In order to combat declining revenues and stave off reductions in service, the Oxford Public Library is asking township and village voters to increase its operating millages back to the rates they originally okayed in the 1980s and 1990s.
When voters trek to the polls for the Aug. 7 primary election, they will be asked to approve a 0.4518-mill tax increase in perpetuity beginning with the December 2012 levy.
A mill is equal to $1 for every $1,000 of a property’s taxable value.
Currently, the library is supported by two operating taxes, a 0.6764-mill levy and a 0.7218-mill levy, for a total of 1.3982 mills. Both were previously approved in perpetuity.
If voters choose to approve this 0.4518-mill increase, the total levy would rise to 1.85 mills, which is equal to a combination of the 1-mill rate voters approved in August 1984 and the 0.85-mill tax they authorized in November 1995.
Over the years, the state’s Headlee Amendment rolled back the two millages to their current rates. This proposed 0.4518-mill increase seeks to override those reductions and restore the millages to their initial rates.
Library Director Bryan Cloutier indicated the institution is seeking this tax increase because ‘over the last four years, the library’s budget has (experienced) a series of challenging and steady declines in its revenue stream.?
‘This event is primarily attributed to a decline in taxable values coupled with ongoing threats and reductions to state aid to libraries and state revenue sharing,? he explained. ‘In addition, we have witnessed a reduction in fines and fees collected for lost or overdue items. As a result, (the library’s) budget has decreased by over $300,000.?
In 2007, the library’s budget was $1.347 million. For 2012, the budget was set at $1.049 million.
If voters approve the proposed tax increase, it’s estimated the first collection would generate approximately $310,000 in additional revenue for the library, less the portion required by law to be distributed to the Oxford Downtown Development Authority.
‘This figure is just below what we have lost in revenue since 2007,? Cloutier said. ‘We are not looking for excess funds, simply to restore our budget back to our 2007 budget figures, so that we can maintain the services we currently offer, while considering implementation . . . of our strategic plan (using) our reserve funds.?
If voters reject the proposed tax increase, Cloutier said ‘it is likely that (the library’s) Sunday hours would be eliminated? and an ‘adjustment? made to the rest of the week’s hours of operation.
‘A reduction in hours would also mean another round of staff reductions,? said Cloutier, noting that since 2007, the library’s staff has been reduced by 20 percent, which equals six employees, mostly part-time.
‘It is rather unfortunate and disheartening to say, but the library’s programming and the materials/book budget would also be vulnerable to additional cuts (if the millage proposal fails),? he added.
Quite the opposite would happen if voters approve the tax increase.
‘Hours of operations would continue at current levels, the book/materials budget would be increased to accommodate for additional copies of electronic downloadable media? and popular databases concerning business and family history would continue to be offered to patrons, according to Cloutier.
Passage of the millage request would allow the library to buy additional copies of the latest best-sellers, thus reducing patrons? wait time to check out a copy.
It would also allow the library to potentially purchase a system that uses radio frequency tags to simultaneously scan multiple books for checkout as opposed to scanning them individually using barcodes, as is the practice now.
‘It cuts down on wait time at the (front) desk, considerably,? Cloutier said.
The estimated cost for such a system could be around $40,000 to $50,000.
‘That’s a rough estimate based on numbers that I’ve gotten from colleagues with (library) collections our size,? Cloutier noted. ‘That doesn’t mean it’s going to be that much. It could be more. It could be less.?
Currently, the library has a substantial reserve fund (or fund balance). As of Dec. 31, 2011, it amounted to $1.46 million, which translates to 139 percent of its budgeted expenditures. That represents an increase of $467,790 since 2007 when the fund balance was $994,596.
Cloutier explained this increase in fund balance was accomplished through ‘strategic and managed reductions . . . in an effort to have the ability to rely on it as a form of operating revenue if necessary.?
