Before I get into library finances, I should clarify something that confuses a lot of people. Douglas County Libraries is not part of some other government agency. We are not a department of the county, although we share geographic boundaries. We receive no money from them, nor from any of the cities or towns or school district in Douglas County.
Instead, we are an independent library district, created in accordance with state statute, by a vote of the people, in 1990. Virtually all our funding comes from a voter approved property tax of 4 mills. In 2009, that generates (with a few other smaller streams of income) about $21 million.
The largest single expenditure of the library is staff. Staff order and receive our materials, set them out for display, help people find things, answer questions, tell stories, manage our facilities, and more. Together, staff and benefits account for 60% of what we spend.
The next largest category is materials: books, magazines, music, movies, and electronic reference sources. That's 16% of our expenditures.
After that the next largest expense is technology. All our libraries are both wired and wireless. We provide high speed access to the world of data. That's about five percent of our costs.
What remains are mostly those things that are unglamorous but necessary: insurance, lawn maintenance, utilities, and capital projects (replacement of heating, ventilation and air-conditioning units, etc.)
For most of its institutional life, the library district has done what we're all supposed to do: save. We have paid for all of our library buildings with cash. We have no debt. In our coffers is enough money to carry the library for the several months of the year before tax revenues are collected and distributed. We actually have the rainy day fund often praised and seldom seen.
But for the first time, the growth of our costs, in an environment of extraordinary demand, has brought us to a 2009 budget where our expenditures are expected to equal our revenue. No more savings.
A more serious problem is that property tax revenues in Douglas County are projected to be flat or falling next year. Our expenditures are not. Moreover, we have significant need for new facilities in Parker and Castle Pines -- and despite our savings, we can neither build or run them.
Faced with that, the Library Board of Trustees issued a prudent and fiscally cautious direction: reduce library expenditures in 2009 by 7-10%. Put the savings in a building fund. I respect that. It smacks of good planning.
Making cuts isn't unusual. Businesses do it. Homeowners do it. In libraries, there are six basic approaches.
* Make across the board cuts. It's simple to just make every department in a large organization absorb a uniform percentage of reductions. The problem is, that's not always possible, and certainly not strategic. Some items -- like utilities or insurance -- aren't discretionary. Some library programs and practices are more essential to our mission than others.
* Reduce the number of library staff. There are a host of ways to reduce headcount: freeze hiring and wait for attrition, buy people out, reduce hours, force days off, or lay people off. We have decided that by freezing hiring and relying on attrition, we can reduce our expenses gradually, thereby avoiding layoffs for 2009, and hopefully avoiding the need in 2010.
* Reduce the number of library facilities. Buildings drive most library expenditures: staff, materials, IT, and maintenance. Just as businesses close franchises that fall below a certain level of activity, the library is considering the phasing out of three of our facilities: Cherry Valley, Louviers, and our aging bookmobile. We're not happy about that, but we are funded by all county taxpayers; it is our obligation to serve the greatest number of them well and cost-effectively.
* Reduce the hours of library operations. The fewer hours a library is open, the less it costs to run it.
* Raise fines and fees. Our fines are among the lowest in Colorado -- a nickel a day for most materials, with a maximum fine of $3 per item, providing you bring it back. Inevitably, people suggest to us that we boost our fines, charge for meeting rooms, Internet use, reserves, or even checkouts. In my experience, however, most of these don't generate a lot of money. What they do is reduce use.
* Seek private funding, whether in dollars, in-kind services, or volunteer labor. We do that now, of course.
The odds are good that we'll do some combination of all of the above, in addition to our usual pursuit of operational efficiencies. The final package to bring us into compliance with the Board's directive will be presented to them at our March 19 meeting, at 7 p.m., at the Philip S. Miller Library in Castle Rock. The public is welcome.
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