Gas slump hits GarCo library budget
An expected $1.2 million drop in property taxes used to fund the Garfield County Public Library District is prompting some tough budget decisions for next year and has already affected the district’s executive director search.
A significant decline in new oil and gas activity in the county is resulting in a huge drop in property tax revenues for 2017, which is causing budget woes for several entities, including Garfield County government, fire districts and other special districts.
Library operations benefit from a mix of revenues coming from a dedicated 0.25 percent portion of the county’s 1-cent sales tax, and a 1-mill property levy approved by county voters 10 years ago.
The property tax was mostly intended to pay for new library facilities in each of the county’s six municipalities, from Carbondale to Parachute.
In 2014, after the last of the capital projects was completed, a portion of the property tax that wasn’t needed to pay off the certificates of participation used for the building projects was dedicated to library operations, explained Sandi Kister, interim director for the library district.
The mill levy is expected generate about $3.4 million for the district this year, as projected. But that is projected to drop to $2.2 million next year, Kister said.
“We’ve already pared down as much from the budget as we can without impacting staffing, benefits and library hours,” she said. “Those are now on the table.”
The library district’s board of directors will meet Oct. 6 in Rifle to go over the proposed 2017 budget and weigh a variety of scenarios for reducing costs even further.
“Part of the problem is we’re running at skin and bones to start with,” said Nella Barker, who chairs the library board. “We’re down to really cutting into our very basic stuff — days and hours of operation, people.”
Options include closing on certain days when libraries are now open, reducing hours, closing for an entire week sometime during the year and potential staff reductions, she said.
“These are all options we’re trying to juggle and put dollar signs to, to see what really matters to people,” Barker said. “But a 35 percent drop in revenues will mean we have to make some changes.”
Already, the uncertain finances have impacted the library district’s ability to replace former Executive Director Amelia Shelley, who left at the end of 2015 to take a library administration job in Washington state.
An ongoing search effort has yielded three different job offers, all of which were ultimately turned down by the applicants, and partly due to pay.
Barker said the executive director position tops out at about $104,000 annually for a chief administrator to oversee the six-branch library district with a $6 million budget this year.
More recently, the library board has been looking in-house and interviewing some of its current branch managers for the director’s position. A decision on that is also expected to be made at the Oct. 6 meeting.
The property tax situation comes on the heels of several consecutive years when the library district’s sales tax revenues have also been uncertain.
A state court ruling six years ago determined that oil and gas companies had been erroneously paying sales taxes on sand, chemicals and other materials used in hydraulic fracturing operations. That triggered a large upfront refund of sales taxes that had already been distributed to municipalities and local taxing districts, and multiple years of withholding by the state to pay off the settlement.
For Garfield libraries, the hit has been about $2 million since 2011. Kister said the district anticipates another $136,600 in withheld sales taxes this year.
The library district takes in a little over $2 million per year in sales tax revenues.
The property mill levy also has an upcoming sunset in 11 years, once the final payment is made on the certificates of participation, meaning voters will likely be asked for a renewal to continue to cover operating expenses.
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