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2004 Ad Hoc Library Committee Splikane 00Valley 11707 E Sprague Ave Suite 106 • Spokane Valley WA 99206 509.688-0053 • Fax: 509.921.1008 • cityhall @spokanevalley.org AD HOC LIBRARY COMMITTEE Draft Meeting Agenda October 11, 2004 7:00 p.m. Spokane Valley City Hall Council Chambers 1. Introductions 2. Review and Discussion of Background Information a. Request for Proposals (RFP) b. RFP Evaluation Instrument 3. Discussion of Committee Proposal Evaluation Approach 4. Committee Logistics (future meetings, etc.) 5. Public Comment 6. Good of the Order 7. Adjourn Spokane County Library District Spokane Valley Library Services Proposal Comparison: SCLD and LSSI SCLD LSSI Advantages • Fixed fee, computed on same basis • Proposed $105,000 (4.6%) lower as SCLD residents pay, covers all Year 1 cost; however, capital costs costs and contingencies. only estimates. • Fee is a ceiling as well as a floor. • Newspaper estimated $750k lower • All SCLD funds applied to library cost over 5 years. service operations with excess • New initial materials collection. revenues over expenses reinvested • Promise of improved services with in improved services to customers; 31% fewer branch and outreach no profit margin. operations staff through more • Guaranteed continuation of same efficient operation. level of service for Valley and • Fines and other payments go to city. Spokane Valley outreach. • Full city control over library policies, • SCLD owns the facility, materials operations, personnel decisions, collection, furniture, equipment so no • Library services specifically tailored need to purchase new. to Spokane Valley. • Experienced and well-trained staff • City owns materials, furniture& who know the community and equipment purchased under the customers is already in place. contract. • Staff back-up of similar expertise levels available from other branches • No interruption in service or customer inconvenience. • Larger branch and outreach materials collection (110k vs. 80k). • Double the number of new items each year(16k vs. 8k); 40k more new items at the end of 5 years. • Materials collection carefully developed to meet Spokane Valley needs. • Services integrated with system, providing access to other SCLD branches, Web site, and all materials through daily interbranch courier. • Guaranteed access to SPL branches/materials. • Meeting and conference rooms available. • Local management, fiscal, HR, and graphics support available. • Long-standing community knowledge and partnerships. • SCLD well-respected local service provider. • 98% overall satisfaction rating. Disadvantages • Fee based on property valuations, • Will need to hire and train entirely not actual expenses, although new staff, unless some laid off staff historically there has been a close are rehired. correlation for the Spokane Valley as • Significant cross-training for back-up a whole. may result in customers being • No direct city control over library served by staff with lower levels of policies, operations, personnel expertise. decisions. • Smaller initial materials collection • Library services responsive, but not (80k vs. 110k items). specifically tailored, to the • Initial collection purchased from community. profile, which may or may not reflect • Contract for services, so no community needs; won't include out- ownership of assets acquired during of-print materials that are still in contract term. demand. • Fewer new items each year(8k vs. 16k) so 40k fewer new items after 5 years. Due to wear, theft, loss, and outdated information, collection size will grow at a lower rate than stated. • No guarantee of access to SCLD branches/materials. • No guarantee of access to SPL branches/materials. • 90 to 120 day lead time for facility lease, furniture, shelving, materials, ILS purchases. • Potential interruption in service and customer inconvenience. • Meeting or conference rooms not included. • No initial knowledge of or ties to community. • Maryland-based fiscal, HR, and management support. Opportunities • Potential long-term city budget • Supplemental Funding Report for advantages from library district alternative funding sources. annexation, creating growing • Corporate facility design expertise. independent revenue stream for library services. • With annexation, Spokane Valley residents can vote on District issues, thus having direct voice. • Potential long-term debt service advantages for future new facilities through Library Capital Facility Area, available only through a library district. • Local SCLD facility design expertise. Risks • With no direct control, District could • 31% fewer staff for branch and "shortchange" Spokane Valley outreach operations may result in residents or take branch in a lower service levels direction not desired by City. • LSSI hasn't before established a library to replace existing operation: has done management, assumed existing operation, or established entirely new library service. • 6-month "termination for convenience after first year for either party. • • If LSSI doesn't work out, city has remainder of lease-purchase agreements and no one to operate library. Comments on • Responses to each requirement with • Many responses less detailed; didn't Proposal detailed information, as appropriate include some requested information to question, state law, or District (e.g. position descriptions and salary policy. ranges). • Because of all-inclusive fixed fee • No inflation factor included for basis, no breakdown of cost annual facility costs and materials components for Valley branch and acquisition. system access. • No apparent estimate for tenant • Proposal a public record. improvement costs for leased facility. • Automation costs don't appear to take 3-5 year equipment upgrades into account; no mention of self- checkout stations or workstation booking, time control, filtering; office software costs • Considerable amount of redacted information, including cost estimate details. Other • Strong community support for SCLD • Strong community sentiment Comments services expressed against privatization. • SCLD has history of working with its • Negative impact on non-city Valley cities and communities. residents and remainder of SCLD: lower SCLD service levels, probable end to SPL reciprocal use. • With staffing SCLD and new materials acquisition levels comparable to SCLD, annual operating costs could approach $2 million and total cost over$2.6 million. Page 1 of 7 Return to Main Page Library Journal When LSSI Comes to Town BY NORMAN ODER -- 10/1/2004 Public libraries, private company: the outsourcing compromise See also More on LSSI... At meetings of national city and county associations, the only library exhibitor is often Library Systems & Services, LLC (LSSI), the first company to offer full outsourcing (or privatization, to some) of public libraries. LSSI offers a seductive line: It can do more with less. As local governments squeeze budgets, LSSI, which has a history in both outsourced federal government libraries and virtual reference, sees more business, even though it has fewer than ten public library contracts at this point. In July, the city of Germantown, TN, hired LSSI to run its branch; the decision to go independent saved money but meant cardholders could no longer borrow books from the Memphis-Shelby County system it had left. It's unclear whether city managers anticipated that, but outsourcing often brings