Michigan's Library Community Gears Up for a $30 Million Battle
By Michael Kelley Nov 7, 2011Michigan librarians, police officers, firemen, and other workers are uniting in opposition to an anticipated proposal from Gov. Rick Snyder that would eliminate the personal property tax, a revenue source that underpins many local services.
Details of Snyder's plan are expected to be released in the next few weeks, but The Michigan Library Association (MLA) estimates that if the personal property tax (which is a business tax on equipment) were eliminated and not fully replaced it would cost the state's libraries about $30 million in state funding. The MLA is already gearing up for a fight.
"We are being very proactive, not reactive," said Gretchen Couraud, MLA's executive director. "It would just gut our libraries; many of them would close or cut services just when we are being overrun by patrons," she said.
The personal property tax makes up to as much as 50 percent of a library's budget in Michigan, and the average local library gets 9.1 percent of its revenues from the personal property tax, according to the MLA.
The Michigan Municipal League has organized opposition to the plan, and in addition to MLA the coalition, called "Replace Don't Erase," includes the Michigan Association of Counties, the Michigan Association of School Administrators, the Michigan Association of School Boards, the Michigan Association of Chiefs of Police, and the Michigan Professional Fire Fighters Union.
"We're playing at a much higher level of advocacy than we ever have," Couraud said. "We are moving to have libraries be part of the discussion at the state level. We are playing in the big leagues, which is where all libraries need to go," she said.
A report by the state Senate's fiscal agency estimates that the tax accounts for $1.3 billion in revenue to state and local taxing jurisdictions, and the report warns that the plan could have "significant consequences" since local governments rely heavily on the revenue and the law may not allow an increase other millage rates to offset the lost money.
"Bottom line: the personal property tax is one of the only stable sources of revenues left for local governments and our public schools, and if the legislature and Gov. Snyder are going to eliminate it, they must replace it with revenues that are guaranteed to go to local public and school services and protected from raids by governors and legislatures," said Dan Gilmartin, executive director and CEO of the Michigan Municipal League.
During the convention of the Michigan Municipal League held in Grand Rapids last month, Snyder, a Republican, said the tax would not be eliminated overnight, MLive.com reported, but he did not promise a dollar-for-dollar replacement for the lost revenue.
"The goal there is not to harm you," Snyder said, according to MLive.com. "The reason we bring up the personal property tax is to make you more competitive."
But library officials, while acknowledging a need for the state to move forward and be competitive, say they have already absorbed painful cuts. Last year the state legislature eliminated statutorily guaranteed renaissance zone reimbursements totaling $3 million to local libraries. Since 2000 annual state aid to public libraries has been cut by 76 percent — from $15 million to $ 5.4 million. In addition penal fines, which are constitutionally mandated to go to public libraries, are being diverted to other forms of government spending. Revenue is down by as much as 33 percent, according to the MLA.
This experience has made librarians wary of promises from the state.
"They are saying they want to eliminate a locally controlled tax and replace it at the state level with an appropriation from the state budget. We are not buying that," Couraud said. "Everybody is saying 'no.' We want a constitutional amendment that would guarantee full replacement of the money," she said.
Marcia Warner, the director of the Grand Rapids Public Library and president of the Public Library Association, said she was impressed that MLA had already joined with influential partners in advocating against this legislation.
"It is striking the people they have made union with," Warner said. "This is our first venture in partnerships in fighting legislation, which is a really good thing," she said.
"My library alone would be impacted by $1.3 million," Warner said. "We had cuts over the last two years of a little over 10 percent already, and this would be an additional 14 percent," she said, adding that the personal property tax is a larger piece of library support than the entire state aid to public libraries budget.
Christine Berro, director of the Portage District Library and past president of the Michigan Library Association, said full replacement is essential.
"Without guaranteed replacement of the personal property tax, local libraries will be forced to close, eliminate branches, reduce hours, or severely cut computer access and programming for children, teens, adults, senior citizens and business entrepreneurs. The personal property tax must be full replaced," Berro said.
Berro recently addressed the coalition put together by the Michigan Municipal League:
