The 2023-24 Budget: California State Library

2023-24 BUDGET The 2023-24 Budget: California State Library GABRIEL PETEK | LEGISLATIVE ANALYST | APRIL 2023 SUMMARY Brief Covers Governor’s Budget Proposals for the California State Library. The Governor’s budget proposes a total augmentation of $1.2 million General Fund ($1 million ongoing, $240,000 one time) for three proposals at the California State Library (State Library). The proposals focus on providing additional personnel for the California History Room, Witkin State Law Library, and State Library audit program. Recommend Revisiting California History Room Proposal in the Future. The Governor proposes a $597,000 General Fund augmentation ($357,000 ongoing, $240,000 one time) for additional staffing and acquisitions for the California History Room special collections. Though workload for the California History Room increased between 2020-21 and 2021-22, it has fallen over the first half of 2022-23. Were workload in the second half of the year to continue at the same rate, the annualized 2022-23 workload would be at its lowest level in five years. Moreover, the State Library can access federal funds and philanthropic support to expand the California History Room’s special collections. For these reasons, we recommend rejecting this proposal at this time. The Legislature could revisit the California History Room’s staffing and collections when workload more clearly justifies an augmentation and the state’s budget condition has improved. Recommend Rejecting Witkin State Law Library Proposal and Revisiting Law Library Special Fund. The Governor proposes a $462,000 ongoing General Fund augmentation for additional staffing at the Witkin State Law Library. The administration’s proposed augmentations are intended to address higher workload and continued increases in the law library’s operating costs. While workload has increased at the Witkin State Law Library, it remains in line with job expectations. Moreover, the California State Law Library Special Fund is intended to cover the operating expenses of the Witkin State Law Library. This special fund receives a specified amount of certain civil appellate filing fees. The fee set aside for the law library is likely to be reauthorized in 2025. As part of reauthorization, the Legislature could consider raising the associated fee amount to help the law library cover rising personnel costs. Particularly given the state’s budget condition, we recommend the Legislature reject the proposal to provide General Fund support to the law library. Recommend Rejecting Auditor Proposal and Considering Alternative Options. The Governor proposes a $168,000 ongoing General Fund augmentation to support one permanent, full-time Senior Management Auditor position at the State Library. The auditor would be responsible for establishing the State Library’s audit program. Currently, auditing is overseen by the State Library’s executive management team, with certain tasks delegated to supervisors and line staff. While the State Library has seen a large increase in one-time funding for local assistance programs, the bulk of this funding must be spent by June 30, 2024. Moreover, the State Library has had significant growth in its staffing levels over the past few years, with many new staff provided to assist in administering new or expanded local assistance programs. Instead of approving a new permanent auditor position at the State Library, the Legislature could reject the proposal and have the State Library continue to complete its auditing responsibilities using existing staff. Alternatively, the Legislature could fund an auditor position but on a limited-term basis with a particular focus on ensuring that the local library infrastructure grants (the State Library’s largest one-time initiative in recent years) are used in accordance with state intent. www.lao.ca.gov 1 2023-24 BUDGET INTRODUCTION Brief Focuses on the California State Library. The brief then has three sections covering the In this brief, we analyze the Governor’s budget proposals for the California History Room, proposals for the State Library. The brief begins Witkin State Law Library, and State Library audit with an overview of the State Library, local libraries, program, respectively. and the Governor’s associated budget proposals. OVERVIEW State Library Oversees Both State Activities State Library Relies Primarily on State and and Local Assistance Programs. The State Federal Funds. Approximately 70 percent of the Library’s main state-level functions are (1) serving State Library’s ongoing budget is supported by as the central library for state government; the General Fund. Nearly 25 percent comes from (2) collecting, preserving, and publicizing state federal funds, with the remainder coming from literature and historical items; and (3) providing special funds and reimbursements. For 2023-24, specialized research services to state agencies. the Governor’s budget includes $39 million in In addition to these state-level activities, the ongoing state operations funding for the State State Library passes through state and federal Library and $34 million in ongoing local assistance funds to local libraries for specified purposes. funding. The Governor’s budget also includes These local assistance programs fund literacy $508 million