BCR To Fold, Members To Join LYRASIS

Another consolidation among library networks, though pitched as collaboration

Norman Oder -- Library Journal, 04/06/2010

• LYRASIS formed last year, with three networks joining
• Economies of scale for training, group purchases
• Not a formal merger, but effectively a consolidation
• Unclear how many jobs will be lost

Further extending its national reach as a library network offering services like training, preservation, and group purchasing, LYRASIS, created in April 2009 by the merger of PALINET and SOLINET (and later NELINET), is absorbing the members of the Colorado-based BCR (Bibliographical Center for Research). BCR includes members from nine western states, plus Kansas and Iowa, meaning that LYRASIS now will cover 33 states.

The press release announcing the move is somewhat oddly headlined: “BCR and LYRASIS Expand Cooperative Relationship.” In actuality, BCR will phase out its operations by the end of the calendar year and BCR members will join LYRASIS October 1, with no LYRASIS dues through June 30, 2011.

Thus the statement that “the agreement will allow members of both BCR and LYRASIS to purchase products and services offered by either organization” applies only to a "transition partnership" of a brief nine months.

Consolidation needed
The partnership aims to ensure continuity of services for BCR members in a cost-effective way. In recent years, BCR has chosen to spend down its reserves on staff development, technology, and its building, president and CEO Brenda Bailey-Hainer told LJ. (She wouldn't specify whether BCR had hit a deficit.)

"We've decided it's time to stop doing strategic investment and say, 'OK, what does the future look like?'" she said. Given that public libraries have cut their training budgets significantly, "we don't think the current financial model is sustainable."

"The BCR Board elected this option in response to the financial realities and their impact on sustainability, a desire to continue the mission and service menu of BCR, and simplicity," the organizations said in a statement to LJ. "The LYRASIS Board elected this option to expand the organization's membership base in support of sustainability, increase capacity for service development for current members, and simplicity of member integration."

Economies of scale
The creation of LYRASIS was driven, as LJ reported, in part by a change in the network business relationship with OCLC, effective July 1, 2009, with regional networks unable to take their longstanding cut, thus undermining the viability of such networks.

Thus consolidation of organizations has produced economies of scale, notably saving on staff, with savings on personnel costs now 24%, LYRASIS CEO Kate Nevins told LJ. The technical infrastructure, including member communications and financial management, has also been combined.

Until the BCR deal, LYRASIS’s primary service area has been the Mid-Atlantic, Southeastern, and New England regions. Now, as LYRASIS moves west, the largest other network is Amigos Library Services, based in Dallas. "We are not talking with anyone else at this point, and we don't have proactive aspirations," Nevins said. "That doesn't mean we might not have opportunities in the future."

In April 2009, Amigos Executive Director Bonnie Juergens told LJ that future partnerships would be explored. Amigos and its members are apparently facing some strains; the 2010 Member Conference, to be held in May, will be online only. (However, see comments below from Amigos about the organization's resilience.)

Inside the deal
Did BCR gain any compensation? "LYRASIS is not purchasing or otherwise making any payment to BCR other than some interim staff sharing," the organizations said, noting there was no legal requirement for BRC members to join LYRASIS.

On April 1, 2010, LYRASIS and BCR began to share office space in the current BCR office in Aurora, CO. BCR is phasing out its training department, and all BCR members now have access to LYRASIS training options at LYRASIS member prices.

LYRASIS is adding some BCR employees to its staff, but it is unclear how many of BCR’s 20 employees  will remain at LYRASIS. (In May 2007, BCR had 34 staffers.) "Decisions are pending regarding staff and offices," the organizations said.

"It's business as usual for the next six months," said Bailey-Hainer, noting there had not been specific discussions about whether she'd be staying.

Member reaction
A BCR press release from February 2010 stated that BCR and Lyrasis were “investigating ways to expand member services and maximize cost effectiveness,” a prelude to a more dramatic decision.

In online member forums, Bailey-Hainer said, there were some concerns about LYRASIS, since it had focused its efforts in the East, but "when they hear about some of the additional products and services that BCR members would have access to, they're very enthusiastic. We've heard from academic libraries that LYRASIS has contracts with vendors BCR hasn't been able to get."

She said members also liked the idea of access to a larger pool of consultants and trainers, as well as LYRASIS's track record of getting grants.

Some members, she allowed, must adjust to a different membership structure. In BCR, members are used to having the state library agency pay the membership fee, while LYRASIS members must pay dues, from $400 to $1210 a year, depending on library size.

"When we introduced the idea that there would be an individual member fee, some expressed some concerns, but figured the savings they'd gain through LYRASIS group purchases would far offset those member fees," Bailey-Hainer said. LYRASIS also offers a group membership, so consortia can still join and represent smaller libraries.