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HomeMy WebLinkAbout11 O.C. LIBRARY RPT 06-20-94 NO. 11 I nt e r- C o m DATE' JUNE 15, 1994 TO: FROM: SUBJECT: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL WILLIAM A. HUSTON, CITY MANAGER ORANGE COUNTY LIBRARY TASK FORCE STATUS REPORT RECOMMENDATION: Receive and file. DISCUSSION: .. The City Council requested an update on the status of the County's library services task force which is evaluating strategies for dealing with the.library system's financial problems. Attached is an outline prepared by the task force which summarizes the information it has collected to date and the remaining components of the task force study. Also attached is the Grand Jury's report on the County library system which confirms what is'known, and that is the County library system has serious financial problems. The Library Task Force report is scheduled to be completed in July or August. oct i bry. wah Orange County Public Library Task Force Status Report Task Force Composition · Cities served by OCPL - Three City Managers (Behest% Casey, Sorsabal) · Friends of the Library Groups - Three representatives · Education Community - Two representatives · Business Community - Five representatives · County Government -Two representatives (Schneider and Scott) Task Force Charge · Study and identify long-term financial situation of OCPL · Identify and review options, resources and revenues · Evaluate efficiency and effectiveness of service options · Consider role of OCPL and County in relation to cities and communities served · Determine level of funding required to adequately meet OCPL responsibilities · Identify alternative scenarios to attain needed funding level · Provide recommendations to Board of Supervisors OCPL Financial and Operating Position · FY 93-94 Operating Budget reduced from $27.1 million (FY 92- 93) to $23.1 million. Includes $5 - $7 million in one-time funds to be used over FY 93-94 and FY 94-95. · Reduced staff by 70 FTE. Reduced public service hours by 40%. Three regional libraries now open five days per week. 24 community libraries open four days per week. Materials budget reduced from $6 million to $4 million · $24 zillion needed in FY 95-96 to maintain current, reduced l~vel of service. $27 million needed to restore Service to six-day operation, including $4 million materials budget. · FY 95-96 revenue projection is $16.7 million. · FY 95-96 revenue/expenditure gap is $7 - $11 million; average is $? million. Pluqqinq a $9 Million Gap $6.92 per capita · $12.02 per cardholder · $18.61 per housing unit · $???? per parcel · Close 8 - 16 libraries · Reduce days/hours of operation by ???? OCPL Task Force Activities · Three meetings to date Divided into four Subcommittees: Legislative, Funding, Marketing and Service Program Evaluation Legislative Subcommittee to examine: statutory constraints and opportunities related to: "Free" v. "Fee" library programs and service, SB 1448 (Roberti), school/public library cooperation, and voluntary property tax check-off for library donations Funding Subcommittee to examine: major revenue options (i.e. Community Services District, Parcel Tax, Benefit Assessment District), library/business partnerships, library foundation and/or other fundraising alternatives, grant opportunities, and City contracting/financing for higher service levels Marketing Committee to examine: target audience and key messages, fees for service, marketing of new information services/technology, selling services to other public libraries, and joint venture opportunities Service Program Evaluation to examine: service demand, service days/hours, efficiency/economy of current operation, marginal or duplicate services, opportunities for privatization, and expanded use of volunteers Completion of review and recommendations targeted for late July/early August to permit placement of' any recommended measure(s) on the November 1994 ballot Other May 18, 1994 Orange Grand Jury Report entitled The Oranqe County Public Library System - A Future? 70OCIV1C CENTER DRIVE WEST.SANTA ANA, CALIFORNIA 92701.714/834-3320 NEWS RELEASE May 18, 1994 THE ORANGE COUNTY PUBLIC LIBRARY SYSTEM'- A FUTURE? The Orange County Grand Jury today released the attached report, "The Orange County Public Library System- A Future?," highlighting the threat posed by the round of budget cuts projected for 1995-96 and predicted to be almost twice those experienced in '93?94. The report points out that in Fiscal '95/'96, a year away, the library budget will be cut to 70 percent of the '93/'94 budget. Last year's budget cut, about 10 percent, resulted in reduced operating hours (40%) and severe reduction of books and periodicals purchases (50%). In '95/'96, the likelihood that library branches will have to close is a virtual certainty unless funding sources can be found. The future of the library system is in the hands of the public t those interested in its future should call their County Supervisor: Roger Stanton Harriett Wieder Gaddi Vasquez William Steiner Thomas Riley District 1 District 2 District 3 District 4 District 5 834-3110 834-3220 834-3330 834-3440 834-3550 For further Lnformation regarding this report, please contact Bob Duley or Charlie VanHoy at 834-3320. 