Jackson County library officials estimate that a third of the money they give to a private company to operate 15 branches goes to overhead and profits, curtailing both employee salaries and library services.
Library officials have been expressing growing unease over the contract with Library Systems and Services, formerly known as LSSI, which manages all 15 branches and came under control of Argosy Private Equity firm in 2015. They're exploring options for getting out of the contract.
“Instead of one-third of the money going back East, it would go locally and support our own economy,” said Jill Turner, library district board member.
Turner said the LS&S contract will cost $4.4 million next fiscal year, 38 percent more than the contract cost in 2008, factoring in increased hours and services. But those workers making minimum wage have seen their earnings rise only 19.2 percent (from $8.18 an hour to $9.75), and those with master's degrees in library science have seen increases totaling 16.98 percent (from $22.50 an hour to $26.32).
The estimates Turner arrived at were based on various assumptions about the contract with LS&S, which she couldn't substantiate.
Chris Ourand, LS&S marketing and communications director, said it was very difficult for him to comment on numbers based on vague assumptions, including the amount of profits his company receives from the contract, which Turner estimated at 10 percent.
“We don’t disclose profits,” he said. “The bottom line is they want to get out of the contract. They signed a contract, and they need to honor that contract.”
Ourand said that LS&S, when it entered into its original contract with the county, made considerable reductions in the operating costs of the libraries. The county signed a contract with the company in 2007 at a significant savings but at reduced hours, after the county had shut down all 15 branches because of budget problems.
Voters in 2014 approved a levy to fund a new library district and the district is currently anticipating a carryover of some $5 million in its next budget. But the library board in 2015 signed a five-year contract with the private firm, which has control over employees and other aspects of the library operations.
Ourand said LS&S officials would be happy to meet with the library district board to find a resolution to the many issues raised.
“Hopefully this is a necessary step to getting some dialogue on this,” he said.
Library district board members would like to pay branch workers more money to ensure they receive a living wage.
Compared with Deschutes County, where library employees get $75,236 on average, including benefits, Jackson County library workers get somewhere between $46,000 to $49,000, including benefits, Turner estimated.
“My goal would be that we would pay employees according to industry standards for the work,” she said.
Turner said the actual salaries of local library workers and number of employees have not been disclosed by LS&S.
In addition, Turner said, she has uncovered “alarming” problems with the existing contract.
She said not enough technical support is provided at the branches. Turner said she’s also investigating whether the contract requires paying workers at industry rates.
In discussions with LS&S officials, the library district has been confronted with responses that raise questions about “honesty and integrity,” Turner said.
When the district first entered into the contract, the board was assured that a technology upgrade plan was in place, but subsequently found out the telephone system is antiquated and needs upgrading, Turner said.
After the library district agreed to pick up vehicle maintenance costs, LS&S came back and said that agreement would also apply to copy machine maintenance, she said.
Other sticking points include ongoing discussions about other contracts, including with Polaris Library systems, an automated program that tracks many library functions, and a contract with Rogue Community College. Turner said LS&S has asked the district to reimburse the company for the RCC contract, which allows the college to use the Medford branch.
In previous years, LS&S prepared a strategic plan, but the district undertook that task this year. Turner said LS&S has asked the district to reimburse for the time staff spent developing the plan even though that was part of the arrangement in years past.
“Those are the kind of things that are very alarming,” Turner said.
She said an LS&S official recently told the Mail Tribune that the number of cardholders rose from 50,000 in 2007 to 130,000 today.
“What was given to newspaper was quite inaccurate,” she said. In 2007, there were 135,252 cardholders, Turner said. In 2013-14, there were 138,742, she said.
Library board member Maureen Swift said the district is looking carefully at its options. She said the district could use overhead and profits gained from getting out of the contract to augment salaries and services.
So far, she said it looks like it might be difficult for the district to break free from LS&S.
“Maybe we will get stuck with the same contract for four years,” she said.