compromises—ones perhaps more apparent to professional librarians than their municipal bosses. LSSI can boost professionalism in struggling libraries, at least for the short term, and guarantee certain service benchmarks. Indeed, LSSI clients—mostly local officials, not librarians—praised the company's performance, according to a 2002 report by the Florida House of Representatives. Outsourcing can save money, but at what cost? LSSI's performance eludes full evaluation— statistics like hours, circulation, and spending provide only a sketch. But LSSI's record suggests tensions between a profit-seeking company and a public agency. Savings may go to profits instead of services. Fully outsourced libraries no longer control compensation—and LSSI saves money on staff. Also, the library may be less publicly accountable. The company makes some librarians uneasy. Barbara Custen, executive director of the Metropolitan Cooperative Library System (MCLS), Pasadena, CA, notes that when cities ask her what it would cost to run their own libraries, MCLS provides"an objective number." LSSI, she points out, may advise a city on how to run its own library, then bid on that same service. A profession confronted The library profession has not fully addressed the outsourcing issue. Outsourcing cataloging, processing, and some other professional tasks has become routine, but the extension to book selection and management was a shock. As a result, the American Library Association (ALA) established a task force on outsourcing and privatization after the Hawaii State PL System outsourced all book selection to Baker&Taylor in 1996 and Riverside County, CA, officials hired LSSI to run the Riverside County Library System (RCLS) in 1997. The task force observed that good library work is closely tied to the community, not"a simple commodity,"and that libraries represent a "public good,"essential public services most efficiently provided by the government, not the marketplace. The task force recommended that ALA oppose "privatizing core library services to for-profit corporations," but, in 1999, ALA Council found the task force's work too speculative. Council instead approved a study that looked at the outsourcing of cataloging, two cases regarding materials selection, and two concerning management (Riverside and NASA libraries). The study observed that the condition of libraries in Riverside"continues to be poor" because of underfunding http://www.libraryj oumal.com/index.asp?layout=articlePrint&articlelD=CA456252 10/20/2004 Page 2 of 7 but concluded that"outsourcing has been an effective managerial tool"—a statement LSSI reproduces on its web site (w.ww.lssi.com). To the investigators, no case study constituted privatization. Led by Robert Martin, then professor in the School of Library and Information Studies at Texas Woman's University, Denton, and now head of the federal Institute of Museum and Library Services, they found the task force's terms unworkable. They defined privatization as relinquishing policy control to a vendor—a shift that no vendor had sought. In 2001, Council endorsed a milder statement opposing the"shifting of policymaking and management oversight of library services from the public to the private for-profit sector"—which has no effect on LSSI contracts since the library board or municipality makes policy. While some communities—such as Fargo, ND, and Finney County, KS—hired LSSI after learning about the company from ALA or the Southwest Kansas Library System, LSSI no longer pitches management services at library conferences. "We're a company that brings value to our customers and improved library service,"company CEO Frank Pezzanite tells U . He notes that LSSI's Virtual Reference service, since sold to Tutor.com, was welcomed by many. "[But] I get the impression from time to time that we're considered to be the Darth Vader of the industry." Profit pressure LSSI generally manages the entire library budget, whether it employs all staffers or just senior managers. VP Bob Windrow told the Dallas Morning News in 2001 that the company "earns money through streamlining procedures, automation, changing procedures, and staff training."The article doesn't mention that LSSI charges some clients (though not RCLS) general and administrative costs up to 15%, which include handling fees on materials of 5%. Additionally, the difference between the budget and what is spent contributes to profit. Also, while LSSI can ramp up libraries that have lagged technologically, Windrow's statement sidesteps a key LSSI strategy: saving money on staff. In a proposal to the Dallas PL (DPL) board last year, Windrow acknowledged, according to board minutes, that the company would keep costs down by paying lower salaries and benefits, hiring fewer librarians, and choosing less-educated employees than current DPL staff. Fargo PL director Charles Pace, a former LSSI staffer, sees the tension between quality and profit. He was hired in June 2001 by LSSI to run Fargo PL. In 2003, he was employed directly by the city after the library board canceled its LSSI contract, dismayed that the company fell behind on several bills. Pace notes, as do two board members, that LSSI's temporary director in Fargo, Lynn Wheeler, stabilized the library, which had lacked leadership. LSSI, according to the Florida report, also significantly reduced the time it took to bring books to Fargo PL shelves. LSSI, Pace recounts, "brought in well-respected library consultant Ron Dubberly"—a member of the company's Advisory Council—to help with strategic planning and also "provided a collection development expert." However, says Pace, after a few months in his job, "the positive phase of LSSI's accomplishments here came to an end. There was a considerable amount of pressure [from • LSSI] to look at ways we could generate revenue and not to spend out the full library budget." LSSI also requested a 28% budget increase and got 11%. Pace adds, "It was very difficult to serve two masters." Company spokeswoman Terri Armand says, "LSSI does not typically comment on statements made about LSSI by former employees or clients." Riverside: a showcase? "We've accomplished more growth in service, developed more functional partnerships, and completed more building projects (without a tax increase or bonding) in the last seven years than I have ever witnessed in a system of comparable size and resources," says Gordon Conable, LSSI's executive VP of public library operations. Recently, RCLS and neighbor San Bernardino jointly upgraded musty automation systems. LSSI points to RCLS as evidence it can boost service elsewhere. But RCLS is an unusual case, as Ronald Baker indicated in "Outsourcing in Riverside County: Anomaly, Not Prophecy" (U 3/15/98, p. 34-37). Once part of a combined city-county system, RCLS offers stripped-down library service, with no central library—nor coordinators for collection http://www.libraryjournal.com/index.asp?layout=articlePrint&articlelD=CA456252 10/20/2004 Page 3 of 7 development or youth services. More than 90% of staff—a notably high number—work on public service and local library operations. The system—with 28 branches, two bookmobiles, and two other facilities—has 33 MLS librarians, a respectable ratio out of 139 FTE staff but one that indicates basic branch coverage. LSSI itself operates leanly. According to a 2002 county audit, the company used 5.29% of the contract for overhead—well below the 10% charged previously