ACRL News Issue (B) of College & Research Libraries March 1983 / 69 Bridging the Library Budget Gap An Approach to Creating Fair User Charges P eter F. R ou sm an iere President R o u sm an iere M an agem en t Associates E la in e F. C iarkow ski C ircu lation L ib ra ria n F ran cis A. C o u n tw ay L ib ra r y o f M edicin e N ath an iel G uild F o rm er V ice-President R o u sm an iere M an ag em en t A ssociates A lib ra ry user charge system should be designed to w in a ccep tan ce from users and to yield signifi­ c a n t recu rrin g fin a n cia l benefits to the lib ra ry . T h e F ra n cis A. C o u n tw ay L ib ra ry o f M ed icine at H a r­ vard M ed ical School recently introd uced such a system. W h a t C ou ntw ay did was co ncep tu ally very sim ­ ple. A team o f adm inistrators and consultants b uilt one datab ase about lib ra ry service costs and a sec­ ond datab ase about lib ra ry users. T h e n th e team m erged these databases to establish fa ir and audit- a b le charges for lib ra ry usage, w hich ad m in istra­ tors can assess again st individual users and a ffili­ ated institutions. T h e C o u ntw ay lib ra ry study w as th e first in the nation to receive U .S . D ep a rtm en t o f H ealth and H um an Services approval for ind irect cost recovery o n g r a n t-s p o n s o re d r e s e a rc h u n d e r n ew A -2 1 guidelines. T h e L i b r a r y C o u ntw ay holds o ver 5 0 0 ,0 0 0 volumes and sub­ scribes to over 5 ,0 0 0 cu rren t scholarly jo u rn als. In a d d itio n to sta n d a rd re fe re n c e and c irc u la tio n fu nctions, th e lib ra ry offers autom ated access to nation al b ib lio g rap h ic d atabases, in terlib rary bo r­ row ing from a nation al netw ork o f lib raries, re fer­ ence workshops, and p u blication s on new addi­ tions to m onograph and serial collections. T h e lib ra ry is open to students, fa cu lty and p ro­ fessionals affilia ted w ith a wide variety o f institu­ tions. I t serves th e m em bership of approxim ately 40 schools and o th er n on-profit institutions under form al agreem ents, and th e m em bership o f an ad­ ditional 3 0 institutions under inform al agreem ents. V irtu a lly all cu rren t and potential users a re m em ­ bers o f one o f these institutions. O ver h a lf o f th e us­ ers cite a n on-H arvard institution as th eir p rim ary a ffilia tio n . In th e fa c e o f escalatin g costs and increased de­ m and from a w ide v ariety o f users, C o u ntw ay ad­ m inistrators realized th a t users w ere not paying for th eir sh are o f lib ra ry costs. T h e y engaged consul­ tan ts who w ere fin a n cia l consultants to n onprofit o rg a n iz a tio n s to h elp th em clo se a su b s ta n tia l budget gap by recovering a fa ir share o f service costs from users. T h e A p p r o a c h T h e jo in t ad m in istrato r-co n su ltan t team pro­ vided the lib ra ry an integrated set o f fin a n cia l a n al­ ysis p roducts th a t w ere essential for th e attainm en t o f th e lib ra ry ’s goal. T h e products included: 1. C on sultation on th e lib ra ry ’s overall strategy to recover service costs from users. 2. A schedule o f lib ra ry services for w h ich usage costs could be assigned. 3. A service cost datab ase, created by a cost allo­ catio n system. 4. A com p uterized user datab ase, created from th e results o f surveys sp ecially designed and co n ­ ducted. 5 . Analyses o f altern ative methods o f assessing costs to users (by m anip u latin g the cost and user databases). 