1993-94 O GE COUNTY G JURY TF: . Kroeger, Foreman FVK:mlh "A library is not a luxury, but one of the necessities of life." Henry Ward Beecher THE ORANGE COUNTY PUBLIC LIBRARY SYSTEM - A FUTURE.~ INTRODUCTION The Orange County Public Library's (OCPL) funding is in free far - FY '92 - '93 $27,000,000 FY '93 - '94 $24,100,000 FY '94 - '95 $23,400,000 FY '95 - '96 $18,000,000 A $9,000,000 (30%) reduction in just three years! The future of the Orange County Public Library- 27 branches Serving 1.2 million people- is decidedly uncertain. The cutback is the result of the elimination by the state of most Special District Augmentation Funds (SDAF) and the exhaustion of the operational carryover funds by '95 - '96. (Addendum 1) The OCPL's response for fiscal year '93 - '94 was to make the necessary cuts to meet its budget mandates without degrading its fundamental structure (core staff and facilities). This was to be an interim step while waiting for the full.extent oi the cuts to be known. The conventional wisdom is that the current regi'me cannot continue for long before the system degrades to a point where the facilities have little utility as libraries. Absent an increase in funding, some libraries will have to dose in order to maintain at least a minimal level of service at the surviving branches. This is in the face of the demand for new and expanded library services in the growing south county communities! The challenge, finding ways to restore the OCPL's funding, brings with it opportunity. Now is the time to plan a library system for the next century with an organization optimized to take advantage of the advances in information technologies, and an organization poised to deliver the greatest level of service to its patrons. PURPOSE The purpose of this investigation is to examine what has been done to adjust to the reduction in funding, to analyze the results obtained, anti to determine the effects on the amount and quality of service provided. The objective is to explore alternatives and recommend various actions to help restore and sustain the Orange County Public Library system. _ METHODS . Engage Ernst & Young as consultants to review the OCPL's response to the current budget and its impact on operations and service. Ernst & Young's "Review of the Orange County Public Library Budget - F'mal Report," dated February 1994, and its findings are adopted by the Grand Jury. (Addendum 2) . Review of past Grand Jury reports: · (a) 1979-80 Grand Jury Final Report (b) 1986-87 Grand Jury Final Report 3. Review historical and projected, funding sources for the OCPL. 4. Review OCPL service reduction plans. Be Review library organizational charts before and after the reduction of funding. Review the memorandum from Supervisor Thomas F. Riley, Chairman of the Board of SuperVisors, to Ernie Schneider, County Administrative Officer, Subject:. "Orange County Public Library Task Force,' dated March 21, 1994. (Addendum 3) 7. Interview staff members at various levels of the Orange County Public Library. 8. Interview staff members of the Orange County Office of Budget and Management. 9. Interview staff members of the General Services Agency. 10. 11. Study Ten-Year Financial Master Plan (1990 and 1992 update). Study and follow action resulting from "OCPL: Interim Financial Report," dated February 1, 1994. 12. Survey the selected OCPL facilities. 13. 14. Consult with County Counsel's office. Examine Budget and Revenue Estimates for fiscal '96. periods '92- '93 through '95- FINDINGS The final budget for '92- '93 was $27 million. The initial budget for '93 -'94 was $21+ million. This was subsequently increased to $24.1 million through a final distribution of Special District Augmentation Funds (SDAF). This one- time allocation was sufficient to provide about $23.4 million through '94 - '95. This exerdse was tantamount to hocking everything to cover a couple of mortgage payments. The payment for '95 -'96, due about 14 months hence, will be about $9 million short of '92 - '93 levels. Then projected revenues drop to about $18 million. The sources of funds to make up this shortfall are not identified. (Addendum 1) (Recommendations 1 and 4) 2. OCPL's initial response to the lower budget for '92 -'93 was to: Reduce the purchase of materials (books, periodicals, subscriptions, etc.) by 75%. Additional .funds were made available in early '94 to partially restore the purchase of materials. B. Cut staff by