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Answer to Budgets in the Red

The March 2003 issue of American Libraries carries Thomas J. Hennen Jr.’s article: “Performing Triage on Library Budgets in the Red.”  This page expands on the on that article. 

I do not pretend to have all of the answers, but here are some answers to Budgets in the Red.  If you would like to suggest others, please e-mail me at: thennen@haplr-index.com 

Focus on our Business Plan Lobbying activities Fund Raising Consultants Friends Groups 
Re-engineering the Budget Planned Giving and Foundations Wider Units Long Range Planning E-commerce Initiatives
Library Consortiums Value Purchasing  Impact Fees Publicity Campaigns Referendums
Protests  Folk Songs Grants  Audit Value Statements User Fees


Focus on our Business Plan

Generations of librarians have believed passionately in our plan. It is a plan that has inspired countless library users and city councils because of its simple elegance.   What we have is a bargain with history, as well as brilliantly simple historical bargain.  Libraries promise to share knowledge and seek wisdom.  We keep that promise, whether it is with print, with what we used to call non-print, or with electronic sources.  We keep the promise at bargain prices. So for this, society has rewarded us for over a hundred years.  The rewards have not been much, it’s true, but we have a staying power that others with less clear business plans, like those at docoms, never approached. 

The business plan for the American Public Library still trumps the fuzzy dotcom plans so popular a few years back.  The idea of free public library service still resonates widely with the American public.  But we are experiencing broad-based homeland insecurities.  While the mission and goals remain, some of the specifics of our strategic responses must change, so too, the tactics we use.  

It is time to consider some strategies for these times, some answers to budgets in the red.


Lobbying Activities

Some lobbying dos and don'ts

Lobbying is not a dirty word.  Federal, State and Local politicians need to hear from library special interest groups on a sustained basis.  

Stay with the state library association program! We must appear united and strong.  The time to oppose issues and legislation is when it is being developed by the state library and the state library association, not when it has gotten to the legislature.  If you oppose, follow the rule your mother taught you, and if you cannot say anything nice, say nothing at all.  

It is a cliché that the two things you do not want to see being made are: Laws & Sausages.  The assumption is that both processes are dirty, bloody, and at times unappetizing.  We can go meatless if we choose, so it is not absolutely necessary to help the sausage makers, but going lawless is out of the question.  We will have library laws whether we watch, help, or stand idly by. They will be better laws if we watch with care and help the lawmakers in their job. 

The American Library Association provides excellent resources for library advocacy.  ALA asks "How can you speak up and speak out about the value of libraries and librarians in the 21st century?"  ALA provides many answers at:  http://www.ala.org/pio/advocacy/

The library association for your state will also be a critical resource.  To begin your contacts for state associations, see: http://www.ala.org/cro/state_guide.html

While the state and federal levels are important for copyright, privacy, filtering and funding issues, by far the majority of funding is at the local level. There is far less available about how to lobby local legislators for library issues.  Local Friends of the Library groups are good places to start.  Leagues of Women Voters and public policy interest groups at the local level should also be contacted.  

The American Library Association has developed a multi-year campaign to focus attention on library issues called @your library.  See: https://cs.ala.org/@yourlibrary/

American Library Association - Advocacy page asks the question: How can you speak up and speak out about the value of libraries and librarians in the 21st century?


Friends Groups 

Friends of Libraries U.S.A. is a membership organization of more than two thousand individual and group members. Their mission is to motivate and support local Friends groups across the country in their efforts to preserve and strengthen libraries. http://www.folusa.org/

You will also want to contact the friends of the library group for your state and locality, of course.  

Friends groups are critically important when it comes to lobbying, capital campaigns, and referenda.  

Some current bibliographic resources are:
Fundraising and Friend-raising on the Web.
Corson-Finnerty, Adam. American Library Association, c.1998.


Planned Giving and Foundations

Library Foundations programs can assist libraries through budget problems but there are a number of caveats. Too often the local city or county expects the library to substitute donated funds for tax funds, leaving the library no better or even worse off than before the gift was given. Donors won't donate without an assurance that their money will go towards library improvement rather than tax abatement. Library staff have little incentive to do the work necessary for foundation development if the end result is to be at roughly the same level of funding as before. 

