03.25.09
$1.6-Million Shortfall Forces ALA Staff Cuts, Furloughs
Unit Managers heard it this morning for the first time as a group, when ALA Executive Director Keith Michael Fiels announced that the Association would attempt to close a projected $1.6 million shortfall in the $27 million FY2009 general-fund budget by, among other things, eliminating 10 staff positions and imposing a three-day payless furlough and other vacation rules on remaining staff to save a targeted $500,000 by the end of the fiscal year, August 31. Fiels hopes the Association can fill the remaining gap by tapping into ALA reserves.
Upper management and the Executive Board began intense and frequent discussions about revenue almost immediately after the national economic crisis hit, knowing that it would inevitably trickle down to libraries and to ALA. Fiels pointed out that the drop was precipitous; the financial picture this month looks totally different from the way it looked last September. He said it was essential that management move quickly if the ‘09 budget is to be balanced. A 3% across-the-board expense cut had already been implemented earlier this year.
An hour and a half after the managers meeting, Fiels explained the situation at an all-staff meeting, noting that in addition to the three unpaid days, Memorial Day and the Fourth of July would be unpaid holidays in 2009. In addition, any vacation days not used by the end of August will automatically convert to sick days; the practice of carrying vacation days over into the next fiscal year will be temporarily suspended. The vacation days and unpaid furlough days will be scheduled in consultation with the supervisors of individual units in order to spread them out over the remainder of the fiscal year. In addition to the 10 positions to be eliminated, an additional six will be unfunded in 2010.
The need for these drastic measures was not questioned at the unit managers meeting or the staff meeting. Foremost on everyone’s mind, of course, was the question of what positions will be cut, and that information has not been made public, both out of respect for the employees’ privacy and the desire of ALA as an employer to handle each affected individual in a caring and humane fashion. The staff cuts are expected to be made within the next two weeks.
We all knew it was coming, especially those of us in Publishing who have been watching the economic debacle unfold at newspapers and publishing houses across the country. ALA Publishing has been hardest hit of all ALA revenue-generating units, with advertising down 30%. Although ACRL had a successful division conference this month and registration is strong for the ALA Annual Conference in Chicago this summer, they cannot make up for the decline. Membership loyalty is also a big factor, but the fastest growing membership category (student), although a great sign for the future, also does not generate enough revenue to address the current situation. Print publication of the ALA Handbook of Organization will also be suspended.
The text of the Fiels’ all-staff memo:
Over the last month, we have been updating our budget projections for the fiscal year that ends on August 31, 2009.
The good news is that registration for Annual conference is strong, and even ahead of registration for last year at this point, and we expect a very exciting and successful conference in Chicago in July. Membership also remains strong and steadily growing, and every dollar in member dues is matched by revenue from publishing, conferences, grants, overhead recovery and income from the endowment.
Everyone is aware, however, of the current economic situation and its impact on libraries, businesses, and other non-profit organizations. Given the state of the economy and library budgets nationwide, it will not come as a surprise to everyone that we are now projecting a net revenue shortfall in the ALA general fund of over $1.6 million.
Because the financial picture has changed so quickly since the beginning of the fiscal year, and because we must reduce expenditures in anticipation of this shortfall, we are going to have to take some unusual measures to reduce salary-related expenditures for the remainder of the year. Specifically:
1. Any vacation days not taken as of the end of August will automatically convert to sick days. No vacation days will be carried over in to 2010.
2. Memorial Day and the Fourth of July will be unpaid holidays in 2009.
3. Each employee will be required to take three additional unpaid furlough days between now and August 31st. These days need to be scheduled in consultation with your Unit Manager so that we can 1) spread out the impact of the reduction on employee income and 2) reduce the impact on member services and unit operations.
Implementation of these three measures will result in general fund savings of approximately $500,000. Our current plan calls for the remainder of the shortfall to be made up through other cost cutting measures, adjustments and use of ALA general fund reserves.
Please note that these measures apply to all ALA staff and all ALA units, including grant funded employees and full-time contract staff.
In anticipation of our lowered revenue estimates, the Association will also be eliminating approximately ten positions between now and the beginning of FY 2010, and will also be leaving an additional half dozen positions unfunded in 2010. In each instance, we will be making every effort to minimize the impact of any cost-cutting measures on staff as well as services to members, libraries and the public. By preparing a 2010 budget that reflects a balance between expenditures and our adjusted revenue expectations, we should hopefully provide for a more stable environment in the coming year.
