The Pilot News - Library’s finances to be inspected

Much of the focal point of the meeting was whittling down the cost of the proposal, which came in late the previous week. Board members Rita Lawson and Peg Schuldt in particular felt the $10,000 estimate on the work – at $150 per hour – was too expensive, with board member Carol Saft countering that the hourly fee is not atypical for experienced accounting firms like Umbaugh, whose CPA Paige Gregory has worked extensively with other Indiana libraries in the past. Saft also pointed out that some of the specific work outlined in the proposal has already been done by the library.
Board member Alfred Nyby said he had hoped Umbaugh’s assessment of library finances would “verify that we’re spending a lot more than we’re receiving. I wanted that verified before we make drastic cuts in library spending. What does it take to prove to everyone that we’re going to have serious money problems? Can we all agree to that? If we keep spending $100,000 more than we take in, it’s not going to last.”
Lawson noted that library spending on remodeling should be complete now, with Nyby replying that the library’s operating fund, which is unaffected by remodeling, is the issue. Asked by Lawson what he wanted Umbaugh to do, Nyby said, “I’m torn. I feel we need to be responsible with the trust with the public’s money; we had an audit (from the state of Indiana) and we haven’t resolved the issues. How much time and money do we spend digging up stuff from two years ago, I don’t know.”
Nyby added, however, that he felt there were “real problems” last year as well. “We were way over budget, funds were transferred where they shouldn’t have been, bank balances didn’t match from one month to another…”
“I’m not willing to pay $10,000 to look at things that are already done,” said Lawson.
Saft said she didn’t feel the price tag was shocking. “We were going to spend $14,000 for furniture for the children’s room,” she added, with Lawson countering that the furniture cost doesn’t come from operating funds.
Lawson, looking over the proposal, also asked why staff member training on reconciling a bank statement should be part of the cost, with Saft responding that statements aren’t being reconciled properly now. Schuldt and Lawson suggested that problem is due to numbers being changed by the library’s accounting software vendor, Computrain.
“Fifty-nine libraries in the state use Computrain,” said Nyby. “Do they have this type of problem?”
“(Library director Carol Jackson has) been dealing with things that have been messed up all along,” asserted Lawson. “I don’t think anyone before her is dishonest for a second. There’s no money missing; we’ve got too much money!”
Board member Melanie Robertson noted the material submitted by Umbaugh was a proposal and allowed the board to add and subtract particular portions based on the library’s needs.
In response to Nyby’s question as to the status of next year’s library budget, Jackson said she has worked with a representative of the Indiana Dept. of Local Government and Finance and concluded a four percent increase bringing the new budget amount to $541,421, a $20,000 increase over last year. “The amount to be raised by tax levy is about $270,000,” said Jackson, who added that the library still hasn’t gotten its tax draw for this year. Jackson said she will submit the budget proposal Aug. 19, adding that the only change from last year is an estimated 20 percent in employee health insurance costs.

Nyby noted the library is “in the $400,000 ballpark (in money received for the year). A $540,000 budget isn’t going to work with $400,000 in receipts. By rights, the Library Improvement Reserve Fund and the Rainy Day Fund get funded by overage in our operating fund. We won’t have that (overage) for years to come. So when we’ve got these tough cuts to make, how do we arrive at them? Do we guess what the public can do without first?”
Jackson explained that the library is open 40 hours more per week than required by the state, which only demands that a library in a community Culver’s size be open 20 hours per week, with one evening open by necessity.
She added that Culver has a unique population, explaining that most libraries Culver’s size have a budget between $125,000 and $500,000, the latter being closer to Culver’s. “We’re very blessed to have that (budget),” noted Saft.
There will be a public hearing Sept. 2 at 7 p.m. on the new budget, said Jackson, which will be adopted on Sept. 16 at the regular board meeting.
At the suggestion of library bookkeeper Jim Faulkner, the board discussed asking Gregory for notification as she works, each time a certain cost is reached for her services.
The board agreed that Saft should counter Gregory’s proposal with a revised one eliminating unneeded services and outlining priorities, including preparation of a report of Gregory’s findings after going over the books, reconciliation of all bank accounts from Jan., 2005 to the current date, staff assistance and training with bank reconciliations, a month to month review of finances for the first three months after her initial work, and possible attendance at board and other meetings.
In other discussion, Nyby asked Jackson why nearly $2,000 was taken from the library’s gift fund and put into payroll; Jackson suggested the move may have pertained to paying staff to work last year’s Taste of Culver event. Nyby asked about $9,000 taken out of the same fund last year, with Jackson replying that event programming supplies are taken from that fund as well. She said the library has cut back on its programs for the public. “We’re not doing very many programs at all.”
Jackson added that, while the library has not yet received its money from all the restaurants who participated in this year’s Taste of Culver earlier this month, “it looks like Taste of Culver didn’t make much (money) at all this year.”
Asked by Lawson if the restaurants – each of which chooses how much of its ‘Taste’ earnings to give to the library -- are keeping the event’s money for themselves, Jackson replied, “Yeah. Pretty much we threw a party for the town.”
At Carol Saft’s request, the board opted to hold an executive session to discuss Jackson’s final days at the library before beginning her new job in the media center at Culver Elementary school. Saft expressed concern that Jackson will begin full-time work at the school Aug. 11, but gave the library board a resignation date of Sept. 5. “I have a concern she’ll be juggling balls at both places,” Saft said. “That’s not good for either place.”
Audience member Russ Mason commended the board for its work in hiring an outside accountant to examine library finances. “This is a lot of money, but it’s good money to correct problems. Thank you for taking this under the wing; it’s important.”