by the city of Riverside as an administrative fee. Pezzanite, an automation veteran, oversees some contracts himself, as does his wife, Judy, the COO and a librarian, from LSSI's Germantown, MD, office. In "Why Outsourcing Is Our Friend" (American Libraries, 1/98, p. 72-74), LSSI advisor Dubberly called the Riverside/LSSI model "eminently replicable." Gary Christmas, Riverside county librarian from 1997 until this July (when he became deputy county executive officer), praises LSSI, noting the county sought the most service, not the lowest bid. Still, he acknowledges that RCLS's experience "can't be a model for anyone else, because they don't have the circumstances we do." As Baker, who formerly headed the combined system's central library, wrote, the county had a white elephant library administrative service center—which now costs $567,432 a year in debt service. In June 1998, less than a year after outsourcing, RCLS found a tenant for that building. Now tenants pay nearly all that debt service, expanding the budget for the library—something not mentioned in LSSI accounts of Riverside. Service at RCLS can be seen through two distinct lenses. Hours, materials, and the number of librarians have jumped, thanks to increased public funding and the service plan developed by LSSI and the county. Still, with a per capita budget under$14 for its 892,800 constituents, RCLS lags behind most peer libraries. The materials budget, $180,000 in 1997, now includes $450,000 from the library fund, plus $600,000 in mitigation fees from new residential development. However, materials funding remains less than half the $2.61 per capita figure—the level of the lowest quartile of peer libraries—that LSSI's own consultant, Dubberly, recommended back in 1998. Meanwhile, RCLS cardholders account for 40% of the library's checkouts in Rancho Mirage, a Riverside County community with a well-funded independent library. Workers shortchanged? At conferences, LSSI distributes a 2002 article from The American Enterprise (published by a conservative think tank) that lauds LSSI's work: "For vested interests like unions, however, the company's ability efficiently to meet terms set by local officials offers no solace." Some LSSI practices, such as a reliance on paraprofessionals, reflect tactics adopted by other cash- strapped libraries. According to the Riverside County audit, LSSI spent 50.02% of its budget on direct labor and 13.12% on fringe benefits—somewhat less than many comparable systems. LSSI prefers having all library employees work for the company. "We have much more control. We can incent them," says Pezzanite. "If an employee does a good job, we like to give them a $5 gift certificate to Borders Books or Mrs. Fields." Existing RCLS workers were offered the same salary; Pezzanite notes they were happy to gain stability. Future hires received lower pay, according to the ALA report, which also acknowledged "vague indications of increasing workloads and decreasing compensation—especially in terms of benefits." Pezzanite asserts, "If you took the pension out of the equation, the [benefits] scale would be tilted in our favor. Throw the pension on there, maybe it's equal, or maybe.it slides the other way a little bit." The difference in retirement benefits, unspecified in the ALA report, is stark. Those working for LSSI get a chance to contribute to their own 401(k) plan—a sum subject to market vagaries—to which LSSI provides a match it wouldn't specify. By contrast, 20-year Riverside city or county employees who participate in California Public Employees' Retirement System (CALPers) are eligible for a lifetime pension at age 55 of 40% of their annual salary. http://www.libraryjournal.com/index.asp?layout=articlePrint&articleID=CA456252 10/20/2004 Page 4 of 7 The loss of civil service rights and pension vesting has alarmed unions and library groups. "Having that package changed on you is very disruptive to the entire institution," notes Pat Tumulty, executive director of the New Jersey Library Association (NJLA). Last year, staff at the Passaic PL, NJ, joined a union to fight a proposed LSSI contract that would have made them all company employees. NJLA, which had not opposed LSSI contracts where the company provided managers but staff remained public employees, says the proposed contract— since dropped—would have been the state's first privatization of a public library. The volunteer dilemma Staff costs make up the largest chunk of a library budget, so at an LSSI library, volunteers embody not only community spirit but also potential profit. New management may liberate untapped energies; when the company took over the library in Calabasas, CA, formerly a branch of the County of Los Angeles PL, it initiated a Friends group. Asked to comment on the use of volunteers, Sally Reed, executive director of the Friends of Libraries USA and a critic of outsourcing when on the ALA Executive Board, says, "There should be full disclosure that money saved through volunteer services may well translate into increased profits for a private company ...making the company look better." In Lancaster, TX, LSSI operates a building more than three times the size of its predecessor, even as the number of FTE staff has increased from seven (three MLS) to 8.5 (two MLS). Volunteer hours have more than quadrupled, though Armand points out that they represent little more than 1 FTE and that the library has new sources of volunteers via the Texas court system and from teens. The library has seen significant turnover: seven of nine employees listed on the library web site since outsourcing have left. Armand would not say whether volunteers did work such as reference or processing but did stress that LSSI "does not use volunteers in lieu of paid library staff or as a means of controlling costs." The bottom line It's hard to determine how much profit LSSI makes. Only Riverside County has released a full audit of its LSSI contract; an analysis of 2002 expenditures showed that LSSI earned only an $80,000 profit (1.02%) on the contract that year beyond its overhead. Is that good negotiating by Riverside, an LSSI willingness to make the library a showcase, or both? In Texas, LSSI representatives said they didn't "foresee a profit in the first few years, but their number one goal is to have a presence in the area," according to Lori Iwanicki, assistant to the Lancaster city manager. LSSI has since signed contracts in two other Texas jurisdictions. LSSI has apparently made a profit in Lancaster, a Dallas suburb, though the numbers are unclear. Some 42.7% of Lancaster's 2002 budget and 45.7% in 2003, according to statistics provided to the state library, constituted "other operating expenses." What's in that category? "As long as they're doing what they need to do, we're not going to ask them to detail every expenditure," says Iwanicki. Meanwhile, spending on staff and materials went down; LSSI's Armand says its profit also went down but would not provide details. For salaries/benefits, Lancaster spent 50% of its budget in 2002 and 48% in 2003, losing one of three MLS librarians. Three neighboring library systems spent from 64% to 80% on staff(with more librarians), yet they also spent a greater percentage on materials. Though 15% spending on materials is considered good, Lancaster spent 8% in 2002 and 6.6% in 2003. The city's new building opened in 2001 with a new collection, just as it began outsourcing. Notes city