Madison’s 2023 finances came out $31.2 million better than budgeted, largely exceeding revenue projections and spending far less than expected with high-interest income and job vacancies, the Wisconsin State Journal reports.
The city Finance Department issued a report showing the city netted $19.2 million more in revenues than budgeted as a result of higher-than-forecast investment income $20.4 million more than expected. Madison’s spending was also $15.6 million under budget.
The city’s “rainy day” fund is therefore up by $16 million to $82.9 million as of last year’s end. The fund is used as a short-term measure to help balance the city’s operating budget.
Madison has been projecting a $27 million shortfall for 2025; the city has initiated community meetings with residents to gain a sense of their priorities. The city has a structural deficit, lacking sufficient revenue to pay for services as Madison’s growth continues.
To eliminate next year’s shortfall, the city will need to increase revenue (possible through a first-ever referendum raising property taxes), cut spending, or both.
The city projects that investment income will keep exceeding the budget by about $10 million for 2024, pushing the rainy day fund to $92.9 million by the year’s end (23% of projections for the 2025 operating budget and higher than the 15% target).