in one-time General Fund, nearly all initiatives, internet services, and resource sharing, of which reflects carryover funds associated with among other things. The State Library provides one-time local assistance initiatives funded in oversight and technical support for these local recent years. (More detail on the State Library’s assistance programs. budget, including spending by program and fund Public Libraries Are Run and Funded source, is provided on our EdBudget site.) Primarily by Local Governments. In California, Governor’s Budget Funds Three New local public libraries can be operated by counties, Proposals. As Figure 1 shows, the three proposals cities, special districts, or joint powers authorities. are (1) both ongoing and one-time support for Usually the local government operator designates the California History Room, (2) ongoing support a central library to coordinate activities among all for the Witkin State Law Library, and (3) ongoing the library branches within a jurisdiction. Currently, support for the State Library audit program. In total, 186 library jurisdictions with 1,127 sites (including the Governor’s budget includes a General Fund central libraries and their branches) are operating augmentation of $1.2 million ($1 million ongoing, in California. Local libraries provide various $240,000 one time) for these three proposals. The services that are influenced by the characteristics Governor’s budget also includes $2.4 million for of their communities. A core part of the mission the third year of a four-year initiative focused on the of all libraries, however, is to provide patrons with State Library protecting collections from natural access to books, media, and other informational disasters. (The Governor’s budget also includes material. Around 95 percent of local library funding ongoing General Fund augmentations of $53,000 comes from local governments and the remaining for broadband cost increases and $26,000 for 5 percent comes from state and federal sources. employee benefit cost increases.) 2 LEGISLATIVE ANALYST’S OFFICE 2023-24 BUDGET Figure 1 Governor’s Budget Contains Three New Proposals for the State Library General Fund Changes in 2023-24 (In Thousands) One Change Ongoing Time Totals New Proposals California History Room Special Collections $357 $240 $597 (three positions) Witkin State Law Library (four positions)a 462 — 462 State Library Audit Program (one position) 168 — 168 Totals $987 $240 $1,227 Other Changes Disaster preparedness for cultural resourcesb — $2,387 $2,387 a Includes absorbing all costs associated with two positions currently funded by the Law Library Special Fund. b Represents third year of four-year funding plan initiated as part of the 2021-22 budget agreement. CALIFORNIA HISTORY ROOM In this section, we provide background on the Proposal California History Room, describe the Governor’s Governor Proposes Funding Increase for the budget proposal, assess the proposal, and offer an California History Room’s Special Collections. associated recommendation. The Governor proposes providing a $597,000 General Fund augmentation ($357,000 ongoing, Background $240,000 one time) for the California History Room. California History Room Is Responsible for The increase in ongoing support would fund three Collecting and Preserving Special Collections. additional permanent, full-time positions. One The special collections of the State Library’s new position would be for a Senior Librarian, who California History Room document the life and would perform outreach and relationship-building experiences of Californians throughout history. with currently underserved and underrepresented These special collections are differentiated groups. The remaining two positions would be for from general collections by their rarity, value, Librarians, who would be responsible for handling and research potential. Many of the items in the requests for research assistance, providing California History Room’s special collections are orientations to special collections, and delivering one-of-a-kind materials such as letters, drafts of custom presentations on specific historical speeches, literary manuscripts, meeting minutes, topics. The one-time funding would go toward the diaries, scrapbooks, and film recordings. In addition purchase of materials related to the experiences to special collections materials, the California of Californians currently underrepresented in the History Room maintains separate print collections special collections portfolio. of books and periodicals that circulate to both state employees and the general public. These latter Assessment collections provide broader historical context for California History Room’s Special Collections the items contained in the special collections. Have Some Shortcomings. Preserving historical assets is a core function of the State Library. www.lao.ca.gov 3 2023-24 BUDGET Approximately 75 percent of the current California Additionally, the State Library works with the History Room materials, however, represent the California State Library Foundation, an independent experiences of Anglo settlers. The State Library philanthropic partner, to acquire rare and unique indicates it has relatively few items in the California historical material for the California History Room’s History Room’s special