Ann Arbor Library Weighs In On Lawsuit

Ann Arbor District Library board meeting (Dec. 20, 2010): The AADL board spent much of their December meeting focused on a statewide issue with local implications: New rules issued by the Library of Michigan are being challenged in court. The board ultimately voted to file an amicus curiae – or “friend of the court” – brief in support of the Herrick District Library in Holland, which filed suit against the state library. At stake are broader issues of local control, which officials at local public libraries believe would be eroded if the new rules are allowed. The new rules change how libraries qualify for state aid.

The board also got brief updates on plans to deal with the downtown library building and with the parking deal being negotiated between the city of Ann Arbor and the Ann Arbor Downtown Development Authority.

Monday’s meeting wrapped up with a farewell to Carola Stearns, the outgoing board member whose term concludes at the end of the year.

Update on DDA/City Parking Deal

An item originally on Monday’s agenda allotted 30 minutes to a discussion of the parking contract between the city of Ann Arbor and the Ann Arbor Downtown Development Authority. However, at the start of the meeting, board president Rebecca Head told the board they needed to postpone that discussion, saying it was premature at this point.

By way of background, at their November 2010 meeting, the board had voted to direct AADL director Josie Parker – in conjunction with the board’s treasurer and the budget and finance committee – to consult with legal counsel about the parking agreement, and to seek a legal opinion about how funds are being allocated that would otherwise be coming to the library. At issue is the potential for tax increment financing funds captured by the DDA from public entities, including the AADL, to be used to offset a parking fund deficit caused by striking a new parking deal with the city. [See Chronicle coverage: "Column: Impact of City-DDA Parking Deal"]

Later in the meeting, Prue Rosenthal – the board’s treasurer – reported that the budget and finance committee had met with attorney Bill Stapleton of the law firm Hooper Hathaway in Ann Arbor, to discuss the parking deal. [The budget and finance committee consists of Rosenthal, Ed Surovell and Barbara Murphy. Murphy was absent from the committee meeting and from Monday's board meeting, due to a death in the family.] Stapleton suggested that at this point, they should simply monitor the situation closely, Rosenthal reported.

Rosenthal also noted that Parker will be attending DDA meetings, to keep up on the progress of the parking agreement negotiations.

Update on Downtown Building Project

During her report from the board’s executive committee, Rebecca Head said the committee had a conversation about what to do with the downtown library building, and how the board might proceed on that project. The committee decided that the full board needs to resume that discussion next year.

In addition to Head, board treasurer Prue Rosental and vice president Jan Barney Newman serve on the executive committee. Rosenthal reported that the group talked about how they might approach the topic, and how they should present to the public what they ultimately decided to do. Newman noted that the plans they’d developed two years ago are already out of date.

The library board and administration had previously decided to tear down the existing downtown building and construct a new one at the same location. They aborted that project in late 2008, saying that economic conditions were a factor. Since then, the topic has emerged during discussions at several board meetings, but no action has been taken aside from authorizing repairs and equipment replacement for the building. [See Chronicle coverage: "Citing Economy, Board Halts Library Project" and "Board Renews Library Building Discussion"]

On Monday, Head noted that it’s up to the board to decide how to proceed, and to provide direction to the library administration about the next steps to take.

State Aid Lawsuit

Much of the discussion during Monday’s meeting focused on a lawsuit filed last year by Herrick District Library in Holland, Michigan, against the Library of Michigan over new rules for determining how a public library qualifies for state aid. The issue has broad implications for all public libraries statewide, and the AADL board was considering whether to file an amicus curiae brief – commonly known as a friend of the court brief – in support of the Herrick library’s position.

State Aid Lawsuit: Background, Presentation

AADL director Josie Parker began the discussion by giving board members some background on the situation. In 2009, the Library of Michigan issued new rules which changed the standards used to determine whether public libraries qualify for state aid. The rules were slated to take effect in October 2010 – the start of the state’s fiscal year. [.pdf file of 2010 Library of Michigan Certification Manual and State Aid to Public Libraries Grant Rules]

When the new rules were announced in draft form in 2008, directors of eight library cooperatives in the state – representing, through their memberships, many of the public libraries in Michigan – objected to the change. They contended that the Library of Michigan didn’t have the authority to set new rules on how libraries qualify for state aid, which is awarded by the state legislature. “It was a loud voice, and it went unheard,” Parker said.

In October 2009, the Herrick District Library filed a lawsuit in the Ottawa County Circuit Court, challenging the Library of Michigan’s authority to set these rules. The lawsuit focused on rules requiring that a public library provide the same level of service to all areas it serves.

Libraries have the authority to contract with areas outside of its millage boundaries to provide varying levels of service. A contracting municipality, for example, could receive limited library services for its residents, and pay an amount lower than what’s levied by the library millage within the library district’s boundary. The new rules prohibit this approach – and if a library continued to provide contracted services at a lower level, it would not qualify for state aid.

