Managing money
At its most basic, managing money in libraries boils down to two things:
- Making the best use of the money you have to fund the goals of your institution.
- Securing additional money to better forward the goals of your institution.
As a library department manager, supervisor, administrator or director, you are entrusted with funds to allocate towards the various areas under your control. Unfortunately, you will never have enough money to allocate as much as you'd like, everywhere you'd like. In most libraries, the main challenge in managing money lies in figuring out how to make the best use of limited resources.
This challenge of doing more with less, combined with the challenge of simply dealing with numbers, can strike fear into the heart of accidental library managers. Many despair of effectively managing money and budgets; a certain mystique surrounds the art of managing money, and accidental managers tend to have little formal background in doing so. As in every area of management, however, a clear understanding of your priorities and goals helps guide you through the process. You don't need to become an accountant to be effective in managing your library's money, but you do need to have a good picture of where your money goes, as well as good priorities that help you allocate funds towards your library's goals.
Allocating money
As a manager, you will likely be responsible for creating a yearly budget for your institution, division or department. This basically means allocating resources towards particular objectives, estimating how much each will cost over the next year. Realize that a good part of your budget is probably already "locked in" – you need to keep the lights and heat on; you need to pay salaries and benefits (which often account for up to 60 per cent of an institution's spending). This does, though, leave you a lot of leeway in allocating the rest of your funding for the year.
In most libraries, you will be working with a line-item budget. When using a line-item budget to manage your income and outgo, you break that budget into multiple categories, or expenditure lines: salaries, print materials, computer equipment, and so on. Then, you assign a dollar amount to each of these categories. Your budget also has corresponding income lines: tax monies, copier fees, fines, and so on. This type of budget allows you to estimate easily monies coming in and monies going out, as well as to compare expenditures in any given category from year to year. You can further break a line-item budget down by department or other subcategory, according to your institution's needs.
Looking at these line items also helps you match budget categories to your library's priorities and goals. Let's say, for example, that your library has set a goal of attracting more teen patrons over the next year. You might, therefore, want to increase the budget for teen programmes and technology this year, while decreasing the budget for another category that is less of a priority (or is less used). Next year, you can look at the numbers again and change the allocations according to current priorities.
You don't need to be a maths whizz to manage a budget. (That's what calculators and spreadsheets are for!) When you take over a budget, further, you can use last year's numbers as a baseline for your current budget – unless you're starting a library from scratch, you'll never need to start a budget from scratch.
Raising money
If your anticipated revenue can't fund all the programmes and services your users deserve, there are several ways to go about increasing your funding. Each method is most appropriate to a particular type of library or to fund a particular type of project. Use what matches your library's needs best; just keep your mind open to the possibility of seeking additional funds when necessary.
Grants
You may wish to fund a one-time project that goes above and beyond your library's day-to-day activities, or you may need to seek one-time funding to shore up a given collection or invest in new technology. For such limited-term projects, you can investigate the possibility of applying for grant funding. One site to bookmark: Stephanie Gerding and Pamela MacKellar's library grants blog, which helps you locate current opportunities. Local and national library associations also often offer grants, as do private foundations, corporations, humanities councils and local organizations.
When seeking any grant, make it clear to your normal funding body that these monies are to be used for a special project, not as a replacement for ongoing operating funds. When writing a grant, call on all your communication skills and be able to demonstrate the ROI (return on investment) in the granting body's terms: What are their priorities? What outcomes do they look for in the projects they fund? Ensure that your goals line up with theirs.
Fund-raising
You can also hold fund-raisers or look to donors to fill in the gaps or to fund special projects. Here, again, these funds are best for one-time purchases, rather than to shore up ongoing programmes and services. When looking to donors, it's best to ask them to fund a specific outlay: new Internet-access terminals, new popular periodicals. Match your ask with your organization: might your local business council, for example, be willing to donate funds to purchase a new Internet terminal or subscription to a business-oriented database? Be sure to prominently credit any donors.
When holding a fund-raiser, think creatively. Libraries have done everything from holding a mini-golf tournament in the stacks to hosting a murder mystery dinner; you are limited only by your imagination – and by the need to keep the costs of the event itself under control!
Referenda
Let's say your library needs to fund something larger: a building project (then corresponding increases in operating expenditures), rising expenses in an era of sky-high energy costs, double-digit increases in health-care costs. In a public library, when you need an ongoing budget increase, it may be time to go for a tax referendum.
Most importantly here, remember the importance of building ongoing relationships before jumping into a politically fraught process like a referendum. If you only connect with your community and its leaders when you approach them with your hand out, you're unlikely to convince them of the need to increase taxes.
Ask for it
In other cases, such as in corporate libraries, your library's budget depends on one or more decision makers within your larger institution. Argue for increased funding by showing the likely return on their investment. Look back to Instalment 5 on building relationships for advice on framing your proposals in terms of others' priorities; be able to discuss potential ROI on decision makers' terms and to use their own terminology. Your goal: to make your library one of their priorities.
In all cases, the skills you have been developing and calling on as a library manager come into play with managing money as well: communication, relationship-building, setting goals and priorities. Cultivate the flexibility to use these skills throughout your career, and you're almost ensured of success.
This series is based on Rachel Singer Gordon's book The Accidental Library Manager (Information Today, Inc., Medford, NJ, 2005; http://www.lisjobs.com/talm/).