collections focused on collections. These materials (including items like underrepresented and marginalized communities. photographs and manuscripts) are not available Moreover, the State Library indicates that the through mainstream vendors or publishers. Over relatively few items in the special collections that the past three calendar years, the California State document the history of marginalized groups are Library Foundation has spent a total of $19,000 for not organized in a way that makes them easy this purpose. to find. Recommendation Workload for California History Room Reject Proposal and Revisit When State Librarians Has Been Fluctuating Notably. The State Library uses an online management Budget Condition Improves. Given the state’s projected budget deficits over the next few years, system called “Ask-A-Librarian” for patrons we recommend the Legislature reject the proposed to submit library requests. This system allows ongoing and one-time augmentations the Governor California History Room staff to identify when a proposes for the California History Room at this request comes in, as well as track the number time. When the state budget condition is better, of hours a librarian spends on a request. (When the Legislature could consider improvements to staff are responding to these requests, they tend the California History Room’s special collections, to pause other tasks such as processing and including by potentially funding a Senior Librarian cataloging new collections.) As Figure 2 shows, to work on expanding certain outreach aimed associated workload for the California History at including more collections material from Room has been fluctuating. Though Ask-A-Librarian underrepresented groups. The Legislature also workload increased notably from 2020-21 to can continue monitoring Librarian workload. 2021-22, it tapered off considerably during the first Though existing workload data do not show clear half of 2022-23. If this trend continues through the justification for additional Librarian positions, the second half of 2022-23, associated workload will Legislature could revisit the issue in future years. fall not only short of the original projections used to Finally, when the state budget condition improves, justify the request for additional personnel but also the Legislature could consider providing one-time will fall to its lowest level in five years. funds for purchasing more material for the special Other Funding Sources Exist for Special collections. In the meantime, the California History Collections Acquisitions. Over the last three Room could continue relying on federal funds and fiscal years, the State Library has spent a total of philanthropic funds for such purchases. $247,000 in federal funding to support ongoing subscriptions to various high-use periodicals and recurring print titles at the California History Room. Figure 2 Workload for California History Room Has Been Fluctuating 2022-23 2018-19 2019-20 2020-21 2021-22 Original Updated Actual Actual Actual Actual Projectiona Projectionb Ask-A-Librarian Requests Received 732 604 739 888 1,065 646 Staff Hours on Research 609 630 830 880 932 422 a Reflects the California State Library’s projection as reflected in its California History Room budget change proposal. b Assumes workload continues in the second half of the fiscal year at same pace as the first half. 4 LEGISLATIVE ANALYST’S OFFICE 2023-24 BUDGET WITKIN STATE LAW LIBRARY In this section, we provide background on the Over the past three years, the Witkin State Law Witkin State Law Library, describe the Governor’s Library has spent on average $375,000 annually proposals for the law library, assess those from the special fund. proposals, and offer associated recommendations. Witkin State Law Library Has Long Depended on State General Fund Support. With the law Background library’s fee amount held flat for so long, the Witkin State Law Library Provides Research State Library reports that it has used some of its Services. The Witkin State Law Library contains ongoing General Fund support to help cover the primary and secondary sources in American law, Witkin State Law Library’s operating costs since federal and state appellate court opinions, session at least 2007. In each of 2021-22 and 2022-23, the laws, codes and statutes, federal agency decisions, State Library used nearly $600,000 of its ongoing and attorney general opinions. Its staff provide General Fund support for the law library’s operating research support to state agencies and the general costs. In 2022-23, the state also provided $80,000 public. In 2021-22, about one-third of its clients one-time General Fund directly in the annual budget were from state agencies and two-thirds were act for the law library. Provisional budget language from the general public. Among state agencies, indicated that this one-time funding was broadly the Department of Justice makes considerably “for support of the State Law Library.” more law library requests than any other agency. In addition to handling research requests, law Proposals library staff are responsible for curating library Governor Proposes Several Augmentations materials, among other responsibilities. For the past for the Law Library. The Governor proposes a four years, the law library has had a steady staffing total