INTERGOVERNMENTAL FISCAL FACTORS 51

20. For a discussion of the elements necessary to achieving a high-quality tax system see, ACIR, Fiscal Balance in the American Federal System (Washington: October 1967), A-31, Vol. 1, p. 132 ff.

21. As shown in Table 3, the state portion rose to 43.7 percent in 1971-72, and preliminary NEA estimates indicate a further rise to 44.5 percent in 1972-73.

22. National Journal, June 30, 1973, p. 936.

23. ACIR, Financing Schools and Property Tax Relief-A State Responsibility (Washington: January 1973), Report A-40, p. 109.

24. Ibid., Table 36.

25. Ibid., p. 114.

26. Ibid., Table 41.

27. Ibid., P. 9.

28. ACIR, The Gap Between Federal Aid Authorizations and Appropriations (Washington: June 1970), Report M-52, pp. 23 and 24.

29. ACIR, Fiscal Balance in the American Federal System (Washington: October 1967), Report A-31, Vol. 1, p. 5.

TECHNICAL NOTE on Table 3 DATA COMPILATION

The information on governmental source of library financing presented in Table 3 was constructed from Census data as follows:

1. It is assumed that most Federal aid for libraries is paid to the states. Figures for 197172 on state intergovernmental revenue from the Federal government for libraries are not published in State Government Finances 1972, but are readily available in Census worksheets. These were supplied by the Governments Division and were used as the Federal component for each state.

2. The Census report, State Government Finances in 1972, provides data on state expenditure for libraries, with separate figures for direct state expenditures (state library, supervision of local library services, and the like) and for state payments to local governments (including Federal aid funds channeled through the states). Deducting the Federal intergovernmental revenue figures from the total state library expenditure figures yields state own-source expenditure for libraries.

3. The Census report, Governmental Finances in 1971-1972 (soon to be published), does not present separate state-by-state figures on local expenditure for libraries (although national totals are presented). The state-by-state figures are, however, developed separately and were drawn from a computer run available in the Governments Division. From these figures were deducted the state and Federal aid amounts (see paragraph 2, above) to arrive at library expenditure from local sources.

CHAPTER 4

Alternative Systems for Funding

the Public Library

Summary of Findings

The central conclusion of this analysis of funding patterns and general assessment of financing requirements for adequately supporting the public library is that the present system is basically deficient. In almost two decades of operation since the direct involvement of the Federal government, the present system has not produced an effective development and distribution of public library services. The distribution of costs among the levels and jurisdictions of government is grossly inequitable and is a prime deterrent to the progressive development of a public library system responsive to the informational-educational-cultural needs of a modern society.

General Conclusions

Historically, the public library represented a private response to the clearly felt need to provide a central repository of information and knowledge vital to the self-development and economic and cultural understanding of all citizens and, through them, the advancement of the community.

The public library today represents an under-developed national resource affecting and affected by the educational, cultural and overall quality of life in the United States. This resource, which is unique to this democratic society, provides informational, educational, and cultural services in patterns which vary according to estimates of need, sometimes imperfectly perceived by the library institution itself. More importantly, services vary widely according to the fiscal ability of the more than 10,000 state, county and local jurisdictions to provide library services equitably to all the nation's citizens.

Uniquely, and for a variety of reasons, the public library has not emerged or developed in a political or bureaucratic form typical of other social institutions. It exists today largely in its pristine state as an

almost randomly distributed pattern of semi-autonomous local service agencies and systems, loosely coordinated with other libraries and almost quasi-governmental in nature. As a social institution, it is related by tradition and function to the public education system. Yet, it cannot be considered an integral part of public education, nor can it be described as a functional service in the mainstream of government. This set of characteristics represents a heavy liability for public libraries in terms of attaining stable, adequate financial support for a full set of services available to all citizens. The institution's deep roots in the community and its strong civic support represent the public library's principal asset, at least potentially, in striving to develop a viable pattern of services responsive to the full variety of community and individual needs.

Today, in our highly complex, industrialized and fragmented society, the need for decentralized repositories of information, knowledge and cultural services still exists and perhaps is even accentuated. There are still wide socio-economic and cultural gaps and quite alienated groups in our social structure producing needs which have long been the focus of public library services. In an era of affluence, there is still the need to provide an even wider variety of channels of upward social and economic mobility responsive to community and individual needs and selection. There is increasing evidence that our formalized, bureaucratic structures for social, educational and economic advancement have not served adequately or equally well the varied needs of all citizens. Indeed, decentralized, unorganized (if you will) social and educational resources such as public libraries increasingly are being seen as providing valid adjuncts and alternatives to governmentally sponsored, formally structured educational programs.

