Accounting, Legal, Maintenance Costs

Financial System

The new district will need to create an accounting system that is in accordance with the Local Government Financial Administration and Taxation laws, MCA 7-6-201 thru 7-6-2137-6-609 thru 7-6-1116. Accountants from the Local Government Services Bureau of the Department of Administration will help the new district with the accounting requirements. Contact your representative once the new district has formed - The district has three different options for setting up an accounting system.

Establish its own accounting system. Accounting will be handled internally by library staff. Pros of this method are the library has complete control over the accounting; the director and board can set up accounts that work for the library; and staff are probably better able to move quickly and respond to problems faster than the other two options. Cons of this method are it has a steep learning curve for library staff and does have some costs associated with purchasing new software, etc.

Contract with the local governing body. Accounting for the new district will be handled by the city or county. Pros of this system are that you probably will keep the same accounts as you currently have, the city/county staff are familiar with accounting procedures, and it makes for a smoother transition if you stay with your current governing body. Cons of this method are that a change in local government officials may end the contract sooner than expected; the local governing body might not respond as quickly to issues the library has; and there will be a cost associated with this one.

Contract with a private accountant who has experience with governmental accounting. Pros of this method are that someone with accounting experience is handling the accounting for the library. Cons of this method are that you will have to set up a new system; response time might not be as quick as you like; it may be difficult to find someone with governmental accounting experience; and there is a cost associated with this one.

Legal Representation

Consider how you will employ legal counsel. It is important to ask for a legal opinion when establishing new policies and procedures. Normally districts only hire attorneys on an as-needed basis. However, it is useful to find an attorney to work with throughout the districting process.

Risk Management and Insurance

Consider errors or omission insurance for the district board, along with liability, theft, fire and damage insurance for the building. A local insurance agent may be able to assist you with acquiring insurance policies. Some local insurance agents have a relationship with the Montana Association of Counties which provides insurance for independent districts. This policy is generally provided through a local insurance agent.

ASPeN: The New Library Directory

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