The 2022-23 Budget: California State Library

The 2022-23 Budget: California State Library FEBRUARY 2022 Summary. The Governor’s budget proposes the Governor. In addition, the State Library passes a total of $30 million General Fund ($8.5 million through state and federal funds to local libraries for ongoing, $21.5 million one time) for four proposals specified purposes and provides related oversight at the California State Library (State Library). and technical assistance. These local assistance The proposals focus on digitizing historical assets, programs fund literacy initiatives, internet services, supporting local library online job training programs, and resource sharing, among other activities. expanding the Lunch at the Library program, and Public Libraries Are Run and Funded Primarily covering higher building rental costs. We recommend by Local Governments. In California, local public approving the proposed digitization activities but libraries can be operated by counties, cities, special adding reporting to enhance legislative oversight. districts, or joint powers authorities. Usually the local We recommend rejecting the online job training government operator designates a central library to initiative given the limited data around costs, coordinate activities among all the library branches participation, and outcomes. Regarding the Lunch at within a jurisdiction. Currently, 185 library jurisdictions the Library program, we recommend the Legislature with 1,130 sites (including central libraries and their modify the proposal to be limited term, establish branches) are operating in California. Local libraries statutory parameters over the grants, and adopt a provide a diverse set of services that are influenced reporting requirement. We recommend approving the by the characteristics of their communities. Most funds to cover higher building rental costs. libraries, however, consider providing patrons with access to books, media, and other informational INTRODUCTION material as a core part of their mission. Around In this post, we analyze the Governor’s budget 95 percent of local library funding comes from local proposals for the State Library. The post begins governments and the remaining 5 percent comes with an overview providing background on the State from state and federal sources. Library and local libraries, as well as a summary of Governor Proposes Notable Funding Increase the Governor’s associated budget proposals. It then for State Library. As Figure 1 shows, the Governor’s has four sections covering the digitization, online budget increases ongoing General Fund support job training, Lunch at the Library, and building rental for the State Library by $9 million (22 percent). proposals, respectively. Figure 1 OVERVIEW Governor’s Budget Increases State Library Oversees Ongoing Support for State Library Both State-Level and Local Funding by Source (Dollars in Millions) Initiatives. The State Library’s main state-level functions are Change From 2021-22 2020-21 2021-22 2022-23 (1) serving as the central library for Actual Estimated Proposed Amount Percent state government; (2) collecting, General Fund $32 $39 $48 $9 22.0% preserving, and publicizing state Federal funding 17 19 19 —a 0.1 literature and historical items; and Other 3 3 3 —a 2.8 (3) providing specialized research Totals $52 $61 $70 $9 14.2% services to the Legislature and a Amount less than $500,000. 2022-23 Budget Series 1 The State Library’s other ongoing Figure 2 fund sources stay nearly flat, such Governor’s Budget Contains Four New Proposals that the State Library’s total ongoing General Fund Changes in 2022-23 (In Thousands) funding grows 14 percent. Beyond ongoing funding, the Governor’s Change Ongoing One Time Totals budget provides the State Library New Proposals $24 million one-time General Digitization activities $1,338 $12,692 $14,030 Fund support. Online job training programs — 8,800 8,800 Governor’s Budget Funds Lunch at the Library 5,000 — 5,000 Building rental payments 2,179 — 2,179 Four New Proposals. As Figure 2 Subtotals ($8,517) ($21,492) ($30,009) shows, the four proposals are Other Changes (1) one-time and ongoing Disaster preparedness for cultural resourcesa — $2,387 $2,387 support for digitization activities, Broadband cost increases $179 — 179 (2) one-time funding for local library Other technical adjustments -45 — -45 online job training programs, (3) an Subtotals ($134) ($2,387) ($2,521) ongoing augmentation for the Totals $8,651 $23,879 $32,530 Lunch at the Library program, and a Represents second year of four-year funding plan initiated as part of the 2021-22 budget agreement. (4) ongoing support for the State Library’s building rental payments. agencies’ historical resources. According to The remaining General Fund adjustments the State Library, the team of preservationists implement budget agreements made last year currently is undertaking one project with the (relating to disaster preparedness efforts for California Department of Parks and Recreation historical assets) and technical base adjustments to