These reductions included cutting staffing levels by six employees; reducing personnel retirement compensation packages (an annual savings of $24,919); freezing all salaries unilaterally and reducing this line item, which includes gross wages and fringe benefits, by nearly 20 percent ($142,078); reducing employee health costs ($12,200); reducing energy consumption ($8,000); reducing the materials/books budget ($46,599); and cutting the total number of hours an employee is eligible to receive and bank both vacation time and sick leave on an annual basis.
Cloutier indicated he made ‘significant changes and reductions? to the library’s budgets from 2008-11 in order ‘to allow for a more moderate reduction . . . versus postponing the inevitable and making one drastic reduction in 2012 in an effort to balance our revenue with our expenditures.?
Some folks may wonder why the library is asking for a millage increase when it has $1.46 million in savings.
Cloutier explained that traditionally the fund balance is supposed to be used for things like capital improvements and emergency situations, not as a form of operational revenue.
If the proposed millage increase is improved, instead of using reserve monies to help fund operations, Cloutier indicated the library could use its savings to accomplish ‘postponed maintenance? such as resurfacing the parking lot and the boulevard leading to Pontiac Rd.; repairing and replacing some of the library’s worn and broken furniture; and replacing carpet that is damaged or worn.
On top of all that, parts of the library building’s major mechanical system are ‘nearing the end of (their) life expectancy.?
‘We wanted to be prepared to cover any major emergency expense in the event something failed,? Cloutier said. ‘We would not want to ask our voters for a bond to cover the expense of replacing a boiler, a rooftop (heating/cooling) unit, a network server, or to resurface the parking lot.?
The library is also considering using some of the reserve funds to expand the youth services department and purchase a commercial backup generator that would allow the facility to ‘remain open in the event of a community-wide power outage.?
Cloutier noted that if proposed millage increase were to fail and the library were to begin allocating money from its fund balance ‘to return to and to maintain? its 2007 budget level, it would use about $300,000 annually from its reserves.
‘At this rate . . . keeping in mind an amount of reserve funds (would be needed) for emergency situations and to bridge the gap between tax payments ? the library would spend down its current reserve fund in approximately 2.5 to 3 years,? he explained.
Cloutier doesn’t want to see that happen. He indicated he wishes to maintain a fund balance of at least $805,000 (or around 55 percent of budgeted expenditures).
In his opinion, that would be a ‘comfortable and acceptable reserve fund for the library in order to keep it viable and healthy.?
If the millage request fails, Cloutier noted the library board ‘is likely to reassign additional funds? from reserves to operations ‘to help offset any additional revenue reductions.?
For 2012 budget, the library already allocated $38,154 from its reserves to help balance its finances.
Cloutier believes the practice of using reserve funds for operations ‘is prolonging the inevitable or placing a Band-Aid on something that really needs surgery.?
Case in point, the library is anticipating additional cuts ‘in excess of $100,000? for its 2013 budget, according to Cloutier.
‘We estimate we could see an additional decrease in local tax revenue of around $20,000,? he explained. ‘Another concern is potentially losing approximately $80,000 in personal property tax (revenue) if the state Legislature passes bills to eliminate (it) without any means of constitutionally guaranteeing a replacement of these funds.
‘Certainly, this is not definite, but we are provisioning in the budget for such action. If it does not happen, great, (but) regardless, we believe that we would still require the additional revenue (from the proposed tax increase) in order to, over the long-term, successfully maintain our Plan of Service.?
Cloutier indicated this millage proposal is important to him not just because he’s the director, but because he’s always valued libraries.
‘In every community where I have lived, from my childhood to adulthood, the local public library has been an instrumental part of my life,? he said. ‘I owe a lot of gratitude and appreciation to the knowledgeable and helpful librarians who helped me.
‘Voting is a right and privilege, as is having access to quality public libraries. Oxford has historically understood the importance and has valued public library services. I can only hope that my team and I have earned the respect and trust of the taxpayers (so they will) continue to support us in the years to come.?