TRENTON – The Senate Budget and Appropriations Committee today approved a measure sponsored by Senator Nicholas J. Sacco that is designed to enable public libraries with healthy budget surpluses to aid municipalities that are starved for revenue in the struggling economy.
“Many libraries are holding surpluses in excess of 100 percent of their current budget, a good deal of which comes from a municipality to begin with,” said Senator Sacco (D-Bergen/Hudson). “At the same time, many municipalities have been hit hard by the recession and a loss in state aid. I like to think of this measure as a marriage – with one partner in the community helping the other in sickness and in health. This bill is intended to provide relief for property taxpayers while protecting municipal libraries that are not as financially stable as others.”
Current budgeting standards recommend a goal of a 20 percent surplus of any entity’s operating budget, while most public bodies actually hold a surplus of 10 percent or lower. This bill (S-2070) would require a free municipal library to transfer any budget surplus amount that exceeds 20 percent of its audited operating expenditures for the previous year to the municipality in which it resides, excluding funds designated for capital improvements or grants.
The measure is intended to deliver property tax relief by helping struggling municipalities remain under the state-mandated property tax levy cap. The bill will ensure that libraries maintain enough money to operate while also maintaining the current funding formula. Municipal libraries that are not in good financial standing would not be affected by this bill until such time as they have built a surplus in excess of 20 percent of their operating budget.
Under current law, a free municipal library may choose to transfer a portion of its surplus to the municipality upon approval by the State Librarian, excluding funds restricted for capital projects and grants.
The bill now heads to the full Senate for approval.
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