Memorandum

To: Lawrence City Commission

From: Lawrence Library Board of Trustees (Prepared by: Jenny Hesseltine, MPA student, University of Kansas, and John Nalbandian, President of the Library Board of Trustees and faculty member, Department of Public Administration, University of Kansas)

Date: August 13, 2007

RE:  Determining the value that libraries add to their communities and states

Introduction

Considering the future of the Lawrence Public Library during the past few years, we have discovered and reported on the very positive regard Lawrence citizens have for the library.  This was reflected in the citizen survey that the city sponsored, and it is reflected in a steadily increasing number of user visits.  As you know, at last count after removing inactive users, the library had 50,000 active card holders. 

With this memorandum, we are trying to broaden our vista to look at the economic benefits a library brings to its community and state.  We report here on rigorously conducted analyses—some utilizing Cost Benefit Analysis and the concept of Return on Investment—to determine the value associated with investments in libraries.  We utilized an internet search and discovered several key documents—summarized here--which the City Commission may wish to review as commissioners consider future investments in the Lawrence Public Library.

Reports Available

 

http://dlis.dos.state.fl.us/bld/roi/pdfs/ROISummaryReport.pdf

 

“This Summary Report describes a comprehensive study to assess taxpayer return-on-investment in Florida’s public libraries. The study used a variety of data collection and analysis methods…including an input-output econometric model (REMI).” (p. 1)

 

“There are many ways to determine how public libraries contribute to the State’s economy and how taxpayers achieve a return on their investment. This study examined several approaches to considering returns on public library availability and use and found they all show substantial returns exceeding taxpayer investment.” (p. 1)

 

http://www.libsci.sc.edu/SCEIS/exsummary.pdf

The purpose of this study was to determine how South Carolina libraries contribute to the economic development of the state, and how the citizens of the state benefit economically from public libraries. The report is based on research conducted in two phases: user surveys and data from the South Carolina state library which helped to determine the monetary value of services provided by libraries across the state.   We have listed four of the summary benefits below:

“(1) The value of reference services to users in SC each year is approximately $26 million.

 

(2) The total direct economic impact of SC public libraries is estimated at $222 million, while the actual cost of these services to the state and local governments is only $77.5 million. This means that for every $1 spent by state and local governments on SC public libraries the return on investment is $2.86.

 

(3) The indirect economic impact of SC public library expenditures (wages, supplies, books and related materials, construction, etc.) on the state’s economy is almost $126 million. This means that for every $1 expended by SC public libraries, the state receives $1.62 of indirect economic impact.

 

(4) The total direct and indirect return on investment for every $1 expended on the state’s public libraries by SC state and local governments is $4.48—almost 350%!”

 

The results of the library user survey were positive and compelling in terms of the value that South Carolina citizens put on public libraries, the services they believe are essential, and the economic impact they perceive those libraries have on their communities. Ninety-two percent of respondents believe that libraries improve the overall quality of life in their community, and forty-seven percent said a library increases property value within the municipality it serves.  In terms of bringing economic development to the community, thirty-eight percent of users said that their library attracted new businesses to their community, and forty-four percent agreed that patronage to local businesses was increased through the presence of a public library. 

http://www.slpl.lib.mo.us/using/valuationtoc.htm

http://www.slpl.lib.mo.us/libsrc/restoc.htm

“The Institute of Museum and Library Services (IMLS) provided funding for a study to apply economic measurements to value public investment in library services. In the initial part of this study the St. Louis Public Library partnered with public libraries in Baltimore, Birmingham, Phoenix, and Seattle. The goal was to refine a case-study methodology to communicate the economic benefits of services provided by large public libraries and to provide a means for libraries to estimate the direct monetary return on annual taxpayer investment.”

“The goal of this research has been to identify and evaluate urban public libraries’ contributions to their communities as providers of information services. Specifically, the project was designed to develop, demonstrate, and evaluate a practical, conservative, transportable methodology for estimating a floor to the return to annual taxpayer investment in an urban public library.”

“Recognizable methods of cost benefit analysis used in many other kinds of CBA studies were used to measure the direct benefits of library services to each class of patrons. The project team calculated direct benefits for general users, teachers, and business users.”

We have listed some of the results below:

“(1). Annual local taxes spent for library operations yield substantial direct benefits. Each library returns more than $1 of benefits for each $1 of annual taxes. Baltimore County Public Library returns $3-$6 in benefits per tax dollar. Birmingham Public Library returns $1.30-$2.70 in benefits per tax dollar. King County Library System returns $5-$10 in benefits per tax dollar. Phoenix Public Library returns over $10 in benefits per tax dollar. SLPL [St. Louis] returns $2.50-$5 in benefits per tax dollar.”

 “(2). Each library studied yields a good return on invested capital. Baltimore County Public Library returns a minimum of 72%. Birmingham Public Library returns a minimum of 5%. King County Library System returns a minimum of 94%. Phoenix Public Library returns over $150%. SLPL returns a minimum of 22%.”

http://www.ipsr.ku.edu/resrep/pdf/m260.pdf

This report is a result of research conducted through focus groups with public library users including business owners; in depth analysis of case studies of libraries in Johnson County, Wichita, Hutchinson, and Meade; and a survey of all Kansas libraries that provide a minimum of 25 hours of service to their communities each week. It focuses on ways libraries can bring economic development to their community by providing business resources to business owners and personnel.

 

Research concludes “that nearly a third of businesses and economic development organizations in all parts of the state use public libraries as a resource” (p. ii).

 

This report makes many recommendations about ways that libraries in Kansas can better equip themselves to facilitate economic development.

 

 Additional Economic Impact Studies

The Virginia Beach, Virginia, Library Staff has assembled the following sources that we have not reviewed

·        ALA - Library Value (ROI) bibliography (links, articles, books) http://www.ala.org/ala/ors/reports/roi.htm  

·        Library Use Value Calculator, Maine State Library http://www.maine.gov/msl/services/calculator.htm

·        Vermont Library Association- Library Use Calculator (similar to Maine's) http://www.vermontlibraries.org/value.html (thanks Buzz!)

·        Jackson County (OR) Library Use Value calculator http://www.jcls.org/caculator.html (ALL of their branches are closing in April 2007 due to lack of funding)