spokeswoman Opal Mauldin-Robertson, "The materials budget will increase as necessary to keep the collection fresh." Lancaster had a higher circulation rate in 2003 than two neighbors (by 11% and 32%) but also a 14-day rather than a 21-day loan period. http://www.libraryj ournal.com/index.asp?layout=articlePrint&articlelD=CA456252 10/20/2004 Page 5 of 7 Similarly, In Finney County, KS, spending on staff went from 59.5% in 2002 to 51.9% in 2003, while materials spending declined from 12.40/0 to 11.4%. Armand says LSSI's profit also went down but would not elaborate. Board chair Pat Fishback, asked how LSSI makes a profit, says, "There are certain things since they are a private company that's not required to be public knowledge. We know the amount of money we pay them for the services we contract for, and we are satisfied." Previously, two board members, concerned about the loss of local control, resigned in protest when the county hired LSSI. When the city of Linden, NJ, ended its LSSI contract early, Linden mayor John Gregorio said the city would save $300,000—about 15% of the library budget—by running the library itself. Six of 37 staff members had retired, but the budget LSSI was managing had held constant. Marketing claims Some LSSI marketing claims are, at best, imprecise. In a February 14, 2003, pitch letter to potential customers, then-LSSI West Coast director of sales and marketing Lee Ireland claimed that LSSI manages "over 45 public libraries across the United States." At that time, LSSI had seven public library contracts but managed some 45 public library buildings. A flyer distributed at the New Jersey Conference of Mayors last April said, "LSSI is currently managing libraries for these communities"; the 20 communities listed represented seven contracts, two of which had expired by that time. LSSI press releases say the company recruited new directors for the libraries in both Lancaster, TX, and Finney County, KS. LSSI did provide veteran interim staff for the libraries, which had had long vacancies, but the directors ultimately hired had applied for the positions before the communities officially contracted with LSSI. A 2002 LSSI press release cited more than $250,000 in grants gained in Lancaster—part of the reason the Northeast Texas Library System later named Lancaster's Cami Loucks the library employee/director of the year for 2003. However, the library must share nearly half the money: two grants totaling $225,000 underwrite shared services In Lancaster and neighboring Cedar Hill. Compromising transparency As public agencies, libraries should be transparent, but this ethic does not necessarily hold for a private company. In the past, LSSI has trumpeted good news but been elusive when asked tougher questions. When the city of Linden, NJ, ended its LSSI contract early, it contractually agreed to portray the management change in the "most positive manner possible" and an effusive quote from Mayor Gregorio appears on LSSI's web site. Neither that endorsement nor the subsequent LSSI press release acknowledges the city's $300,000 savings. Because of a contract clause preventing current Jersey City PL (JCPL) top managers from discussing LSSI, it's hard to evaluate fully LSSI's performance at JCPL, where it operated from 1999 to 2001. A study by Arthur Andersen noted that the library "lacked automation, training, and leadership prior to LSSI's arrival."The New Jersey State Librarian had refused to release grant funds. Allan Kleiman, head of reference at Westfield PL, NJ, and a one-year employee of LSSI at Jersey City, says, "I don't know who could have done it outside an LSSI type that could bring in a heavy-duty team." When the contract ended, LSSI sought to block criticism from new director Priscilla Gardner—who once criticized LSSI vocally—and the assistant director. The nondisparagement clause might have been a quid pro quo. Board chair Mofalc Meinga tells U, "It was a mutual agreement, because they let us out of a contract early," thus avoiding a potential "sizable fee" to terminate. "I would give them a good recommendation," he adds with a laugh. "I'm not gagged on that." Former employees say LSSI has required them to sign a nondisclosure agreement. LSSI would not comment on that. This requirement was not mentioned in either the Florida or ALA reports on outsourcing. New ventures http://www.libraryj ournal.com/index.asp?layout=articlePrint&articlelD=CA456252 10/20/2004 Page 6 of 7 In most LSSI libraries, budget pressures limit service, but it is a constraint LSSI can embrace. Steve Coffman, LSSI VP for business development, has called for libraries to be run more like bookstores, questioning how much the differences (reference, cataloging) are worth to library patrons—and LSSI recently proposed such an "efficient library" project. Most recently, he has argued that libraries should emulate public radio and raise private operating funds. In June, LSSI released a report on such "plural funding," written by a veteran public radio consultant and partly funded by three library entities (see News, U 7/04, p. 22ff.). Coffman's crusade—which has sparked criticism from those who emphasize more public support— also could boost LSSI, though Coffman notes, "LSSI is not selling any of these concepts." The web site for the "Plural Funding Project" (www_pluralfunding.org) declares, "Dedicated to improving the funding for America's libraries," but the site, which provides useful resources but does not represent a nonprofit organization, is owned by LSSI. The pilot plural funding project will be in Riverside, which means fundraising might increase LSSI's profits or burnish its showcase. For now, LSSI's fundraising record in Riverside lags behind Its own goals. The RCLS Foundation LSSI established as part of its contract has raised about$60,000, though company consultant Dubberly said in 1998 that it should raise $200,000 by the close of FY00. LSSI cites a lag in board members; Christmas points to a lack of foundation staff and that residents identify with branches, not the county. A foundation brochure, which Lipicked up at an RCLS branch in January, lists the foundation's web address as www.lssi_com/rclfoundation, but the web site has never been built. Last resort If LSSI didn't exist, would it have to be invented? Fargo PL tried hard to find a director before turning to LSSI. The New Jersey State Librarian welcomed the company to supply top managers at Jersey City. The NJLA's Tumulty says LSSI's presence points out that libraries must practice long- term planning and boards must be actively involved. In Paterson, NJ, the board considered an LSSI proposal but instead found a new automation-savvy director, Cindy Czesak. "I'd have no trouble hiring LSSI to do consulting, but I have real questions about them running a whole system," says Czesak, a former NJLA president. "I think they worry. less about developing long-term relationships within the community." The Florida report concluded that outsourcing fits only libraries with multiple problem issues that can't be solved in-house. Libraries in crisis, NJLA said in 2001, should consider outsourcing management a last resort and first ask the state library for help. Last year, when the Passaic PL board considered an LSSI contract, pushed by the mayor, the state did such a review. If communities outsource, a professional librarian might best monitor the contract, as Riverside County officials have recommended; LSSI's