FAYETTEVILLE -- A Public Library committee on Tuesday finalized a "menu" of cost-cutting and money-making measures to plug the library's growing gap between revenue and expenses for the next three years.
Options include increasing late fees, raising rent for meeting room space, instituting a hiring freeze, charging for VIP access at specific library events and reinvesting $2 million set aside to buy the old City Hospital property.
Library revenue
A “menu” of cost-cutting and money-making measures the Fayetteville Public Library Board’s “Long-term Revenue Committee” recommended Tuesday could save the library about $207,000 in 2016 and $620,000 through 2018.
Initiative1-year impact3-year impact
Hiring freeze$50,000$150,000
VIP receptions$10,000$30,000
Interest on City Hospital money$60,000$180,000
Increased late fees$19,000$57,000
Meeting room rent$28,000$84,000
Property tax growth$40,000$119,000
Total$207,000$620,000
Source: Fayetteville Public Library
The library's board is set to consider the options during a meeting next month.
Even with all of the stopgap measures discussed Tuesday, members of the "Long-term Revenue Committee" agreed: Eventually, a property tax increase for the library is needed.
"There's no reason to cut anything or charge any more," Jack Butt, president of the library's foundation, said Tuesday.
"We are driving a Cadillac, but it's not in excess. It's a highly desirable public institution," Butt added. "When you have the golden goose, you don't start plucking feathers. You pay what it costs to feed the golden goose. So maybe our recommendation to the board should be: We raise the millage."
Committee members provided no details on when a millage election would be held or how much of an increase they would seek.
George Faucette, a Realtor who serves on the library foundation's board, said timing will be key and depends on whether the library is able to expand on the City Hospital property.
Currently, the library receives a 1-mill levy. For the owner of a $150,000 house, that works out to $30 per year in property taxes.
The millage is expected to generate about $1.3 million this year -- roughly one-third of the library's $4.1 million budget for 2015. The other two-thirds comes mostly from transfers from the city ($2.1 million) and a transfer from the library foundation ($120,000).
Library officials balanced their budget this year by dipping into reserve, holding off on equipment and material purchases and delaying building maintenance projects.
But those cuts can't last forever, Stephen Davis, accounting and human resources manager for the library, said.
According to him, if the library's property tax base continues to grow by just 2 percent each year and expenses climb by 3 percent annually, the library will face a $2 million deficit by 2023.
Expenses have grown at the 10.5-year-old library as things such as computers and carpet need replacing and librarians make the transition from books and DVDs to e-readers and streaming video.
Library membership has almost doubled in the last decade, with more than 70,000 cardholders.
"What we have is an explosion in demand for this facility," Janine Parry, committee chairwoman, said Tuesday.
If the committee's recommendations are approved, late fees would jump from 20 cents to 25 cents per item, per day.
Meeting room rental rates would increase by $10 per hour. Study rooms would continue to be free.
The committee also suggested charging for private receptions with guest speakers, such as Bob Woodward, an investigative reporter who gave a free lecture at the library earlier this month.
Leaving nonessential positions open as they become vacant could save the library about $150,000 over three years.
And reinvesting the $2 million set aside for buying the City Hospital property could earn about $180,000 in interest over a three-year period.
In total, the measures are expected to save roughly $620,000 through 2018.
Committee members also recommended taking $800,000 leftover from the 2004 sale of the Fulbright Building at 217 E. Dickson St. -- where the library used to be located -- and setting it aside in a capital reserve fund. The fund would be used over a three-year for needed repairs.
Committee members rejected several cost-cutting ideas Tuesday, including paid parking, a $5 fee for library cards and fewer open hours each week.
The committee's recommended course of action would shore up anticipated shortfalls in the library's annual budget, but it does nothing to address how an up to 85,000-square-foot library expansion on the adjoining City Hospital property would be paid for.
Library officials hired an architect and did a series of public input sessions on the expansion project last year. The project was then shelved amid budgetary concerns and a lawsuit filed in July in Washington County Circuit Court.
The library's board in 2013 agreed to buy the 4-acre City Hospital property from Washington Regional Medical Center. But deeds filed by the family that donated the property to the city in the early 1900s complicated the transaction.
Judge Cristi Beaumont in March ruled heirs of Stephen K. and Amanda Stone no longer had a legal claim to the property, but the heirs have since appealed Beaumont's ruling.
Vince Chadick, an attorney representing the library, said it could be six to 18 months before the Arkansas Court of Appeals settles the matter.
Jeffrey Scherer, architect for the expansion project, in May 2014 estimated expanding the library on the City Hospital grounds would cost between $40 million and $50 million. Scherer also presented a scaled-back version of the project, confined to the library's current footprint, but he did not provide a cost estimate for that option.
The library, which opened at 401 W. Mountain St. in 2004, cost about $28 million to build.
It was paid for using a three-quarter-cent temporary sales tax, which generated $19.3 million between 2000 and 2002. An additional fundraising campaign included $5.5 million in donations from Jim Blair, Barbara Tyson and the Willard and Pat Walker Charitable Foundation.
NW News on 04/29/2015