augmentation of $462,000 ongoing General level of seven permanent, full-time positions. Fund support for four additional permanent, Special Fund Revenue Is Intended to Cover full-time positions. The four positions consist of Law Library’s Operating Expenses. The California a Senior Librarian, who would serve as the main State Law Library Special Fund is intended to cover point of contact for state agencies and assist with the operating expenses of the Witkin State Law coordinating digitization projects; two Librarians, Library. The state created this special fund in 1992. who would serve in traditional legal research The special fund receives a specified amount of capacities; and a Library Technical Assistant II, certain filing fees charged for civil appellate cases. who would perform paraprofessional tasks such as Statute sets both the total civil filing charges (the book acquisition, catalog classification, physical bulk of which is retained by the judicial branch) as upkeep of library material, and book inventory. well as the specific amount that is to be deposited One of the Librarian positions, as well as the into the Law Library Special Fund. Currently, Library Technical Assistant II position, currently are $65 of certain civil filing fees are deposited into supported by the Law Library Special Fund (costing the Law Library Special Fund. This fee amount a combined $221,000). The administration’s has been flat since 1999. The Legislature has a proposed augmentations are intended to address practice of reauthorizing the amount of certain higher workload and continued increases in the law civil appellate filing fees deposited into the Law library’s operating costs. Library Special Fund periodically. The next Assessment reauthorization is expected to occur in 2025. The last time the Legislature increased the relevant Workload Has Increased for Law Library, civil appellate filing fees was in 2012. At that time, but Remains in Line With Job Expectations. though the total civil filing fees were increased, no The number of hours law library staff spend accompanying increase was made to the amount on research has been increasing—rising from of the fee set aside for the Witkin State Law Library. 578 hours in 2017-18 to 2,393 hours in 2021-22. www.lao.ca.gov 5 2023-24 BUDGET The increase is linked to more research requests, Finally, the state’s projected General Fund operating with research hours spent per request holding deficits further call into question the timing of relatively stable over this period, averaging such a proposal. In other areas of the budget, the 1.25 hours per request. Though projected hours administration effectively has counter proposals spent on research for 2022-23 (assuming the intended to provide General Fund relief. In those second half of the year looks similar to the first cases, rather than having ongoing General Fund half) could fall slightly from the 2021-22 level, replace existing special fund support, special fund hours spent on research still are likely to remain revenue is used instead of General Fund. elevated compared to earlier years of the period. Recommendations The State Library attributes at least some of the increase in law library research activity to the Reject Proposal. Given the law library’s state’s expansion of telework, as remote work can workload levels remain in line with job expectations separate state employees from traditional print and the administration has not provided clear resources previously maintained within their own justification for using ongoing General Fund agencies. Though hours spent on research have support in place of existing special fund support, increased, the average share of time each Librarian we recommend the Legislature reject the proposed spends on research remains below 40 percent—the General Fund augmentations. As the state is likely target the State Library specifies in its Librarian job to reauthorize the amount of civil appellate filing duty statement. fees deposited into the State Law Library Fund in 2025, the Legislature could consider increasing No Clear Justification for Replacing Special the amount at that time. The law library has not Fund Support With General Fund Support. had an increase in its set-aside rate in more than After hovering at about $300,000 for the past few two decades, despite continuing to experience years, the administration projects that revenue in increases in its staffing costs. This budgetary the State Law Library Special Fund will increase to approach is consistent with statutory intent to fund $391,000 (30 percent) in 2023-24. Moreover, the the law library using special fund revenue. Such an amount of civil appellate filing fees deposited into approach also helps improve the state’s budget this fund are up for reauthorization in 2025. Were condition by mitigating the law library’s reliance on the allocation for the law library to be increased, General Fund support. sufficient additional revenue could be generated to address the library’s rising operating costs. STATE LIBRARY AUDIT PROGRAM In this section, we provide background on and strengthening the systems of internal control the State Library audit program, describe the to minimize fraud, errors, abuse, and waste of Governor’s proposal, assess the proposal, and offer government funds.” The State Library