digitize historical photographs, and it is (including adjustments for library broadband costs). reviewing potential projects with the California Highway Patrol and the California Department DIGITIZATION INITIATIVE of Transportation. In this section, we provide background on the • CA.GOV. CA.GOV is an archive of State Library’s recent digitization efforts, describe point-in-time snapshots of state agency the Governor’s digitization proposal, assess the websites. These snapshots and their data are proposal, and offer an associated recommendation. available for users to access in future years. The State Library contracts with the Internet Background Archive, a private nonprofit entity, to collect State Library Has Undertaken Several these snapshots. A volunteer committee Initiatives to Digitize State Historical Assets. of specialists from the State Library, the As part of its core mission of curating historical University of California, Stanford University, items in California, the State Library is undertaking and the California State Archives oversees efforts to digitize its collections. The purpose of and curates development of the archive. digitization is to create a digital copy in addition According to the State Library, it spends to the physical copy, thereby improving online $72,000 annually on its contract with the accessibility and further preserving the original Internet Archive. materials. The State Library indicates that it has • Other Activities. Beyond these activities, several digitization efforts underway. These efforts the State Library undertakes a variety of are described below. other ongoing and one-time digitization • Digital Concierge Services. The 2019-20 initiatives. These initiatives include: the budget provided the State Library $1 million California Newspaper Project, which digitizes ongoing General Fund for three concierge local California newspapers (receiving preservationists. These preservationists work $430,000 ongoing General Fund support); with state agencies by request to digitize 2022-23 Budget Series 2 (2) California Revealed, which digitizes Proposal historical resources from over 300 cultural Governor Proposes Supporting New and heritage institutions throughout the state Expanded Digitization Efforts. As Figure 3 (receiving $1.4 million one-time federal shows, the Governor proposes providing a total funds); and (3) Voices of the Golden State, of $14 million General Fund support and nine which preserves oral histories conducted by additional permanent State Library positions for higher education institutions, museums, and enhanced digitization activities. The Department other entities (funding and source of funds of Finance (DOF) indicates that $11 million of the not available at the time of this post). one-time funding would be available over five years State Library Recently Developed Digital (through 2026-27) and the remaining $1.7 million in Preservation Strategy. In April 2021, the State one-time funding supporting cataloging activities Library released a document describing the and equipment purchases would be available core principles guiding its digital preservation through the budget year. (DOF indicates it will activities. The document directs each of the add this expenditure period to provisional budget State Library’s bureaus and sections (such as language at May Revision.) the California History Section or the Witkin State Proposal Spans Four Key Areas. The largest Law Library) to identify their top assets for digital area focuses on digitizing various state historical preservation each year. Library resources are to assets, such as analog videos from the California be prioritized for digitization based on several Channel and fragile historical resources. The next factors, such as their rarity, cultural relevance, largest area would focus on digitizing resources and physical condition. in the State Library’s Government Publications Section, with the goal of digitizing 20 percent of Figure 3 State Library Digitization Proposal Has Many Components (In Thousands) Ongoing One Time Totals Digitize California Historical Assets Digitize video media over five years — $5,000 $5,000 Procure new software and equipment — 432 432 Scan future acquisitions (two positions) $200 — 200 Contract with vendor to digitize fragile assets 125 — 125 Subtotals ($325) ($5,432) ($5,757) Digitize Government Publications Contract with vendor to digitize 20 percent of catalog over five years — $3,500 $3,500 Contract with vendor to catalog pre-2007 documents — 1,100 1,100 Expand CA.GOV archive (four positions) $370 — 370 Ongoing catalog maintenance 110 — 110 Subtotals ($480) ($4,600) ($5,080) Digital Concierge Services for State Agency Assets Undertake additional state agency projects over five years — $2,500 $2,500 Develop list of state agency photographic assets (one position) $131 — 131 Subtotals ($131) ($2,500) ($2,631) Expand Information Technology Capacity Procurement and cloud services management (two positions) $312 — $312 Purchase additional servers and cloud capacity 90 $160 250 