Jones Expansion Funding Assurances Collapse Under Scrutiny
Photo: https://www.joneslibrary.org/
At the April 14 special meeting to consider rescinding a $46.1 million borrowing authorization for the beleaguered renovation and expansion of the Jones Library, Town Manager Paul Bockelman provided information meant to assure councilors that committing to a construction contract does not present a financial risk to the Town.
A 15-page Response to Council Questions covered uncertainties ranging from the status of a low construction bid submitted by Fontaine Brothers in November 2024, to the availability of state and federal grants critical to project financing. It was accompanied by a memo from the Jones Library Trustees intended to demonstrate that the Library and its Capital Campaign have the ability to meet their agreed upon share of the total project cost.
Nine councilors were persuaded by the documents that were sent to them five hours before the start of the meeting and voted to continue funding the project. They should have taken a closer look.
What follows is a list of claims that won over the Town Council but need to be better understood by town leaders and the public. As has been typical of project-related communications coming from the library, there is as much to be learned from what is not said as from what is.
Growing Trustee Funding Gap, Dwindling Donations
The Capital Campaign reports that its share of the $46.1 million project expense is $13,822,000 and that $6,537,740 in cash and pledges have been secured. They have remitted $1.650,000 to the town despite a memorandum of agreement (MOA) requiring the transfer of money to the town as soon as it is raised.
They declare that the outstanding amount to fundraise is $8,300,000, acknowledging that this includes $1 million in fundraising expenses. The Capital Campaign reports paying $602,184 in fundraising expenses to date.
The Capital Campaign omits any mention of recent progress. Analysis of the past two monthly reports shows that $1,129 was raised in February and $1,605 in March. With the project in jeopardy, it might be expected that donors would open their wallets or at least make large pledges to bolster the fundraisers’ optimistic forecasts, but that has not been the case.
Draining the Endowment
To meet the terms of its Memorandum of Agreement (MOA) between the trustees and the town, the trustees plan to draw down the Jones Library endowment by $4,300,000. This draw would leave the endowment, described as valued at $9 million, with $4,700,000. They neglect to report that the endowment balance was down to $8.8 million on April 1. Although the trustees moved half of the endowment into fixed rate money market funds at the beginning of this month, the fact that equity markets have fallen 6% in April undoubtedly has reduced the endowment value further.
Drawing down the endowment, which is used to fund library operations, could have a devastating impact. Director Sharon Sharry stated at the June 2024 trustees meeting that an annual draw of $300,000 is needed to maintain level library services and reported that the lowest endowment draw since she was hired in 2011 has been a 4% draw of $293,000 in 2016. In FY25 the Library relied on a 4% draw of $354,619, allocating $144,956 to spend on materials.
According to an Endowment Model submitted by the trustees, the endowment draw would need to be drastically reduced to enable directing $4,300,000 to the renovation-expansion project. The library would need to survive on a draw ranging from $250,000 in 2026 to $287,171 in 2033, or less than Sharry’s level funding figure. And this would be in a renovated library that is 30% bigger than the current building and with promises of expanded programming befitting its new role as a community center. Will the town be required to make up the amount needed for level library services, or will the magnificent new library be forced to cut back on investment in materials, programming, and other offerings?
April 30 MBLC Deadline Looms
Recognizing that as time goes by, construction costs go up, the Massachusetts Board of Library Commissioners (MBLC) imposes a deadline to enter into a construction contract on a project funded by an MBLC construction grant. Amherst has received three extensions to the MBLC deadline, with the final extension, according to the MBLC, being April 30. With a $15.6 million award from the MBLC hanging in the balance, the Amherst Town Manager does not want to miss this deadline.
However, a very late start on the historic preservation and environmental reviews required to receive $2.1 million in federal funds from the Deptartment of Housing and Urban Development (HUD) and the National Endowment of the Humanities (NEH) has put Amherst in a bind.
