A report detailing alleged mismanagement of funds at the Blue Earth Community Library and Fossil Discovery Center led to a serious discussion at a recent Blue Earth City Council meeting held on Monday, May 16.

In a report presented to the council, city administrator Mary Kennedy outlined a contrast in library revenues from the years 2018 and 2019 to the years 2020 and 2021.

In particular, Kennedy identified a discrepancy in copier revenue between those two periods.

In 2018, copier usage had generated $6,549 in costs, while $1,400 of income from copies made was deposited at City Hall as revenue for the city. Meanwhile, in 2019, there was $7,690 in copier costs and $2,065 in revenue was deposited at City Hall.

In contrast, 2020’s copier usage generated $5,575 in costs, and $445 was deposited as revenue at City Hall. It was noted in the report that the library was closed some of 2020 due to the coronavirus pandemic. In 2021, $7,066 in copier costs were incurred, with only $277 in copier revenue being deposited.

“There is concern in the level of copier revenue being deposited in years 2020 and 2021, as well as the frequency of deposits,” Kennedy concluded.

Kennedy noted policy dictates the library deposit revenue on a regular basis at City Hall. While 62 deposits were made from the library to City Hall in 2018, and 63 deposits were made in 2019, those numbers dropped over the next few years to 10 deposits in 2020 and 18 deposits in 2021.

She also cited the library’s unauthorized decision to waive late fees in response to the pandemic, as well as unreported income from an annual used book sale.

Randy Anderson, director of the Faribault County Historical Society, who was at the council meeting on Monday, explained that the decrease in copier revenue was impacted by a project he has undertaken on behalf of the historical society.

Anderson said he has been using the library’s copier to create digital files of thousands of original documents.

Anderson and former library director Eva Gaydon had been hoping to create a partnership between the library and historical society to facilitate public access to the digitalized documents, converting the library’s back room into a joint local history and genealogy center, Anderson explained.

“In a year and a half or so, we should have all of that material available at the library,” Anderson added.

“Eva and I discussed a reduced rate on the photocopying machine,” Anderson said, adding that documentation of his copier usage accounts for at least part of the decrease in copier revenue. “This is a matter that should have gone to the library board,” he admitted.

However, Anderson promised to compensate the city for the copies once the library board and historical society settle on the exact amount which is owed.

The council thanked Anderson for his explanation, but was still concerned about the library’s low frequency of deposits to City Hall.

“The explanation is great,” Kennedy responded. “However, it doesn’t change the fact that it wasn’t paid when it was supposed to be paid. There is staff that is responsible to see that that happens.” 

Due to the apparent mismanagement of finances as well as several other management concerns, the library board had voted 5-2 the previous week to either terminate Gaydon’s employment or accept her resignation.

Gaydon, who has since submitted her letter of resignation, was scheduled to complete her last day as library director on Tuesday, May 17.

“We will be getting an interim librarian and advertising for a librarian to take (Gaydon’s) place,” said council member Wendy Cole, who is also a member of the library board as the council liaison.

In other business, the Blue Earth City Council: 

• Adopted Resolution 22-16 electing the standard allowance available under the Revenue Loss Provision of the Coronavirus Local Fiscal Recovery Fund. The elected standard allows the city to spend its $339,649 in allocated ARPA funds with fewer restrictions and less documentation.

• Directed city attorney David Frundt to revise the city’s current ordinance on the keeping of chickens within city limits. The revisions are intended to give the council more control over the permit application process.

The revision is in response to a comment from a resident who was unable to obtain neighbor consent to house chickens in her backyard. Under the current ordinance, permission is necessary to receive a permit from the city.

• Discussed the deteriorating condition of the baseball dugouts at Veterans Field during a 4:30 p.m. worksession.

Brent Legred, president of the Blue Earth Area Baseball Association, noted that he is worried about the dugouts’ structural integrity – particularly if they are left to weather another winter.

Mayor Rick Scholtes requested that city engineer Wes Brown have a structural engineer inspect the dugouts to gather more information.

• Passed a motion to use liquor store funds to fund the installation of new scoreboards which the Baseball and Softball Association recently purchased for the 14th Street ballfield.

• Rescheduled a Monday, June 20 City Council meeting to Tuesday, June 21 in observance of Juneteenth.

• Accepted Kim Shaffer’s resignation from the Planning Commission, noting that after 11 years on the commission, Shaffer will be joining the HRA.

• Heard project updates from Brown, who shared rainy weather has slightly delayed project plans. He said work is slated to begin on First Street next week.

• Failed to pass a motion which would pledge the city’s contribution to a local recruitment incentive package which is under development.

Council member Ann Hanna made a motion to forgive 100 percent of city tax on properties at the new housing development for five years as part of the package. However, her motion died for lack of a second.