Libraries serve as essential community hubs, from offering internet access and after-school tutoring classes to English learning classes and chess meet-ups. In recent years though, many cities have seen their libraries cut hours, lose services and staff, or even permanently close. Why the budget cuts? Using new publicly available data, we can reveal that libraries across the country lose millions every year to costly corporate tax breaks.
In many places, the losses are significant. For example, Kansas City (Missouri) Libraries lost more than $4 million from tax abatements in 2022 alone. For context, the library only spent $2.4 million on materials, including new books, processing materials, and digital databases, in the same year. In the same year, St. Louis County Library Systems lost almost $1 million.
Often, these are “passive” losses, foregone revenue caused by to tax-break deals awarded by other governments, including cities, counties, or even the state itself. Put another way, library districts – like public school districts, which lose billions each year to corporate tax breaks – have no say when their money is given away.
We can detect this lost revenue now thanks to an accounting rule that went into effect in most places in 2017, requiring most government bodies in the U.S. — including some public library districts — to disclose how much revenue they lose to economic development tax abatement programs. Because some libraries operate as independent districts, we can see how much revenue they’re foregoing to tax abatements in their end-of-year spending reports (Annual Comprehensive Financial Reports, or ACFRs).
In Louisiana, the controversial Industrial Tax Exemption Program (ITEP) program costs libraries significant amounts of money. St. Mary Parish Libraries lost more than $350,000 in 2022, and estimates from Together Louisiana projected that East Baton Rouge Libraries lost $6.6 million in revenue in 2017 due to agreements made under ITEP, which give industrial companies significant property tax breaks.
In Ohio, Cleveland Public Libraries lost almost $3.5 million in funding in 2021. Franklin County, which we have previously praised for its transparency, reports more than $15 million lost in 2023 across the seven library districts in the county.
In Oregon, the Deschutes County Library lost $139,836 in 2023 and Washington’s King County Rural Library lost $448,385 in 2021. With the average full-time local government librarian’s salary being only $59,000, those dollars could’ve meant hiring more staff, buying more materials, and offering more programming.
Because most libraries are not independent taxing bodies (but are instead units of city or county governments), we can only estimate how much most libraries are losing to corporate tax breaks. Our sampled data comes from some of those few libraries that operate separately, but the available numbers expose the breadth of the issue nationally.
For many libraries, even losing a few thousand dollars can significantly impact their operations. For people without internet access at home or students looking for a safe place to study after school, for example, losing access to a library a few hours a week is a big deal. It’s time to rein in costly subsidy programs and reinvest in libraries and other vital public services.