HUD regulations require a 30-day public comment period on the Town’s Environmental Assessment finding followed by a 15-day objection period before federal funds can be authorized for release. The public comment period began on March 28 and ends on April 28, with the HUD objection period extending to May 13.
In the award letter sent to the Library, HUD Deputy Assistant Secretary Robin Keegan clearly lays out the definition of a “choice-limiting action” that must be avoided to guarantee the release of funds. “Choice limiting actions constitute work, such as entering construction contract agreements/commitments …,” she writes.
The implication is that if the town follows HUD requirements to qualify for the award of $1,110,661, the Town Manager must hold off until at least May 13, the earliest date in which the ongoing environmental review can be completed, before signing a contract, or risk losing the funds.
Show Me the HUD Money
This conflict between HUD and MBLC dates may explain why the Jones Library Trustees do not assume that HUD money will be part of the funding formula for the renovation-expansion. A list of funding sources in the Trustee Assurances document reports estimated amounts to be secured both with and without HUD funds included. This may signal that the Town Manager is willing to sacrifice the $1.1 million from HUD in order to meet the April 30 MBLC deadline.
Show Me the NEH Money
Equally uncertain is the $1 million challenge grant from the National Endowment for the Humanities. The Town Manager suggested that the release of funds was imminent: “The NEH grant agreement is being processed and will be released soon.”
However, in the same section he tempers his optimism, “The Town/Library has not received any correspondence or notifications from NEH that these funds have been cancelled.”
The fact is that NEH has seen draconian cuts implemented by DOGE and the Trump Administration, losing 80% of its staff and having a reported 85% of its outstanding grants terminated. A database maintained by the Association of Computers and the Humanities lists more than 1400 canceled NEH grants, including several supporting the development of humanities centers as proposed for the Jones Library grant.
On March 12, Shelly Lowe, the NEH Chair who approved the Jones Library Grant award in 2023, resigned.
No Library Loan Guarantee
To demonstrate their ability to borrow $4 million to supplement the $4.3 million endowment draw, the trustees presented a letter from Frank Canning of MassDevelopment. Canning explained how MassDevelopment, the state’s economic and finance authority, could issue a tax-exempt bond on behalf of Jones Library so the library would be able to borrow at a lower interest rate.
He added, “As we had discussed, we need an investor to buy the bond and the $4 million proceeds from the bond sale are lent to Jones Library to fund your project and you repay the $4 million to the investor under an agreed upon repayment schedule.”
Canning discusses a couple other possible scenarios where MassDevelopment provides the loan, or a bank issues a more conventional type of loan, “with a set repayment schedule, secured by a mortgage on the building.”
However, the existence of a mechanism for the Jones Library to seek to borrow funds in no way guarantees that it has the resources or approval to borrow the necessary $4 million.
Hints of a Potential Debt Exclusion
Bockelman was asked what would happen if the town needed to assume additional unanticipated debt because the library is unable to come up with its $7 million share. He answered that two-thirds of the Town Council could authorize additional borrowing, He also identified as an alternative — a debt exclusion question could be presented to the voters which if approved would allow money for the additional library borrowing to be raised from property taxes outside the limits of Proposition 2 ½. No mention was made of the fact that the impact of a debt exclusion passed for the new $98 million Fort River School will begin showing up on tax bills in 2026.
Other Risks and Challenges
This is only a partial list of the questionable assurances upon which the Town Council based its decision to forge ahead with the Library project.
Lack of a space to serve as an interim library during construction, procurement process issues, slate roofing work remaining to be bid, the possible need to address environmental issues, the acknowledged possibility that opening up walls in the historic building could reveal unforeseen problems, a budgeted contingency that has shrunk to 8.5%, tariff and related economic uncertainties, and the need to address the rising costs of essential town services should lower the confidence of all thirteen town councilors who have been so trusting of the Town Manager’s and trustees’ assurances. It is the current and future people of Amherst who stand to suffer the financial consequences.
See related: Public Comment: Jones Library Fiscal Assurances – How Will That Work?