6. A fin a l sched u le o f cost assessm ents, w ith backup d ocum entation to satisfy auditors. F o r m u l a t i n g a S t r a t e g y B efo re em b ark in g on th e p ro ject, the team se­ lected an ap p rop riate strategy for recovery of costs from users. T h e strategy u ltim ately selected by the lib ra ry had the follow ing elem ents. F irs t, th e full costs o f the lib ra ry w ere to be assessed upon users (there w as to b e a single assessment m ethod for all users). Second, the assessments w ere to be su ffi­ c ie n tly d o c u m e n ted to e n a b le users to pass on charges to th ird parties. T h ir d , most o f the cost re­ covery was to b e in the form o f institutional assess­ m ents ra th e r th an direct charges to individuals. I d e n t i f y i n g L i b r a r y S e r v i c e s E a r ly in the p ro ject, th e team analyzed th e key services o f the lib rary . W e divided key services into tw o groups. In one group w ere ten services th at provided a direct b en efit e ith er to individual users, such as copy service, or a restricted group o f users. As an exam p le o f restricted service, som e o ffice space and m eetin g room s in the building w ere c o n ­ trolled and used solely by the host university. T h e charges o f these ten services a re to b e paid in the fu ­ tu re a t uniform unit rates by all users. In a second group w ere nine core lib ra ry ser­ vices. T hese included th e jo u rn a l room s, stacks, referen ce questions and charge-outs. L ib ra ry ad ­ m in istra to rs decid ed th a t all users w ould have 70 / C &R L News eq u al and essentially un lim ited access to these ser­ v ic e s , a n d th a t th e li b r a r y w ill re c o v e r co sts through annu al assessments o f a ffilia te d institu­ tions, based on th eir respective m em bers’ use of each o f th e nine services. S e r v i c e s C o s t D a t a b a s e T h e team com p iled a d a ta b a se to provide th e costs o f th e 19 key services. Sin ce lib ra ry expenses a re on ly recorded in a tra d itio n a l line-item fo rm a t, w e established costs for services through a tw o-step process. W e first allo cated line-item expenses to 17 lib ra ry cost cen ters, th en w e reallo cated cost c en ter expenses in to service charges. T o allo ca te expenses to lib ra ry cost cen ters, w e co llected all costs incu rred to o p erate and m ain tain lib ra ry resources from th e lib ra ry ’s bud get and ex­ pense records, w h ich a re audited fin a n cia l records th a t provide sum m aries o f charges for costs such as p ayro ll, books, and utilities. T h e study then dis­ trib u ted those line-item expenses to 17 cost centers. Som e service costs w ere synonym ous w ith cost c en ter expenses— for exam p le, th e cost for jo u rn a l use w as sim ply th e expense of th e jo u rn a l cost c e n ­ te r. O th e r service costs w ere th e sum o f tw o or m ore cost d istributions. C h arge-o u ts, for exam p le, had a la b o r co m p o n en t based on th e c irc u la tio n desk tim e and m otion studies, and a book use com p o­ nent based on its p rop ortion o f books used in the year. Ex am p les o f som e o f our reallo catio n s o f cost c en ter expenses to services w ere th e follow ing: 17 C ost Centers into 19 Services C ircu la tio n C harge-outs desk C ou rse reserve C ircu la tio n questions L ib r a ry cards R eferen ce C o m p u ter searches R eferen ce questions In te rlib ra ry loans A cquisitions Serials file questions T o a llo ca te circu latio n desk costs a m ong the four services, th e team m easured d irect lab o r and m a te­ ria ls co sts o f th e c i r c u l a t i o n desk c o s t c e n te r through tim e and m otion studies o f each activity. It th en ap portioned th e to ta l costs o f th e circu latio n desk to these services based on th eir relativ e p rop or­ tion o f direct costs. O n e o f th e 19 services was overhead services. T h e overhead categ o ry o f service encom passed all lib rary activities th a t m a in ta in and en h a n ce the li­ b rary as an ongoing, prod uctive resource. These fu nctio n s— ad m in istratio n , ca ta lo g in g , security— m ake th e lib ra ry a v a ila b le and v a lu ab le. A fter six a lte rn a tiv e m ethods o f a llo ca tio n , th e team allo­ cated to affilia ted institutions these costs based on the broadest m easure o f usage: length o f tim e in the lib ra ry spent by each a ffilia te ’s m em bers. L i b r a r y U s e r D a t a b a s e T h e nin e services to be fin an ced from institu­ tion al assessments on th e basis o f m em b er usage generate large expenses. In ord er to m ake these