Tainted by misinformation, FRL debate drags on

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Tainted by misinformation, FRL debate drags on

Jackson County commissioners voted to leave the Fontana Regional Library system on June 24. File photo

As residents of Jackson County continue to rail against commissioners’ June vote to withdraw from the Fontana Regional Library system over LGBTQ content — a decision made without a plan, without a clear understanding of library operations and without reliable financial projections — questions are growing more pointed, but the minority that supports withdrawal continues to spread misinformation about key aspects of library operations.

‘HOW MUCH IS THIS ALL GOING TO COST US?’

Jackson County is now in its second month of the so-called “demonstration year” during which it must untangle its operations from the FRL and prove that it has the wherewithal to operate an independent public library for the first time in at least 80 years.

At the Aug. 5 meeting of the Jackson County Board of Commissioners, 25 people spoke during a 45-minute public comment session, suggesting it’s going to be a very long year if commissioners continue to ignore questions and concerns from the press and the public.

Continuing criticism of the board’s decision to withdraw began immediately, as speaker after speaker continued to question the justification behind withdrawal, the absence of a clear problem statement describing that justification, and whether commissioners would again raise their property taxes next year to pay for the estimated $500,000 annual increase in library expenses.

Others focused on specific claims made in prior meetings. Susan Barscheski said she had counted eight Bibles on the shelves — including in Spanish, Cherokee, large print and audio formats — along with dozens of Christian-themed titles. Losing FRL membership, she warned, could mean losing access to many of those materials.

“In a time like now, disinforming people, misinforming people, it’s too easy, and I see it as an abuse of power to take information from people and take access from people,” Barscheski said.

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Some speakers took a more critical tone. Luther Jones, who recently criticized the Town of Sylva’s decision not to pass a resolution in support of FRL (the town later did) pledged financial support to any future opponents of commissioners who supported withdrawal.

Concerns about accessibility — echoing those from Barscheski, who also cited the availability of audio bibles that could be borrowed through the NC Cardinal interlibrary system — came from Susan Danner, who is visually impaired and relies on a free reading app provided through the Jackson County Public Library.

“Will this cost us free apps for the disabled?” Danner asked.

Questions about costs persisted, with one speaker saying she still hadn’t heard an answer to the one she’d been asking since June — “How much is this all going to cost us?”

As has been the case since the outset of the library debate, supporters of the withdrawal remain a minority and speak mostly for outside agitators who don’t live in Jackson County.

Only one, conservative activist and Sylva resident Keith Blaine, showed up Aug. 5 in an attempt to justify the withdrawal by spreading more lies, including a whopper about who, exactly, has the ear of Jackson County commissioners.

“You weren’t given the position [of commissioner],” Blaine told commissioners. “You were elected by the citizens of Macon County.”

Howls of laughter and derision followed, but the Freudian slip — Macon County residents including frequent FRL critic Jim Gaston were among the few to support Jackson County’s withdrawal — wouldn’t nearly be Blaine’s last false statement of the night.

‘OVERPAYMENT’

Nearly all local government units in North Carolina maintain what’s called a “fund balance” — a pot or pots of liquidity, outside of the general fund budget, to be used for short-term reimbursable expenses, unexpected disasters or other needs not addressed in the general fund budget.

In household terms, fund balance is similar to a savings account that a family can dip into so the light bill gets paid even though payday may be several days away. When that day comes, some of the paycheck goes back into the savings account. Or, when a tree comes through the roof in the middle of the night, that savings account can be used to buy a tarp to cover the hole, and pay the insurance deductible to get the repair and reimbursement process started — without impacting the normal family budget used for housing, utilities and other necessities.

Overseen by the Department of the State Treasurer through the Local Government Commission, fund balance accounts are monitored closely and can earn a warning letter from the agency if they drop too low.

Ultimately, state intervention in any public body’s fiscal affairs can also result when the LGC thinks a fund balance account doesn’t provide enough hedge against cash flow issues.

That’s exactly what happened in the Cumberland County town of Spring Lake on Oct. 5, 2021. Then-Treasurer Dale Folwell ordered the LGC secretary “to impound the books and records of the Town, assume control of the finances of the Town and oversee and direct all its financial affairs” after the town’s general fund went into the red.

A subsequent fiscal accountability agreement between the town and the treasurer cited “dramatic decreases in percentage of fund balance” — from 30.6% in 2017 to -8% in 2020 — as financial stability and fiscal management problems. The power of the purse was returned to the town in July 2024.

Former FRL Finance Director Lynn Cody, who recently resigned from his post, told The Smoky Mountain News that guidance from the state and from trainings provided to fiscal officers suggest fund balance can be an absolute bare minimum of 8% of annual revenue, but more practically should be between 40%-50%.

“Fund balance is, basically, just for emergency use,” Cody said, adding that the monthly payments made by county governments to the FRL system don’t always line up with FRL’s expenses.

