A court has been asked to decide who should hold the title to property that has served as home to Poplar Bluff's library for about a century.
A response from the city of Poplar Bluff is expected next week in a suit brought by the independent Poplar Bluff Municipal Library District, which oversees library operations and sales tax funding.
The district asks to be granted either ownership of the land, building and parking lot at 318 N. Main St., or an undetermined cash judgment against the city, according to documents filed Oct. 3 at Butler County Courthouse.
The suit was brought after the Poplar Bluff City Council declined in August under a 5-2 vote to consider the library board's request for the deed.
The library board contends the city failed to honor a verbal agreement made in 2014. City officials argue the only promise made at that time was that they would consider the request again in 2018.
Both sides indicated in August the property could be important as collateral in loans for future building projects.
"I think the city council's position is that the property has belonged to the citizens of Poplar Bluff since 1917 and for almost a century, they have maintained, built facility and paid for its cost upkeep," said city attorney Mark Richardson. "They don't believe it's proper stewardship of property owned by the citizens of Poplar Bluff to transfer it to an independent district board."
A written statement was issued by library board treasurer John Stanard and is printed on page A4 of today's edition. Stanard said any further comment would be made by the board's attorney, Scott Robbins of the Poplar Bluff firm Kennedy, Kennedy, Robbins & Yarbro.
"The library board felt they had no choice but to proceed in court," said Robbins.
The library wants to receive title before any additional loans are taken out using the property as collateral, he said.
Neither side has indicated a specific project or timeframe that would require debt.
Library property, along with other city property, was previously used to secure debt for construction of the Black River Coliseum and other improvement projects, including at the city golf course and library. That debt will be repaid this year.
MONEY DISPUTE
At the center of the current library and city dispute is a different debt, of approximately $500,000.
The money was paid from the city's general fund to the library's operating fund account in 2012, following an error in tax collections that both sides accuse the other of causing.
The library entered an agreement in 2014 to make payments to the city of $97,957 annually until 2018, according to a memorandum of understanding signed in June of that year by two city officials and two library officials.
The final payment was made in October, said Richardson.
Library officials claim they only agreed to the payments because they expected to receive the land title.
City officials argue the funds were repayment of a loan after a tax issue created a shortage of operating cash for the library.
TAX ERROR
Voters agreed in 2012 to replace a property tax that provided funding to the library with a quarter-cent sales tax.
Property tax collections stopped in 2012, despite the fact that sales tax revenue was not received by the library district until 2013, according to Stanard.
"... the city either negligently or purposefully, failed to collect the Library District's property tax for that last year," he wrote in the document provided to the Daily American Republic.
This caused the library to operate in a negative balance and, as a result, funds were provided by the city, Stanard said.
City manager Mark Massingham disagrees.
The property tax rate is set in September of each year for taxes collected in November or December of the same year, he explained. The library board set their property tax rate at '0' and no taxes were collected for 2012, he said.
"The library has for many years set its own property tax assessment," said Richardson, who believes the library board failed to realize property tax was collected retroactively for the prior year.
The library board negated an entire year's income, Richardson said, and the city provided funds to keep the facility open.
The one-page agreement signed in June 2014 says the board "agreed in principle to repay the City of Poplar Bluff (City) monies provided by the City which supplemented the Library operations for the tax years 2008-2012 in the amount of $489,786.88." The city agreed in the document that library had no further financial obligations to the city after the amount was made.
The document does not mention the library title.
In legal documents filed by the library board, they say a "hand shake agreement" with the city was made for the property title. According to the board, this was material in their agreement to make payments to the city.
DISPUTED PROMISE
Library board members point to a June 2, 2014 city council meeting as proof of a verbal agreement to transfer the title.
Massingham asserts no promise was made during that meeting.
A video recording of the meeting is posted to the city's YouTube account and minutes are included on the city's website.
Massingham, who was interim city manager at the time, said during the meeting the city could not transfer title because it was collateral on an existing city debt.
He proposed a five-year lease of the property to the library board at $1 per year, and this was later approved by the council.
When the lease was up, Massingham said about one hour into the nearly two-hour meeting, "then we can consider transferring the library building to the library. It would include that entire parking lot, that block there."
Stanard quotes in his statement an article written June 3, 2014, in the DAR which incorrectly quoted Massingham as saying "we will transfer the building and parking..."
No correction was requested and the error was not discovered until this week.
"It was talked about at the city council meeting, but there was not action taken by the city council," said Richardson. "The memorandum of understanding for the half million dollars contains nothing about the transfer of the building, or that the payment was for consideration of the transfer of the building."
The library property should have been transferred to the library board in 1965, when state law was amended to create library subdivisions, said Robbins.
The library board is appointed by the mayor, with approval of the city council. The city council has no authority over the board beyond that and the board operates independently, Richardson said.
The library board voted to pursue the lawsuit in a closed session meeting, said Robbins, who could not provide information on whether the vote was unanimous.
Robbins said he was not aware of any other documents beyond the June 2014 council meeting which discuss the proposed transfer of the property deed.