Cataloging Changes: Privatizing the Vineland Public Library

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Vineland Library LS&S

Plans to have Vineland Public Library managed by a private entity will be heard in public session September 28.

CORRECTION: Wed., Sept. 27 at 4:41 p.m.
Based on information received by SNJ Today after the print deadline for this story, there, in fact, could be a saving to taxpayers if the Vineland Library management is outsourced. While it is accurate that the direct city budget item for the library is $1.365 million for 2017 and by law can’t be reduced, other relevant expense items in other city budget lines exist, notably for health insurance premiums and employer pension contributions for library staff. If the library employees are exited from city benefits, that expense will be reduced or eliminated, decreasing the city budget. According to LS&S, the total city budget for the library is $1.925 million.

VINELAND, N.J. — It seems a Maryland-based management company with a track record of efficiency may be able to save the Vineland Public Library as much as $350,000 annually over five years if operations are outsourced to it.

But Library Systems & Services (LS&S) will first have to navigate a phalanx of questions from the library Board of Trustees, staff, and citizens.

The management company will face its initial scrutiny at the board meeting on September 28 at 7 p.m. at the library. 

LS&S, based in Rockville, MD, initially made its offer to the Vineland City Council on July 18. According to the minutes of the meeting, it claims to help municipal governments operate libraries at the same or lower cost and reduce risk. It claims to provide library professionals with an “amazing and progressive” place to work.  

Because of its size, LS&S claims savings through volume purchasing, shared business functions, best practices, up-to-date technology, and staff realignment.

“This is in no sense privatization,” said Todd Frager, COO/CFO of LS&S. “We are a management company. The library will always be public, there will never be a fee for using it and we’re always going to run it with local people.”

The city will still own the library building and grounds. LS&S, upon direction from the library board, would take over employees and the management, as well as programming of the facility. The board is autonomous, with its members appointed by the mayor.

Education should supersede money.

Victor Druziako, president of the Board of Trustees, expressed concern about what role the board would have if LS&S took over management. 

“We are in charge of the library by law and currently have full access to all its financials; if the private company were to manage us under contract, I have a feeling not so much,” he said. “The Vineland Library is a jewel of Cumberland County,” Druziako said.

“It has operated like a finely tuned machine for years and its many programs are very important.”

Frager explained that LS&S, a private, for-profit company, has 35 years of its own experience running libraries, is the third largest library system in the country after the New York City and Chicago systems in terms of branches, and has worked with the Library of Congress. LS&S faces few complaints from any of the 83 library systems it manages, according to Frager.

Pam Tuller, director of the Finney County Library in Garden City, Kansas likes being part of a larger system. LS&S took over Finney County Library in 2003.

“I really appreciate their support; I always have some one to call for backup,” she said. “LS&S has ‘been there, done that,’ plus it is very cognizant of serving diverse populations like ours.”

Tuller said the library is in no way private.

“It’s the same public library that Garden City started many years ago,” she said.

Vineland Library Director Brandi Grosso is perplexed by the city’s interest in the LS&S proposal.

“I can say that there is a collective shrug as to why City Council invited LS&S to present an outsourcing proposal for a successful library that is filled with knowledgeable, dedicated staff who provide an outstanding curricula and personal service,” she said in a statement.

“Reactions from those hearing about this presentation (on September 28) have been of overwhelming support for the library, so I am sure that public attendance at this month’s board meeting will be indicative of that support.” she added.

Some regular users of the library became confused and agitated when confronted by rumors last month of these possible changes there.

“I was so disappointed about this,” said Emily Fischer, who brings her four children to the library frequently. She said there are many programs that help families in the community, especially the disadvantaged, and they may be eliminated.

“I think a private company will put its profit first,” Fischer said. “Education should supersede money.”

LS&S believes that opposition to its proposals generally is rooted in reflexive bias.

“There are people who think it’s an inherently bad idea regardless of our success,” said Frager.

“That’s their opinion and they are certainly entitled to it. The fact is we are guided by our communities and answerable to them at every turn.”

Even as he feels at this point differently about community needs, Druziako agrees with Frager about free expression.

“I don’t want the LS&S reps to think they are coming into a hostile room where people shoot them down right away,” he said.

“Everybody wants to believe what they say is true and we want to hear it out.”