Clear statements passed by the library board are essential to assure the continued flow of donations. Community Foundations that manage funds for a number of charitable groups are one way to minimize the extra work of record keeping that a dedicated, stand-alone library foundation entails. State and regional library staff should organize information and training for library boards and administrations on the pros and cons of community foundations, planned giving and other types of gift assistance.

American Library Association - Library Fund Raising


Some current bibliographic resources are:

Becoming a Fundraiser: The Principles and Practice of Library Development.
Steele, Victoria. American Library Association, c. 2000.
Fundraising for Libraries: 25 Proven Ways to Get More Money for Your Library.
Swan, James. Neal-Schuman, c.2002.
An Introduction to Public Library Foundations: A Member's Guide.
Krois, Jerry, comp. Wyoming State Library Division, c.2000.
Legacies for Libraries: A Practical Guide to Planned Giving.
Sherman-Smith, Amy. American Library Association, c.2000.
Making the Case for Your Library: A How-to-do-it Manual.
Gardner Reed, Sally. Neal-Schuman, c.2001.

E-commerce Initiatives

Very few libraries have taken advantage of the Internet-based options for increasing the flow of small-scale contributions.  Library associations at the state and national levels should feature examples of such programs.   According to Amazon.com the Amazon Honor System is a safe and easy way to support a favorite Web site.  

The Amazon Honor System allows individuals to use Amazon.com payment technology to make payments to Web sites as small as $1.00.  If Amazon can do it, why can’t ALA?  A tool allowing library fans, of which there are many, to donate small sums to their favorite library could be a boon to both the association and local libraries.  Imagine the ALA @your library campaign with a dollar sign added in for good measure!   

The benefits, pitfalls and legal constraints of such programs must be considered.  The library literature should be pointing to examples.



Impact Fees

Impact fees allow communities to assess up-front costs on new homes as they are built in a community. They are intended to allow communities to levy a fee to offset the impact that a new household has on the ability of a library to sustain its service level. Such impact fees are far more workable in larger units of service. Impact fees are not legal in some states, and quite controversial in many others.  Developers often oppose them and governing bodies have mixed responses. 

In fast growing areas the use of impact fees may be a very effective tool in library funding and development. An impact fee is a property tax assessment that is placed on a home while it is being built. The cost is usually rolled into the purchase price of the home. The theory behind impact fees is that new residents impose an impact on the library that should be borne by the new resident rather than current residents. State law must authorize the impact fees for library purposes and the community must endorse the proposed fees based on a plan. The plan will ordinarily need to be drawn up by the library or its agents. 

We need model state laws, model local ordinances and specific examples of successful impact fee development. Home builders and real estate agents will often oppose impact fees for libraries, and they have much deeper lobbying pockets than we do, so the political aspects of an impact fee strategy must be considered on a state-by-state basis. 

It is time for ALA and state associations to promote impact fees. Give libraries that could benefit from impact fees the guidance, tools, and blueprints to make them a reality.

A sample impact fee statement is provided.  


Ohio State University Study did a useful report on impact fees: 


Publicity Campaigns

On September 20, 2002, the Dow dropped below 8000, but if we had a similar national library barometer, it would be reaching new heights as library use soars during this recession. 

Two national studies commissioned by ALA and released in March 2002 show that Americans are using their libraries more than ever, and 91 percent of adults believe public libraries will play an important role in the future, despite all of the information available on the Internet. Waukesha County Federated Library System recently replicated both studies locally and found, not surprisingly, very similar results. For the full ALA press release see: 

The ALA Press release notes that librarians have long believed that when the economy goes down, public library use goes up. The ALA contracted with the University of Illinois Library Research Center (LRC) to study library use over the last five years at the 25 U.S. public libraries serving populations of 1 million or more. Using data from 18 of those large libraries, the study found that circulation has increased significantly since March 2001, when the National Bureau of Economic Research pegged the beginning of the latest recession. Using statistical analysis, the LRC found that circulation in March 2001 was 8.3 percent higher than would be expected from the previous, non recession trend. For the national study see: 

Library Media and PR - Strategies, techniques, resources, tips and tools for library communicators.