Subtotals ($402) ($160) ($562) Totals $1,338 $12,692 $14,030 2022-23 Budget Series 3 the section’s state agency publications, barcoding halfway through the initiative) and a second report by older resources for future digitization efforts, and November 1, 2026 (toward the end of the initiative). providing dedicated staff to oversee the CA.GOV We recommend the reports include the amount digital archive. The proposal also would augment spent, specific activities undertaken, and the number the existing Digital Concierge Services team, of resources digitized each year. We recommend accelerating the team’s time line to complete active the reports also include an assessment as to the projects and expanding the number of new projects remaining number of State Library items to be it can undertake. Finally, the proposal would digitized and the associated cost. expand the State Library’s existing information technology staffing and storage capacity in support ONLINE JOB TRAINING PROGRAMS of all of these efforts. In this section, we provide background on workforce development programs, describe the Assessment Governor’s online job training proposal, assess the Proposal Supports Reasonable Objective. proposal, and offer associated recommendations. Preserving historical assets is a core function of the State Library. Digitizing assets furthers this mission Background by creating an additional copy of an asset were it ever State Provides Billions of Dollars on Workforce to be damaged or destroyed and by making the asset Development Programs. California spends billions more readily available to the public. of dollars annually for roughly three dozen workforce Multifaceted Proposal Comes With Risks and development programs spanning many state Challenges. The proposal has many components agencies. Some of these programs assist students spanning several units of the State Library. With so and other individuals with entering the workforce many proposed activities, the State Library faces for the first time, whereas other programs assist the risk of not being able to implement them all fully unemployed or underemployed individuals with within the time period allotted. Moreover, some re-entering the workforce and potentially upskilling parts of the proposal could meet with unexpected to a higher-paying job. For occupations requiring less challenges. For example, the Concierge Services than a bachelor’s degree, the state’s programs are team could encounter much stronger or weaker primarily concentrated at high schools, community interest from state agencies than assumed in the colleges, and local workforce development boards. proposal. Typically, reporting language helps the These programs identify state and regional workforce Legislature hold the administration and the State needs, support credit and noncredit coursework in Library accountable for accomplishing identified career-focused fields, and provide a variety of other objectives and milestones. Reporting also would training opportunities (including apprenticeships). help the Legislature make funding decisions for State Library Oversees Certain Library-Based future digitization initiatives at the State Library. Education and Training Programs. The California The administration, however, has no reporting Library Literacy and English Acquisition Program requirements associated with its digitization supports volunteer-based literacy tutoring for adults proposal, thus limiting accountability and weakening and children at local libraries. The program currently the ability of the Legislature to conduct oversight of receives $7.3 million ongoing General Fund. The State the digitization efforts. Library also oversees the CAreer Pathways initiative, which provides local libraries subscriptions to various Recommendation online education and training platforms available to If More Digitization Is a High Priority, Adopt their patrons. For example, library patrons can earn Reporting Requirement. If the Legislature would a high school diploma online through the Career like to support more digitization at the State Library, Online High School program, and patrons who are we recommend it require the State Library to 50 years old or older can participate in digital literacy report on its digitization activities as a condition of and online enrichment courses under the GetSetUp receiving an associated augmentation. Specifically, program. CAreer Pathways received $3 million we recommend the State Library be required to one-time General Fund support in 2021-22 for the submit a first report by November 1, 2023 (around 2022-23 Budget Series 4 Career Online High School program. It received Assessment $5.4 million one-time federal relief funding for the Initiative Could Be Relatively Expensive remaining online education and training programs. on a Per-Course Basis. Because the proposal State Library Established New Workforce would not be tied to specified enrollment or Development Initiative With Federal Relief Funds. course-taking expectations, per-participant costs According to the State