depends two associated budget options for the Legislature on its executive management team to establish to consider. and maintain its internal controls. This team is comprised of the State Librarian, Deputy State Background Librarian, and the bureau chiefs of its five main State Law Requires Agencies to Have Internal divisions. The executive team delegates authority Controls. State law requires each state agency to as it deems appropriate to supervisors and line maintain “effective systems of internal control as staff to achieve audit responsibilities. The State an integral part of its management system.” State Library reports that it currently has eight staff law further declares that “all levels of management with audit-related responsibilities, with these staff of state agencies must be involved in assessing spending 30 percent of their time on this work. 6 LEGISLATIVE ANALYST’S OFFICE 2023-24 BUDGET State Library’s Budget Has Grown in Recent assistance programs. Moreover, were the State Years. State law sets forth that state agencies with Library’s existing eight staff with audit-related ongoing budgets of $50 million or more should responsibilities to lack capacity to fulfill related consider establishing an ongoing audit program. ongoing audit work, the State Library might The State Library budget exceeded the $50 million consider redesignating one of its other existing ongoing General Fund threshold for the first time in staff. The State Library has seen a significant 2022-23 (reaching $51 million). Over the past five increase in its staff over the past five years. Most years, the State Library’s ongoing General Fund recently, the 2021-22 Budget Act funded 20 support has increased $20 million (66 percent). additional positions and the 2022-23 Budget Act In addition to increases in ongoing General Fund funded a further 17.5 new positions. These support, the state provided the State Library with positions generally were intended to help the State considerable one-time funding in 2021-22 and Library implement various new and expanded state 2022-23. Most notably, the state provided the State and local assistance programs. Furthermore, it is Library $439 million one-time General Fund in unclear the extent to which a new ongoing auditor 2021-22 and $50 million in 2022-23 for local library position could be helpful with overseeing recent infrastructure grants. one-time initiatives. The largest of these initiatives (the $439 million for local library infrastructure Proposal grants) requires grant funds to be used by Governor Proposes Providing State Library June 30, 2024, such that a new auditor might be in With Auditor Position. The Governor’s budget place only a few months before the funds expire. includes a $168,000 ongoing General Fund Though some auditing work might exist even after augmentation for one permanent, full-time Senior these local assistance funds expire, such work Management Auditor at the State Library. The State does not justify a new ongoing position. Library reports that the Senior Management Auditor Options would be tasked with strengthening processes and internal controls, analyzing audit reports, verifying Legislature Could Consider Two Options. proper reporting, and providing consultation in the Given the factors just mentioned, one option is for administration of local assistance grant programs, the Legislature to reject this proposal. Under this among various other related responsibilities. The option, the State Library would continue relying State Library indicates that the primary rationale for on its existing staff to ensure internal controls are the new auditor position is the significant growth in met. To date, the State Library has not identified the State Library’s local assistance programs and instances of fraud or mismanagement of public funding over the past few years. resources. Moreover, many of its one-time initiatives will expire shortly, calling into question the need Assessment for an ongoing position. A second option for the State Library Has Not Made a Particularly Legislature to consider is converting the requested Strong Case for New Position. Though a new position from permanent to limited term. Though auditor position might improve the State Library’s the State Library potentially has opportunities within oversight of local assistance programs, it is not its recently expanded staffing level to perform clear that an auditor position is needed at this more auditing and oversight, the Legislature could time. The State Library is only $1 million over the consider a limited-term position that would be $50 million threshold at which an agency is “to particularly focused on ensuring that the local consider” establishing an ongoing audit program. library infrastructure grants are used in accordance Of this amount, less than $25 million is associated with state intent. with ongoing General Fund-supported local www.lao.ca.gov 7 2023-24 BUDGET LAO PUBLICATIONS This report was prepared by Ian Klein, 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. To request publications call (916) 445-4656. This report and others, as well as an e-mail subscription service, are available on the LAO’s website at www.lao.ca.gov. The LAO is located at 925 L Street, Suite 1000, Sacramento, California 95814. 8 LEGISLATIVE ANALYST’S OFFICE