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Tuesday, May 3, 2016

Governor's veto puts library project at risk

Monday, July 20, 2009

Architect's rendering from Werner and Associates of the proposed new branch of the Barry-Lawrence Regional Library in Monett.
A veto by Governor Jay Nixon last week has endangered future operations of the Barry-Lawrence Regional Library and may likely force construction of a new branch library in Monett to be shelved.

Nixon vetoed House Bill 146, passed late in the legislative session to remedy a problem created by Senate Bill 711 in 2008. The 2008 law stated all taxing entities had to operate on the last tax levy approved by voters. What that meant had been up to interpretation, which the Missouri Department of Revenue changed last year.

The last vote taken to define the library district's property tax rate was in 1973 when the library district was consolidated. The 20-cent-per-$100 of assessed property maximum levy was still in effect when the General Assembly passed the Hancock Amendment in 1984. The Hancock Amendment rolled the levy downward but the old ceiling remained on the books.

Facing decreasing property assessments and a rollback of the levy down to 11 cents, the library board went back to voters in 1989 for a four-cent increase. The ballot language at the time did not state what the new tax ceiling would be.

"We were only at 15 cents for one year," said Jean Berg, library director.

Then the Department of Revenue, still accepting the 20-cent ceiling, raised how much the library could collect to 16 cents for several years. Since then the levy stayed around 17 cents until the 2008 law passed, at which time the Department of Revenue declared the district's true levy was 15 cents.

Nixon said he vetoed the bill because he felt the new bill had too many loopholes and could allow taxes to be collected unfairly. Berg said once she saw how the governor was issuing numerous vetoes to save money, she was not hopeful for House Bill 146.

The ramifications of cutting two cents off the district's property tax levy are significant. Berg estimated the reduction would cut $300,000 from the district's annual income. The library board had to have a budget in place for the start of its fiscal year on July 1. Berg expects to rework that budget.

Accurate recalculations cannot be done until the county assessors issue final assessment figures for the coming tax cycle. A letter is also needed from the state assessor declaring what tax rate the district can use. Berg expected all these steps will take another two weeks. Despite talk of a veto override session by the General Assembly, Berg is not hopeful the district can expect help from state lawmakers.

A reduced levy impacts the district at several levels, especially over plans to build a new Monett library branch. Berg said the district has had some funds left over at the end of each fiscal year that have been placed in a reserve fund. The board had planned to commit $500,000 in reserves to the $2.4 million Monett project. Now the board may be forced to reallocate its entire reserve to sustaining general operations.

"For a couple of years we can hold the body of our services together using the reserve money," Berg said. "Beyond that we will be looking at a drastic reduction in services."

Plans for the new Monett branch were progressing adequately if the anticipated cash flow could have been maintained. Donations have brought in around $300,000. Last week EFCO Corporation and its parent company, Pella, made a $50,000 payment on its pledge to the project.

Using $500,000 in reserves on top of $300,000 in donations, the board could finance the rest of the construction on the new Monett branch, if tax revenues remained steady to pay for the lease purchase. Now that entire formula is in jeopardy.

"I think the Monett project has got to go on the back burner," Berg said, though the choice will be up to the board. "The new branch will still happen. It's definitely down the line a ways."

The board could go to the voters and ask for the 17-cent levy to be restored. The next board meeting is scheduled for Aug. 14. The filing deadline for the November ballot would be Aug. 25.

"Whether or not we can get a tax levy passed, in this economy, I don't know," Berg said. "A lot of people care about the library. I hope we can rally them to the polls. We probably should have gone to voters last February. It's hard to know which way to go."

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