Portland Public Library and Portland Teachers Assn., No. 81-A-02, affirming
No. 81-UD-04 on jurisdiction.  Affirmed CV-81-884.

STATE OF MAINE                                     MAINE LABOR RELATIONS BOARD
                                                   Case No. 81-A-02
                                                   Issued:  June 18, 1981
PORTLAND PUBLIC LIBRARY       )             
     and                      )            REPORT OF APPELLATE REVIEW OF
                              )              UNIT DETERMINATION REPORT
PORTLAND TEACHERS ASSOCIATION )                         
     This is an appeal by the Portland Public Library (Library) of a unit determina-
tion report issued pursuant to 26 M.R.S.A.  966(1) on November 25, 1980 by a Maine
Labor Relations Board (Board) hearing examiner.  The hearing examiner concluded
that the Library is a "public employer" as defined in 26 M.R.S.A.  962(7), and
that the Board's Executive Director consequently has jurisdiction to determine an
appropriate bargaining unit of Library employees pursuant to the provisions of the
Municipal Public Employees Labor Relations Act, 26 M.R.S.A.  961, et seq. (Act).
The Library contends on appeal that the hearing examiner made errors of fact and
law in reaching this conclusion.
     A hearing on the Library's appeal was held on January 14, 1981, Chairman
Edward H. Keith presiding, with Employer Representative Don R. Ziegenbein and
Alternate Employee Representative Harold S. Noddin.  The Library was represented
by F. Paul Frinsko, Esq., and the Portland Teachers Association (Association),
the party which initiated this proceeding by filing petitions for an appropriate
bargaining unit determination and an election, by John C. Alfano.  The parties
were given full opportunity to examine and cross-examine witnesses, introduce evi-
dence, and make argument.  Both parties filed post-hearing briefs, which have been
considered by the Board.
     The Library is an aggrieved party within the meaning of 26 M.R.S.A.  968(4).
The Association is a public employee labor organization.  The jurisdiction of the
Maine Labor Relations Board to hear this appeal and render a decision and order
lies in 26 M.R.S.A.  968(4).

                                  FINDINGS OF FACT
     Upon review of the entire record, the Board makes the following findings of
      1)  The Portland Public Library was incorporated by an act of the State
Legislature in 1867 (Chapter 174) "for the purpose of establishing and maintaining
a library and an institute of natural history, science and art, in the City of
Portland, with all the powers and privileges, and subject to all the duties and lia-
bilities of similar corporations in this state."  Section 3 of the Act provided:
          SECT. 3. The City of Portland are hereby authorized to appro-
     priate and pay, annually, toward the expenses of establishing and
     maintaining said institution, a sum not exceeding one dollar for
     each of its ratable polls, in the year next preceding that in which
     said appropriation is made; and may also furnish rooms for its ac-
     commodation.  And when, and so long as said city shall make such
     annual appropriations, said corporation shall allow, under proper
     regulations, the inhabitants of said city to have free access to its
     library, for the purpose of using and enjoying the same on the prem-
     ises.  The property of said corporation shall be exempt from taxation.
     2)  In 1876, the Legislature passed an act (Chapter 198) which, among other
things, authorized the City at any time to take the property and rights of the
corporation to be used and maintained as a free public library.  In 1889, however,
this option was terminated by an act (Chapter 287 Section 1) which declared among
other things that:
          "All the powers, immunities and franchises and affairs of the
     [Library] shall perpetually hereafter be exercised, managed and
     governed by a permanent board to be styled The Trustees of the
     Portland Public Library; the corporate property shall be used and
     improved for a free public library for the inhabitants of the city
     of Portland, and shall be forever exempt from liability to be taken
     by the city from the management, direction and control of said board
     of trustees."
A subsequent act of the Legislature in 1965 (Chapter 61) removed previous restric-
tions on the amount of property the corporation could hold.
     3)  In 1943, the Library received tax exempt status from the Internal Revenue
Service under Section 501(c)(3) of the Internal Revenue Code.  This status has been
retained through the present.
     4)  The current Library by-laws, last revised in 1976, provide for a self-
perpetuating Board of Trustees, with a maximum of 20 members.  One of the members