Herrick’s lawsuit argues that the Library of Michigan and the state’s History, Arts and Library Department – which previously housed the state library but which has since been dissolved – lack statutory authority to set rules for determining how state aid is distributed to public libraries. The suit also argues that neither the state constitution nor the statutes that govern public libraries require that libraries deliver the same level of service to contracting jurisdictions. Finally, the lawsuit contends that because the new rules are vague and overly broad, they are unconstitutional.

Parker told the AADL board that the lawsuit is challenging the new rules for the same reasons that the directors of the eight library cooperatives had objected to them – because the Library of Michigan has no authority to set the rules, and because the state library is taking away local control from district libraries.

On Sept. 9, 2010, Judge Calvin Bosman of the Ottawa County Circuit Court issued a ruling in the case, stating that the Library of Michigan lacked the authority to issue these new rules. The state library appealed the decision to the Michigan Court of Appeals, and filed a motion for stay – essentially asking that the lower court’s decision not take affect until the appeal is resolved. Parker said they learned earlier in the day that the motion for stay has been denied.

The lawsuit and the recent denial of the motion for stay throws state aid into limbo, Parker said. Libraries haven’t received aid for the state’s current fiscal year, which began Oct. 1 – although the money has been budgeted by the legislature. In the short term, it doesn’t affect AADL, Parker said – in general, state aid has been dwindling because of Michigan’s economic situation. Most recently, the legislature budgeted about $6 million in total aid to public libraries statewide.

Because of the state’s overall economy, AADL didn’t anticipate receiving state aid this year, so it won’t affect their current budget, Parker said. Nor does AADL have any contracts to provide services to other municipalities. But longer-term implications could be significant, she said.

Parker elaborated on that issue in a follow-up phone interview with The Chronicle, saying that the Library of Michigan’s actions could potentially erode local control. Constitutionally, libraries are governed by elected local boards and receive most of their funding from local millages. That local control is important because it gives each library flexibility to respond to the changing needs of the community it serves, she said.

William Perrone, an attorney with the law firm Dykema’s Lansing office, attended Monday’s meeting and also addressed the board. In addition to the issues that Parker had covered, Perrone noted another aspect of the rules change: It links – for the first time – the qualification for state aid to the receipt of penal fine revenue.

Libraries receive two sources of annual funding from the state: 1) state aid, and 2) penal fines. State aid, as required by statute, is an amount budgeted annually by the legislature, then divvied up among public libraries on a per-capita basis.

Separately, libraries also receive a portion of penal fines paid to the state’s criminal justice system each year. These payments are mandated by the state constitution and are administered by the county treasurer, who allocates the funds to libraries in the county on a per-capita formula – the state simply notifies the treasurer which libraries are eligible to receive these revenues.

In its most recent fiscal year, which ended June 30, 2010, AADL received $251,308 in penal fine revenue. By comparison, that same year the library received $71,634 in state aid – more than half of that was allocated to fund the local Library for the Blind and Physically Disabled, which AADL administers. The AADL’s overall annual budget is just over $12 million.

State Aid Lawsuit: Amicus Curiae Brief

Perrone told the board that when the Herrick lawsuit is resolved, it will likely set a precedent on the issues being raised. It will determine whether the Library of Michigan has rule-making authority by inference, he said – the state has already conceded that rule-making authority isn’t laid out explicitly in state statues. If such authority is inferred, the next question is whether state aid rules can be a part of that authority – or whether state aid is the purview of the legislature.

Perrone explained that an amicus brief is a mechanism to show the court that the impact of the lawsuit is broader than its effect on the plaintiff. The AADL brief would address three issues, he said:

• To support Herrick District Library regarding its position on state aid rules.
• To say that these new rules run counter to the state’s public policy, created when the legislature set up the library system – that is, to object to taking away local decision-making authority and transferring that control to the state level, in essence creating a state library system.
• To point out potential negative consequences if these new rules remain in place.

Perrone described several negative consequences that would result from these new rules. The effect would be to deny library services to those people who need them – the opposite of what the rules were meant to do, he said. Libraries that previously provided limited services at a lower rate – or at no charge – couldn’t afford to give contracting jurisdictions full service. So instead of losing their qualification for state aid, the district libraries likely would decide not to provide any contract service at all, he said.

Another potential consequence of failing to qualify for state aid is that libraries could also lose their charters. There’s a provision in Michigan’s library act that stipulates if a library fails to qualify for state aid, the state librarian can seek to dissolve the library. “That’s pretty draconian,” Perrone said.

