Library district, Wellington at odds over new annexations

By Cherry Sokoloski
North Forty News

The Fort Collins Regional Library District, barely a year old, is already engaged in its first turf battle. The infant district, born in 2006, is scrapping with an old pioneer, the town of Wellington.

The issue, which came to the forefront in recent weeks, is a territory dispute involving new annexations to the town. In particular, there are legal questions about whether property owners in new Wellington annexations must stay in the library district, thereby paying for two library systems.

Regional library district officials contend that once a property is in the district, it can't be removed. However, Wellington town officials are ready to fight to protect newly annexed properties from double library taxation.

At the March 11 meeting of the Wellington Library Board, town attorney Brad March read a letter from the library district's attorney that states the district does not intend to exclude properties as they are annexed to Wellington.

March said he had been under the impression that the district board was willing to discuss the issue with Wellington. After receiving the letter, he told the library board, "I think we need to sue them.... The first effort the town took was to try to do this on a friendly basis, and apparently they don't want to talk friendly."

March is recommending to the town board that it seek a declaratory judgment in district court to obtain a judge's opinion on the boundary issue.

The new regional district, whose boundaries coincide for the most part with Poudre School District boundaries, completely surrounds the town of Wellington. The property tax that funds the district is set at 3 mills. Wellington opted not to join the district, so all property within the town limits is excluded from having to pay the library district tax.

According to the library district's attorney, Kim Seter, new annexations that overlap with the library district are still in the district and must pay the 3-mill tax. New annexations also start paying taxes to Wellington --including taxes that fund the Wellington Public Library.

Businessman surprised

Wellington's newest annexation, approved in February, is an 87-acre parcel that will be home to Super Vacuum Manufacturing Co. as well as other businesses. The vacant parcel, now zoned light industrial, is the first addition to Wellington since the library district was approved in 2006.

Roger Weinmeister, president of Super Vac, was surprised to learn that he could be paying taxes not only to Wellington but also to the FCRLD. A volunteer fireman himself, he compared the situation to fire district boundaries.

"People wouldn't want to pay for double fire coverage," he stated. For the sake of fairness, Weinmeister said, new Wellington annexations should be able to withdraw from the FCRLD.

Weinmeister is moving his business from Loveland to Wellington and anticipates expanding the operation. He can see his tax liability for the library district climbing to $8,000 to $10,000 per year. "That's real money," he commented.

In terms of attracting new businesses to Wellington, Weinmeister said the dual library taxes for new annexations "certainly won't help."

Wellington developer Fred Ziegler agreed. Staying in the district, he said, means "double taxation, and that's not right." He also argued that the 3-mill property tax for the library district is an added cost that could discourage new businesses from coming to Wellington.

"It all adds up, and it affects competition," Ziegler said. "Low cost is what has attracted new business and residential development so far, and we don't dare lose that."

Wellington is working hard to attract more commercial development to ease the tax burden on residential parcels.

Library law lacking

The issue of annexations was first brought up by the town board in the spring of 2006 when Wellington decided to opt out of the proposed district. March later sent a letter to the district board asking for an agreement whereby new annexations would be removed from the district.

However, the new board delayed acting on the issue because it was busy grappling with organizational logistics. The district's March 11 letter is its first response to Wellington's request.

The fact that the town opted out of the district, March said, means that there's an expectation on Wellington's part that new annexations will also be excluded from the district. But, he added, town officials recognized early on that there was "a lack of clarification" on the issue.

State library law, March said, clearly stipulates the process for opting out of a library district when it is formed, but it provides no process for properties to remove themselves from a district.

The new annexations, March said, will be supporting the Wellington library with their property taxes and shouldn't have to support the regional library district as well.

"Logic says that if you're in the town of Wellington, you're going to use the Wellington library," he said.

District wants revenue

Officials with the new library district see the situation differently. Brenda Carns, executive director of the FCRLD, said the district needs to keep its revenue base, and all property initially in the district should stay in the district. "Case law is clear on this," she said.

Seter agreed. He cited a 1988 court case in which Westminster sued Jefferson County over library district boundaries. Westminster sought to have a new annexation in Jefferson County removed from the county's library system, since the town had its own library. The city lost the argument. The prevailing judges stated that allowing part of the library system to withdraw could create "economic chaos" for the county library system.

Carns suggested a solution to the Larimer County dilemma. She would like Wellington to join the Fort Collins Regional Library District.

"I think it would be advantageous for people in Wellington if they became part of the district, because the level of service is higher in the district than what a smaller town is typically able to provide," she said.

The regional district will collect $6.8 million in property taxes this year. This year's regional library budget, Carns said, amounts to about $49 per person. Wellington has budgeted $146,300 for its town library this year, which translates to expenditures of about $27 per person.

If the town joined the library district, the district's 3-mill tax within Wellington's town limits would generate about $147,000, based on the town's assessed valuation. That's essentially the same amount as Wellington's current library budget. However, Carns said, since the Wellington library also serves rural residents, the library district would likely budget considerably more than that for the town's library if it were in the district.

Seter, a recognized expert on library law, said some communities have come up with revenue-sharing agreements to solve boundary dilemmas. "Many possibilities are open" for such arrangements, he said. (See related article on this page concerning Johnstown and the Weld Library District.)