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Menomonee Falls closes FY2024 with roughly $1 million surplus; working capital inches below three-month guideline
Summary
Director of finance Valerie Emerick told the Village Board the village ended FY2024 with about a $1 million surplus and an $11.7 million fund balance, but revenues missed budget by roughly $800,000, and months of working capital stood at 2.9. Staff signaled rate studies and a deferred SAFER grant will affect 2025 results.
Valerie Emerick, the village director of finance and treasurer, told the Menomonee Falls Village Board on Aug. 18 that fiscal 2024 closed with an approximately $1,000,000 surplus and a year-end fund balance of $11,700,000, but overall revenues were about $800,000 short of budget.
Emerick said the revenue variance reflected timing and variability in several items: higher-than-expected building permit and interest income in some categories, offset by SAFER grant reimbursements that will be received in 2025 rather than 2024. "We had a revenue deficit this year in 2024 of about $800,000," Emerick said. She told trustees that the village’s net ambulance fee revenue and deferred grant reimbursements are difficult to forecast.
The director reviewed expenditures and noted savings tied to a fully staffed SAFER-funded fire force that reduced part-time wages and overtime; expenditure categories that generated savings helped produce the reported surplus. Emerick reported the unassigned fund balance was $9,200,000, producing 2.9 months of working capital on the 2024 budget — slightly below the roughly three-month best-practice target.
Village Manager Mark Fitzgerald cautioned trustees about the consequences of drawing down reserves. "Moody's would down rate us at least 1 position," he said in response to a question about using the surplus, adding that any downgrade would make future borrowing more costly.
Emerick also reviewed enterprise funds: the water utility — governed by the Public Service Commission — had positive results and staff plan a water rate case study before year end; 90% of supply is purchased from the City of Milwaukee and the village paid about $2,100,000 to Milwaukee in 2024. Sewer reserves did not grow in 2024 and the village paid approximately $8,900,000 to the Milwaukee Metropolitan Sewerage District (MMSD); staff plan an internal sewer rate study. The stormwater utility fee implemented 01/01/2024 is producing operating income as intended.
Emerick said other one-time items — chiefly developer capital contributions and debt proceeds for a Fire Station 3 remodel — affected year-to-year comparisons and that most outstanding debt will be repaid or refinanced by TIF proceeds. She told trustees the village’s credit rating stands at Moody’s Aa2 and stressed the value of maintaining reserves to preserve borrowing capacity.
On audit findings, Emerick acknowledged a material weakness tied to monthly reconciliations caused in part by understaffing in finance; she said an assistant director is in place and a senior analyst will start in September to restore a monthly reconciliation cadence.
Next steps announced to the board include formal water and sewer rate studies and continued monitoring of SAFER reimbursements and MMSD contract reimbursements that will influence the 2025 budget picture.
