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Finance staff reports $9.1M freighter settlement and 2025 unaudited general fund results; reserves remain above policy
Summary
City finance staff presented unaudited 2025 general fund results, noting a roughly $10 million freighter settlement with chargebacks to other taxing jurisdictions, a $2.7 million mark‑to‑market investment gain, and unassigned reserves of about $15.14 million (roughly 72 days of operating expenditures).
Wauwatosa finance staff presented the city’s unaudited 2025 general fund results, highlighting a large one‑time settlement and other timing items that together left the fund balance stronger than initial budget comparisons suggested.
The presenter said a roughly $10 million settlement (referred to in the packet as the "freighter" settlement) created a $9.1 million revenue surplus in the revenue analysis and that the city charged back about $6.5 million of that amount to other taxing jurisdictions per state law; the city’s proportionate share was roughly $3.6 million. "We had over‑taxed and so we need to issue a property tax refund to freighter," the presenter explained, adding that state law permits chargebacks to other jurisdictions with Department of Revenue approval.
Staff also pointed to a $2.7 million surplus in interest driven primarily by mark‑to‑market valuation gains on investments; staff characterized most of those as unrealized paper gains because the city holds investments to maturity. Other revenue and expense drivers included higher building‑permit revenue (timing effects), lower municipal citation revenues driven by fewer citations and policing vacancies, and operating overages tied to the freighter settlement and a $2.1 million judgment related to a medical college tax appeal that will have its own chargeback timing.
On expenditures staff noted overtime overages in police and fire driven by vacancies and deployments and that some one‑time timing moves (vendor payments) reduced 2025 operating spending. As a result of the combined factors the presenter said the city’s unassigned general fund reserves rose to about $15.14 million, or about 72 days of operating expenditures, above the fund‑balance policy minimum of 60 days.
The presentation was informational; no committee action was required. Staff said auditors were on site and that audited financial statements would be presented later.