is appointed annually by the Portland City Council from its membership.  In prac-
tice, the Mayor has been appointed as the Council's Trustee.  Another of the mem-
bers, purely as a matter of custom, has been the Superintendent of Schools.  The
by-laws also provide that the Board of Trustees may appoint a Librarian (also
known as the Director).
     5)  In 1974, the Trustees voted to support a resolution proposed for passage
by the City Council which stated:  "That it is the sense of the Council that one
of the paramount needs of the City is a new Public Library Building, that a suit-
able new [building] should be constructed as soon as possible, with due considera-
tion to the other needs of the City . . ."  The Trustees' suggestion that a build-
ing committee be formed, composed of representatives appointed by the City Council
and chaired by a Council member, was accepted. The City Council eventually picked
a building site, paid for the design of the library, and approved the building
     6)  The new library building, which was occupied in 1979, cost about $6,200,000,
with the United States government providing about $3,400,000 of the total and the
City providing the land and over $2,000,000 in cash.  The City applied for the grants
which resulted in federal funds for the Library.  In an Equal Employment Opportunity
Commission form filed as part of the application process, the City listed the Library
as one of the fuctions performed by the City.  The City owns the main building and
provides it rent-free to the Library.  The Library's 1979 annual report states the
value of the use of this contributed facility cannot be reasonably determined.
The City also owned and provided rent free the building previously used as the main
library facility.
     7)  The Library owns none of the buildings which it uses.  In addition to the
central facility, the Library has five branches, four located in school buildings
and one located in the City's Public Safety Building on Peaks Island.  The City
does not charge rent for the use of the Public Safety Building.  The Library also
operates a Bookmobile.
     8)  The Library is almost totally dependent on the City for annual operating
funds.  In 1979, Library expenses totaled approximately $1,090,000, and the City
provided about $844,000, or over 80% of total expenses, for salaries, operations,
and furniture.  The State also contributed over $58,000 in cash to the Library in
1979.  The City in 1980 provided about $850,000 on Library operations, or over 80%

of the Library's expenses.  The Library has an endowment fund which at the end of
1979 was worth about $1,068,000.  This fund produced about $100,000 in income in
     9)  With the exception of the endowment fund, the Library owns little that
is not traceable at least in part to City expenditures.  The Library's books,
artifacts, equipment and furniture, valued at slightly over $9,000,000, have been
purchased in part with City money.  Other sources of money are the State and federal
governments, the endowment fund, and donations from the public.
    10)  The Library submits a budget request and goes through the same budgetary
review process that applies to City Departments.  The Library is denominated as a
department on all City forms that are utilized.  The Library Director and the
Board of Trustees' Finance Committee prepare a six-month budget request, which is
approved by the full Board of Trustees and submitted to the City Manager.  The
City Manager reviews the budget request, meeting with the Director and the Trustees,
and then makes his own proposal for the Library in his total City budget which he
submits to the City Council Finance Committee.  The Finance Committee also meets
with the Trustees, asks questions, and reviews the request.  When the Library's
budget is finally approved, it is submitted to the City Council for vote at a pub-
lic hearing.  The budget request for the first half of 1981 was a detailed, line-
by-line request consisting of 27 pages and including budgetary details about all
phases of the library operation.  The Library is not required to submit a line-by-
line budget to the City Council, but always does so in order to show the Council
where its money is going.
    11)  In addition to providing the buildings and a major portion of the operat-
ing budget, the City also gives financial support to the Library in other ways.
The Library is a separate participating local district of the Maine State Retire-
ment System, and the City pays the full cost of this benefit directly into the
retirement system on behalf of Library employees, currently at a rate of 16.32%
of earnings.  The City insures the main Library facility and its contents and the
Bookmobile.  The City carries liability insurance on the Library employees and
makes the required unemployment insurance payments for the Library employees. The
City pays the Library employees through its computerized payroll system with
checks drawn on City funds.  The City makes and records all payroll deductions
and files the necessary returns and reports showing these deductions.  These returns

and reports are signed by City officials rather than an officer of the Library.
The City sells ordinary supplies such as paper and pencils to the Library at cost.
    12)  The Library Director and the Board of Trustees run the day-to-day affairs
of the Library.  The Director, who is invited by the City Manager to all meetings of
City department heads, is responsible for hiring and directing the staff.  The
Library has in effect a comprehensive personnel policy.  The City exercises signifi-
cant influence, through its control of the Library's budget, over such matters as
the number of employees employed by the Library, their salary levels, and the days
that the library remains open.
    13)  For example, in the 1981 budget request, the Library requested 4 additional
clerical positions.  The decision whether to create these positions is the City
Council's, which must decide whether to fund the positions.
    14)  In 1979, a Board of Trustees subcommittee recommended that the Director
be given a salary raise.  According to the June 20, 1979 minutes of the Board of
Trustees meeting, the City Manager refused to accept the recommendation:
          "The Subcommittee met with the City Manager in order to see if
           there was any way that the Library could increase Mr. Chene-
           vert's salary to $30,000 in order to reward him for the out-
           standing job he has done.  Mr. Wilson [City Manager] made it
           very clear that this would not be politically feasible and
           his recommendation would be to put Mr. Chenevert on the newly
           adopted Pay Plan and make it retroactive to January 1, 1979."