Finally, the issue of tying the qualification for state aid with the qualification to receive state penal fines is significant, Perrone said. Revenue from penal fines constitutes a lot more money than does state aid, he said, and affects more libraries. That’s because all libraries in the state receive penal fine revenue, and there’s a larger pool of funding to distribute. In contrast, state aid is set by the legislature and is generally a smaller amount, available only to libraries that meet Library of Michigan qualifications.

These points would be made in a neutral tone in the amicus brief, Perrone assured the board, with the goal of conveying to the court that the new rules aren’t appropriate.

They’re working under a tight timeframe, he said. Herrick’s brief in response to the Library of Michigan’s appeal is due on Dec. 24. Amicus briefs are due 21 days after that – on Jan. 13. With the holidays, that tightens things up even more, he said. Dykema has already done some minimal research. They’ve talked to the legal counsel for Herrick, and Parker has talked to the library director there. Perrone said he believes they are prepared to meet the deadline for filing.

State Aid Lawsuit: Board Questions, Comments

Prue Rosenthal asked whether there was anything in the new rules mandating that contracting entities pay the full cost to receive full services. Perrone said that the state library act allows libraries to enter into these kinds of contracts, but there are no rules dictating what the contracts should entail. It was his understanding that municipalities outside the library district – usually townships – couldn’t afford to pay the full cost for complete services. [According to a Jan. 9, 2010 Grand Rapids Press article about the Herrick lawsuit, the townships under contract with Herrick reported that they'd have difficulty paying the full amount.]

In response to a question from Jan Barney Newman, Perrone said it would likely be several months before a ruling is made on the lawsuit – typically, a ruling is handed down six to 12 months after the briefs are filed, he said. Oral arguments might occur this summer.

Parker clarified for the board that AADL would not be entering the lawsuit. The amicus brief is simply designed to show the broader implications of the case.

Newman then asked whether any state aid would be awarded in the interim. That decision is up to the state library, Parker replied. In November, the state library issued a notice that payments would be held – they’ve stated it would take a year to modify their electronic system, which is now set up to conform to the new rules. State library officials have argued that they don’t have the staff resources to make the change – that was an argument for why the new rules need to go forward, Parker said.

Perrone noted that if the state library had been granted the stay it requested, they could have implemented the new rules. Now, they can’t. He contended that at this point, the state library can’t simply hold the funding until the case is resolved – it’s been allocated by the legislature. They’ve got to deal with it, he said, or potentially face another lawsuit.

Carola Stearns asked whether the municipalities that are contracting with district libraries are upset by the level of service they’re receiving. Perrone replied that the rule changes weren’t generated at the request of these contracting entities, and that the contracting entities didn’t litigate. His understanding is that it’s a state authority issue, not a quality-of-service issue. Parker added that it’s also a financial issue, from the perspective of both Herrick and the townships.

Rebecca Head noted that historically, the Library of Michigan at one point did have decision-making authority. Perrone said this was true when the state library was part of the legislative branch. But in 2001, the legislature transferred the Library of Michigan to the Department of History, Arts and Libraries, which had just been formed as part of the executive branch. As part of that transfer, legislators stripped out the section of the state statute that gave the Library of Michigan decision-making authority. The state library was later transferred again – in 2009 – to the Department of Education, but its decision-making authority wasn’t restored.

Newman noted that the state library could appeal to the legislature to restore its authority. That’s true, Perrone said. But what the state library is trying to do instead is a back-door approach to getting its authority back, he said.

Head reported that the board’s executive committee had been briefed by Perrone last week, and had agreed that it would be reasonable to move forward with an amicus brief. Margaret Leary said she fully supported filing the brief. AADL was in a position to do something in support of public libraries, and they should, she said.

Leary also had two questions: 1) Are other libraries also filing amicus briefs? and 2) What’s the position of the Michigan Library Association?

Parker couldn’t say definitively whether other libraries were also filing amicus briefs. The directors of library cooperatives in the state have been discussing it, she said, but she hasn’t heard whether they will file.

Parker said that unlike many other libraries, AADL has the resources and time to take leadership in this way. [Parker and the board have previously taken stands on other statewide issues, including a strong position in support of the Library of Michigan when it was at risk of being dismantled. See Chronicle coverage: "Board Briefed on Gutting of State Library"]

Many others are watching the situation, Parker said, adding that she thinks they’ll be representing a lot of people.

As for the Michigan Library Association, they haven’t taken a position, Parker said. Ed Surovell commented, “That in and of itself is a position.”

Parker noted that it’s difficult for her, because she’s chair of the MLA’s legislative committee. The MLA board hasn’t asked the legislative committee to comment – the issue has remained at the board level, she said. But the association isn’t filing an amicus brief.

As the board prepared to vote on a resolution to file the brief, Surovell said he needed to abstain. His position as a trustee for the Library of Michigan Foundation – a separate entity that raises money to support the state library’s special programs, services and collections – created a conflict for him, he said. “I do not, however, lack an opinion.”

