CORRECTION: A story on Page A1 Wednesday should have said the Lexington Public Library has budgeted $250,000 in legal fees for Stites & Harbison for its work representing the library during recent investigations of its spending. It is unclear how much of that has been paid so far.
The Lexington Public Library is cutting its budget for the first time in a quarter-century, which will result in about 10 percent less money for new books, a hiring freeze except for critical positions and the indefinite delay of several renovation projects.
The library board of trustees voted Wednesday to cut this fiscal year's spending by 2.6 percent, taking $373,557 from about $14.5 million in planned expenditures. More cuts are likely to follow during the next few years, board members said.
"Unfortunately, I think it's safe to assume, given the economy, that it's going to get worse before it gets better," board treasurer Richard Browning said.
The library, mostly financed by Fayette County property taxes, is proving to be in shakier financial condition than the board previously thought.
For one thing, board members said, city officials recently advised the library that property taxes could be flat this fiscal year because of the recession and stagnant housing values — and flat might be the best-case scenario, with a drop also a possibility, board chairman Larry Smith said.
Also, the library spent a lot of money unexpectedly when credit card charges by its former executive director, Kathleen Imhoff, came under scrutiny by the Herald-Leader earlier this year. Imhoff, who was fired in July, spent more than $134,000 over five years on travel, meals, gifts and other items.
The library has budgeted $250,000 to pay the law firm Stites & Harbison to act as an intermediary with the Herald-Leader during its reporting, and later with city auditors who are continuing their own investigation of library spending. The library expects to pay the city $120,000 to cover the audit costs.
Finally, the library has budgeted $45,000 to search for Imhoff's replacement, which — like the legal and auditing fees — was not included in its original budget.
"If we had not had those legal costs and all, it would not be so severe now," Browning said.
To close the current budget gap, the board voted to:
■ Spend $137,090 less on new books, magazines, research items and other materials, which is 9 percent of the materials fund. In coming months, patrons might notice that some new books are not bought or take longer to appear on the shelves, acting director Martha White said.
■ Reduce the money for its 250 employees' salaries and benefits by $150,000, or 1.7 percent, which will be achieved by the hiring freeze and eliminating vacant jobs where possible, White said. Board members said they do not expect layoffs, but they are considering a 2.5 percent cut in pay if more savings are needed.
■ Delay indefinitely planned renovations to the Central Library garage and the Eagle Creek and Beaumont branch libraries, including improving and expanding the branches' public computer areas.
■ Eliminate some spending that Imhoff previously had charged on her credit card, including travel, meals and a $7,500 library staff calender that featured personal photographs taken by Imhoff and others.
In the next month, the board will discuss whether to cancel the extended Friday and Sunday evening hours that the library started offering in April, Smith said. Although the longer hours are popular with the public, they cost money because of staffing payroll and utility costs, he said.
The library is legally an independent non-profit organization, but it runs on tax money and is overseen by a board nominated by the mayor. Thanks to a 1979 lawsuit by an unhappy library patron, and to subsequent court rulings, the library is guaranteed a nickel of every $100 in property taxes.
That has provided a comfortable, steadily rising revenue stream — until now.
"We haven't had to make such serious choices as we now have to," board member Timothy Sineath said.