[Michlib-l] Bill Payment and Purchasing Policies -- City Libraries formed by City Charter

[Stephanie Masin]

Greetings everyone --

I know there aren't a ton of libraries in the State that are City libraries formed by City Charter, but I'm hoping that those of you who ARE in libraries that fit that bill will be able to provide information regarding your bill payment procedures and purchasing policies.   I'd also love to hear from those who are a little more legal saavy/knowledgable regarding this matter.

A bit of background regarding our library.  In our library by-laws it says that the "Director may dispense an amount not to exceed One Thousand and 00/100 ($1,000) dollars without a vote of the Board of Trustees and the Director may expend an amount of One Thousand and ONe and 00/100 ($1,001.00) dollars but less than Five Thousand and 00/100 ($5,000.00) dollars with the concurrence of the President and Treasurer."   We pay an administrative fee to our City finance department to handle payment of our bills, running our financial statements, and working with the auditors (though we pay separately for our portion of the audit).

We have always followed the above guidelines for purchasing... with larger expenditures (over $10,000) going before our City Commission in compliance with their purchasing policy.   Historically we've submitted our bills to City Hall for payment.  The Library Board reviews the bill reports at their monthly meeting, but have not approved actual bill payment as again, those are submitted to the City for payment (and the library board's assertion in the past has been they've approved the annual budget... as long as they haven't seen anything alarming in the bill reports or a deviation from our expenditure guidelines, they have not felt the need to approve the bills before they're submitted to City Hall for payment).

With that said, we've had some instances in the past where we've had late charges on some bills because the timeline for the receipt of the bill didn't fall within the City's bill payment schedule properly... so they ended up being paid in the following payment cycle (resulting in a late fee).   The City insists that vendors will "adjust their payment schedules" to work with municipal entities.  I've never had that experience with Comcast (for example)... so we've ended up with late fees that just keep accruing because the City doesn't pay late fees.

Also, in the past our City Commission has handled bill approval similarly to our Library Board.  They have reviewed the amounts already dispersed and approve in their consent agenda.  However, our new financial director for the City is changing this process so that bills are not paid until after the City Commission has reviewed them all.  Based on the timelines for this new process we already know we are facing several months worth of late charges on some of our bills.  When I raised this concern with our finance director she reviewed the state laws regarding our type of library and said she wasn't sure where we fit in to that process as our bylaw wording is unclear (since we don't dispense funds, the City does per the administration agreement), we've always deferred to their purchasing policy when questions have come up, and state law seems to indicate that only the library board needs to approve the bills.... not the City commission (though since they administer payment of our bills I doubt they'll set a separate payment schedule just for our bills).

So, I'm appealing to your collective knowledge for some insight/guidance in this situation.

Thank you!

Stephanie Masin
Library Director
Maud Preston Palenske Memorial Library
500 Market Street
St. Joseph, MI  49085
(269) 983-7167
www.stjoseph.lib.mi.us<http://www.stjoseph.lib.mi.us>

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