administrator Dawn Wagner said Saukville may want to take a more conservative approach to the building inspector arrangement but noted that future development may make up the shortfall. She noted that if work on the Emerald Ridge development on the west side of the village begins, additional building permits would need to be issued.

“(Revenue) does change throughout the years, and obviously if we have some growth opportunities related to residential or commercial development, that will have significant impact in terms of revenue coming in for building inspection permits,” she said.

Zoning changes and a tax increment finance district have already been made for Emerald Ridge development, which would add eight multi-family buildings and 63 single-family houses, but additional steps need to be completed before the project proceeds.

Wagner said the village will monitor progress on the development to see if the building inspector agreement should be adjusted.

The village has $11.6 million in outstanding debt, with room to borrow an additional $14.5 million.

Revenues from the water utility remain positive at $76,067 in 2021, as did sewer utility revenues at $616,019.