Caution needed when expressing opinion as fact
To the Editor,
Free Speech is sacrosanct and wide allowances should be made to protect it. However, there are times when such “speech” cries out for rebuttal; especially when statements are given the appearance of legitimacy by cloaking them with purported “facts.” I believe that is what happened in a recent “letter” (posted April 29) regarding the upcoming millage vote for the Tecumseh District Library (TDL). The writer opines that while the renewal millage may be warranted, the additional 0.2 mil levy should be defeated and uses data he has gleaned from the library’s latest financial report as the factual support for his position.
As a retired fiscal analyst, I have seen the bad public policy that can occur when opinion is given validity through the misuse or misapplication of “facts;” therefore, a rebuttal. The writer uses selected bits from the report to tell us what the future needs of the TDL are, a report that by its very nature is but a snap-shot of the financial status of the TDL at a single point in time. If the report is well annotated, you will be able to see changes in certain items between this report and the previous “snapshot,” and you may be able to drill down far enough to ascertain how some of these values came about, but you really won’t know how the organization has fared over a longer period of time, nor where it is going, without a good deal of additional information. And therein lays the rub; the writer would like us to believe that the library is awash in resources: a million in investments and; 1.2 million in cash! By his reckoning, the library has been stashing away cash at the rate of $136,000 a year, so given this and the assets on hand, he says that the library could operate for another three years without a single cent of additional revenue. So that begs the question, if the library is so good at generating cash, why not save the tax payers some money? In the writer’s view, you could vote down the millage increase; reduce the current millage and; and the library would do quite well, at least over the short run.
Methinks had the writer done a real analysis, the answer to that question would have been crystal clear. For the issue is not what the library’s balance sheet looks like in any point in time, but rather how much and what kind of revenue stream does the TDL need to provide the level of services that this community deserves. Yes, the library did have those assets; as of the date of that report. But what does that mean? Can you just write a check and spend it on anything that you want; all of it; some of it? Part of the answer is “to an extent,” but most of the answer is “NO!” The bulk of the non-cash assets are from endowments, which were never intended to be used for day- to-day operations: protect the corpus; use only the interest for specific and well defined projects and; maintain a "rainy day fund” to protect the TDL’s survival.
As for the cash on hand, simple, just actually look at the report in total. Property tax is the largest source of revenue for the library. Not so obvious is that because of the timing of collections, around half of the property tax dollars that show up in the “cash” balance are already dedicated to the coming years expenditures. Given a “steady state” situation that distinction wouldn’t matter because the flow of revenue would be more or less constant over time. However, with the economic dislocations we have endured (let alone the recent propensity for state government to continue to squeeze local units of government), trying to treat the year-end cash balance contained in the financial statement like some sort of miracle answer to the millage question is a sure recipe for disaster. Finally, there was a significant amount of variance in the amounts and types of revenue that went into the cash balance, year-over-year! With another year of reduction in property tax revenue the question is, “Will those same levels of revenue show up in the following years cash balance?” Given their amounts and sources, it is certainly a bet I wouldn’t want to make. The previous writer stated his opinion, to which he is entitled, but did not back it with facts. Vote Yes + Yes as this community deserves no less.