Outcome: The board voted to approve a resolution directing AADL to file an amicus curiae brief in support of Herrick District Library’s lawsuit against the Library of Michigan. Ed Surovell abstained.

Financial Report

Ken Nieman, AADL’s associate director of finance, HR and operations, gave a brief report on the library’s finances. He noted that through the end of November, the library had received about 95% of its budgeted tax revenue, or nearly $11 million. They had about $13.8 million in cash on hand, and the items that were currently over budget – including employee benefits, software licenses and repairs/maintenance – are expected to come back in line before the end of their fiscal year on June 30, 2011.

Aside from one word change pointed out by treasurer Prue Rosenthal, there was no discussion among board members regarding this report.

Director’s Report

Josie Parker began her director’s report by noting that the library and its staff have received several instances of national recognition. Tim Grimes, AADL’s community relations and marketing manager, has been invited to be an advisor to the Tribeca Film Institute in applying for a grant to develop a six-part public series of lectures, documentary film screenings and other events. Eli Neiburger, AADL’s associate director of IT and product development, is also involved. The series – titled “From Bluegrass to Broadway: A Film History of America’s Popular Music” – would cover a range of American musical traditions, including blues and gospel, jazz and hip-hop. Parker said that AADL and the New York Public Library are involved, because on a national level they’ve been two of the libraries that have taken new technologies seriously, as a tool to delivering programs and services.

Grimes has also been invited to help develop a new project for the National Endowment for the Humanities, tentatively titled “Bridging Cultures Bookshelf: Muslim Worlds.” Grimes and others will meet next year to identify books and other resources that will ultimately be distributed to at least 1,000 public libraries nationwide, designed to spur discussion and programming about the Muslim culture.

Parker also noted that the book selected for the 2011 Ann Arbor/Ypsilanti Reads program is “Life Is So Good,” by George Dawson and Richard Glaubman. The book relates the story of how Dawson, who’s now deceased, learned to read when he was 98. “I think it’s time for an upbeat and positive read,” Parker said, “and this one will be.” Glaubman will attend the Jan. 22 kick-off. [The event runs from 1:30 to 3 p.m. in the Morris Lawrence Building at Washtenaw Community College, 4800 Huron River Drive. A complete list of events is on the AADL's website.]

Parker reported that AADL was selected as one of 20 sites for the traveling exhibition of “Benjamin Franklin: In Search of a Better World,” marking the 300th anniversary of Franklin’s birth. The exhibit will be in Ann Arbor from May 4 through July 11, 2011, and staff are developing programming for it.

Finally, she congratulated librarian Erin Helmrich, whose article “What Teens Want: What Librarians Can Learn from MTV” – originally published in an issue of Young Adult Library Services – will be included as a chapter in a 2011 publication of the Young Adult Library Services Assocation. Helmrich has also co-authored a book with former AADL librarian Elizabeth Schneider, titled “Create, Relate and Pop @ the Library: Services and Programs for Teens and Tweens.” That book will be published in March of 2011.

Farewell to Outgoing Board Member

At the end of Monday’s meeting, the board unanimously passed a resolution of appreciation to Carola Stearns, and presented her with the gift of an inscribed clock and gave her a round of applause. It marked the last meeting for Stearns, who lost the Nov. 2 election to Nancy Kaplan. Kaplan attended Monday’s meeting, and will officially take office in January.

Board members expressed gratitude for Stearns’ service. Prue Rosenthal noted that Stearns had kept the board on its toes, and Margaret Leary commented that Stearns had taught her to think more scientifically. She also pointed out that Stearns had agreed to accept a two-year appointment, knowing that she’d be in the public eye before running for election – that took courage, Leary said. [Stearns had been appointed to the board in mid-2008, following the resignation of former board member Jean King.]

Ed Surovell recalled that Stearns had been new to the board at a time when other board members had felt comfortable with the way they were doing things. “Carola reminded me of how strange it all seems” as a new board member, he said. She worked hard to catch up, he added, and in the process reminded the rest of them “what the real questions were.”

AADL director Josie Parker also thanked Stearns, saying that she brought an analytical perspective to the staff that was valuable. While they already took that approach to some extent, “now we do it automatically,” Parker said. “It makes us a much better library.”

Stearns, who had given more extensive remarks about her tenure at the board’s November meeting, thanked her colleagues for their support.

Present: Rebecca Head, Margaret Leary, Jan Barney Newman, Prue Rosenthal, Carola Stearns, Ed Surovell. Also: Josie Parker, AADL director.

Absent: Barbara Murphy

Next meeting: Regular board meetings are typically held on the third Monday of the month, with the public portion of the meeting starting at 7 p.m. in the library’s fourth floor board room, 343 S. Fifth Ave. The board’s next regular meeting is set for Monday, Jan. 17, 2011. [confirm date]