other, smaller contracts are mostly monitored by nonlibrarians. Riverside's Christmas helped in collection development and sat in on most interviews to hire librarians, while elsewhere LSSI takes on those roles, under the policy guidance of the board. As long as LSSI meets contract terms, there is little Incentive for communities that find their problems solved to look too closely. That suggests a role for library groups to monitor the contract process with the checklists ALA and state units have promulgated. The California Library Association states, for example, that "the rights of library workers to negotiate the conditions of their work must be preserved."The Public Library Association asks, "Have library staff had the opportunity to participate in the planning and decision-making process?" Former LSSI employee Pace suggests that management companies be paid separately from the library budget and that the fee be all- inclusive. That might help address a fundamental question unmentioned on the checklists: If a company runs a library for a profit, how much profit is fair, and what might be sacrificed in the process? Norman Oder is Editor, News, U http://www.libraryjoumal.com/index.asp?layout=articlePrint&articlelD=CA456252 10/20/2004 Page 7 of 7 Advisory Council LSSI has hired some well-respected veteran librarians, such as Gordon Conable and Bob Smith, and has connections to several others. When LSSI got the Riverside contract in 1997, the company announced the creation of an Advisory Council. Among the members Is Charlie Robinson, former director of the Baltimore County PL and controversial proponent of"give 'em what they want" library service, emphasizing high circulating popular materials. Some former Baltimore County managers have worked for LSSI. In that press release, which remained on LSSI's web site until this spring, the company said Riverside staffers "will have a chance to get help directly from the most experienced and forward- thinking public librarians in the country." Such help, however, costs extra. While LSSI has hired council members Ron Dubberly, now a consultant, and George D'Elia (professor of library and information studies, Univ. of Buffalo, SUNY) to help clients on projects, council members mainly advise the company on market trends. Other members are Henriette Avram (ex-Library of Congress, leader in the development of MARC), Linda Crismond, (consultant, former ALA executive director), June Garcia (Dubberly Garcia Associates, former director of San Antonio PL), Ron Kozlowski (former director, Anne Arundel Cty. PL, MD), Robert Rohlf(consultant, former director Hennepin Cty. Lib., MN), and Claudia Sumler (director, Camden Cty. Lib. Syst., NJ). Dubberly, Garcia, Robinson, and Rohlf are past Public Library Association presidents. For Ramiro Salazar, director of the Dallas PL (DPL), membership on the Advisory Council—even though council members don't solicit business—led to an awkward situation. LSSI last year made two presentations before the DPL, proposing pilot projects. Mary Suhm, then the city's first assistant city manager and a former librarian, says she suggested that Salazar's connection to LSSI could damage his credibility and the confidence of his staff. Salazar then left the council. DPL has not contracted with LSSI. ©2004,Reed Business Information,a division of Reed Elsevier Inc.All Rights Reserved. Use of this website is subject to its terms of use. Privacy Policy. Return to Main Page http://www.libraryj oumal.com/index.asp?layout=articlePrint&articleID=CA456252 10/20/2004 Page 1 of 3 Return to Main Page Library Journal More On LSSI BY NORMAN ODER -- 10/1/2004 COMPANY BACKGROUND In this article: LSSI was founded in 1981 by CEO Frank Pezzanite, who developed the MINI MARC Company Background minicomputer cataloging system while at Informatics, Inc., and his wife, Judy Pezzanite, a librarian and the company's COO. Since the The Political Arena Reagan-era push for privatization, the company -----"""-""-"--"""""---"""—"- has done library project and management work Edgy Issues for several federal agencies, including the Library of Congress, the Department of Energy, and the Return to main article... Smithsonian Institution. LSSI saw opportunity beyond the federal arena, but needed capital. So, in 1996, the Follett Corporation, known for its college stores, bought a half interest in LSSI. While Follett was seen as an entree to the academic market, in 1997, the Riverside County Library System (RCLS) outsourcing opportunity"sprang up,"in Frank Pezzanite's words. RCLS became the country's first fully outsourced public library, where all employees work for the company. (Riverside also has a county librarian and has separate contracts for janitorial services and landscape maintenance.) In 1998, the Jersey City Public Library hired LSSI to supply top managers. That contract concluded, as have public library contracts in Hemet, CA (top managers); Fargo, ND (top manager); and Linden, NJ (top manager). Ongoing are six full outsourcing contracts. They include: Riverside, CA ; Calabasas, CA ; Lancaster, TX ; and Finney County, KS. LSSI in August began service In Germantown, TN and last month opened a library in Red Oak,TX. It also has a contract to provide consultant services to help establish a library in Bee Cave, TX. While LSSI began providing outsourced technical services to Montgomery College, Rockville, MD, in 1999, Its major academic library effort was at Chatham College in Pittsburgh, where it supplied staff from February 2000 to July 2003. College spokesman Paul Kovach says Chatham was"quite pleased"with LSSI but concluded that it would be more cost-effective to hire its own librarians. Chatham librarians are staff, not faculty, and LSSI supplied staff but didn't manage the entire library budget, as It has done in public libraries. LSSI officials have said the company hasn't pursued the academic market because most librarians have faculty status and tenure. That would preclude major changes in personnel deployment and spending. In 2000, LSSI established a virtual reference operation, hiring Steve Coffman from the County of Los Angeles Public Library to manage it. In June 2003, LSSI sold that Virtual Reference division, which played a major role in expanding live reference service among libraries, to Tutor.com. While Coffman has said LSSI chose to focus on library management, the move also came as the Pezzanites needed funds to buy back Follett's half of LSSI. Follett spokeswoman Pam Goodman says of the sale, "Their business no longer fit with our long term strategy." Up to now, there hasn't been enough potential in library outsourcing for new entrants. Earlier this year, the city of Germantown, TN also sent an RFP to Los Angeles-based Library Associates, a firm that mostly works with special libraries. The company bid on the contract and now will consider competing in the public library arena. LSSI has about 440 employees, with only ten percent working at its Germantown, MD headquarters. The rest work at customer sites—nearly a third at Riverside 's facilities. Annual revenue, says Frank Pezzanite, is"in the $20 million range."The Riverside contract represents about one-third of LSSI's revenues, and public library outsourcing is about 70 percent of its http://www.libraryj ournal.com/index.asp?layout=articlePrint&articleID=ca457652 10/20/2004 Page 2 of 3 business. The Pezzanites own half of LSSI. The other half is owned by Internet