FACT CHECK DO FACTS SUPPORT CLAIMS IN FLYER CIRCULATING COMMUNITY?
September 6, 2015 (Updated September 7) -- With six bullet points of claims, figures, and highlighted “power words,” a flyer, that for the past week has been circulated around the community and posted on social media groups and in public areas, charges that the “Gold Coast Library budget is being mismanaged.” It encourages residents to reject the proposed 2016 budget, that represents a 0.74% increase over the current spending plan and about a 25 cents a month increase in the average homeowner’s library taxes, that is being put up to a community vote on September 9, and to support two candidates seeking positions on the library’s board of trustees. Five candidates in total are running for three seats.
On Friday, the Gold Coast Library posted on its website and facebook page an informational document addressing the allegations made in the flyer concerning library spending and the proposed purchase of the Halm property on Glen Head Road and building of a new library.
According to information obtained by Northwordnews this past week through interviews as well as through library records that are easily accessible through a visit to the library or on its website, the flyer contains significant inaccuracies, misrepresentations, and unsupported claims.
They include: 1] that “Salaries and benefits for 30 employees have increased by 50% over the last 5 years”; 2] that the “library outbid a suitable investor for the Halm property on Glen Head Road”; 3] that the library budget has doubled since its opening ; 4] that the “Library has $2.1 million HIDDEN in reserve.” and 5] that “your library taxes will double if not triple if this bond passes.”
As for the first allegation that payroll has increased by 50% over the last five years, public records indicate that that figure is far off the mark. According to the published library budget summary charts for the period spanning 2012 through the 2016 proposed budget, library payroll, including salaries and benefits, will have increased only by 10.2% over that five year period - from $969,742 to $1,068,265. If one cherry picks the 5 year period from 2010 to 2014 (literally “the last five years”), it would include the four budget years (2011 -2014) that were most impacted by the dramatic increase in New York State mandated employer pension contributions (expenses that the library has no control over) that resulted from the 2008-09 stock market collapse. The employer retirement contribution obligation rose from 7.4% of payroll in 2010 to 11.9% of payroll in 2011 to 16.3% of payroll in 2012 - more than doubling the library’s required pension contribution costs. That obligation rose to over 20% of payroll in 2014. And even during that five year period, total payroll (including benefits) increased by only 24% - not the 50% claimed in the flyer. And if one were to look at the full 7 years from 2010, when pension costs were 7% of payroll, to the 2016 proposed budget, total payroll (including benefits) have increased by 35% - well short of the claim even when lengthening the term by two years.
The poster also alleges that “if the bond is approved by the community,” payroll expenses are “expected to double.” It does not state “who” expects payroll expenses to double. Northwordnews reached out to Library Director Mike Morea, to ask him about his expectations of the size of the staff he would need to man a new and larger library. He stated, as he has at two public meetings attended by Northwordnews reporters - “the Library does not plan to need additional staff in a larger building, with the exception of a part or full-time custodian.” He has stated repeatedly at board meetings at which the architect has presented, that despite an increase in square footage, housing the library in a single one-story building rather than the current situation with two buildings, one of which has multiple stories, would greatly improve efficiency and the ability to provide supervision.
As for the claim that the library had “outbid” a suitable investor - Northwordnews reached out to Donald Lyon, the owner of the Halm Industries Property and his real estate consultant Stephen Deutsch for comment. “100% incorrect,” said Mr. Deutsch. The library’s bid was actually lower than that of a developer who had offered $6 million for the property.
Explaining why he accepted an offer that was $300,000 lower, Mr. Lyon replied that it was his fondness for this community. “I really want to offer the community the opportunity to create something special with this property,” he said. Showing a 3x5 inch framed black and white photograph of the building from when his father had built it 65 years ago, Mr. Lyon explained his strong attachment to Glen Head and the surrounding area. “This property and this community mean a lot to the Lyon family.” he said. “I think for this property to be used for a library would be great for Glen Head.”
