Project: Comprehensive Fee Restructuring Home

Internal

Income categories and expenditure categories as currently structured are not sufficiently aligned, decreasing the transparency of Marmot’s budgeting process.

Examples:

• The distribution of overhead expenses across service programs is not sufficiently accounted for in the current Schedule of Fees.

A new Schedule of Fees, much like the new IT Services fee model, aligns income categories very clearly with expense categories.

Barrier fees are either made more cost-accessible or eliminated.

Members are able to easily understand what is included in any given fee.

Gather member feedback and review communication from potential members to identify all barrier fees.

Collect expense data to determine target amounts for personnel, licensing, equipment, and other expenses.

Examine the expense currently associated with barrier fee income, and recategorize the expense appropriately.

Construct fees for each service program that mirror the expense categories.

If a barrier fee still needs to exist, lower the dollar amount associated with it to make it more affordable. Otherwise, subsume the barrier fee into new income categories.

Run financial analyses to determine the viability of new fee structures.

Develop a glossary of member fees that explains what is included in each one.

External

A select number of Marmot fees are cost-prohibitive, serving as barriers for existing members wishing to expand services and discouraging potential members from pursuing Marmot membership.

Examples:

• Staff sessions

• Digital Archive participation and storage

• SIP2 Licenses

Not all services performed by Marmot have a clear income stream or cost center.

Examples:

• Purchasing equipment on behalf of members is a significant cost center with no corresponding income.

• Special projects and research/innovation beyond a normal SLA are not recognized either as cost centers or in income.

While not all services performed by Marmot require a 1:1 fee, significant cost centers that are currently invisible (subsidized by other service programs) are delineated.

Identify invisible cost centers.

Evaluate the time or licensing costs for invisible cost centers.

Design income categories to reflect the time or licensing costs associated with invisible cost centers.

Not all existing fees scale according to the size of the library or the time required to support extraordinary needs.

Marmot fees for support are scalable to reflect the true costs associated to the size of a library or library system, without becoming another barrier fee.

Identify metrics that could be measured to account for the different attention each member library requests from Marmot staff for various services.

Answer the question “What is the reasonable amount of support a library should need?” to identify a baseline to measure against.

Develop weighted measurements to assign the share of costs

Expenses associated with adding licenses for new services are not set or predictable, making the standardization of implementation fees to members difficult.

• Example: adding new SIP2 licenses comes at an extensive cost to Marmot but is prohibitive for the implementing library to absorb in one year

Identify an income stream that provides members or potential members standardized implementation fees while holding a reserve that can help alleviate unexpected jumps in cost.

Each implementable service program component should have its own identified implementation fee charged to members and a clear outline of how shared funds subsidize unexpected implementation costs and maintenance increases.

Marmot does not have a clear outline of what Marmot services require a library to be a Voting Member (as opposed to using a subset of Marmot’s service programs without becoming full Voting Members of Marmot).

Clearly defined requirements of Voting Membership and what additional benefits Voting Members have beyond what is provided to Associate Members.

Clearly defined descriptions of Associate Membership for select services and associated fees.

Brainstorm what is “core” to Marmot’s identity that transcends changes in technology that might eliminate the need for compromise in system configurations.

• Example: what might membership look like in the future using OpenRS as a pathway for Prospector membership and multi-tenant configuration options for an ILS?

The current Schedule of Fees is not optimized for flexibility in the face of a shifting landscape for library systems.

Examples:

• We have no method for quickly adding newly developed service options into the current Schedule of Fees.

• Some fees are too specific and are not flexible enough to apply to similar services or licenses
  Example: Envisionware fees, Web server

The new Schedule of Fees can be consistently added to or maintained in the face of changing systems or through a shift from commercial systems to open source systems.

Design income and expense categories that are not vendor- or system-specific, and that could accommodate a shift from commercial systems to open source systems.

Develop a procedure for adding new service fees at the point of need, while folding service expansions into the annual budget process.

Develop a catalog of services that are covered in Marmot member “general” services so that we can see which costs should and shouldn’t be pass-through

Beyond these concerns which Marmot staff hear anecdotally, Marmot staff have not engaged with library directors in formalized conversations to uncover additional concerns about Marmot fees.

Library directors feel heard when sharing their thoughts about Marmot’s existing fee structure and possible replacements.

Hold two sets of director focus groups: one at the outset of the project to gather concerns about the existing fee structure; another mid-way through the project to gauge comfort in models being considered.

Prepare for director focus groups

Adam, Managers

July/August, 2023

Conduct director focus groups

Adam, Managers, Board members

August/September, 2023

Summarize director focus group results & update project goals

Adam, Managers, Board members

September, 2023

Problem/goal/solution overview for directors

Adam

Fall, 2023

document outlining problems, goals, and solutions; schedule a couple of open house meetings for library directors

Compile expense data & establish targets

Adam, Managers

Fall, 2023

Develop multiple fee models per service program

Adam, Managers

Fall, 2023

Conduct impact analyses

Adam, Managers

Fall, 2023

Board review

Adam, Board

Late fall, 2023

Prepare for second round of director focus groups

Adam, Managers

December, 2023

Conduct second round of director focus groups

Adam, Managers, Board members

January/February, 2024

Summarize second round of director focus groups

Adam, Managers, Board members

February, 2024

Update fee models and rerun impact analyses

Adam, Managers

March/April, 2024

Board review for Council 2024

Adam, Board

April/May 2024

Council 2024

Adam, Managers, Board members

June 13-14, 2024

Final adjustments

Adam, Managers

Summer, 2024

Board approval

Adam, Board

August, 2024

Individual library budget summary reports and meetings

Adam, Managers

August/September, 2024

Implementation of new fee structures

Adam, Managers

January 1, 2025