Systems, Inc., also owned by the Pezzanites along with a third investor they wouldn't identify. Internet Systems was formed by the Pezzanites to buy back LSSI from Gaylord, which owned the company for about three years in the 1980s. Internet Systems did authority processing, database preparation services, and retrospective conversion for libraries. At the American Library Association Annual Conference In Orlando last June, there were hints of a new direction for LSSI. A representative of Starbucks, speaking on a panel organized by LSSI VP Steve Coffman, said that LSSI Is establishing a new food service arm to operate Starbucks franchises in libraries. Later, Coffman told U that"LSSI has talked to Starbucks" but whether LSSI participates"is still very much an open question." LSSI has ties to several library institutions. It funds the LITA/LSSI Minority Scholarship in Library and Information Technology, a scholarship at the University of Maryland for part-time LIS students, and the Urban Libraries Council/LSSI Award of Excellence in Public Library Management. THE POLITICAL ARENA Does the entry of a private management company help neutralize political disputes or exacerbate them? It depends on where you look. In Riverside County, the decision to outsource helped resolve a city-county dispute over library resources. In 1998, LSSI Advisory Council member Ron Dubberly wrote that, in Riverside, "asset management has been distanced from the political arena." ("Why Outsourcing Is Our Friend,"American Libraries, 1/98, p. 72-74.) In other cases, outsourcing has been hardly clear of politics. Last year, the proposal to have LSSI run the Passaic Public Library, NJ, was seen as an effort by Mayor Samuel Rivera to gain greater control over the library. He and city council members negotiated with LSSI without informing library board members and staff. Linden, NJ officials portray the hiring of LSSI as an effort to upgrade library services, saying the director was uncooperative with the board, among other criticisms. That former director, Roberta Canavan, asserts that there were also political reasons—and a former board member backs her account. Hired during a previous administration, Canavan had refused to support the mayoral candidacy of John Gregorio, who was pardoned after being convicted of conspiracy charges. Once Gregorio returned to office in 1991, Canavan says, the mayor influenced the library board against her; she contends that the boost in library performance since her departure is partly thanks to grants she had sought to automate the library. Though LSSI policy bans political contributions in the company's name, according to state records, LSSI gave $500 to Gregorio's campaign in 2001. LSSI spokeswoman Terri Armand says the payment was for tickets to Gregorio's birthday dinner for library head of operations Greg Pringle and his wife—"a miscellaneous administrative expense... not intended to be a political donation." In 2002, LSSI Sales Manager George Bateman gave $500 to the election committee for two New Jersey state assemblymen, one a former member of the library board in Pennsauken, where LSSI last year solicited business. Bateman, a Maryland resident, says he's long made"contributions in states where I have no business relationship. I'm aware of good political leadership. It has nothing to do with my job." Frank Pezzanite says, "I don't control my employees. I try to discourage [political contributions]." In Jersey City, LSSI was brought in by Republican Mayor Bret Schundler, and then ousted when Democrat Glenn Cunningham gained office. After Schundler left the mayoralty and ran for governor, while the LSSI contract was extant, Pezzanite, also a Maryland resident, contributed $2000 to his campaign. "I liked his thinking, on a political basis," Pezzanite says. Fran Ware, LSSI's site director In Jersey City at that time (and another Maryland resident), gave Schundler $1,125, according to state records. http://www.libraryj ournal.com/index.asp?layout=articlePrint&articlelD=ca457652 10/20/2004 Page 3 of 3 In New Jersey, LSSI has hired a lobbyist, Barry Lefkowitz, who also represents the New Jersey Conference of Mayors. Lefkowitz's role, says Pezzanite, is to provide information on "the political feel"of communities considering a contract with LSSI. EDGY ISSUES As the debate over LSSI shows, the library community has struggled to define when outsourcing becomes privatization. The federal government, however, has drawn a line. In Southern California, 13 libraries serve as Passport Acceptance Agencies. However, one Riverside community's application for its library branch—run by LSSI—was declined because the State Department will only designate public employees to serve on its behalf. The Riverside County Library System, LSSI's largest client, is alone in having a professional librarian monitoring the contract—something county officials have recommended to ensure contract performance. But the relationship apparently isn't tense. When Riverside County officials in July named a replacement for Gary Christmas, who was promoted to deputy county executive officer, they chose Nancy Johnson, who since 2000 had worked for LSSI, heading the Hemet Public Library, an independent library in Riverside County. News coverage in the Riverside Press-Enterprise noted that Johnson has been a librarian for 31 years, "has worked for public library systems in the Inland area and Orange County,"and "had been the Hemet city librarian since 2000," but didn't make the LSSI connection. "She's been a longtime librarian in Southern California. Only part of that time did she work as a contract director for Hemet,"says Christmas. "I don't see a problem with that. She's going to be working for the county. She knows the way they've operated, at least in terms of the Hemet arrangement." p 2004,Reed Business Information, a division of Reed Elsevier Inc.All Rights Reserved. Use of this website is subject to its terms of use. Privacy Policy. Return to Main Page http://www.libraryj ournal.com/index.asp?layout=articlePrint&articlelD=ca457652 10/20/2004 Dynix Partners with LSSI to Provide Virtual Reference Services Page 1 of 2 iIik4L : .#if D Y N I 7 I�� . .. .a Dynix Press Release Dynix Partners With Lssi To Provide Virtual Reference Services PROVO, Utah - March 24, 2003 -Through a partnership agreement announced today, Dynix has launched a strategic partnership with Library Systems &Services (LSSI), the world's leading supplier of virtual reference services for libraries. Through the agreement, Dynix will make LSSI's Virtual Reference ToolKit available to its customer libraries, helping them to offer their patrons 24-hour online reference service. Additionally, Dynix and LSSI are entering plans to fully integrate Virtual Reference Toolkit into the Horizon Information Management System. By connecting library professionals to online patrons via the Internet, Virtual Reference ToolKit provides libraries with the resources necessary to expand library services and expertise beyond their buildings and the confines of their reference desks. The service makes professional reference and search assistance available to a library's patrons from anywhere, any time of day. "We've been using LSSI's virtual reference services since 2001 and have been very pleased," said Barbara Pitney, reference services coordinator at King County Library System, a Dynix customer in Issaquah, WA. "Our patrons have been very