The claim that “the Library’s Budget has doubled since opening from $800,000 to $1.6 million,” is grossly misleading. The Library opened on August 1, 2005. The library’s first full year of operation was 2006 with a voter approved budget of $1,044,604. And over a period of 11 years through the 2016 proposed budget of $1,616,845, expenses will have increased by 54.8% - not the 100% increase claimed in the flyer. Northwordnews reached out to Library Director Mike Morea for an explanation as to why costs increased by nearly 55% over that 11 year time period. He gave the following reply: “When the Library opened, it was closed on Wednesdays and Sundays. There was no Annex building to provide regular programming to the community. In the 10 years since opening, Library circulation has nearly doubled, from 63,931 in 2006 to 112,323 in 2014. Offerings and attendance in programming have increased from 195 programs with 2,667 attendees in 2006 to 591 programs with 8,729 attendees in 2014.”
Back in January, Mr. Morea, in response to questions from Northwordnews, stated that when the library district was first established in 2001, the community did overwhelmingly approve an initial $800,000 budget. That amount was provided to the library each year, pursuant to law, until a new budget was placed in front of the voters. Prior to its opening, the Library used these funds to establish the Library’s collections, programs and services and to help offset the costs of purchasing the building the library is presently in. Funds not spent, were invested in Certificate Accounts and helped to build up the library's reserve fund. In September 2005, the community approved a $1,044,604 budget for 2006 - the library’s first full year of operation.
The fourth claim, that the library has $2.1 million "hidden" in reserves, is both misleading and inaccurate. Hardly hidden, end of year financial statements have been posted on the library website for at least the past two years, and an examination of the most recent end of year report (2014) shows that the the library on December 31, had $1.5 million held in a capital fund with $1.2 million designated for future building aquisition / expansion / improvement; $100,000 for elevator renovation; $100,000 for HVAC Renovation; and $100,000 for Roof Renovations. In addition, following a determination of a Government Accounting Standards Board report, the library has designated $150,000 of the fund balance for “post retirement benefits” to ensure that it can pay long term post employment liabilities. Strategic, long-term planning, whether it is for capital projects or likely future liabilities is generally and perhaps even universally considered a responsible and conservative budgeting practice that in the long run saves taxpayers money and prevents spikes in taxes. In addition to the reserves and designated funds, the general fund includes about $460,000 in undesignated funds (also clearly indicated in the financial report). Municipalities and other similar entities, such as library districts, maintain an unreserved/undesignated fund balance for, among other reasons, to cover payroll while awaiting tax receipts, to pay for an unanticipated emergency expense, or to offset what would otherwise be a sharp increase in taxes (for instance to cover a spike in mandated employer pension contributions).
The claim that the cost of the proposed project will be somewhere between $14 and $18 million does appear to be accurate and based on statements made by the library board in public meetings during which it has given estimates of cost of the purchase of the property and the construction of a new library to be between 15 and $19 million. However the claim that as a result of the cost of the project, “library taxes will double if not triple if the bond passes” is unsupported by any evidence. The impact on one’s taxes as this point is not precisely known, and dependent on the amount financed through the bond and the interest rate. The library board in public meetings and on its “New Library” website has stated that the goal is to keep the cost to the majority of taxpayers of a new library below $100 per year (less than $9/month). The library has a tax calculator on its “New Library Initiative” website that allows homeowners to determine the precise impact of a $17 million and a $19 million bond proposal (at the current interest rate for a AA rated agency and 30 year maturity range), respectively, on the library portion of their tax bills. Click here to link to calculator on New Library Initiative website.
On Friday, Northwordnews reached out by phone to the two candidates who were endorsed in the flyer, Rudolph Hertlein and Anthony Papiro, for comment, and left messages on their home answering machines. Neither returned the call as of this article’s original posting.
There is one factual claim on the flyer that is 100% accurate. The Library Budget Vote and Trustees Election will take place on September 9 at the library from 9 am to 9 pm.
That vote, however, is completely unrelated to the new library proposal. That referendum is likely to take place in December. UPDATE (September 7, 2015) -- Mr. Papiro spoke with Northwordnews on Sunday morning. He said that while the flyer may be "hard hitting," he agreed with the statements that are made in it. He said that he is not opposed to having a larger library, but that he is opposed to the current Halm property proposal.