Library, $4.4 million of CAreer could be high relative to other state education Pathway’s one-time federal relief funds is supporting programs. We converted the number of course subscriptions to six online learning platforms hours to a “full-time equivalent (FTE)” basis, (Bendable, Coursera, Learning Express, LinkedIn using the approach taken at the community Learning, Northstar, and Skillshare). (The remaining colleges. (At community colleges, 525 contact $785,700 in federal relief funds were spent on hours is equivalent to one FTE student). The State other platforms.) Similar to other CAreer Pathways Library’s reported course hours under the existing programs, patrons can access these platforms by initiative—well over 20,000 hours—converts using a computer at their local library or on their to around 40 FTE participants, with a resulting own device using their local library’s webpage. cost of over $100,000 per FTE participant. Even Virtually all libraries offer at least one online learning were the State Library to quadruple course platform to their patrons, and more than half offer all taking patterns in the initiative, generating six platforms. The platforms focus on many areas around 160 FTE participants, costs would be and offer several types of services and content. $27,500 per FTE participant. For comparison, the Coursera, for example, offers certificates in a variety state is providing community colleges $5,907 per of industries, including information technology, FTE student for noncredit instruction. Without cybersecurity, and marketing. LearningExpress, more certainty as to the number of patrons and by comparison, focuses on preparing participants course hours funded under this proposal, the for certain tests, including the California Basic Legislature could end up approving an initiative Educational Skills Test, California Real Estate that is considerably less cost-effective than its Salesperson Exam, and the California Police Officer existing workforce education programs. Exam. Another platform, Skillshare, offers numerous Lack of User and Outcome Data Also Poses self-paced courses ranging from the creative arts, Risks. The Legislature might be willing to fund design, entrepreneurship, and technology. The State a particularly high-cost program if it had been Library could not provide the number of patrons shown to provide underserved or historically participating in these platforms, but it reports that disadvantaged populations with particularly participating patrons completed “well over 20,000” good employment outcomes. The State Library, course hours across all libraries. however, has not provided the Legislature with data on the number of participants, participant Proposal demographic characteristics, and participant Governor Proposes $8.8 Million General Fund outcomes of its programs. Moreover, the state Over Two Years to Continue Recent Initiative. already supports numerous ongoing and one-time Proposed budget bill language states that the funds workforce development initiatives designed to would support library-based online job training and benefit underserved and historically disadvantaged educational upskilling programs over two years. students. The administration has not made a Though not specified in the proposed language, the compelling case that the State Library’s proposed State Library indicates the funds would continue education and training programs would benefit a supporting the six platforms listed above that were group not already intended to be served by other originally supported with one-time federal relief funds. such programs, as well as have notably better The State Library indicates its intention to spread the employment outcomes. funds evenly over the next two years (with $4.4 million spent each year). 2022-23 Budget Series 5 Recommendations Food Research and Action Center (a nonprofit organization), in the summer of 2019, average Reject Proposal. Given the risks and daily participation in California’s summer program uncertainties around program cost, participation, was 16.5 percent of daily participation during the and outcomes, we recommend the Legislature 2019-20 academic year. Participation was even reject the proposal. Even if this proposal were lower nationally, with average summer participation rejected, the State Library would continue 13.8 percent of participation during the fall through implementing its current federally funded initiative. spring. Experts have suggested several reasons for The State Library indicates that it plans to collect the lower summer participation, including lack of better data on that initiative. Were this forthcoming awareness of the summer program, limited number data to adequately address the concerns raised of sites in certain areas, and lack of sufficient earlier and demonstrate the initiative’s added incentive for students to travel to the nearest benefit to the state’s existing workforce programs, summer meal site. the Legislature could consider supporting the initiative in future years. (If the Governor’s proposal Lunch at the