as­ sessments a cce p ta b le to a ffilia te d institu tions, it w as im p o rta n t to docum ent w ho uses th e lib ra ry . T h e te a m m ea su red lib r a r y use th ro u g h th re e w eek-long surveys cond ucted at d ifferen t tim es in th e aca d em ic year. T h e team drew upon these surveys to build a com p uterized d atab ase o f lib ra ry use, th e m a jo r a f­ filiation s o f each user, and the purpose for w hich the visit w as m ade (e.g. ‚ sponsored research , te a ch ­ in g , e t c .). T h ese d ata w ould have been alm ost im ­ possible to co lle ct through o th er m ethods. T h e team carefu lly defined th e questions about purpose o f visit to distinguish organized research p r o je c ts , r e s e a rc h tr a i n i n g a n d r e im b u r s a b le health c a re as opposed to research for aca d em ic courses o r personal reasons. T h ese distinctions had to be m a d e c le a r to users so th a t th e ir answ ers w ould p recisely m easu re th e lib ra ry p o rtio n o f costs a llo ca te d to sup p ort fe d era l re sea rch and o th er reim b u rsab le activities. T h e costs associated w ith reim b u rsab le activities could th en b e allo­ ca ted by th e affilia ted institutions to th e federal governm ent and oth er fin a n cia l sponsors. C a l c u l a t i n g L i b r a r y C h a r g e s A fter th e survey results w ere analyzed by co m ­ p u ter, th e team calcu lated allocations for ea ch in ­ stitution by m ultip lyin g th e cost to use each service tim es th e n um b er o f tim es th e service w as used by the institu tio n ’s m em bers. U sing th e survey results, t h e te a m c a l c u la t e d th e c o s t fo r e a c h v is it (w eighted for th e tim e o f y e a r), distributed th e cost am ong five purposes for using th e lib ra ry , th en d i­ vided th e costs fo r any users w ith m ultip le a ffilia ­ tions. T h e team distributed th e cost for each visit to various purposes by th e percentages listed on the user’s fo rm . F o r exam ple, if a user said th a t 5 0 % o f th a t visit w as fo r “o rganized re sea rch ,” th en re­ earch was a llo cated 50 % o f th e cost, and th e c a l­ u la tio n p ro ceed ed in th is w ay th ro u gh course- ork, tea ch in g , clin ica l c a re , and “o th er” until ach e n tra n ce had a total cost for th e visit plus a reakdow n o f th a t cost fo r d ifferent purposes. T h e cost o f the user’s visit to th e lib ra ry w as then llocated to his or her in stitu tion. I f the user re­ o rd ed o n ly o n e a ffilia tio n , th a t a ffilia tio n re ­ eived 1 0 0 % o f th e cost, and ap p roxim ately 6 0 % f the e n tran ts recorded only one affilia tio n . H ow ­ ver, if the user recorded m ore th an o ne a ffilia tio n , or exam p le a researcher w ith tw o fa cu lty ap p o in t­ ents, th e team em ployed a series o f decision rules h a t evaluated th e n atu re o f each a ffilia tio n ’s re la ­ ionship w ith th e lib ra ry , th e user’s purpose for the isit, th e user’s position, or som e o th er p ra ctica l dentifier th a t could reasonab ly weigh benefits. s c w e b a c c o e f m t t v i March 1983 / 71 R e s u l t s O n ce the team had divided the costs for m ultiple affiliation entrances, it then produced a schedule of assessments for each affiliated institution. T h e as­ sessment for each institution was divided into por­ tions for organized research, clin ical c a re, teach ­ in g . c o u rs e w o r k , a n d o th e r p u rp o se s. T h is distribution enabled the institutions to pass on the charges to third parties. T h e team also produced a schedule o f unit charges for the services paid for di­ rectly by users. A d v a n t a g e s o f t h i s A p p r o a c h T his approach, w hile necessitating a careful cost accounting and user survey effo rt, has several sig­ n ifican t advantages over others used to recover ser­ vice costs from library users. This approach perm its detailed ju stification of cost recovery because cost calculations and survey responses directly produce usage charges and insti­ tutional assessments. An audit