Lebanon Forgives Library Debt

Kenneth Hendrick, of Quechee, uses a computer at the Kilton Public Library in West Lebanon last week. Hendrick often stops there on his way home from work. (Valley News - James M. Patterson)

Kenneth Hendrick, of Quechee, uses a computer at the Kilton Public Library in West Lebanon last week. Hendrick often stops there on his way home from work. (Valley News - James M. Patterson) Purchase photo reprints »

Lebanon — The City Council last night voted to forgive $325,300 in outstanding debt owed by the public libraries’ Board of Trustees, a sum associated with the construction of the nearly three-year-old Kilton Library in West Lebanon.

The debt forgiveness allows for the libraries’ fundraising wing to focus entirely on new initiatives and programs. It also pushes the city’s share of the $6.1 million library construction cost up from 25 to 30 percent.

According to Lebanon Finance Director Len Jarvi, forgiving the debt obligation would be unlikely to impact the municipal tax rate, as the amount could be absorbed in the budget over a number of years.

In a presentation to the council, Director Sean Fleming said that the library’s nonprofit foundation is anticipating a $126,000 shortfall in their fundraising goal for 2013.

“With this economy, we have been hurt by pledges that we’ve been unable to collect,” he said.

In its first “annual appeal” over the summer, the foundation was able to raise $29,000, which it plans to use to replace flooring, carpeting, and furniture at the downtown Lebanon Public Library.

Fleming said the debt forgiveness was needed so that the foundation could set up a “long-term funding plan,” which would include the hiring or contracting out of a professional fundraiser.

The idea of a professional fundraiser was met with resistance from city councilors, however, including Erling Heistad, who said he has hired three professional fundraisers in the past and not one of them had even covered the cost of his salary.

“I’m concerned when we put an assumption out that somebody else is going to step in and do a better job than we can,” he said. “I would bet the trustees here know the community and will be respected within the community far better than somebody with expertise that may or may not help.”

Fleming said that the position, which would likely be about 20 hours per week, could eventually represent the “linchpin” of the foundation. He added that, as far as fundraising goes, there is a “flow of money already there.”

“I’m anticipating if we hire somebody, that’s just going to increase, so I’m optimistic ... that investing that money in a development, contracted-out position would pay dividends to the library,” he said.

The motion to forgive the debt passed 7-2 with Nicole Cormen and Bruce Bronner opposed, but even some of the councilors who ultimately supported the motion expressed reluctance .

Before the final vote, Karen Liot Hill proposed putting off the vote until a later date, but the motion failed, with only Cormen and Liot Hill in support.

In discussing the motion to forgive the debt, Liot Hill said that $325,000, which represents the remaining debt owed on a $1.1 million short-term debt issued to the trustees by the city, was a “big number.”

“I think some of us had the idea in our minds, especially when we were asked to cover some short-term borrowing that ... maybe things aren’t going to pan out the way we projected, and maybe we shouldn’t be too optimistic, so I can’t say I’m terribly surprised that we are here,” she said.

Assistant Mayor Scott Pauls expressed a similar sentiment earlier in the meeting when he said that the shortfall in fundraising could be attributed to “going forward with Kilton too fast.”

“I think the libraries are too valuable to get hung up on some of this stuff,” said Pauls. “But it ... gives me a bit of pause to be looking at plans that look great to me, but I want to see some diligence. I want to see much better diligence than we’ve seen in the past.”

Cormen expressed concern that the debt forgiveness would set a “bad example,” given that there was a pledge made to the council that the entire loan would be paid back.

“This is public money and it is a public library, but we have had to ... make a lot of tough decisions for numbers a lot smaller than $325,000,” she said.

In arguing for the debt forgiveness, Fleming said that the “number one priority” of the nonprofit Lebanon Public Libraries Foundation has been to repay the debt owed to the city, but doing so has hindered other efforts.

“It’s tough to get new board members energized about paying off an old project, but we do have a very energized board right now,” he said.

Fleming repeatedly pointed to the Howe Library in Hanover as a model that the Lebanon Public Libraries Foundation was trying to emulate. The Howe Library’s endowment, Fleming said, funds 25 percent of their operations.

“We’re not there right now,” he said. “Less than 5 percent of our ongoing costs are funded by the trustees.”

City Councilor Steve Wood, who proposed the motion to forgive the debt entirely, said that the council shares in the responsibility for past mistakes.

“The thing is, we wanted this,” he said. “We sought this. Let me remind us, without going through a list of how many errors have been made in the past — much graver, capital errors than this.”

He continued, “You can drive east and west, and look left and right, and see very expensive errors that have been much more expensive than this.”

Construction of the Kilton Library totaled $6.1 million. The fundraising for the project can be traced back to 1999, when James and Willena Kilton gave $1.3 million to the Library Board of Trustees.

Ten years later, the City Council appropriated $1.5 million toward the construction of the Kilton Library.

The city also provided a bridge loan of nearly $1.2 million to fund the construction of the building, the balance of which was being debated last night. Jarvi said in a memo to the council that the library trustees have contributed $4.6 million toward the entire cost of the library.

Ben Conarck can be reached at bconarck@vnews.com or 603-727-3213.