impressed that they get to work with a live person and frequently thank us for the extra help we've offered them. I am excited about this partnership and hope it will lead to further integration of Dynix and LSSI products." "Virtual reference has been embraced by the library community with remarkable speed even though, until now, we've only worked directly with the libraries," said Arthur Brady, vice president of LSSI. "It only makes sense to align our activities and offerings with an ILS vendor like Dynix, as this improves efficiency and reduces costs in the sales process, while also enhancing the smoothness of implementation and operation of our virtual reference services." "Our partnership with LSSI extends the value of our Horizon Information Portal offering by coupling the best search and retrieval tool available to patrons with unmatched virtual reference support," said Dynix President and CEO Jack Blount. "Given the number of libraries that Dynix and LSSI already have in common, it became important to find ways for our companies to work more closely together. The integration of the Virtual Reference Toolkit product set into existing and forthcoming Horizon systems means both staff and patrons will enjoy substantially improved functionality." About LSSI Founded by professional librarians in 1981, LSSI is the leading supplier of virtual reference services to libraries throughout the world and a major employer of librarians working in public, school, federal, corporate and special collection libraries around the United States. LSSI made history in 1997 when it entered into the first private/public library partnership in the country for the management of the Riverside County, CA, public library system. Since that time, LSSI has become the largest provider of contracted library management services in the United States. For more information in LSSI, visit www.lssi.com/vrt. About Dynix Celebrating its twentieth year of service to the library community, Dynix is the world's pioneer provider of library information management systems. As a committed advocate of the library community, Dynix serves academic, special, school, public, and consortium libraries in over 40 countries. With more than 100 professional librarians on staff and proven experience in software leadership, Dynix is focused on providing customers visionary technology solutions that support the latest industry standards and offer intuitive functionality. For complete corporate information and a guide to Dynix products and services, visit www.dynix.com. Contact: Bill Brady, Public Relations Manager (801) 223-5314 • bbrady @dynix.com http://www.dynix.com/about/press/2003/920.asp?print 10/20/2004 Dynix Partners with LSSI to Provide Virtual Reference Services Page 2 of 2 Copyright© 2004 DVNIX. All right reserved. http://www.dynix.com/about/press/2003/920.asp?print 10/20/2004 Contact: Terri Armand Director of Communications Library Systems& Services, LLC 1.800.638.8725 ext.224 terriana,lssi.com ,y , 4. .z3N `, News Release ` f i t{� : 4 T TL 't ' 3 '1 c,) --%-t • 1' �r .,. , _�, . LSSI and the City of Germantown, TN Reopen �• }t ;' . Germantown Community Library In Record Time - � f Nµ `� ; err '` rho+a� August 4,2004—Just three weeks after signing a management contract with Library ..`ir F,$ " ";,;' Systems and Services(LSSI),the Germantown Community Library reopened it's doors with a :`s 4 l 4 Partnering°With :i° ribbon cutting ceremony and a crowd of enthusiastic readers excited to see the changes to the :COrnt7iUnites f0 . revitalized library. ;40.i ICI Better • '� On Jul 13,2004,the City of Germantown assumed operation of the library, a r , r ' a``-. July ty P ry, formerly `Libraries , , i y, {. £ ,.• c branch of the Memphis Shelby County Public Library System. "Overnight,the City went from just ,4, �4,gti owning a library building to also being responsible for its operation,"explained Mayor Sharon Goldsworthy. "We hit the ground running with the LSSI management team leading the way." r r ` X x 7,:t:43.7,1.11 The facility was closed temporarily to inventory and enhance the collection (including the ':..h. ,.: addition of nearly 1000"best sellers"), install a new automation system,develop new lending 4. . 14 sn Y , cards, hire personnel,paint the interior,refresh the exterior,reorganize materials and rearrange :; i• f• urnishings. "It was an amazing transition period, with City staff, LSSI personnel and volunteers d working long hours to prepare for reopening. There was a remarkable "can do" spirit and k �—n vM 5 5{� 3 . 0.7.- 1 ,-a .�. ti f r,5r� cohesiveness between the public and private partners,"said Mayor Goldsworthy. The library's ' reopening was a huge success. By day's end LSSI staff issued 1,500 cards and patrons checked 7V451,44 t�r� A 1 out more than 2,500 items. � ,u`^ +,t+ 5",4,-m e , a "I am so proud of the extraordinary teamwork displayed over the past weeks here in " '`1 Germantown,"said Frank Pezzanite, President and CEO of LSSI. "The LSSI staff,together -Y• tGi t �' rs> c g .= v _ with the City officials,the City departments,the citizens of Germantown and several vendors all 1 1i "' `` e worked together to accomplish the astonishing task of reopening the Germantown Community - . � Library in an unprecedented time frame. No one has ever attempted such a task before." j0, Mayor Goldsworthy stated there were three significant factors in Germantown's decision to "I contract with LSSI to manage its library: "Substantial cost savings,absolute accountability for .lt J t441eP F-.* L every taxpayer dollar and expanded services. Those count with elected officials and, more }library Systems A Services LLC c :2025ocenwry.eou(e.0 . ::° s importantly, they make a difference for the customer, our citizens,"she said. "What we've seen LGermamo in...`�i .OS74 , in the LSSI team, and in the people they've employed to serve our community, is a genuine ,Fm.A15400.5522 �-; `i commitment to making libraries truly focused on serving the customer. s1 4064384725i fr:,,,4,,4.;..ti Founded in 1981,LSSI is the world's premier provider of library management services www Issicom ` „ ;� P P arY g +iP4tI w'a«,rte s and has built its reputation by providing more efficient and effective ways to manage new and existing library operations. LSSI's management services are uniquely tailored to each individual library and are available on a short-term or long-term basis depending on the library's specific needs. ALA I Fargo PL Ponders Booting LSSI over Late Payments Page 1 of 2 American Library Association I Search ALA I Contact ALA I g� Login ALA .tf'2ii4,.. 7, ', LEIE3rrArl 5 I 1 C. ittt ` 9 %L/MENT�L` 0 d Click here , E mil DA •1 .4 I i ' it \J Quic for the full-text, 'e -`' A IKTESt' ice . o of current and , 244, g back issues. © (j)j 11 Q n E' i News and updates from the magazine of the American Library Association. `'Browse'Job Ads ■''Subscribe to/2S I t . -r - Libraries;° :; Sub____ article l I`Placem6: I '3tl 1.