“At times, we have to be able to make sure that the bills are paid during that time and due the fact that we do have a good, healthy fund balance, it means our general fund is always available,” he said. “A lot of times when we apply for grants, you have to request the funds to be able to pay those grant funds, and then you’re reimbursed. In other words, you have to put the money up front first, and then you’re reimbursed for those funds.”

The FRL has adopted a minimum fund balance policy of reserving an amount equal to or greater than 25% of annual operating revenues.

According to the FRL’s most recent audit for the fiscal year ending June 30, 2024, revenues topped $4 million and fund balance was $2.7 million; however, $770,000 of that is restricted, meaning it’s already been allocated and can’t be spent for various reasons.

One of those reasons, Cody told FRL board member Cheryl Taylor on July 8, was for payouts on sick leave and vacation time. FRL also pays 100% of unemployment insurance for employees who depart — sometimes unexpectedly. Pulling that money out of fund balance ensures operations funded by the general fund can continue without disruption.

Those earmarks leave an unrestricted fund balance of $1.9 million, or about 47%. Cody said he felt comfortable with that level of fund balance.

Like nearly all other public bodies in North Carolina, Jackson County government has a fund balance of its own — $76.2 million, with about half restricted for the same reasons the FRL’s is. That $76.2 million puts Jackson County’s fund balance as a percentage of expenditures at 43.34%, per Jackson County’s most recent audit.

Blaine mischaracterized FRL’s fund balance as 80 years’ worth of “overpayment.” He also claimed that Jackson County had “overpaid” $160,000 last year.

“My concern is, you’re not getting proper accounting of the finances, of overpayment,” Blaine said to commissioners.

Had any of those allegations been true, they certainly wouldn’t have escaped the attention of the FRL’s auditor, Carter, P.C. FRL’s most recent audit mentions no instances of noncompliance.

“And as far as I know, throughout all these [audits] for many years, we have never had no discrepancies,” Cody said. “We’ve met the state standards, and everything has been processed. And we’ve never had no complaints from the state.”

Not only was Blaine wrong about fund balance being an overpayment, he was wrong about it being a payment at all. County governments don’t contribute to FRL’s fund balance — only to FRL’s general fund, mostly for operations.

“All those [general fund] funds are used in the library system,” Cody said. “A lot of the fund balance that has been created is donations and restricted donations and grant funds that have been given to the library over the years.”

Blaine also said he wanted to know how much of the $2.5 million in fund balance— actually, $2 million — would come back to Jackson County once the withdrawal from the FRL system is complete. The answer to Blaine’s question is zero, according to Cody.

“They’re not due none of those funds,” he told SMN.

A subsequent speaker, Chris Hamlet of Sylva, recognized Blaine’s incorrect assertion about fund balance immediately and offered a sharp rebuttal.

“That was multiple accounts that were for emergency — basically, emergency accounts. If something happened at the library, like something happened to the roof, that’s where that money is there,” Hamlet said. “That’s for emergency funds. Your own [Jackson County] budget has funds like that.”

Hamlet also shot down another lie by Blaine about library staff wages.

“One lady said, ‘Well, the library [employees] do not make a living wage,’” Blaine said. “Well, the FRL is the one who decides how much they make. It’s not you guys.”

“That is incorrect,” Hamlet said. “Each county sets the salary through their staff, through the money that you allocate as part of your allotment to the Fontana regional, our Jackson County librarians are not paid the same as Macon County librarians, or the same as Swain County librarians. Each of their salaries is based off of what that county contributes to the Fontana Regional [Library system].”

One of the few true statements Blaine made during his public comment was about FRL’s book challenge policy.

“Most people don’t even know what the process is,” he said. “Most people don’t even know there is a process.”

That could be because out of the tens of thousands of books borrowed from the FRL system each year, only five have been challenged in the last 13 years.

During the joint FRL-Jackson County meeting June 19, it was noted that the policy meets legal standards and protects First Amendment rights — while also protecting FRL from First Amendment lawsuits.

Hamlet also offered a question of his own, about what it would cost for the county to begin performing the accounting functions currently handled by FRL.

“This includes almost daily intake of fees and overdue charges and books, as well as collecting any money for people who rent out space in the old courthouse, as well as paying the events to take place at the library,” he said.

When reached for comment, Cody wouldn’t speculate on how many hours of work it might take on the part of Jackson County to replace what is currently being done by FRL, but it sounds substantial.

“The only thing I can say on the transition that Jackson County will take is, if they take the employees, they will have new employees that they’re going to have to absorb, and also the expense that they’re going to have to accrue for their retirement based on their longevity, that will be based on the accruals that they actually earn,” he said. “The operation is basically just the operation that we do at the [FRL] headquarters. We pay the bills and stuff, and all that would have to go over to them. We’re purchasing and monitoring all the bills and invoices coming and going.”

At least two speakers refuse to believe FRL withdrawal is a done deal. Kate Baker closed her remarks with a clear call to action, asking commissioners to take a vote reversing the decision to leave FRL.

Laura Lauffer, a 1988 Western Carolina University graduate who lives in Webster, left commissioners with a warning.

“This is not done,” Lauffer said. “Y’all still have time.”

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