SINCE LIBRARIES ARE FUNDED BY TAX DOLLARS, WHAT DOES THE PUBLIC THINK ABOUT LIBRARY FUNDING?
In 2007, the New Jersey Library Association commissioned Potomac Incorporated to conduct a public opinion survey. The results revealed strong public support for library funding.
71% said that public libraries were an essential community service;
83% said public libraries were a good investment of tax dollars;
57% said more money should be spent locally on public library services.
Clearly, the residents of New Jersey value their investment in public library service. See the detail survey results here.
WHY IS PUBLIC LIBRARY FUNDING DIFFERENT FROM OTHER LOCAL GOVERNMENT FUNDING?
Public libraries in New Jersey were established by a referendum of the voters. With the referendum, libraries receive a dedicated amount of funding to operate each year. Libraries are not mandated by state government but rather created by the people.
Because libraries are established by the voters their dedicated funding should not be included in the levy cap legislation.
HOW IS PUBLIC LIBRARY FUNDING DETERMINED?
Funding for public libraries is linked to property values. Since 1884, the dedicated portion of the municipal budget which must be reserved for library purposes has always been 1/3 of a mil. Therefore, wealthier communities with high property values will pay a higher per capita cost for their libraries but the required rate is the same for all communities.
In addition, when a community receives new ratables such as a new shopping center or a new housing development, the library budget will increase to reflect this new growth.
ISN’T A 1/3 OF A MIL A TREMENDOUS AMOUNT OF MONEY?
A third of a mil equals 33 cents on a $1000 of assessed value. For example, a home which is assessed at $100,000 would pay $33 a year for library service. A home assessed at $200,000 would pay $66.
In practical terms, $33 is a less than a dollar a week for library service.
WHAT PERCENTAGE OF THE TAX BILL IS FOR LIBRARY SERVICE?
If you look at the entire tax bill for a property (local, school and county taxes) approximately 2% goes for library service.
If you look at just the municipal portion of the tax, the average amount for the public library is less than 5%. In only one community of New Jersey, Avalon, is library funding over 10% of the local municipal library budget.
HASN’T LIBRARY FUNDING INCREASED DRAMATICALLY DURING THE PAST SEVERAL YEARS?
Library funding fluctuates based on property values. This is cyclical. The current statute permits library funding to increase when equalized valuations rise, compensating for the many years when library budgets would not receive any statutory increases. Municipal officials express concerns when library budgets increase during periods of economic growth. Unfortunately, property values do not always increase in New Jersey. In 2008 the equalized valuation for New Jersey increased just 2.2%, and 2009 it decreased by 1.7%. (Source: State of New Jersey, Department of Treasury http://www.state.nj.us/treasury/taxation/lpt/lptvalue.shtml)
The decrease in the equalized valuation has already effected library funding. (2009 Minimum Funding Chart from the New Jersey State Library) As the equalized valuation continues to change in the current economic contraction; municipal and joint library minimum funding will continue to be adjusted correspondingly.
DO ALL PUBLIC LIBRARIES RECEIVE DEDICATED FUNDING?
No, in NJ we have 48 association libraries. These libraries were not established by referendum and receive discretionary funding from the municipality. Unfortunately, most of these libraries are funded at a very low level and do not even meet state aid requirements.
DOESN’T STATE AID TO PUBLIC LIBRARIES PLAY A SIGNIFICANT ROLE IN LIBRARY FUNDING?
Every dollar for library funding is important. Unfortunately, direct state support for public libraries is $8.6 million, which is a $1 per capita per year. This has not increased in twenty years. In the Propsed FY11 New Jersey Budget, state aid for New Jersey libraries is scheduled to be reduced by 50%.
THE CURRENT LAW PERMITS LIBRARY BOARDS OF TRUSTEES TO SET ASIDE FUNDING FOR FUTURE NEEDS. DOESN’T THAT MEAN THAT TOO MUCH MONEY IS BEING SPENT ON LIBRARIES?
Under the current law, library boards can reserve funding for the future needs of the library. Isn’t that good fiscal planning? Just as in a personal budget, it is frequently necessary to plan for a needed capital item rather than borrow the money later. There are numerous examples where a library board has reserved dedicated funding to be used later for major improvements in the library such as a new computer system, new carpeting or furnishing. If the library hadn’t saved from its resources, the town would have had to bond for these items later. Isn’t it good fiscal policy to set aside funding for what you need rather than bond?
A state law approved in April 2008, allows for the state librarian to approve transfer of library funds if:
- The library’s reserve is equal to its budget for the previous year, plus an additional 25 percent, excluding money earmarked for capital expenses.
- The town gives the library money from its municipal budget, as required by state law.
- The library has money in its budget for operating expenses for the remainder of the year.
- The library board of trustees has a written plan for at least three years, showing the long-term funding needs of the library.
Source: New Jersey Revised Statutes: 40:54-15
ARE THERE OTHER PROGRAMS SUPPORTED THROUGH DEDICATED FUNDING WHICH ARE OUTSIDE THE LEVY CAP LEGISLATION?
Yes, for example, open space funding. Open space funding is also established by a referendum of the voters just like library funding. Currently, every county in New Jersey and more than 230 municipalities have a dedicated tax for open space preservation. Rates for open space funding vary but are often higher than the minimum dedicated amount for library funding. Funding for open space is a dedicated tax line exempt from the levy cap legislation and library funding should be as well.
Both open space and library funding can currently be set aside from year to year for future needs.
WHAT IS THE POSITION OF LOCAL GOVERNMENT ON EXEMPTING LIBRARIES FROM THE CAP LEVY LEGISLATION?
At its November 2007 Conference, the New Jersey League of Municipalities approved a resolution supporting removing municipal libraries from the cap levy legislation.
SO WHY AREN’T MUNICIPAL LIBRARIES EXEMPT FROM THE CAP LEVY LEGISLATION?
Good question, we don’t know. The New Jersey Library Association has been trying for years to resolve this issue. Maybe hearing from the public will help. S2068 would allow for the creation of the dedicated tax for public and joint libraries. S2068 has passed in the New Jersey Senate, 40-0. The identical bill, A2679, has been referred to the Assembly Housing and Local Government Committee. Call and mail your assembly representative and ask them to support A2679. S2068 is supported by the New Jersey League of Municipalities.