Anderson, Montgomery libraries on defense as suits target taxes

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LAWRENCEBURG — The outcome of civil suits that seek to roll back tax rates levied by the library districts in Anderson and Montgomery counties could have implications for many libraries elsewhere in the state.

A suit filed in May would roll the Anderson County library tax back to its level in 1967, when the library was first organized. A similar suit filed in June would roll back the Montgomery County library tax to its level in 1980, when it was organized.

The suits argue that the library districts have improperly raised tax rates over the past decades without voter approval as required by state law.

These two suits and three others in Kenton, Campbell and Boone counties in Northern Kentucky were all filed by Brandon Voelker, a lawyer in Cold Spring. Voelker, who represents citizens in all five counties, said the suits aren't meant to start a debate "on whether libraries are good or bad. It's a matter of whether the people have a right to decide the size and scope of their library."

Attorneys for the libraries say their districts followed the instructions on tax increases as provided by the state Department of Libraries and Archives and by past opinions of the state attorney general.

In his response to the Anderson suit, attorney Ben Crittenden wrote: "The library denies that any residents or taxpayers in Anderson County were charged a tax increase never properly enacted."

If the suits are successful, they would have dramatic impact. For example, Anderson County's 2012 library tax rate of 8.6 cents per $100 would be lowered to the original 1967 rate of 2.5 cents per $100. That would cut the Anderson County library's tax revenue from $749,000 to $217,000, a rollback of 71 percent.

The loss of that much revenue would result in a reduction of two-thirds of the library's staff and "at least some cut in pay" for the remaining staff, Bryan Proctor, president of the Anderson County library board, wrote in an email. Programs for everyone from toddlers to seniors would be cut.

"We would be unable to continue offering computer classes, early literacy classes and after-school homework assistance," Proctor wrote.

Such slashing of budgets might affect other libraries created by petition, said Tom Underwood, executive director of the Kentucky Libraries Association.

"There are probably 90 library districts in the state that are sweating this," Underwood said. "You don't know what the judges are going to ultimately rule." If tax rates are rolled back, Kentuckians can expect to see layoffs and service cuts at libraries across the state, he said.

No decision has been issued in the Boone, Anderson and Montgomery cases, but in April, judges in Kenton and Campbell counties ruled in favor of the plaintiffs represented by Voelker. The Kenton and Campbell cases now go to the Kentucky Court of Appeals.

In doing research on another issue, Voelker found a passage in a 1964 state law that says if a library district was formed by petition from voters, its property tax rate shall not be increased or decreased without a petition signed by 51 percent of the registered voters in the last general election. The law is KRS 173.790.

Attorneys representing the five libraries point to a 1979 law, commonly known as House Bill 44, which said taxing districts are allowed limited tax increases without voter approval.

"People understood there was tension between these two laws quite some time ago," said Crittenden, the lawyer for the Anderson County library. "Now it's being litigated and there are arguments to be made on both sides."

The judges in Campbell and Kenton counties ruled that House Bill 44 did not render the older law meaningless.

"Pursuant to KRS 173.790, a library tax created by a petition of the people of a county can only be changed by a petition of the people of that county," Campbell Circuit Judge Julie Reinhardt Ward wrote. "There is a certain logic to this procedure and there is no manifest indication that the Kentucky state legislature intended that House Bill 44 take this power away from the people."

The cases have implications elsewhere in Kentucky because a majority of the state's 106 library districts were created by petition.

Among them are libraries in Bourbon, Boyle, Clark, Franklin, Garrard, Harrison, Jessamine, Mercer, Scott and Woodford counties, as well as numerous libraries in Eastern Kentucky, according to the Kentucky Public Library Trustee Manual. Fayette County's library was created as a unit of government and would not be affected by the outcome of the suits.

In any case, if taxpayers in Kenton and Campbell counties are truly concerned about library services, "why isn't this the best time to go have a rally and try to get a petition (for a tax increase) passed?" Voelker asked. He said representatives for the Kenton and Campbell libraries have answered, "It's just not realistic. People won't approve it."

"Our response is, 'Well, perhaps people don't entirely approve in what you're selling,'" Voelker said. "If people truly believe in the level of service, they'll sign a petition."

Underwood said he finds it odd that libraries are put on the defensive now, particularly after State Auditor Adam Edelen, in a 2013 report on special taxing districts, found that all 106 library districts were in compliance with reporting requirements for transparency and accountability.

"The idea that libraries have flouted their legal obligations or engaged in some sort of intentional wrongdoing couldn't be farther from the truth," Crittenden said. "We look forward to getting this resolved so libraries can get back to serving their purpose and their communities without the fear that they're going to have to dramatically reduce or cut back services."