This is not to say that we should replicate or simply expand the traditional patterns of public library services. Proximity of service to each community and individual remains important, but there are essential changes to be achieved through expanded inter-connecting linkages and networks of library services. These advances are needed to increase service efficiency and to more nearly satisfy cost-benefit requirements of the public sector. Modern technology provides vast new means to establish such network linkages and provide the means by which information and knowledge from the accumulated record can be translated for individual utilization. It is unlikely, however, that modern technology can ever replace the printed page or the highly personalized interactive process of consulting the written record. Nonetheless, the style and pace of modern life in an information demanding society requires more than the passive, unobtrusive pattern of public library services that exists today in many communities. Changes such as these, and more, should be incorporated in modern

public library services. But, the essential features and function of providing specialized research, information, and educational-cultural services remain at least as much needed as ever before in the history of the public library.

Federal Level

It is obvious that the amount and extent of Federal funding has been small and has far from realized the expectations of the LSCA designers. The impact of revenue sharing, in addition to the elimination of Federal categorical aid, could have other severe effects on the future development of public library services because it (1) provides the states with an opportunity to reduce or eliminate their matching fund contribution, and (2) leaves local public libraries with the need to face local political and fiscal decision-makers with increased budget requests due to Federal and state cut-backs. The problem will be especially severe in urban areas because of the classic mismatch of needs and resources in such areas, and with respect to regional library networks which operate on a state-provided fiscal base. Reports on the proposed and actual use of revenue sharing funds do not provide much hope that public libraries are receiving, or will likely receive, priority consideration in applying for these funds.

Beyond the political dimension of the current revenue sharing versus categorical grant battle, there is broad justification for continuation of substantial Federal funding. Public libraries represent an activity and service, the benefits of which, in the terminology of modern public goods theory, extend beyond the individual and his local community. Moreover, for the reasons cited earlier, funding in support of public library services is a relatively late entry into the Federal and state financing scene. Substantial and direct Federal financing is particularly appropriate to provide national services and linkages, to meet interstate disparities, and to assist in the upgrading of this service to a desired level. The continuing importance of public libraries as an information resource and a civilizing force in an imperfect modern society is ample evidence of need for continued Federal involvement and support.

A word should be said about the Library Services and Construction Act. Perhaps it was the best measure that could be developed a decade ago. Nonetheless, as a fiscal subsidy method, the LSCA provisions represent a rather crude mechanism utilizing factors more appropriate in a tax redistribution scheme than a goal oriented aid system. The total cost of the "floor" ($200,000-Title I, $100,000-Title II, and $40,000Title III), representing the minimum grant to each state, could equal $17 million, or nearly 30 percent of the 1972 total appropriation of $58.6

million. That seems to be an expensive underwriting of the status-quo in a functional area where directed expansion and development are needed. It is difficult to achieve planned objectives under this kind of arrangement.

The LSCA makes heavy use of the plan device in the administration and utilization of Federal funds. This is a valid technique, but it requires intensive staff evaluation, including revision, of submitted plans, and the kind of administrative-political clout required to reduce or cut off funds if the state plan or its implementation do not meet standards.

In the present turbulent environment of intergovernmental fiscal affairs, leaders of the public library field now face a new opportunity and a new challenge. The present LSCA expires in 1976. Through the activity and hard work of many people, there is emerging a new recognition of the importance of the public library as a viable institution in a modern society. The President's statement, in his January 24, 1974 Education Message to the Congress, cited earlier in this report, can represent potentially a new and important commitment. Moreover, the nature of the commitment is not necessarily limited to a narrow single-purpose objective. Under this new initiative, a legislative program referred to as a Library Partnership Act is now being formulated. Whatever the legislative title, as it finally emerges, this action represents an opportunity to implement an appropriately strong Federal role, and to improve the total public library funding system.

State Level

As of 1970-71, a total of 35 states authorized some form of state aid to public libraries; however, only 23* states made appropriations for this purpose. The total amount appropriated was $52.5 million of which nine states appropriated $45 million or 82 percent of the total for all states. New York State alone appropriated $15.5 million, or about onethird the total for the nine states. This indicates, of course, that in the majority of states the aid system for local public libraries operates at a nominal or minimal level.

A later (1972-73) analysis by the Bureau of Library and Learning Resources (now the Division of Library Programs) noted that 13 states had no legislative provision for a support program. An additional nine states which have direct assistance programs provided less than $200,000 per year. Thus, 44 percent of the states either make no financial effort to support local library services, or provide amounts which must be viewed as nominal. While LSCA can be credited with activating state concern and some degree of fiscal response, it is apparent that *Excluding Hawaii where all library services are state funded.