�pcoming1 2 I Abaut.Amenean Libraries i ALA Home Fargo PL Ponders Booting LSSI over Late Payments • American Libraries The Fargo (N.Dak.) Public Library board is taking a close look at performance issues with tt Read American Maryland-based private firm Library Systems and Services Inc., which has managed the lil I. Libraries on ebrary operations since 2001. Board members first noticed an accumulation of overdue bills durinc (ALA members only) company's first performance review in February 2002; the situation improved but emerged P Current news May when unpaid bills resulted in some subscription lapses, the Fargo Forum reported July ■ News archive r 2004 Board President Betty Kerns sent a letter June 29 to LSSI President Frank Pezzanite that sa ■ 2003 matter is not taken care of immediately, you will be given a 30-day notice of our intention I ■ January 2003 the contract with LSSI."The firm's contract is in effect until December 2004, but it has a cl. allows the board to dismiss LSSI if problems continue. r February 2003 r March 2003 Pezzanite responded July 12, saying that LSSI was modifying its procedures to ensure that ■ April 2003 bills are handled with the highest priority. "We are not perfect but always work to correct al ■ May 2003 problems quickly," he wrote. ■ June 2003 r July 2003 However, the board is pleased with Library Director Charles Pace, who works for LSSI and i have to go if the contract is broken. Board Vice-President Prakash Mathew told the Forum, ■ August 2003 concern is how we retain the good director that we have. Charles has done a tremendous jc ■ September 2003 r October 2003 Posted August 4, 2003. r November 2003 r December 2003 r 2002 r 2001 • 2000 r 1999 AMERICAN LIBRARY ASSOCIATION P 1998 50 E. Huron Chicago, IL 60611 Call Us Toll Free 1-800-545-2433 ■ 1997 ©2004 American Library Association. Copyright Statement P Selected articles View our Privacy Policy. For questions or comments about the Web site, complete the F r Career Leads Online Form. I The Crawford Files FAQ Member and Customer Service Events Calendar I. Internet Librarian P Technically Speaking ■ Datebook ■ ALA Annual Conference reports r ALA Midwinter Meeting reports ■ http://www.ala.org/al_onlineTemplate.cfm?Section=august2003&Template=/ContentMa... 10/20/2004 ALA I Fargo PL Ponders Booting LSSI over Late Payments • Page 2 of 2 ALA Council meetings ALA Executive Board meetings t Other conferences Table of contents r Annual Indexes Submitting articles and photos About American Libraries r Advertising r Get American Libraries r Get e-mail subscription Printer-Friendly • _.J Version Email this URL Cite this Page http://www.ala.org/al_onlineTemplate.cfm?Section=august2003&Template=/ContentMa... 10/20/2004 Polaris® First ILs to Incorporate LSSI Virtual Reference Page 1 of 2 Polaris® First ILS to Incorporate LSSI Virtual Reference SYRACUSE, New York, June 4, 2002 - Gaylord Information Systems (GIS) and LSSI announced today that Polaris will be the first library automation system to seamlessly integrate the functions of the library's public access catalog with live reference service through LSSI's Virtual Reference ToolKit. The exchange of data between Polaris and LSSI will enhance the experience of library users by providing access to a librarian at multiple points in the search process. "Gaylord and LSSI are taking significant steps toward providing a more satisfying experience for library patrons," said Anita Wagner, GIS vice president of business development. "Integrating our two systems means that if a PAC search doesn't retrieve the expected results the patron will receive an automatic prompt to initiate a reference session. Prompts will appear at appropriate points during the search process, reminding patrons that reference help is readily available. We are excited to be the first ILS vendor to work with LSSI to integrate our two products in such a way that will help library patrons find what they need and reduce the frustration that can be associated with PAC searches. No other ILS vendor is even coming close to providing this type of integration to virtual reference services," added Wagner. Patrons using Virtual Reference ToolKit can choose to maintain with LSSI a history log of their reference transactions. These logs can then be displayed within their Polaris patron accounts, providing patrons with a single point of access to information about their library account. "Polaris users already can access their patron accounts for information on fines and fees, items checked out, and items on hold," Wagner said. "Now, they can use the same patron account to track open reference queries and access a log of completed reference questions and answers." "Virtual reference is all about meeting patrons where they are, and providing the specific reference assistance they need at that point. The breadth and richness of resources provided by Polaris guarantees heavy use by patrons, and immediate, live reference assistance neatly completes the picture," said Steve Coffman, vice president of product development for LSSI's Reference Division. "Tightly coupling virtual reference with a library's online catalog puts the service exactly where—and when— the need for help arises." About Polaris The Polaris integrated library system facilitates all aspects of library operations by providing innovative workflow solutions packaged in a familiar Windows interface. The Polaris staff client offers a complete solution for acquisitions, collection management, cataloging, circulation, interlibrary loan and serials control. With its object-oriented design and integrated Z39.50 capabilities, Polaris avoids the artificial boundaries common to legacy systems built on a modular framework. It also avoids the costs and downtime associated with installing modules one piece at a time. The Polaris PowerPAC extends this innovation to the end-user by providing a fully customizable library portal to the library's catalog and other library resources, including enhanced bibliographic data such as book images, tables of contents, and reviews. With embedded metasearch capabilities, patrons can search the library's catalog, the web, other library catalogs and Z39.50 databases at one time using one common interface. Today 300 libraries use Polaris every day to serve the information needs of their communities. About LSSI http://www.gisinfosystems.com/NewsEvents/PressReleases/2002/June02/6.4.02PolarisFir... 10/20/2004 Polaris® First ILs to Incorporate LSSI Virtual Reference Page 2 of 2 For 20 years—and for the benefit of nearly 2,000 libraries of all types and sizes—LSSI has been finding and delivering new tools and technologies. Now, LSSI's Reference Division team is taking this unique ability to identify and adapt technologies for libraries—and bundling them with superior training and support—to provide new tools and new ways for reference librarians to meet the changing nature of library usage. www.lssi.com/ About GIS Headquartered in Syracuse, New York, Gaylord Information Systems is a Microsoft Certified Solutions Provider and the 27-year-old software development division of Gaylord Bros., a leading supplier and innovator in the library industry for more than a century. In addition to its library automation systems, GIS offers workflow analysis, retrospective conversion and database enhancement services to libraries of all types. Thirty percent of GIS staff is composed of professional librarians, including GIS President Katherine Blauer. More information is available via telephone +1-315-457-5070 or 800-272-3414; fax +1-315-457-5883; or email gisinfo @gisinfosystems.com and at www.gaylord.com. Contact: Judy Michaelson GIS Marketing and Public Relations 740-362-3700 judy.michaelson @gisinfosystems.com Louise Stewart Client Account Executive LSSI Virtual Reference Services +1- 503-253-2681 Email: louises@Issi.com http://www.gisinfosystems.com/NewsEvents/PressReleases/2002/June02/6.4.02PolarisFir... 10/20/2004