What broke?

A challenge facing libraries is the tendency to migrate away from the traditional model of public library funding. In the library field we have a funding model. It can be simplified thus: the library provides free services to a patron base or municipality. The members of the public in that municipality in turn support the library and make it known to city officials (either by voicing their opinions, or by ballot box) that the city should fund the library to keep the services free. The city then funds the library at a level to maintain or grow service.

Somehow though, that model broke. The libraries began charging fees for services; the public stopped vocalizing their support of the library; or the city officials stopped funding public libraries at a level to offer the services. Which came first, and who is to blame is a topic for another post. Once one portion of that model fails, the previously happy cycle begins to break down at each element. The library charges for services, the public support wanes, and the municipality, seeing either a self-funding library or an apathetic public decides to fund the library at a lower level.

All across the country public libraries are trying to blend business models to narrow the revenue gap, with predictably mixed results. The libraries serving the largest population are those which charge their patrons the most for the most core library services, such as placing holds and borrowing best sellers. Understandably, public response is negative with 87% of the public served by the libraries which charge fees are opposed to those fees, saying “I remember when the library was free”. It’s not just the biggest libraries either, approximately one-third of public libraries have fees attached to core services, the most common fee being a charge for borrowing DVDs.

The revenue generated is rather trivial; for libraries of municipalities sized between 10,000 and 25,000 residents, the median revenue of fee-based services comes to about $2,000, or about 0.3% of our total revenue. Coffee shops and gift shops in a library might generate a little more revenue, or more likely will struggle to break even and will have to be closed. I encourage libraries to open gift shops, cafés, and copy centers; but you cannot hope that those ventures are cash-cows.

The economics won’t work in our favor. This example is from Dan Ariely’s 2008 behavioral economics book Predictably Irrational: If a friend asks you to help him move, you might be willing to help out. And if he offers to buy you a pizza for your troubles, you’d gladly accept, and you’d be happy to assist. But if the friend offers to pay you $10 (the price of a pizza) to help him move, you are more likely to tell him to jump in a frozen lake. In the first example, your relationship operated in the friendship mode; in the second example, your friend tried to move your relationship into the business mode, yet didn’t offer the market rate for helping him move. Libraries attempting to shift into the business model and charge fees for services will similarly get the cold shoulder from the public. The downside to making money is the potential loss of love on behalf of the public.

The fees public libraries charges for some services are meant only to cover costs. Lamination, faxing, inter-library loans, ear-buds, for example, cost the library material expenses. Other fees such as fines for late returns or for unclaimed ILLs are meant to alter behavior. I maintain opposition to the imposition of fees and of the entrepreneurial trend among libraries. My previous library gave away $3.3 million worth of service in the previous year, why should we quibble over a small percentage of that?Image

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