Some current bibliographic resources are:

The Responsive Public Library: How To Develop And Market A Winning Collection
Baker, Sharon L. and Wallace, Karen L. Libraries Unlimited, c.2002
Powerful Public Relations: A How-To Guide for Libraries.
Karp, Rashelle S. American Library Association, c.2002.


Aging boomers remembering that properly applied direct action resulted in victories in the 60's. Those same boomers may be ready to join forces with others and apply the lessons learned to saving libraries the way they have recently done in San Francisco. In June of 2001, San Francisco voters approved Proposition E, which nearly doubled funding for local libraries. Proposition E didn't call for tax hikes. It mandated that a set percentage of local property tax revenues be devoted to libraries in each city budget. Proposition E won 70% of the vote. The Friends of the San Francisco Public Library launched the campaign.

According to Dale Carlson of the Friends & Foundations of California Libraries, "Foot-dragging over implementation of Prop E indicates the politicians still haven't taken local taxpayers' messages to heart. It's clear the Friends in San Francisco - and all over California - must begin holding elected officials accountable for failing our libraries. Indeed, constant vigilance and continual political engagement need to be ingrained in the culture of Friends' organizations if Californians are to be provided the library service they deserve and have made clear they want." 

Direct action and street protests may be one of the strategies we need to use as answers to budgets in the red.


Folk Songs

So far I only have this one folk song for library budgets.  Can you provide others? 

Folk songs have provided another means of communicating to the public at large for a long time. The content of the songs varies with the epoch and the need, of course. We should remember that there are a lot of folks out there for whom the public library has been by turn liberator and anchor. So, with all due apologies to Bob Dylan we have: 

Budgets in the Red 

How many books can we fail to buy 
Before we can call it a theft? 

Yes, 'n how many staff can we just let go 
Before there are no answers left? 

Yes 'n how many hours can we take away 
Before seekers are bereft? 

We must answer, my friend, to budgets in the red 
We must answer to budgets in the red.


Audit Value Statements

 Playing off the current national news is often a good way to get a local media spin. The audit or Comprehensive Annual Financial Report (CAFR) for many libraries is part of the city or county audit. For others it is a separate document. It does not usually get much public attention unless there have been irregularities. But given the current Enron and Anderson accounting scandals, there may be an opportunity to make a valuable point about a valuable agency, the public library. 

With tongue in cheek, we might talk to the local press and convince them that in the next scandal it may be revealed that auditors have been using accounting practices that conceal the true value of libraries! Libraries get carried on financial sheets as costs, not assets. Our auditors have flagrantly undervalued libraries!

Andrew Richard Albanese spoke of the need to re-assess library value in the May 15, 2001 issue of Library Journal, "Nashville is one of a growing number of cities that are moving away from the traditional view of library as cost center. Rather, local officials and politicians, under whose collective purview libraries fall, are seeing them more as equity anchors, as investment magnets that help expedite the revitalization of a neighborhood or community."

Here is a quote for the close of a press release on library audits; "Despite rare exceptions, it is not expected that local municipalities will immediately re-state their balance sheets to put the library on the asset side of the ledger, but there are hopes in some quarters. As citizens are using libraries more and more for a variety of purposes, many of them are joining the growing chorus demanding accountability in their public sector audits."

See also Thomas J. Hennen Jr.'s GASB story.  

Wider Units

As a long-term option, a district or other form of wider unit may be in order. But only 19 states have provided for library district legislation. A.L.A should provide model legislation for the formation of library districts.  From the 1930's through the end of the 1970's ALA and national library leaders believed in and advocated strongly for wider units. As smaller units proliferated in suburbs and rural areas the momentum was lost. The elimination of some of the overhead and duplication one finds because of the many, often splintered library service units, could go a long way towards easing the budget deficits we currently see. One problem is that we have no good crisis response teams at either the regional, state, or national level that could go in and assess situations and recommend cost effective mergers and consolidations. We need such teams. Perhaps they could be organized from retired librarians that are committed to the future of public libraries - individuals that care but lack the vested interests of their still working colleagues.

What organizational form delivers the best library service?  For many years library leaders have told us that “wider units of service” will produce better library services.  The presentation will examine the issues, using national data.  Although far more study is needed, the national data suggest that, in most cases, wider units of library service are, indeed, wiser.  

