Cost Formula Work Group 2024 for 2025 Minutes

March 12, 2024, 1 pm

Via phone/video conference

Action Items: None

Present: Nicole Menzel (ROM), Larry Oathout (STP), Debbie Bird (POR), Jan Holmes (SUN), Elizabeth Clauss (CSP), Tracy Herold (DCL), Jill Porter (MFD), Pat Garvey (MPL), Margie Navarre Saaf (MPL), Molly Warren (MPL)
Absent:
Excused: Cathy Borck (WID), Emily Whitmore (SGR)
Recorder: Michelle Karls/Vicki Teal Lovely (SCLS)
SCLS Staff Present: Vicki Teal Lovely, Kerrie Goeden, Shannon Schultz

1. Call to Order at 1:04 pm

a. Introduction of guests/visitors

i. Shannon Schultz new director at SCLS.

b. Changes/Additions to the Agenda

i. None.

c. Requests to address the Committee

i. None.

2. Approval of previous meeting minutes: January 2024 minutes

a. Motion: L. Oathout moved approval of the January meeting minutes.  J. Holmes seconded.

b. Discussion: none.

c. Vote: motion carried.

3. Action Items

4. Discussion

a. ILS Formula Review

i. Discussion:

1. Review Cost Formula Work Group Tenets

a. There is an advantage to the community as a whole if all SCLS libraries participate in the ILS and SCLS network

b. Technology, Network and ILS services should have separate fees

c. Factors used in the formulas will be taken from easily accessible data

d. The formula will generate fees to cover the costs of the services included

e. Continue to invest enough for current and future services

2. Review possible goals from last meeting

a. Provide stability caused by fluctuating numbers. This goal may prove too difficult due to the impact changing formula elements have on the distribution of fees (when one library’s fees go down, another library’s must go up).

b. “Fix” fees and each library’s fees increase by percent of budget increase. This may also not be the best path, as we then have no base as an ongoing reference.

c. Reduce small and/or rural library fees (without impacting other libraries fees)

3. “Testing Spreadsheet”. V. Teal Lovely asked if anyone tried the spreadsheet and had any success or ideas to share. Is there anything that anyone would like demonstrated?

a. Discussion: V. Teal Lovely has found in trying different formula scenarios and adjustments that it is impossible to achieve savings for small/rural libraries without increasing fees for other libraries.  N. Menzel stated that someone will end up being negatively effective. If we incorporate the additional state aid amount of $25,000 into the formula, the larger libraries receive the benefit of the reductions instead of smaller libraries. 

4. “Rounding spreadsheet”. This was a first attempt to apply fee reductions. The amounts were assigned somewhat arbitrarily, using the combined total of circulation and collection as a base. The concept is to “freeze” the formula moving forward as this is the only way the reductions can be preserved. Upon further reflection, SCLS is recommending that the formula be retained as is.

a. Building component—reflects the minimum SCLS staff support for each agency.

b. Circulation—roughly reflects the majority of the cost of the ILS software (Bibliovation, Talking Tech, Syndetics Unbound and Solus) and the SCLS staff to support all modules.

c. Items—reflects the cost of MPL cataloging, OCLC and Backstage authority control.

5. SCLS proposes applying fee reductions for Small and/or Rural libraries which will be subtracted from the fees generated by the formulas. Standards used could be the IMLS Locale code (suggested by Shannon) in conjunction with population. Locale codes define Rural, town and Suburban libraries. They are readily available in the DPI annual report. Population is also a readily available number. This IMLS brief does a good job of breaking down the issues for small and rural libraries. SCLS has created a prototype version of this proposal, but it is not ready to be shared. Today, we would like to get feedback on the concept of using the Locale codes and the breakdown of “small libraries” to create a fee reduction proposal.

a. Discussion: J. Holmes likes this suggested approach and finds it very innovative.  How would it continue?  The $25,000 will be a permanent annual contribution from SCLS.  The Locale code came into the discussion yesterday between V. Teal Lovely, K. Goeden, and S. Schultz.  M. Navarre Saaf pointed out that this seems like an objective way to determine costs.  L. Oathout asked how the IMLS code be applied.  V. Teal Lovely said that yesterday the Locale code proved useful for determining rural libraries.  She used increments of $250.  No concerns were voiced for this approach.  V. Teal Lovely will come up with an easy-to-manage way to do this that we can share with libraries.  We would like to have this group approve it and then present it at the May All Directors meeting where there will be a vote.  She will continue to look at the PC support fee.  At the January meeting, we talked about being at a deficit that is reflected per PC.  We are talking internally about how to mitigate some of that.  We propose moving forward with a percent increase in each year. 

2. Plan for Next meeting:  Tuesday, April 16 at 1 pm worked for all present.

3. Adjournment at 1:45 pm.

For more information about the Cost Formula Work Group, contact Vicki Teal Lovely.

Cost Formula Work Group/Minutes/4-16-2024