MANAGEMENT TO PRIVATE
promote efficiency and cost savings in government, thus allowing service levels to rise while limiting cost and tax increases (Rondinelli, 2003;Savas, 1987). On the other hand, critics of NPM claim that outsourcing cases in this country often result in either failures to deliver services or outright corruption. The end result, according to the critics of NPM, is that gov- ernment capacity is hollowed-out, and, ultimately, democratic accountabi- lity to the citizen is lost (deLeon & Denhardt, 2000;Milward, 1996).
The library profession has also been influenced by the emergence of NPM. During the past 30 years, outsourcing has been adopted by the li- brary profession, especially in terms of internal operations. The extensive development of outsourcing in the library profession eventually led to a study being conducted by the American Library Association on this area of service delivery (Martin, 2000). The section of the Martin study related to the outsourcing of public library management generated controversy in the library profession and reflected the broader debate occurring in the public management field over the use of NPM principles for the delivery of gov- ernment services. We restrict the current study to public libraries (local government libraries of general scope intended for public use); other types of libraries such as Federal governmental departmental libraries and mili- tary libraries will form the subject of another study.
In essence, NPM makes little or no distinction between the role of gov- ernment in society and free market principles. To NPM advocates, govern- ment should not be run like a business, but rather business should run government (Lane, 2000). To these advocates of NPM, substitution of public goods theories with concepts such as decentralization, market com- petition, deregulation, load shedding, privatization, user fees, and enterprise management leads to a more responsive government service (Arnold, 1998;
Ferlie, 1996). In public administration, opposition to NPM reflects a more traditional view of the public sector which emphasizes a positive role for public service in our society (Frederickson, 1996). The public administration critics of NPM charge that NPM undermines representative democracy, and circumvents constitutional systems developed to sustain democracy by re- moving public accountability from government (Goodsell, 1993;Moe, 1994;
Terry, 1998).
A similar level of debate has emerged in the library profession. NPM advocates in the library profession claim that only the use of outsourcing will save public libraries from fiscal extinction (Dubberly, 1998). Opponents of NPM in the library field, on the other hand, believe that the use of outsourcing, especially in public library management, will result in the loss of democratic accountability, and the eventual privatization of public ROBERT C. WARD AND MICHAEL CARPENTER 142
libraries (Schuman, 1998). The end result of this debate is that NPM advocates in the library profession call for embracing the movement, and opponents call for active opposition to the movement.
The Use of Outsourcing for Public Library Management
While the debate over the application of NPM principles in the library pro- fession reflects the broader debate raging in public management, often the debate is based more on emotions than fact. In an attempt to sort emotions from fact, we have assumed the task of examining actual cases involving the application of NPM principles to public library management. We seek to discover if the application of such principles have led to the proposed in- creases in services claimed by the advocates of NPM, or if it has resulted in the reduction in public accountability postulated by the NPM critics. Of the thousands of public libraries in the United States, at the time of this research project, we have found only eight cases in which outsourcing of the man- agement of a public library has occurred. Of the eight cases, only seven cases have data available for examining this phenomenon. The seven cases are:
Calabasas, California Hemet, California
Riverside County, California Jersey City, New Jersey Linden, New Jersey Fargo, North Dakota Lancaster, Texas
The outsourcing of the management of a public library as opposed to the outsourcing of particular functions such as cataloging, binding, and build- ing maintenance, is not a common practice in the United States. To this day, the vast majority of public libraries continue to operate as either public board systems or as in-line agencies of local governments. An examination of these seven cases shows that the reasons for such a decision to outsource the management often reflect the emergence of unusual conditions not nor- mally associated with the operation of a public library.
While each of the cases has specific issues related to the decision to out- source, generally the decision originated from one of three reasons.
1. Dispute over a local intergovernmental contract for library service de- livery, and specifically the levels of services delivered and the costs for such services: Calabasas and Riverside County.
2. Inability to attract qualified candidates for the director position: Hemet and Lancaster.
3. Dissatisfaction with the current or past director’s performance and pro- fessional knowledge: Fargo, Jersey City, and Linden.
While specific justifications to outsource vary from case to case, generally they all relate to a single overriding issue, namely the perceived failure of administrative accountability within the specific public library program.
The Concept of Administrative Accountability in Public Administration Administrative accountability is a cornerstone of the system of representative democracy found in the United States. Broadly stated, administrative ac- countability is measured by the level of control exercised by elected officials, the representatives of the citizenry, over appointed officials. Both legally and economically, this control is often described as the principal/agent relation- ship, with the elected official defined as the principal and the appointed official defined as the agent. Often this relationship is seen as a simple linear relationship between an order giver and an order taker. However, admini- strative accountability in a representative democracy is anything but simple, and involves multiple layers of relationships composed of law, philosophy, and professional ethics (Chang, de Figueiredo, & Weingast, 2001).
Romzek and Dubnick (1994)have sought to classify these varying levels of administrative accountability. The first level of administrative accountability relates to the internal rules, regulations, and legal mandates that form the basis for the creation of a public agency. Administrators, at this level of accountability, adhere to the established requirements necessary to deliver the appropriate government services. The second level of accountability relates to the professional standards and training needed to actually perform the des- ignated work of the agency and maintain the professional processes related to their area of work. The third level of administrative accountability refers to the legal relationship between the elected official and the appointed official within a democracy. This is the traditional level of principal/agent relation- ship and is grounded within the constitutional system that establishes the government itself. The final level of administrative accountability relates di- rectly to the citizen and applies to both the elected principal and the appointed agent. In essence, both the principal and agent are legally and morally bound to perform their duties within the political wishes of the citizen/customer.
