Central Arkansas Library System board members on Thursday adopted a 2022 budget that outlines additional spending based on the increased property-tax revenue the library system expects to receive as a result of the successful millage referendum in Little Rock.
Those new dollars will bankroll salaries, books, electronic materials, deferred maintenance and technology, according to Executive Director Nate Coulter's presentation to the board Thursday.
Two motions, one to adopt the 2022 general fund budget and another to adopt the library system's other budgets, were approved.
By a wide margin, Little Rock voters on Nov. 9 approved raising the millage rate that supports the library system's operations and maintenance from 3.3 to 3.8 mills.
Each mill reflects the amount paid on every $1,000 of the tax-assessed value of a piece of property.
Library officials pursued the millage increase -- the first approved in Little Rock for the library system since 2007 -- because of a structural budget problem. In years past, the library system had been using bond proceeds to help cover the materials budget.
In a separate but related phenomenon, electronic materials such as e-books and audiobooks have been a drag on the system's finances because the pricing model to loan those materials is less favorable to libraries compared with physical books.
The library system's 2022 general fund budget provides for nearly $24 million in total revenue.
That figure includes $21.4 million in ad valorem taxes from Little Rock, Pulaski County and Maumelle, up from $18.6 million projected for the current year. An additional $150,000 has been budgeted based on Perry County's taxes.
The vast majority of 2021 tax collections, or $16.5 million, came from Little Rock, according to a budget memo written by Coulter.
An overall general fund revenue increase of approximately $3 million, or 14%, has been budgeted for next year, with the millage increase accounting for $2.4 million in expected revenue.
The library system has planned for a 2% increase in property-tax revenue over the current year's collections.
Coulter's budget memo stated that revenue from fines has declined in recent years, falling from $165,000 in 2016 to $118,000 in 2019.
In the memo, he attributed the decline to "the rise in the circulation of e-books and audiobooks where no fines are collected," adding, "the pandemic accelerated that downward trend."
The library system has budgeted for just $75,000 in fines next year, Coulter wrote.
Expenses in the general fund budget for 2022 are up by 19.6%, reflecting an increase of $3.8 million over the current year, according to the budget memo from Coulter.
"While a part of this 19.6% rise in expenses is related to inflationary growth of expenses and a share is attributable to growth in the amount of expenditures associated with grants," Coulter wrote, "the bulk of this increase is the product of the voter approved millage and our campaign promise to spend a third of new revenues on staff retention, a third on collection materials, and a third split between maintenance and technology."
Just more than $15 million has been budgeted for salaries and benefits in 2022 compared with the projected $12.8 million in the same category this year.
The system's 2022 spending on salaries and benefits will increase by approximately $813,000 as a result of the successful millage increase compared with what the category would have looked like without the millage increase, Coulter said during his presentation to the board.
Pay for the system's lowest-paid employees will increase to $14 an hour even though officials had originally planned for the floor to increase to $13 an hour, Coulter said.
According to his memo, 63 individuals are being paid less than $13 an hour at the moment.
Additionally, the system has adjusted its overall pay grade after finding it was paying about 9% less than other libraries, Coulter said.
According to his budget memo, the library system is budgeting for four new positions next year: a diversity and inclusion officer, a digital literacy specialist, a youth services programmer and an outreach archivist.
The materials budget will increase next year to roughly $2.4 million compared with $1.9 million in projected spending on materials this year.
The boost to the materials budget includes an increase of $283,500 in the budget for downloadables compared with projected spending for 2021.
In the library system's separate category of general fund operating expenses, the total is expected to increase by nearly $700,000 over this year for a total of $5.1 million, according to the 2022 budget.