The Trustees accepted the City Manager's recommendation.  The other Library employees
also are paid in accordance with the City Manager's and Council's wishes.  The minutes
of the June 29, 1979 Trustees' meeting also state:
          "[T]he City of Portland had recently adopted a new pay scale for
           its non-union and administrative employees and Mr. Leddy [Secre-
           tary of the Board of Trustees] reported that the City Manager as
           well as the City Council were in favor of the Portland Public
           Library adopting the same pay plan for the Library."
The Trustees adopted the pay plan, which had been proposed as a result of a study
of the City's job classification system.  The practice of having the City Council
determine the pay scale for library employees apparently is well-established; the
Librarian's annual report to the Trustees for 1966 states:  "In June the City Council
set up a new salary scale for library employees . . ."  Library employees also re-
ceive the same benefits as City employees, except that the Library employees have


a different vacation schedule.

    15)  Due to lack of funds, the main library is closed on Mondays.  The Library
notes in its 1981 budget request that the main library could be reopened on Mondays
if an additional $20,000 for the six months period was budgeted:
          "Although we have received numerous and persistent requests
           from the public to at least restore Monday hours at the
           Main Library, and increase the hours of service at the branch
           libraries, costs for such increase are not included in this
           budget request.  [The estimated additional costs for re-open-
           ing the Main Library for 9 hours of service on Mondays is
           $19,934 for six months.]"
Decisions concerning when the Library is to be open thus are indirectly made by the
City Council through its control of the budget.
     At issue is the question whether the Portland Public Library is a "public employ-
er" as defined in 26 M.R.S.A.  962(7):
          " 'Public employer' means any officer, board, commission, council,
           committee or other persons or body acting on behalf of any munici-
           pality or town or any subdivision thereof . . ."
The leading case on the construction of Section 962(7) is Baker Bus Service, Inc. v.
Keith, 416 A.2d 727 (Me. 1980), where the Court held the phrase "acting on behalf
of" "invokes the general principles of agency."  Id., at 730.  The Court accord-
ingly held that the test for determining whether an entity is acting on behalf of
a municipality is whether the entity "acted as a 'servant' subject to the City's
control or right to control."  Id., at 731.  The hearing examiner applied the Baker                 
Bus test and concluded that the Library was subject to the City's right of control.
On appeal, the Library urges that the hearing examiner erred because the City has
no control over the Library's affairs.
     Having carefully considered the facts and applicable legal principles, we con-
clude there are sufficient elements of City control present such that the Library
is a "public employer."  We deny the Library's appeal and remand this proceeding
to the Executive Director for determination of an appropriate bargaining unit of
Library employees and for a representation election.
     There are a number of elements of control in the relationship between the
Library and the City.  An important element, emphasized in Baker Bus, is that the
Library has a relatively minimal capital investment in the Library operation.
While the Library "owns" over $9,000,000 in such assets as books, artworks and furn-
ishings, a portion of these assets was purchased with City funds.  The Library's
capital investment clearly is dwarfed by the large City investments in buildings
and in the operating funds provided by the City.  Capital investment in the tools
of the trade is a significant factor in establishing independent contractor status.
Id.  The buildings, equipment, book collection and materials necessary for the opera-
tion of the Library are attributable in large part to the City.
     Another element is the considerable control, exercised directly and indirectly
through the budgetary process, over such operational and personnel functions as the
number of days the main library remains open, the size of the book collection, the
number of employees hired, and the salaries paid to the employees.  Examples of
this control are numerous; the main facility could be reopened on Mondays if the
City provided additional funds, and the number of books purchased and the services
provided by the Library are dependent to a large degree on the amount of City money
allocated to the Library.  As evidenced by the 1981 budget request, the Library has
to request additional employee positions from the City as part of the budgetary
process.  By controlling the Library's purse strings, the City controls the number
of employees hired by the Library.  The employees are paid, consistent with the
City Manager's and City Council's wishes, from City funds according to the City pay
scale, and some of the employees' benefits are paid for directly by the City. The
Board of Trustees is not even free to set the Library Director's salary; in 1979
the City Manager refused to agree to a salary increase for the Director but recom-
mended an alternative plan, which was accepted by the Trustees.
     While the Trustees and the Director manage the day-to-day operations of the
Library and hire and direct the employees, it is clear the City has major, direct
influence over important aspects of the operation.  It is apparent that the Library
could not initiate major new programs, services or hiring plans without approval
of the City through the budgetary process.  In addition, it is highly unlikely the
Library could strike any course independent of or contrary to the City's wishes.
Such an action could jeopardize City funding, without which the Library could not
survive, at least not at its present level of operations.

