Library Near-term Budget Outlook
(See also JCPL State of the Library)
1. Revenue from property tax mill levy
The Library’s property tax revenue will be adversely impacted in two ways.
A. Lower assessed valuations because of economic stress.
The Library has been advised by the County budget office to expect an additional decline of about $1.6 million in 2012 because of reduced property values assessed in 2010. This is the same reason all County revenues will be down, including school funding
B. Making the Library’s property tax “fungible”
Through the action of “shifting” a portion of the Library’s mill levy to other departments, the Board of County Commissioners have now established that the Library’s mill levy is fully fungible with other County tax revenues. This is in spite of the fact that the voters specifically approved the Library’s mill levy in a 1986 election.
For the years 2009 and 2010, the Board of County Commissioners took an amount equal to about $1.5 million per year from the Library’s approved mill levy. Now that they have set this precedent, they can take whatever amount they want to bolster funding of other departments.
The combined total impact on the Library’s tax revenues is at least $3.1 million per year. In 2010, a reduction of $1.5 million caused the Library to reduce staff by about 12 FTEs and close libraries on Mondays, so if something doesn’t change, we can expect further cuts in service.
2. Cost of Outsourced Services
The Library outsources a number of services to the County, including human resources, payroll, legal counsel and insurance. The County has increased the fees for these services to the point they significantly exceed the cost to purchase the same services from private industry. The County even charges for services like computer service, which the Library does not need or use, as the Library has its own Information Technology Department, the costs for which are already covered in its budget.
As a district, the Library Board can solicit bids for the administrative services mentioned above and independently select the best contractors. In their current situation, since the County has demonstrated it will use the Library’s mill levy to impose County policies and the Library Board is pretty much stuck paying whatever the County wishes to charge.
In 2008, the Library estimated it would save about $500,000/year going out for bid to private industry compared with what the County charged for the same services.
Outlook on Library Policies
In addition to diverting Library resources by shifting property taxes, the County Commissioners have also used their right to make Library Board appointments to attempt to implement policy changes. In 2010, when the Library Board decided to cut services in order to balance its budget, the County Commissioners made three board appointees, including one of themselves, whose first official action at a Library Board meeting was to attempt to change the Library’s budget policy. This is a dangerous nexus of libraries with politics.