Wednesday, October 16, 2019

Library and town in spat over proposed new lease

Increased rent means fewer days open?

by Mark Reaman

If a lease deal with the town of Crested Butte cannot be amicably reached, the Gunnison County Library District is considering options to address an increased financial burden. Those options could include reducing service and closing several days a week in Crested Butte, starting next year.

The town is trying to get a formal lease in place for the town-owned Old Rock Schoolhouse and initial indications are that the financial burden to the library could be an additional $7,000 to $8,500 per year. The district’s annual budget is just under $1 million. At a Tuesday Library District board meeting, the library board instructed executive director Drew Brookhart to try to come to lease terms with the town that could be reviewed by the district’s attorney and the board. Brookhart again asked the town to hold off on any new lease until after the November election when the district is asking voters for financial support through a mill levy.

The board directed Brookhart to try and resolve the issue by obtaining a clear proposal in writing from town and running that by the district’s legal counsel. After a review by the lawyer, the district board will review the analysis and continue negotiations with the town.

“The demand for a lease with increased rent is putting the library district in a difficult spot given our current budget,” explained district board president Bruce Bartleson. “We have always had a cooperative relationship with the town but this feels like a punitive document and we will have to adjust our services to accommodate the increase.”

The town staff has been trying for two years to clean up its lease situations with the 26 tenants it has in 14 town locations. According to a memo from town manager Dara MacDonald, the tenants include private businesses, non-profits and governmental agencies. The Library District has not had a lease in place on the Old Rock building since 2012.

“Town Council adopted a lease policy and directed that staff begin chipping away at the backlog. Lease rates were established at well below market pricing so as to help the community,” MacDonald informed the library board in a memo. “The Town does need to recover some, but not all, of the costs to manage its building inventory. Leases have now been executed with all occupants with the exception of the library and one other,” the Wildflower Festival.

“The Town and library district have enjoyed a long relationship dating back to the early 1990s and the Town hopes to see the library continue as a bedrock institution in the northern valley supporting the communities of Crested Butte South, Mt. Crested Butte, Brush Creek and Meridian Lake. The Town of Crested Butte values the services provided by the Library District and we certainly want to see them continue,” MacDonald added. “We do understand that the library district has limited funds for operations as the district does not have an independent funding source at this time. It is for that reason that the Town has always approached the execution of a new lease with a substantial period before any payments would begin.”

MacDonald asked the library board to choose someone from the board to help “negotiate a lease and attempt to work through acceptable terms for both parties. Understanding that any lease is subject to approval by both governing bodies.”

The town has offered a couple of lease options depending on which services would be paid for by the town or the library, but basically the town expects the library district to pay an additional $7,000 to $8,400 annually.

Brookhart has said it would be much more productive and reasonable if lease discussions between the district and the town could be held after the upcoming fall election when the district is asking for a mill levy increase to fund operations and capital expansion. If the ballot issue passes, the district would be on firmer financial footing and Brookhart said the negotiations with town could be based more in long-term financial reality.

“Entering into a lease agreement mid-year presents planning and budgeting challenges for the Library District,” Brookhart explained to his board in a memo. “Because the Town of Crested Butte is requiring the Library District to enter into an agreement mid-year, it is necessary for the Library District to plan as though the Library District will again be at its TABOR spending limit during fiscal year 2020.” He said in that case, the library could not legally spend more than it already does, even though the majority of its budget comes from Gunnison County.

County manager Matthew Birnie agreed that the Library District was subject to TABOR restrictions. “The County is ‘de-Bruced’ under TABOR, but that doesn’t transfer with the creation of a new entity like the Library District,” he explained. “It is now an independent governmental entity subject to TABOR. The [agreement with the county] doesn’t address TABOR, but I believe Drew’s characterization of the IGA establishing their funding baseline from which they can grow under TABOR is correct.”

Because of the timing, Brookhart told the board, “It is in the best interest of the community for the Library District to make the community aware of a values based discussion regarding a reduction in service… A discussion and implementation of a reduction in library service needs to be conducted in a way that is fair to as many library users as possible.”

Brookhart suggested that in order to be fair to the broad demographics that utilize the Old Rock facility, “The only fair way to reduce services is by reducing hours of operation. A reduction in hours will evenly impact all library users.”

Depending on the terms of the lease and the amount the district would have to increase its contribution to operate the Old Rock Library, Brookhart estimates that instead of the current seven days per week that the Crested Butte library is open, it would have to be closed two or three days a week. He also noted in an email to his board what he termed several “inconsistencies” between what has been discussed verbally with MacDonald and the town and the actual proposed written leases.

“At a cost of $7,000 to $8,380 per year for a lease, it is difficult to understand why the Library District is now considering closing the facility in Crested Butte between two and three days a week,” MacDonald responded the library board. “The Town of Crested Butte would like to work with the Library board to define a reasonable lease that supports the community and ongoing operations of the library in Crested Butte.”

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