Library Program Aims to were approved for 2022-23, we recommend adding Increase Local Library Involvement. Initiated an evaluation to ensure the cost-effectiveness of in 2013 with federal funding, Lunch at the Library the state funding could be determined.) aims to increase the number of California local libraries serving as summer meal sites and LUNCH AT THE LIBRARY increasing summer enrichment opportunities for students. As the meals themselves are funded by In this section, we provide background on the the federal government, the Lunch at the Library federal summer meal program and the Lunch at program focuses on other services that support the Library program, describe the Governor’s summer meal sites. Specifically, the program proposal to augment funding for the Lunch at the provides: (1) training and technical support to Library program, assess the proposal, and offer library staff to help them establish their libraries associated recommendations. as summer meal sites; (2) library learning, Background enrichment, and youth development opportunities that wrap around the summer meal program; and Federal Government Provides Free Summer (3) library resources at other community summer Meals. The federal government subsidizes lunches meal sites. Initially supported through a mix of and snacks for low-income students at schools one-time federal funds and private grants, then during the academic year. To prevent low-income one-time state funding, the state began providing students from experiencing food insecurity during the program $800,000 ongoing General Fund in the summer when they might not be attending 2020-21. (The ongoing funding was adopted as school, the federal government runs an additional early action in February 2021.) According to the program providing summer meals. For the summer State Library, the ongoing funds entirely support meal program, sites beyond schools, including grants to local libraries. libraries, can distribute federally subsidized meals. To qualify to participate, meal sites must be located Subset of Libraries Currently Participate in in areas where at least 50 percent of students Program. According to the State Library, in 2021, qualify for a free or reduced-price lunch during the 118 library sites within 39 library jurisdictions school year. operated summer meal sites, providing a total of approximately 308,000 meals. In addition, Participation in Summer Program Is Notably 49 library jurisdictions provided library materials Lower Than in Fall Through Spring. Because and services to nonlibrary sites operating as students are required to attend school during the summer meal sites. (In total, 71 library jurisdictions academic year, virtually all eligible students receive participated, with some jurisdictions both subsidized meals during that period. By contrast, operating their own summer meal sites and only a portion of eligible students are accessing providing library materials to nonlibrary sites.) free meals during the summer. According to the 2022-23 Budget Series 6 For context regarding the size of the Lunch at library sites—is very narrow. Even under the State the Library program, prior to the pandemic in Library’s plan to increase local library summer 2018-19, California had a total of 4,928 federally meals by 10 percent each year for five years, the recognized summer meal sites serving 15 million initiative would only account for a small proportion meals (inclusive of local library summer meal sites). of summer meals across the state. Moreover, During the pandemic in 2019-20 (the most recent the administration has not clearly explained why data available from the California Department of expanding meals at local libraries would be more Education), summer meals notably increased, with cost-effective than expanding at other potential 8,601 sites providing 273 million meals. sites, including more school and community-based sites. Furthermore, the statewide educational Proposal impact of providing library materials at meal sites Governor Proposes Expanding the Lunch likely is negligible compared to the billions of at the Library Program. The Governor proposes dollars the state provides K-12 schools for ongoing increasing the Lunch at the Library program by education, including the billions of dollars in new $5 million ongoing General Fund, bringing total funding the state is providing for the Expanded ongoing support for the program to $5.8 million. Learning Opportunities Program (ELOP). Of the $5 million augmentation, $4.7 million ELOP Could Boost School Attendance in would be for local assistance. According to the the Summer. The state in the 2021-22 budget State Library, the local assistance augmentation established ELOP, which expands learning would increase the number of start-up grants to opportunities for students in Transitional local libraries, as well as provide targeted grants Kindergarten through grade 6. Among other to support libraries in high-need communities provisions, the program requires participating and to pilot new meal delivery and educational school