March 17, 2010

Dear ,

Mayor Jim Newberry recently requested that the Lexington Public Library contribute
$342,000 of library funds to the general fund of the Urban County Government. For a
number of reasons I will outline in this letter, the Board of Directors respectfully
declined the Mayor’s request.

The process for funding libraries was established by state law in 1944 after years of
neglect by local governments. As you know the Library is not funded by revenues
from the Urban County Council’s general fund but receives its revenue from a
dedicated property tax. Simply put, the Mayor is asking for the “return” of funds that
were never provided by LFUCG through the general fund in the first place.

What Mayor Newberry is asking for is not a return of funds provided by the
Urban County Government, but a contribution to the LFUCG general fund from
the funds dedicated to libraries through the property tax.

Nevertheless, the Library Board considered the Mayor’s request and declined after
considering the following facts:

• The Lexington Public Library has already reduced its budget in this fiscal
year by 5.4 per cent ($746,000). In his State of the Merged Government
Address, the Mayor indicated that the city budget was being reduced by $12.5
million, about a 4.5 per cent reduction in the general fund.

• Added to the 5.4 per cent reduction we have already made, approving the
Mayor’s request to contribute $ 342,000 to the Urban County
Government's general fund would constitute a 7.9 per cent reduction,
significantly more than the reduction made in the city's general fund.

• Anticipating that revenues from property taxes will remain flat and costs will
continue to rise, we know that in order to balance the Library budget next
year, expenditures may have to be cut by another 3.3 per cent, an
additional $462,000.

If the 2010-2011 reductions are made, the Library will have cut its budget
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March 17, 2010

• 8.7 per cent (over $1.2 million) in the 2009-2010/2010-2011 budget cycle
even without making the requested contribution to the City's general fund.

• A contribution of $342,000 to the LFUCG general fund would bring total

cuts to an estimated $1,550,000 in fiscal 2009-2010 and 2010-2011.

• The Library's budget is governed by state law which authorizes the use of
designated funds from property taxes. As such, the Library Board does not
have the statutory authority to contribute revenue to the LFUCG general
fund.

In order to achieve this year's budget cut, the Lexington Public library has reduced by
two hours per week the amount of time Lexington's libraries are open. We have
left 14 staff positions unfilled, canceled some electronic databases, and reduced
our materials budget by 10 percent, in addition to putting off several capital
projects. These cuts mean there are fewer people to help customers find the
information they need, fewer new books, and a decline in the number of online
research tools the library is offering

If additional cuts have to made next year, LPL anticipates the possibility of having to
take more drastic measures. These could include a further reduction in service hours,
further staff reductions, and further cuts to materials.

These cuts come at a time when the Lexington Public Library has become more
essential, and busier than ever, due in part to difficult economic times. Simply put, for
every $1 invested in the Library, the community gets back more than $4 in services.

Despite cutting our budget by 5.4 per cent, we have worked hard to maintain and
expand services. For example, at the request of the Urban County Government
last year, LPL agreed to staff and provide programming at the Gainesway
Community Center. Prior to LPL’s commitment, the Community Center was a
seldom-used facility with only a security officer on staff. Since the Library accepted
responsibility for the Center, we have offered more than 40 programs to more than
450 low income families and at-risk youth and delivered more than 1,400 books to the
Center.

LPL also assists the Carnegie Literacy Center by providing financial support,
$55,000 in this fiscal year alone. LPL partners with the Fayette County Public
Schools, the Parks and Recreation Department and many other city government
agencies. The Library is currently working with the Police Department to provide
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March 17, 2010

support for a broadband networking project that will improve the Department's ability
to communicate via the Internet throughout the city.

The Library Board recognizes the task LFUCG has before it and I believe we are
already doing more than our part to help the Mayor and members of the Urban County
Council weather the current downturn in the economy. We are adjusting our budget
to address economic realities and making painful but necessary sacrifices to
continue to provide outstanding service to the community even with less money
available.

Asking LPL to write a check to the LFUCG general fund is asking everyone who
depends on the Library to make additional and unreasonable sacrifices.

Respectfully,

Lawrence T. Smith
Chairman
Board of Trustees

cc: Mayor Jim Newberry