Faced with a precarious budget situation, Evanston Public Library administrators proposed selling and then renting back the North Branch Library to pay for improvements in the Main Library.

Sale of the building, appraised at about $800,000 three years ago, could provide money for the Main Library’s $2-million project to expand the children’s room and create a separate space for young adult books. The city’s Capital Improvement Plan provides $200,000 for the next fiscal year, which is intended to pay for the project’s planning stage.

But the city soon may need to pay out a large settlement in Prado DeVaul v. City of Evanston, a police-pursuit lawsuit, said Paul Gottschalk, the library’s administrative services manager. If the settlement forces the city to dig into the Capital Improvement Plan, the library’s expansion would be one of the first items to suffer, Gottschalk said.

Although Gottschalk mentioned the capital improvement portion of the budget, money for potential legal fees comes from the budget’s insurance fund.

Gottschalk presented the library-selling plan to the library’s Board of Trustees Wednesday night.

The entire North Branch building, 2022-2026 Central St., which contains the library collection and Perennials gift shop, belongs to the city. Perennials pays rent to the city, so another possibility would be subdividing the property and selling Perennials’ space while keeping the library as city property, Gottschalk said.

Under the proposal, the city would rent the North Branch on a 15- to 20-year lease with a termination clause, in case the library decides to close or move the branch before the lease expires. The arrangement would be similar to the one now in place at the South Branch, Gottschalk said.

During the meeting, trustee Marybeth Schroeder expressed concern about presenting the plan before changes in the structure of city government take place.

“We don’t know where the City Council will be in April,” Schroeder said. “We have a brand new city manager.”

Library Director Neal Ney said the proposal is a fresh approach to raising revenue for library expansion.

“Rather than selling bonds and paying interest on them, we’re selling the building and paying rent,” Ney said.

The plan also will be hard to sell to North Branch employees, Gottschalk said. Some of those employees wish to expand the library space into Perennials’ space, Gottschalk said.

The proposal also could lead some to question the future of the North Branch, he added.

“There will be a lot of fretting, ‘Is this a plot to close the North Branch?'” Gottschalk said. “My position is there’s no advantage to the North Branch doing this; there’s no disadvantage to the North Branch doing this.”

The building would be relatively easy to sell because the library and Perennials would be attractive tenants to potential investors, he said.

But Central Street is a desirable retail district and the library would have to pay higher rent per square foot than at the similarly-sized South Branch, he said.

Many of the trustees were concerned that the city’s potential lawsuit settlement might shortchange the library’s capital funding. They urged Gottschalk to continue researching the idea.

“It’s a very exciting possibility,” trustee Brooke Roothaan said.

Reach Greg Hafkin at [email protected].