Ray Andrade said,
March 25, 2009 at 6:35 pm
My comment is simple:
Please do your absolute best to prevent the elimination of funds from the Office for Diversity & Spectrum. Gwendolyn Prellwitz, Robert Gould, and others have been doing an outstanding job with all of the Office’s objectives — especially with the Spectrum initiative.
If funding for the Office of Diversity & Spectrum is reduced, the ALA will risk very easily presenting itself as guilty of the classic excuse that slows the progress of minority groups: “administrative convenience.”
Please do your best to prevent this.
Thank you,
~Ray Andrade
(A Spectrum success)
Stephanie said,
March 26, 2009 at 7:10 am
Please please please don’t balance your budget on the backs of your employees. I would rather see my membership dues and conference fees increase than to see someone lose their job.
Chris said,
March 26, 2009 at 10:33 am
If everyone at ALA took a small pay cut and you raised dues and fees by just a little bit, wouldn’t that go at least part way to making up the shortfall? So many people are already out of work around the country. It saddens me to hear of more employees being laid off.
Rachel Williams said,
March 26, 2009 at 2:22 pm
I definitely agree with Chris and Stephanie. Finding other areas to cut instead of cutting employees would be much better than losing valuable staff. I think Chris is definitely on the right track as far as using pay cuts and raised dues to compensate for the employees. Then reassess where you are in a few months and see if it’s still necessary to lay off employees.
laura pearle said,
March 27, 2009 at 9:46 am
What about cutting unnecessary publications, like the Handbook? Reducing the number of days for MW and Annual (savings in staff hotel rooms)?
Leonard Kniffel said,
March 27, 2009 at 10:11 am
The printing of the Handbook is indeed being suspended, and I’ve added that piece of information to the report above. I apologize for the initial omission.
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[...] the bloated juggernaut that is ALA seems to be impacted by the crappy economy! “Unit Managers heard it this morning [...]
Nancy Silverrod said,
March 30, 2009 at 10:36 am
I would like to add my voice to the request that laying people off be reconsidered, making use of pay cuts across the board to protect jobs. Like others, I am willing to pay increased dues, and would suggest a change in the dues structure based on income, with students, retired, and unemployed members paying reduced dues, and others paying more in a formula related to their salary.
Robert Ridinger said,
March 30, 2009 at 11:28 am
Why not eliminate the numerous unnecessary ( and expensive ) meetings and inservice institutes - and consider eliminating Midwiner as well- much of the same work that we are fored to come halfway across county for- often in bad weather and on liminted budgets- could- and increasingly, IS being- handled by online meetings. Enough of the chants about the benefits of face-to-face meetings- they may be a luxury we can no longer afford at the same scale as before.
Monica Birrer said,
March 30, 2009 at 12:28 pm
I am very sorry to read this - at first I thought it might be part of an April Fools story - what if. I am responding to the many comments about raising membership dues; I would like to discourage that option. Many rural librarians are working for fairly minimal salaries and their institutions may not even assist with payment of dues. An increase would just mean that they could no longer be a member at all. I am sure ALA has taken this into consideration. Maybe those of you who can afford a dues increase could consider making a donation to ALA. As library budgets also “take a hit” librarians and library support staff will also have fewer dollars to pay for dues, conference attendance, etc,
Richard Dennis said,
March 30, 2009 at 6:32 pm
I strongly suggest to ALA, look very closely at non-human resources to cut it’s budget. I also ask upper management look very closely at the economic situation in the United States and find compassion before firing workers.
Clearly, your bloated expenses and can and should be cut before letting people go. I won’t get into a verbal exchange of how much waste occurs at ALA. Look at increasing fees, removing stale non-selling books, eliminate production cost, eliminate waste, tun-out lights, whatever needs to cover your short-fall.
Be a leader and make progressive decision AND stop MAKING THE EASY ONES LIKE SHORT CHANGING HATRD WORKING MEN AND WOMAN WHO CAN NOT AFFORD TO BE WITHOUT A JOB.
Perhaps you sir, should take a pay cut.
Patrick Ragains said,
March 31, 2009 at 9:38 am
I think ALA might look at cutting its Midwinter meeting as another measure to economize (in addition to cutting the Handbook of Organization). I’m not aware of any other national organization that has two meeting per year. Yes, we’d lose the benefit of face-to-face contact, but we can communicate and conduct business online quite effectively between annual meetings, if it comes to that. We’ve all been doing more association-related work online anyway, so we know it works. We can’t be sure of the long-term effects of furloghs or layoffs of ALA staff, but I presume it won’t all be positive.
