According to the article in this issue from Watchdog.com, California cities who have contracted with Library Systems & Services (LSSI) have realized significant savings in costs of operation.
However, in the past few months the California legislature has passed a bill which severely limits the ability of cities to turn over the operation of their public libraries to LSSI or similar firms. This was done because of lobbying from a public employees union.
According to Ron Dubberly, CEO of LSSI, whom I talked with in Seattle (WA) at the ALA Midwinter Conference, the law turned out to really affect only two cities, an apparent mistake by the union lobbyists. But no fear: they are going back to update the law so that it covers all libraries, and perhaps even bans renewal of existing contracts.
Much of the savings which accrue from signing a contract to operate your library apparently come from the transfer the retirement plans of the employees from a defined-benefit system, the kind ot pension plan that affects most public employees across the country, to a 401k plan, in which the employer contributes to an employee-owned retirement fund. This apparently costs a lot less than most public pension plans.
Defined benefit plans were originally adopted by states, cities and towns because public employees were paid only a fraction of employees in the private sector. Pensions were only part of the benefits. …