Is 'Private' Really Private?
Robinson, Charles W., Library Administrator's Digest
The item about the Web site GuideStar (see News Section) really got me curious. So I trolled around the site a bit (you have to register, but it's no big deal). I've known for some time that nonprofit organizations have to file with the IRS something called the Form 990, which is available upon request to any member of the public.
Some years ago I first found out about the Form 990 when I inquired of ALA as to the total compensation of the executive director. When I was only quoted the published salary, not the total compensation, I asked for ALA's Form 990, which I had learned about on a tip from someone I now forget. Anyway, ALA, after some hesitation, sent me a (recently amended) Form 990, which revealed that in addition to salary, the executive director was receiving bonuses and a housing allowance, both of which had to be revealed to the public via the Form 990, which asks for total compensation. The executive director left shortly afterward for other opportunities, and subsequent executive directors are paid a lot less in total compensation. It appeared to me that the ALA executive board at the time wished to keep things "private," not knowing, perhaps, of the Form 990 which is required of nonprofits.
And I agree, as probably you do too, that if the public relieves you of the burden of paying any taxes, income, sales and the like, they have a right to know if your nonprofit work is truly nonprofit and in the public interest. In effect, the public are shareholders in a nonprofit organization. That's why a $36 million "private jet expense" looks more than a little peculiar to newspapers like the Boston Globe, as reported in the news item.
But this doesn't concern public libraries, does it? We're creatures of government, which has its own pretty strict rules about public disclosure, right?
Well, not always.
I was reminded of this when I saw a news item in the professional press about the Providence (RI) Public Library. Apparently city officials in that city expressed displeasure with what they perceived as a reluctance of library officials to reveal their finances, despite the fact that the library receives a large proportion of its budget from city coffers. As a matter of fact, the Providence Public Library describes itself as a "private nonprofit organization." As you might expect, however, almost all of its operating budget comes from city appropriation (82 percent).
So it's no wonder that the city fathers wanted full disclosure from the library. They probably got it, too.
When I arrived as deputy director in my first administration job, I was informed that the library, by state law, was independent and that the annual appropriation from the county was in the form of a grant. We could, by law, do anything we wanted with the grant money. And, by gosh, it was listed in the county's annual report as a grant.
I couldn't believe it, and it was a good thing I didn't. The money was pretty insignificant when the library was small, but of course became a lot larger as we added branches and staff. The government became more professionalized, added lots of analysts and auditors to their staff, and pretty soon we became, in effect, another municipal department. The law is about the same, although quoting it to elected officials is not wise at all. Hey, they could just go to the legislature and get the law changed! …