districts to provide 30 days of learning enrichment approaches. The remaining opportunities during the summer. The state $314,000 would support two permanent State provided $1.8 billion Proposition 98 General Fund Library positions to implement the expanded for ELOP in 2021-22 and the Governor proposes grant program and provide local libraries technical providing $4.4 billion for ELOP in 2022-23, with assistance. According to the State Library, the the goal of reaching $5 billion ongoing by 2025-26. proposal would result in local libraries increasing This program likely will boost student attendance the number of summer meals they serve by about during the summer, potentially providing 10 percent each year for the next five years, students better, more cost-effective access to with the library summer meal count reaching free summer meals and summer educational approximately 500,000 by 2026. enrichment programs. Large Lunch at the Library Augmentation Assessment Has No Parameters or Reporting. Despite Student Food Insecurity Is a Salient Issue. providing the program a more than five-fold According to Feeding America, a nonprofit funding increase, the Governor does not propose organization that annually analyzes federal establishing parameters guiding how the funds census data, 17 percent of Californians under the are to be spent. The proposal also does not age of 18 reported being food insecure in 2021. establish a reporting requirement providing data While these data do not indicate what time of year on the use of the funds, program outcomes, children experience food insecurity, food insecurity or the cost-effectiveness of the additional might increase during the summer months when library meal sites relative to schools and other students are less likely to be attending school. community-based sites. Moreover, the program Proposal Is a Narrow Approach to has no existing language in these areas despite Addressing Food Insecurity. As we have noted receiving ongoing funding. in previous years, the proposal’s strategy to boosting summer meal participation—adding more 2022-23 Budget Series 7 Recommendations BUILDING RENTAL PAYMENTS Modify Proposal to Be Limited Term. Given In this section, we provide background on the proposal’s uncertain impact on summer food the State Library’s buildings and its rental insecurity and the notable expansion in summer payments, describe the Governor’s proposal attendance underway at schools, we recommend in this area, assess the proposal, and offer an the Legislature modify the proposal by making it associated recommendation. limited term. For example, the Legislature could Background provide the program $5 million one-time General Fund over three years. At the end of this period, State Library Occupies Two Buildings Owned the Legislature would have better information by the Department of General Services (DGS). on the Lunch at the Library’s impact, as well as The first building, the Library and Courts I building, ELOP’s impact, on summer meal participation. is a historic facility constructed in 1928. Space in The Legislature could then better assess whether the building is shared between the State Library an ongoing augmentation for the Lunch at the and California’s Court of Appeal, Third Appellate Library program is warranted. District. The second building, referred to as the Adopt Statutory Parameters, Reporting, and Library and Courts II building, was constructed Evaluation. To assist legislative oversight over the in 1990, with the construction financed by state proposed augmentation and inform future budget lease revenue bonds. The State Library is the sole decisions in this area, we recommend establishing occupant of this building. The State Library pays parameters over the grants. Helpful parameters DGS rent each year to occupy both buildings, which would include designating amounts for each grant in turn supports DGS’s operations and maintenance purpose (such as start-up grants and grants to pilot of the buildings. new meal delivery approaches), prioritization criteria State Library’s Rent Notably Increased (such as prioritizing grants to libraries in counties Recently for Two Key Reasons. As Figure 4 with high rates of food insecurity), and performance shows, the State Library’s rent for the Library and milestones (such as achieving a 10 percent annual Courts II building has notably increased in recent increase in the number of library sites and summer years. According to the State Library, the cost meals). Additionally, we recommend requiring the increase is due to two factors, described below. State Library to collect and report certain data • Transfer of Jurisdiction to DGS in 2019-20. each November 1 over the initiative’s funding Prior to the repayment of the building’s lease period. At a minimum, we recommend the report revenue bond debt in May 2018, the State include the number of library jurisdictions and sites Public Works Board had jurisdiction over the providing summer meals, the number of summer building. The state directly paid rent on behalf meals provided