the equivalent of 75 full-time personnel which resulted in a 40% reduction in service hours. (Addendum 4) C. Severely curtail spending on maintenance, equipment replacement, and training. The response outlined above appears reasonable in the short term; it is not a long-term solution. Maintenance o~ buildings, utilities and office equipment, being at or near zero, is questionable in view of the large capital investments involved. The deterioration is obvious: doors, windows, floors, office equipment and computers out of service or in need of repair. The drastic reduction in the purchase of books and periodicals takes the very heart out of the basic reason for having libraries. Shortened service hours are at best an inconvenience; virtual elimination of maintenance and acquisitions can reduce the libraries to reading rooms. (Recommendations 7 and 8) . The amount raised by the OCPL in '92 - '93 through volunteer fundraising efforts was minimal. The contributions of the "Friends of the Library" organizations are quite substantial, but not normally in cash. This is not an implied criticism; fundraising was just not a necessary element of the library's revenue equation. That has change~i; every method of increasing the OCPL revenue stream must now be explored. The OCPL has taken the initiative in this area and is investigating programs, including library "gold cards," and a corporate associate program. The County Counsel's office is evaluating these proposals to determine their legali~-. The law does not mandate a public county library, but it does limit ho.w county libraries may charge fees for services and materials. However, fundraising as a source of revenue has contributed up to 10% of other library systems annual revenues. A more realistic figure for the OCPL is less than 2% ($400,000) a year per the Ten-Year Financial Plan's analysis. Fundraising requires up-front expenditures with no guarantee of a payoff. Dollars are not the only positive product of fundraising, however. It is believed that the effort of fundraising in and of itself can raise public awareness in a constructive way. Positive public attitude and support will be necessary if Orange County's electorate is to be involved in providing new, secure sources of funding. (Recommendation 6) e The reduced budget outlook necessitated staff reductions. Most of these fell in areas dos,st to the service delivery, points. The chief result was the reduced level of service hours available to patrons. The Public Programs and Community Relations/Management Support departments perform similar functions and have actually increased in staff in the past couple of years. (Recommendation 11) . Techniques for measuring and comparing workloads, performance and efficiency at the staff level are virtually non-existent; this results in staffing decisions based on primarily subjective criteria. Without some system of performance measurement, the ability to improve continuously may be stymied. (Recommendation 9) e The budget for library stock (boo~, periodicals, audio-visual materials, etc. )was reduced by 33% (initially 75%). Choosing which periodicals to keep and which to drop was done by dead reckoning at each branch. The decision process involved few patrons. (Recommendation 10) The OCPL Ten-Year Financial Master Plan was published in July 1990. The plan, prepared by a professional consulting firm, is impressive in its scope and prescience. It identified the SDAF as an uncertain source of funding and it projected annual deficits of up to $5 million in the latter half of the '90s (though not as a result of SDAF going to zero). The plan includes recommendations that still look appropriate today - three years after its publication. The plan, limited to addressing'financial issues, did not include discussions or recommendations on the organizational structure of the library or on the potential effects of new technologies and their effects on the organizational structure. (Recommendations 3 and 5) o At th.e behest of the Chairman of the Board of Supervisors, a task force was established in March '94 to study the Orange County Public Library and to formulate possible courses of action to resolve its funding problems. The .charge of this task force is quite broad and remarkably similar (albeit more extensive) to the study undertaken by the Grand Jury which was underway when the task force was created. The establishment of the task force, although somewhat preemptive of this Grand Jury study, is wholeheartedly welcomed. (Addendum 3) (Recommendations 1 and 2) RECOMMENDATIONS Based on these findings, the 1993-94 Orange County Grand Jury recommend_s that: The Board of Supervisors . Support the Orange County Public Library Task Force in fulfilling its charter. (Addendum 3) . Consider becoming members of the Task Force to give it visibility and