     It is true, as the Library urges, that a high degree of financial support
by a municipality is not by itself conclusive in determining "public employer"
status.[fn]1  However, when the financial support results in the municipality having
significant influence over the operations of the private entity, as is the case
here, the support becomes a pertinent element of control.  The type of operational
control exercised by the City was identified by the Court in Baker Bus as signifi-
cant evidence of control.  Id., at 731.  The legislation creating the Library
stablished the terms of the relationship between the City and the Library; the
City provides the buildings and funds necessary to operate the Library, and the
Library provides free services to City residents.  The evidence shows that this
relationship as it has evolved is not that which typically arises between an
independent contractor and the other contracting party, for "[a]n independent
contractor . . . must be subject to no control in the details of [the undertaking]."
Murray's Case, 130 Me. 181, 154 A. 352, 354 (1931).  The Library is subject to
control in the details of its operation, and therefore cannot be said to be an in-
dependent contractor.
     The hearing examiner in his report correctly identified and analyzed other
elements of control which need not be discussed at length here.  These elements
include the facts that the public identifies the Library ("Portland Public Library")
as part of the City; the City insures the Library buildings, the contents of the
buildings, and the Bookmobile; the City carries liability insurance on Library
employees; the City makes retirement system payments and unemployment insurance
payments for Library employees; the City provides free computer payroll services
to the Library; Library employees are paid according to the City pay scale; and
the City treats the Library as if it were a City department.  Most of these factors
were identified in Baker Bus as elements of control which establish the master-
servant relationship.
     The Library's reliance on the hearing examiner's report in Teamsters Local 48

1.  For example, in Erskine Academy Teachers Association v. Erskine Academy Board
    of Trustees, MLRB No. 79-06 (March 27, 1979), we held that a private high
    school supported financially by surrounding towns was not a "public employer"
    because it had a "huge" capital investment in the operation and because it was
    totally independent of and not subject to the control of the towns.  The facts
    that the Library does not have a large capital investment and that it is sub-
    ject to the City's control distinguishes the instant case from Erskine Academy.

and Auburn Public Library (Oct. 18, 1978) [No. 79-UD-03] is misplaced.  The report was issued
nearly 2 years prior to the Law Court's Baker Bus decision, and did not purport
to apply the agency test.  The tests applied in the report are more restrictive
than the agency test, have not been approved by this Board or the courts, and
have no precedential value in this proceeding.  Equally misplaced is the Library's
reliance on New York cases, which construe statutory provisions wholly unlike
Section 962(7) and which do not apply the right to control test.
     Finally, the Library's argument that a library corporation ought never be
said to be a "public employer" is not persuasive.  The legislature clearly in-
tended that employees of entities which act on behalf of a municipality be granted
the rights and protections provided by the Act.  Baker Bus Service, supra at 731.
We conclude that the City has sufficient elements of control over the Library so
as to make the Library the City's alter ego or "servant."  Since the Library acts
on behalf of the City, the Library is a "public employer" as defined in Section
962(7), subject to the jurisdiction of the Maine Labor Relations Board.  We will re-
mand this proceeding to the Executive Director with instructions that he or his
designee determine an appropriate bargaining unit of Library employees and conduct
a representation election as soon as practical.[fn]2
     On the basis of the foregoing findings of fact and discussion and by virtue
of and pursuant to the powers granted to the Maine Labor Relations Board by 26
M.R.S.A.  968(4), it is ORDERED:
     1.  The November 25, 1980 unit determination report in this matter is
         affirmed.  The Portland Public Library is a public employer as
2.  During the hearing before the Board, the Library raised the question whether
    the jurisdictional issue was properly before the hearing examiner or whether
    the Board itself is required to make the initial jurisdictional determination.
    Section 966(1), the provision governing resolution of bargaining unit ques-
    tions, indicates that all questions arising in bargaining unit proceedings
    are to be initially decided by a hearing examiner.  The Act makes no provi-
    sion for bringing any question arising in a unit proceeding, jurisdictional
    or otherwise, to the Board in the first instance.  We accordingly conclude
    that the jurisdictional question was properly before the hearing examiner.
    In any event, we have thoroughly reviewed the facts of the case and made our
    own determination whether the Library is a "public employer."

         defined in 26 M.R.S.A.  962(7).
     2.  The Library's appeal is denied.
     3.  This proceeding is remanded to the Executive Director with the
         instruction that he or his designee determine an appropriate
         bargaining unit and conduct a representation election for
         Library employees as soon as practical.
Dated at Augusta, Maine, this 18th day of June, 1981.
                                          MAINE LABOR RELATIONS BOARD
                                          Edward H. Keith

                                          Don R. Ziegenbein
                                          Employer Representative

                                          Harold S. Noddin
                                          Alternate Employee Representative