Steve Murden said,
March 31, 2009 at 10:49 am
I completely agree with the previous comments about eliminating mid-winter, which I’ve been advocating for years. Mid-winter was always supposed to be about work, and not about programs (although that “rule” is regularly violated), and since most such work can be done electronically, what is the justification for continuing to hold a second conference? There would certainly be considerable cost savings for ALA, as well as businesses and organizations that participate.
John Bradford said,
March 31, 2009 at 11:21 am
Does ALA actually make money at Midwinter? If so, then we’d be cutting revenue as well as expenses getting rid of it. And I say that as someone who hates traveling (and catching a cold) every January.
Maybe Midwinter should be moved back to Chicago, keeping ALA from having to pay its staff to travel annually.
Leonard Kniffel said,
March 31, 2009 at 12:18 pm
The fate of ALA’s Midwinter Meeting has been discussed for many years and by many member groups, and these discussions have forced me to recognize that saving money by simply doing away with Midwinter is not as simple as it appears. Even though the cost of conference registration has increased only enough to cover inflationary increases, the Midwinter Meeting continues to generate net revenue, which in turn supports the Washington Office and other core operations. Members have voted with their feet, and attendance at Midwinter remains strong. Eliminating an event that is popular and generates net revenue to support the Association doesn’t really make sense to me.
I talked today with ALA Executive Director Keith Michael Fiels about Midwinter. He said that what he would like most for ALA members to know is that dues account for only about half of the support the Offices such as Literacy and Outreach Services, Library Advocacy, Intellectual Freedom, Diversity, and so forth, and the rest comes from net revenue from conferences, as well as publishing, grants, and the divisions.
Your ideas for how ALA can economize are important, so please keep them coming. I’ll try to respond periodically from inside ALA when useful information comes to my attention.
Ennis O'Delsy said,
March 31, 2009 at 12:49 pm
I think there can be compromises in a lot of ways. I agree with either hosting Midwinter in Chicago or suspending the conference for a couple years during the leanest times should certainly assist. I cannot see raising dues because as a low-paid librarian, I can barely afford my ALA dues and because I pay those, I have to choose between our state association and the national organization. Additionally, many libraries have undertaken cuts and furloughs–including ours–so I do not feel that asking other staff to take an unpaid holiday or two is something that I couldn’t do because I am doing it. I am not fan of raising fees for conferences or events but that might be a suggestion because many organizations do budget for those expenses and a small increase could probably be covered. Printing costs are always increasing. There are a number of organizations out there that would likely have some cost cutting measure recommendations. Many publications have gone to a more compact printing schedule, some have elminiated the print versions altogether while others find a combination. I would find one larger publication with all or maybe the largest sections included to be more helpful than the number of publications that are printed currently–and that I have trouble finding time to read anyway. There is a value to our organization but also understanding that when times are tough, people have to make tough choices. Please make sure they are the right ones.
keith michael fiels said,
April 5, 2009 at 9:32 am
…but the point of Midwinter is not making money. Attendance at both Annual and Midwinter, as well as attendance at events such as the division conferences and institutes, have continued to rise over the years as more and more people have found them a valuable opportunity to network, learn and expand their horizons. In the case of Midwinter and Annual, ALA policy requires that they be held in different parts of the country so that more members will have an opportunity to attend (a big percentage of registrations at each conference are regional and day-visitors).
It’s clear that the current travel budget cuts around the counrty will have an impact on attendance, and we are moving “full steam” to make virtual attendance a reality, beginning this summer in Chicago.Eliminating Midwinter will neither save money nor benefit the many thousands of attendees who find it a valuable professional experience.
Susan Dillinger said,
April 13, 2009 at 2:19 pm
I must say that I am totally against eliminating any staff positions that are currently filled and I am against pay cuts, furloughing and unpaid holidays. Your employees are your most valuable resource and to penalize them during tough economic times is not the way to go. We are having the same discussions in my city. Cutting salaries, furloughing and unpaid holidays are the easy way out. How about the following:
1. Don’t fill positions that become vacant for at least 6 months.
2. Increase fees for ads in publications.
3. Limit travel and associated expenses and conduct meetings via the web.
4. Raise dues by tying them to salaries.
5. Be more aggressive with fundraising.
6. Eliminate executive perks if there are any and make all employees have the same level of benefits.
7. Make all round tables and division operate within their own budget.
I am sure if I had a detailed budget I could come up with more suggestions.
Cutting budgets on the back of employees only promotes low morale and poor customer service. If anything the employees should be given cost of living raises so that they can cope with rising prices.
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