Hennen published "Are Wider Units Wiser?"  in the June/July 2002 issue of American Libraries.    00029769, Jun/Jul2002, Vol. 33, Issue 6

Popular items like parks and libraries in "a la carte" districts can soak up public funds. That leaves less for important but non-attractive government functions like accounting or road building. The converse of this argument is that too often local government officials use the very popularity of library services to our own detriment. City mayors have used this strategy in local budget battles: Threatening to close a branch library causes city council members to rally to the defense of their branches and voila--the budget is restored. Meanwhile other less-popular city services are protected from scrutiny.

For further information you may wish to consult my Joint Library report at: http://www.srlaaw.org/documents/JointLibrary.pdf


Long Range Planning

HAPLR author, Tom Hennen has a forthcoming book for Neal-Schuman Publishers, “Hennen’s Effective Library Planning.”  Hennen believes that a library must have some fundamental things to be minimally effective.  After these fundamentals, library planners should choose roles, set objectives, and do the other elements of the Public Library Association Planning Process series .  First, however, libraries should go “forward to basics.”  

Basics include having the necessary policies and procedures on hand and up to date.  Going forward to basics means comparing the library to other libraries in a relatively comprehensive and consistent manner.  This presentation will provide the tools to provide for those basics as well as to plan for the future. 

A library could finish an entire Planning for Results  process and still lack such fundamental things as a personnel policy, a selection policy, an Internet acceptable use  policy, a comprehensible budget, or a host of other essentials! Using the Planning Process series , a library could avoid comparing itself to any other libraries in the state or nation and not realize that it has not even begun to live up to its potential.  

A great online source of help for planning in a small library is "New Pathways to Planning." It grew out of a series of workshops sponsored by Northeast Kansas Library System (NEKLS) in 1998. Our goal was to provide a process that could be used by small public libraries to meet a system requirement for a written library plan, including a vision statement, goals and objectives. To create this process, NEKLS collaborated with Marty Hale, School of Library and Information Management (SLIM), Emporia State University, Emporia, Kansas. It is available at: http://skyways.lib.ks.us/pathway/

Some current bibliographic resources are:

Planning for Results: A Public Library Transformation Process.
Himmel, Ethel. American Library Association, c. 1998
Staffing for Results: A Guide to Working Smarter.
Mayo, Diane. American Library Association, c. 2002
Managing for Results: Effective Resource Allocation for Public Libraries.
Nelson, Sandra. American Library Association, c. 2000
New Planning for Results: A Streamline Approach.
Nelson, Sandra. American Library Association, c. 2001


Re-engineering the Budget

Does your library budget presentation look much the same as it did 5 years ago with much the same results?  Maybe it is time for a facelift on the budget.  The funding authorities, whether they are city councils or the voters at large for a referendum, may be demanding a different take on the budget presentation.  

In the wider context of budgets at the municipal level, budget officers are increasingly demanding accountability factors and outcome measures in municipal budgets.  Sometimes lethargy, inertia, or an appeal to a library board's autonomy and prerogatives, have led libraries to resist the forces for changing the look and feel of the library budget. 

It is often said that the single most important policy document for any agency is its budget.  That is probably because; notwithstanding all the planning and projecting we do, unless something is translated into a budgeted item it does not ordinarily get done.  This simple fact explains why all too often long range or strategic plans gather dust on shelves rather than accolades from the public.  Library planners must have the resolve to not only plan, but to budget, and then implement the plans!  


Library Operating Expenditures: A Selected Annotated Bibliography
ALA Library Fact Sheet Number 4
This bibliography was prepared to describe sources of information on library operating expenditures. It covers public, academic, and school libraries. 

Managerial Accounting for Libraries and Other Not-for-Profit Organizations, Second Edition  G. Stevenson Smith  American Library Association Editions, 2002. ISBN: 0-8389-0820-9
With more than 50 figures and examples illustrating library-specific scenarios, this step-by-step guide walks you through the process of forecasting, budgeting, evaluating performance, and analyzing costs. Nonprofit managers at all levels will be equipped to answer the perennial question, "How are we doing?" 


In most states, the most likely source of grant money is the Federal Library Services and Technology Act (LSTA), administered in each state by the state library agency.  