at library sites, the number of of the State Library (effectively debt service nonlibrary meal sites receiving library materials and enrichment Figure 4 programs, grant allocations by State Library Reports Shortfall in library jurisdiction/site and function, and learning outcomes of students Its Building Rental Budget participating in library educational (In Thousands) enrichment services at summer meal sites. We recommend the 2018-19 2019-20 2020-21 2021-22 report also include an evaluation Rental Costs component that would seek to Library and Courts I building $3,754 $3,785 $3,823 $3,025 assess the cost-effectiveness of Library and Courts II building 1,010 3,815 4,123 5,151 Totals $4,764 $7,600 $7,946 $8,176 the additional library summer meal Base rental budget $5,838 $5,843 $5,997 $5,997 sites relative to schools and other Funding Surplus/Shortfall $1,074 -$1,757 -$1,949 -$2,179 community-based sites. 2022-23 Budget Series 8 payments) to the board. During this time, Proposal the State Library paid DGS for basic facility Proposes Rebenching State Library’s Rental services ($1 million in 2018-19). When the Budget. The proposed amount—$2.2 million debt was repaid, jurisdiction over the building ongoing General Fund—would close the shortfall transferred to DGS, with the State Library now between actual rental costs and the State Library’s paying full DGS rental rates (over $4 million base rental budget beginning in 2022-23. The in 2021-22). amount is tied to the estimated funding shortfall • Central Plant Fee Beginning in 2021-22. in 2021-22. DGS charges buildings under its jurisdiction Assessment a fee for utility costs. According to the State Library, it was not aware of this charge State Typically Does Not Adjust Agencies’ until it received an invoice from DGS in Budgets for Rent Increases. Rather, agencies May 2021 for the 2019-20 and 2020-21 must manage any rental fluctuations within their fiscal years. The State Library indicates that budgets. When rent increases, agencies typically it ultimately paid the charge in 2019-20 and must redirect spending from other budget areas received a one-time waiver from DGS for (for example, by holding certain positions vacant for 2020-21. Moving forward, DGS expects the an extended period of time). When costs are lower State Library to pay this charge ($916,000 than expected, agencies can spend the surplus in 2021-22). funds on one-time purposes. Though Not Common, State Sometimes State Library Reports That Its Budgeted Provides Increases for Rental Costs. Though Rental Amount Is Systematically Below Actual not typical, the state has provided certain agencies Costs. According to the State Library, it has a adjustments for rental payments, particularly for budgeted level of support to make rental payments. large ongoing changes in costs. For example, the This amount has been adjusted by the state in 2021-22 budget provided a combined $6.4 million certain years, most recently in the 2018-19 budget. ongoing augmentation for several natural resource The state has not since adjusted the State Library’s state agencies for higher rental costs. budget for the higher DGS building and central plant fees that began in 2019-20. Consequently, Given Unusual Rental Cost Increase, the State Library estimates its current budgeted Proposed Augmentation at State Library Is rental amount—just under $6 million in 2021-22— Reasonable. Rather than rental costs growing will fall short of actual rental costs. According to gradually over many years, the State Library’s rent the State Library, it covered the initial shortfall in increased notably due to a change in jurisdiction 2019-20 and 2020-21 through limited-term savings over the Library and Courts II building. Moreover, from other areas of its budget. The State Library the State Library’s other savings during the attributes these savings to pandemic-related pandemic will not be available in the upcoming factors. For example, the State Library reports that budget year to help manage the higher costs. the transition to remote work prompted an increase Given these circumstances, we think providing an in retirements and the State Library deferred adjustment for rental costs is reasonable. backfilling those positions. The State Library also Recommendation states that it benefited from one-time savings associated with the reduction in its travel budget. Adopt Proposal. Given factors described According to the State Library, these one-time above, we recommend the Legislature approve savings are not available in 2021-22 and notes the Governor’s proposed $2.2 million for higher that it will distribute the estimated funding shortfall ongoing State Library rental costs. across all of its operations. 2022-23 Budget Series 9 2022-23 Budget Series 10 2022-23 Budget Series 11 LAO PUBLICATIONS This post was prepared by Jason Constantouros, and reviewed by Jennifer Pacella and Anthony Simbol. The Legislative Analyst’s Office (LAO) is a nonpartisan office that provides fiscal and policy information and advice to the Legislature. 2022-23 Budget Series 12