stature. Orange County should fire its best shot to ensure the future of its library system. The library system cannot be properly managed or operated without reliable, long-term funding. A first-class county should have a first-class library. o Fund a "Ten-Year Comprehensive Master Plan." The plan should formalize and rationalize the financial elements and recommendations made by Orange County Public Library Task Force. It should include a survey of the new technologies and recommendations for an organizational structure of the OCPL that is adapted to the new information and communication technologies. The study should reflect the modern organizational structures that emphasize productiVity and maximize the delivery of library services to its patrons. 4, Call on the cities where county libraries are located to provide more financial support to the library. This support could be in the form of services, facilities, utilities and maintenance. OCPL Task Force Members 5. Acquire and become familiar with the OCPL Ten-Year Financial Plan, dated July 1990. Good background, good preparation, good reading! The County Librarian . Appoint a staff member to manage and coordinate a broad and vigorous fundraising program. Develop a plan which outlines all the options for generating revenues. This plan should detail the costs of each alternative, the expected benefits, and ways to coordinate these activities and approaches. Activities and approaches to be considered include: · Increasing user fees and fines Using a "Gold Card" to recognize individuals who are willing to make a reasonable annual contribution o£ money to the OCPL. Establishing an underwriting program which targets business and industry to become the backbone of public financial support to the library Energize "The Friends of the Library Foundation," expand their programs and put the full force and effect of their efforts into the general operation of the Orange County, Library System. Promote the use of some library rooms as meeting places for dubs and dvic groups that could pay a rental fee for the use of the space. The goal of fundraising is two fold - to raise funds, of course, and to raise public awareness. In a practical sense, the latter may-be more important. . Allocate a larger portion of the available funds for maintenance for fiscal year '94- '95. The '93 - '94 budget of $167,728 was 65% of the prior year's allotment. This Iow level of maintenance, if protracted, could spawn its own crisis in a sea of inoperable equipment, with patrons seeking a staffer for services instead of using a working computer. Restore maintenance schedules and normal operating expenditures in the long term as funds become available. Explore options to boost cost-savings for operations. . Simplify the current branch library operating hours and days. It is preferable to have all the libraries open five consecutive days with uniform hours; for example, Tuesday through Saturday from 10 a.m. to 7 p.m. Reassess the schedule in light of a few months experience. In adjusting the schedule of the new operating hours include public perception and staff reaction. o Produce monthly summaries of workload measures in a shortened format. Develop additional workload measures, such as daily information inquiries per employee, and track staff workload on a more regular 'basis. Continue rotating staff to facilitate staff development and operations staffing. Develop performance measures for management use. Establish benchmark figures and standards as data are tracked. 10. Conduct periodic surveys of library users to assess demand for services and particular collections. Track use of periodicals by library patrons. 11. Make a critical review of the OCPL's organizational structure; reduce functional overlap and boost coordination within the organization. Savings thus achieved could-be applied to maintenance, fundraising development or other areas with critical needs. Addendum I This addendum_shows the actual sources (generalized) of revenues for '92 - '93 and the projected revenues for '93 - '94 through '95 - '96. General Description of Revenue Sources Property Taxes- excluding SDAF Spedal District Augmentation Funds (SDAF) Final distribution of SDAF1 Interest Income Intergovernmental Revenue Fees, Fines and Other Charges Donations, Miscellaneous Other Finandng Sources (ACL, other)2 Totals Actuals '92 - '93 Projected Amounts (000's) '93-'94 '94-'95 '95-',°6 $14,222 $15,075 $15253 $15,523 5',734 0 0 0 0 2,500 2,500 0 359 95 95 70 1,129 1,126 1,186 1,189 880 862 1,036 1,090 78 182 146 146 4,613 4,279 3,091 0 $27,015 $24,119 $23,407 $18,018 The OCPL was allocated 66% ($5 million) of the final SDAF distribution; this will be split, about 50/50, between '93 - '94 and '94 - '95. Operational carryover funds will be used up in '94- '95 leaving $0 carryover o into '95 - '96.