Grant making agencies are usually seeking to augment local spending and use targeted funds for experimental purposes that enhance the objectives of the grant making agency.  This point needs to be made for nearly all grant making agencies, including state administered LSTA;  they rarely make funding available to substitute for a shortfall of state or local funding!  

From this point, it follows that grants are not, for the most part, much help for library budgets in the red because of a loss of state or local funding.  Nonetheless, grant revenue, if carefully worked into a library's overall profile, can help alleviate funding problems, if only for a time.  

Contact your state library agency for the rules on funding under the Federal Library Services and Technology Act grant program.  

Contact the Institute for Museums and Library Services (IMLS) provides for some limited direct funding to public libraries.  IMLS provides national leadership grants and grants for cooperation between libraries and museumshttp://www.imls.gov/grants/index.htm

Other sources of grant writing information: 

The Big Book of Library Grant Money, 2002-2003: Profiles of Private and Corporate Foundations and Direct Corporate Givers Receptive to Library Grant Proposals.
Prepared by The Taft Group for the American Library Association, c. 2002.
Foundation Center’s Proposal Writing Short Course


Sorry, still working on this section. 


"A Tale of Two Levies" in the March issue of American Libraries magazine.   By Jennifer Burek Pierce. The divergent outcomes of two Montana ballot measures offer lessons for libraries.

Campaigning for Libraries.  Learn the ins and outs of running a successful library referendum—from selling the need to the legal questions involved. Bibliography. Suzan Rickert. Judy Zelinski, ed. Central Colorado Library System. 1988. 64 p.  ISBN 0-8389-7505-4



Fund Raising Consultants

 Sorry, still working on this section. 

Libraries decide to hire a fund raising consultant for a variety of reasons.  Most often the motivation is the need for a new building and the inability to get the local funding authority to authorize bonding authority.  At other times, the motivation comes when a board, administrator, or friends group identifies a need to enhance services beyond what is possible under current tax structures.  Whatever the motivation and need, seeking a fund raising consultant can be a process fraught with problems.  

Paustenbaugh, Jennifer.
"Choosing and Using a Fund-Raising Consultant: A Bibliography."
Available online at: http://www.ala.org/lama/committees/frfds/frfdsbibl.html
This bibliography was prepared for the LAMA (Library Administration and Management Association) Fund Raising and Development Section’s Development Issues Discussion Group on February 15, 1997. It includes articles and books written between 1991-1995.



User Fees

Sorry, still working on this section. 

The last time that library planners saw a concerted effort to move towards library fees, an effort that included library directors and library trustees, was during the recession of  the mid 1980's.  This recession is likely to engender similar efforts.  

The American Library Association opposes the charging of user fees for the provision of information by all libraries and information services that receive their major support from public funds.  See the ALA statement, Economic Barriers to Information Access at: http://www.ala.org/alaorg/oif/econ_bar.html

Many states expressly prohibit most types of user fees for public library services in their statutes.  Most state library associations concur with the ALA position noted above.  

Most library statutes allow for limited library charges: 

  • fines for overdue materials, 

  • fees for replacement of lost items,

  • fees for photocopies and faxes,

  • fees for some value added databases.  

In most cases, a move towards wider user fees will first require a change in state law.  

Library Consortium

 Sorry, still working on this section. 

Pooling resources with one or more libraries in your area is an effective means of leveraging the library's buying power.  

Library consortiums are established to: fund a shared automation system, to fund a shared acquisitions or cataloging system, to provide specialized personnel functions that none of the members can afford individually, and so forth.  

Establishing or joining a consortium, usually provides returns in the long run rather than in the short run, so that this option will not usually be much help for a short-term budget crisis.  



Value Purchasing 

Sorry, still working on this section. 

Buying in bulk, based on a contract with a vendor, will always save money.  Libraries need to seek the best venues for value purchasing in order to get the best deals.  In some cases this will be a state purchasing contract, in other cases it will mean buying into a regional, county or local purchasing consortium.  

If the library can buy 10% more books or 15% more supplies for the same dollar by using a state or regional purchasing contract, it should, of course do so.  If no such consortium exists for the library, it may be time for the library to initiate one. 


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