Management of Municipal Library Construction Projects

Submission Date:

Friday, December 22, 2023

Question:

I am seeking clarification on the legal provisions regarding the oversight and management of construction projects by a municipal library. Our Law Department has previously indicated that the library board is not authorized to handle construction projects directly, asserting that it is the responsibility of the town. However, assuming full compliance with municipal laws, would it be permissible for the library to manage its construction projects if we hire a qualified project manager and maintain close coordination with the accounting department for payments?

Could you please advise on the legal framework that governs these responsibilities and whether there is any flexibility for the library board to take on such a role?

Thank you for your guidance on this matter.

Answer:

Let's begin by breaking this question down a bit and giving one-word answers.

Question 1: Is it legally possible for a municipal library to manage its own construction projects?

Answer: YES.

Question 2: Can a library board take on such a role?

YES.

Question 3: What is the legal framework for such an arrangement?

Well…

And with that, we're out of one-word answers. So, grab a relaxing beverage of choice, get comfy, and join me in fiddling with the Rubik’s Cube of New York State library law: library real estate.

Why is this issue a "Rubik's Cube"?

Well, for starters, there are SIX questions every municipal library board must always know the answer to:

1. Who owns the library building and grounds?
2. Who insures the library building and grounds?
3. Who is responsible for day-to-day maintenance of the library building and grounds?
4. Who pays for day-to-day maintenance of the library building and grounds?
5. Who pays for construction, renovation, and repair of the library building and grounds?
6. Who can sign contracts as the owner of the library building and grounds, and/or who [if anyone] can sign contracts as "tenant" of library building and grounds?

One would think there are only two possible answers to each of these questions ("the library" or "the municipality") and that those answers would have some sort of internal consistency—but that is not the case. Often, the answers are hybridized (with a third party playing a role), and what is written on paper might not be true in practice. Further, a clear answer to one question doesn't mean there is a clear answer to another. This means that the six questions of the "Cube" form scores of possible combinations.

Here are some interesting combos inspired by situations I have run into:

• The municipality owns the building, but the deed restricts use to only the library, which arranges for and pays for everything but the heat and roof repairs.
• The library owns the building and grounds, and the municipality has nothing to do with it. NOTHING.
• Everyone says the library "owns" the building, but they don't own the land; when this is found to not be the case, everyone wants to keep saying it anyway, since that helps keep things separate and emphasizes the library board's authority over the operations of the library.
• The municipality owns the building and grounds AND has custody of the library's money AND the library board can never get a clear answer on what part of the library budget is being used to maintain and insure the building.
• The municipality owns the building and grounds, but the library handles everything (with or without a lease).

These different permutations are neither "wrong" nor "right", but they do set the stage for some interesting dynamics. Here are some inspired by situations I have run into:

• The municipality owns the building, but the deed restricts use to only the library, which becomes very useful knowledge when a new mayor tries to threaten the library with eviction.
• The library owns the building and grounds, and the municipality has nothing to do with it. NOTHING. So, everyone is happy because there is no cause for friction about real estate.
• Everyone says the library "owns" the building but they don't own the land. This works well until a construction grant requires proof of ownership and the truth has to be articulated in a letter to the state.
• The municipality owns the building and grounds AND has custody of the library's money, AND the library board can never get a clear answer on what part of the library budget is being used to maintain and insure the building.  No one knows if/how it is insured. This can be a nightmare.
• The municipality owns the building and grounds, but the library handles everything (with or without a lease). When there is a lease, it should establish this level of authority: who can arrange a contractor, whose insurance covers what, etc. When there isn't a lease, the lack of clear authority can become a problem.

Because of the variety possible, no two libraries have precisely the same combination of answers to these questions. But each of these questions relates to the member's request for the "legal framework" that enables a municipal library to oversee its own construction project.

Let's examine the six questions with respect to this "framework."

1. Who owns the library building and grounds?

When the library owns the building and grounds, it is indisputably able to enter contracts for construction (site testing, general contractors, contractors).

When the library doesn't own the building and grounds, it only truly has the authority to enter contracts for construction if that authority is confirmed in writing.

This can get confusing, as anyone can hire services (such as those of an architect) for a building but might not have the authority to do so on behalf of the library.

2. Who insures the library building and grounds?

This factor is important because insurance and risk management are such a huge part of designing and building a library (whether renovating, repairing, or newly constructing). If the library isn't in a position to call the shots on insurance, it is not truly in control of the project.[1]

3. Who is responsible for ensuring day-to-day maintenance of the library building and grounds?

Very often, libraries who are not positioned to sign a contract for major construction (because they don't own the building or have a lease or municipal policy that allows them to) find themselves arranging small services such as a plumber visit or a quick repair by an electrician. From what I have seen, this seeming authority is due to one of two things; either 1) the municipality has a policy allowing "department heads" or others to sign on to smaller contracts, or 2) it is due to these smaller contracts flying under the radar of the risk management and procurement authorities.

4. Who pays for day-to-day maintenance of the library building and grounds?

Even when a library owns the building the issue of "who pays" can result in a municipality denying the library’s ability to sign a routine maintenance contract.

For example, if a municipality funds the library out of a general operations budget (no separate tax levy) and is the custodian of the funds, a municipality can functionally[2] deny the ability of the board even so much to bring in a needed cleaner, if there is not exceptional clarity.

On a more routine level, this aspect can get weird[3] when municipalities deduct or charge costs for services provided by third party contractors or facilities departments, without even alerting the library.

5. Who pays for construction, renovation and major repair of the library building and grounds?

The examples in #3, above, become more extreme once construction, renovation, and major repair come into play.

Some municipalities will accept construction funds and then try to bundle the projects, using library money to underwrite non-library projects.[4]

Some will reject architectural plans generated by a firm hired by the library, claiming the municipality must be on the contract.[5]

And some, like the member's question describes, will demand to have complete control over a project.

 6(a). Who can sign contracts as owner of the library building and grounds?

This factor is the one at the heart of the member's question.

There are two ways a municipal library can sign a contract with a general contractor for construction:

A) As owner of the building; or

B) With confirmed permission of the actual owner.

"Confirmed permission" is the key term here; the "confirmation" can be in the form of a policy, a letter of understanding, or a lease. It should be in writing, and it should be clear and unambiguous. If it doesn't exist, the library can't (or at least, shouldn't) sign the contract.

6(b). Who [if anyone] can sign contracts as "tenant" of library building and grounds?

If a library is a tenant of its municipality, the lease or license to operate the library within the building should clearly spell out this right or set out the procedures for solely or jointly arranging contracts.

And that's it.

I wish I could offer a more straightforward formula… sort of an A + B = C. But as I said, it's a Rubik's Cube, and a municipal library can have any of several combinations. The bottom line: if the library doesn't either own the building or have clearly articulated authority to sign contracts for and manage risks associated with construction, renovation, or major repair of the building, the board won't be situated to manage the project.

So, for a problem like the one described by the member, I suggest:

Step 1: Research and confirm your library's answers to all six questions.

Step 2: Assess which answers are the cause of any impediment to the library overseeing its own construction projects.

Step 3: Develop solutions to the issues.[6]

This last step is of course a vast step. What makes it extra challenging is that each library will have its own unique solutions, which take months or years to develop and actualize. But I promise there always ARE solutions.

Happy building!

Tag:

Municipal Libraries, Library Buildings, Construction, Contracts, Board of Trustees