I don’t know how to run a library, but it certainly sounds intriguing.

Among management changes in the outsourcing proposal, exiting current employees from the state fixed benefit pension program seem the most fraught. It is consistent, though, with trends in local and state governments elsewhere and in line with the philosophy of fiscal conservatism and smaller government.

“People who don’t have pensions like [our approach],” Frager noted. “And people with pensions can understand. It’s not our fault and it’s not the employees’ fault that fixed pension commitments are simply not sustainable. LS&S offers a generous 401(k) plan with a 10 percent employer match.”

The presentation materials offered by LS&S to the city council apparently listed “Staff Recruitment, Development, and Realignment” as the largest factor in cost savings.

Druziako said, “There’s no magic here; economies of scale in purchasing and administration can only go so far, the bulk of the cuts would have to come in personnel adjustments. It’s all about reduced staff through attrition and retirement and, especially, pensions.”

(For full details on the effects on employees, see the paragraph at bottom.)

The current library expense in the annual city budget is set at $1.365 million by law under a state formula and represents 0.22 percent of the city’s general budget.

Sources with detailed knowledge of the proposal, speaking on background, agreed the annual city contribution to the library must remain unchanged so there actually will be no taxpayer savings. Any savings will benefit the library board and allow it to expand and improve services.

Only the city contribution is handled by LS&S, according to Frager.

Donations to the library, such as last fall’s $100,000 gift by retired Vineland physician Frank DeMaio, are treated as “pass-throughs,” going directly to the library budget. DeMaio’s gift is earmarked for much-needed replacement windows.

The library’s total budget for 2017 is $1.511 million with the amount above the city’s contribution coming from state aid, grants, over-the-counter income, and fund balance. The proposed $350,000 savings in the first year would exceed 23 percent of that figure.

How the LS&S fee will be paid is unclear at this point. Some sources said the five-year fee might be paid upfront; others speculated that the firm might instead keep a percentage of the annual savings.

Frager said, “We collect a set fee for the deliverables desired by the library board and the community. It’s a fixed services contract—you know what you’re paying and know what you’re getting.”

It appears details such as this will be negotiated as the decision whether or not to form a public-private partnership (PPP) between the library and the management company—and for how long and under what terms—is explored.

In some public libraries, LS&S takes on a more limited consultant role with no impact on employees and that is an option in Vineland.

“I wanted the Library Board to know that there’s something out there they should know about, it’s a fiduciary duty to examine it,” said City Council President Paul F. Spinelli. “I don’t know how to run a library, but it certainly sounds intriguing.

“I’ve also made it very clear that no one in government that I know of is trying to influence the Board of Trustees vote,” he added. “It’s absolutely their call.”

Spinelli said there has never been at any time any criticism by the city council of any aspect of library operations. The philosophical, economic and political conflict in our country about outsourcing government functions in many instances hits with hurricane force. Now, Vineland is taking its turn at the eye of it.

“It’s not privatization,” said Druziako, “but it’s a loss of control by the community.”

“We always work really hard to be the best we can be for our patrons, and our communities” said Frager. 

Open Public Meeting      
The meeting Thursday, September 28, begins at 7 p.m. in the community room of the library at 1058 East Landis Avenue and will be open to the public. Anyone will have a chance to make a statement under the “Sunshine Law.” City Council members will be present, but are likely not permitted to ask questions under he same law. Those involved in setting up the meeting were unsure if members of the public will be permitted to ask, and have answered, questions about the proposal.

Effects on Current Employees      
According to the minutes of the library Board of Trustees from July 27, it was presented that, under LS&S management, staff at the library: • Would be laid off under Civil Service and possibly re-hired by LS&S; • Would no longer be protected by Civil Service; • Would no longer be City of Vineland employees and eligible for city benefits, including the city’s health insurance plan; • Would no longer be able to participate in the N.J. State PERS pension plan; they would be offered a 401(k) plan; • Those who have been employed for more than 10 years could choose to freeze their pension and collect on it at the time of their retirement: they would no longer be able to contribute to it; • Those who have been employed less than 10 years would be able to cash out what they have contributed, with penalties.

SOURCE: Minutes of the Vineland Library Board of Trustees meeting of July 27, 2017

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