trail becomes avail­ a b le for auditors from the institutions and the fed­ era l g o v ern m en t w ho w ill wish to tr a c e th e ir assessments back to sup porting d e ta il. T h e a p ­ proach is readily understandable to financial exec­ utives who are responsible for m aking decisions about library financial support. M oreover, this approach builds a strong founda­ tion for fin ancial planning. L ib ra ry adm inistrators can use the databases to com p are alternative stra t­ egies of service pricing, user charges, institutional assessments, and individual m em bership fees. ■ ■ E d ito r s N ote: F o r m ore in form ation on the co n ­ sulting firm that advised the C ountw ay L ibrary , c o n ta c t R o u s m a n iere M a n a g e m en t A ssociates, In c., H earthstone Plaza, Suite 206, 111 W ashing­ ton St., B rooklin e, MA 02146. New A ccred itation C riteria Proposed E d w a rd G. H olley, Dean S chool o f L ibrary Science T h e University o f N orth C arolina at C h a p el Hill At its' annual m eeting on D ecem ber 13, 1982, T hom as G . C arp en ter (M emphis State) and E m ­ m ett B . Field s (V an d erb ilt) presented a form al draft of new C riteria f o r A ccreditation (Proposed) to the C ollege D elegate Assembly o f the C om m is­ sion on C olleges of the Southern Association o f C o l­ leges and Schools. T h e culm ination of th ree years’ work by four task forces, the Criteria f o r A ccred ita­ tion was hailed by Fields as the boldest m ove o f the Commission on Colleges since 1962. M oreover, a l­ though individual sections o f the 1962 standards have all been revised during the later sixties and seventies (a library section was added to the G rad ­ uate Standard in 1969 and the L ib ra ry Standard was revised in 1975), this is the first com p lete revi­ sion o f SACS standards for colleges and universities in tw enty years. I f approved by the C ollege D ele­ gate Assembly at its D ecem ber 1983 m eeting in New Orleans, the Criteria f o r A ccreditation will replace the current standards during the next three years. Em phasis in the new c riteria is placed upon edu­ cational outcom es assessment and an ongoing plan­ ning process. T o quote C arp en ter, “T h e new C rite­ ria for A ccreditation presented here represent a retention o f the most im portant elements o f the old standards which have served the Commission on Colleges well throughout the past several decades, and it includes the addition o f new elem ents, p ar­ ticularly a stronger emphasis on planning and edu­ cational outcom es assessment, which w ill help the Commission serve its constituents m ore effectively in the fu ture.” Stated simply the new criteria ask colleges and universities to d eterm ine w hat e ffect a college and university has on students, i .e ., “w hat difference does a college education m ake?” T h e c o ro lla ry to th a t ap p ro a ch m igh t be sta ted as “W h a t effect does a college or university library have on students?” i.e ., “W h a t difference does a college library m ake?” In the process of overhaul o f the current stan­ dards, the author and G erald Sandy, director of the library at Armstrong S ta te College, Savannah, G eorgia, served as m em bers o f the Study C o m m it­ tee on Services and Support. Included under E d u ­ cational Support Services are the L ib ra ry , Student Developm ent Services, Com puter Services, and In ­ structional Support. Although the L ib ra ry Section is sim ilar to Standard 6 in the current docum ent, the emphasis in the proposed docum ent is upon the library user, in line with the general thrust o f the criteria. T h e L ib ra ry Section should therefore be studied in conjunction with Section I I I , Institu­ tional Effectiveness, which discusses “Outcom es Assessment” and “P lan n in g.” As readers will note, S A C S has u n d e r p r e p a r a t io n a m a n u a l w ith “guidelines and suggestions for the development and use o f outcom es assessment programs and m ea­ surem ent instrum ents.” Both Sections I I I and Section 5 .2 are given be­ low.