The advocates of NPM argue that traditional public management has focused on the first two levels of accountability, namely organizational and ROBERT C. WARD AND MICHAEL CARPENTER 144
professional accountability, and ignored the other levels of legal and po- litical accountability. According to NPM advocates, such as Niskanen (1971), public bureaucrats have used their expertise and position to engage in an unethical game of information monopoly to advance their agency and professional interests. NPM theorists believe that bureaucrats have a dis- tinct advantage in terms of information and expertise over the elected offi- cials. The elected official lacks specific technical knowledge in terms of public policy arenas. Due to this lack of technical knowledge, elected offi- cials are reluctant to intervene or object to the bureaucrat’s advice. Bu- reaucrats use their technical information position to manipulate the decision-making process, seeking to maximize agency budget gains while minimizing program effects, thus shirking their primary legal and political responsibilities for personal and professional gain.
Shirking of legal and political accountability on the part of bureaucrats in a democracy is one of the major reasons proponents of NPM advocate that government should adopt a broad-based program of outsourcing govern- ment services. In the minds of NPM proponents, government bureaucrats have failed because they have emphasized accountability to the first two levels, hierarchy and professional, while ignoring accountability to the last two levels, legal (principal/agent) and political (customer/citizen). Conse- quently, administrative focus on the hierarchical and professional levels of accountability leads to inefficient operations, unnecessary red tape, and ir- responsible behavior.
The argument presented in favor of NPM is that only by emphasizing the legal (principal/agent) and political (customer/citizen) levels of accounta- bility can we return government to a responsive system that fulfills citizen wants. Since, in a representative democracy, elected officials have the sole legitimate authority for defining public wants, their stated preferences should always have priority over any hierarchical or professional accounta- bility. Thus, by focusing on the specific legal and political ends of account- ability, managers are able to obtain specific outcome measures, and achieve designated public service demands (Savas, 1994). The end result of such an approach returns administrative accountability to its rightful focus, namely the legal and political levels of accountability.
Outsourcing facilitates this type of administrative accountability by clearly identifying and separating the purchaser of government services from the provider of government services. By separating providers from purchasers, a process is unleashed which negates the shirking behavior of bureaucrats, namely the unleashing of economic self-interest. Under this approach, both the separate purchaser and provider have a vested self-interest in finding and
implementing the optimal way in which to deliver the government service.
The self-interest factor is at work because both parties have an interest in dividing the gain achieved and mutually reaping the benefits of this new exchange. Thus, by separating government administration from hierarchical and professional accountability we create a clear contractual relationship between a service seller and a service buyer. This separation allows for the introduction of competitive market principles into a non-competitive arena and assures economic efficiency by introducing pricing and profit incentives (Lane, 1997a, b, 2000). Thus, NPM advocates claim that three critical out- comes will accrue to government if it adopts these new public/private prin- ciples. The first claim is that administrative accountability will return to its proper focus on legal (principal/agent) and political (customer/citizen) ac- countability. The second claim is that government will experience an eco- nomic and efficiency gain by introducing a profit incentive into public service delivery. The third claim is that this economic efficiency gain leads to a greater citizen use and satisfaction with services and products delivered, thus, ulti- mately, strengthening the political accountability level of democracy.
In terms of the outsourcing of public library management, we need to examine the extent to which the separation of administration from govern- ment actually led to the achievement of these stated claims of NPM. Such an examination will require an in-depth look at the cases.
Methodology
In terms of the outsourcing of public library management, we need to ex- amine the extent to which the separation of administration from government actually leads to the achievement of the stated benefits claimed by NPM advocates. If the NPM advocates are correct, an examination of the use of outsourcing should reveal gains in three areas: an increased level of direct accountability to elected or appointed officials by contractors versus public employees; an increase in the economic efficiency of the use of public funds;
and an increase in public use or satisfaction with the public goods that are provided by the agency. If the basic premises of NPM are correct, we should see gains in all three areas: accountability, efficiency, and use/satisfaction.
In order to measure gains in the areas of accountability, efficiency, and use/satisfaction, a researcher must locate three separate, but related, units of data. In terms of accountability, one must obtain information related to the previous system of governance of the agency plus the new contract devel- oped between the local government and the private service provider. At the time of this research, a search of the various reports on public library ROBERT C. WARD AND MICHAEL CARPENTER 146
management outsourcing discovered that there were eight reported cases in the United States. Of the eight cases, the researchers were able to obtain information related to the previous systems of operation and contracted systems of operation for seven of the eight.
In terms of efficiency, the researcher must obtain the previous operating expenses for the agency during the time of direct local government control, and the new operating expenses in effect during the new contract period. In the seven cases under study, the various state laws related to the operation of public libraries in these states require that each of the public libraries shall report to their state libraries full financial information related to the ope- ration of their libraries, including both revenue and expenditure information by line item and staffing. This information is subsequently provided by the state libraries to the National Center for Educational Statistics (NCES), and is available in public records from both sources.
To measure use/satisfaction, the researcher must locate the previous an- nual performance measures of the agency during the local government control period, and the new annual performance measures in effect during the private contract regime. Once again, by state law this type of informa- tion, containing uses by categories of services, hours of operation, staffing levels, and units of collection inventory, must be reported annually to the various state libraries. Additionally, this type of information is also reported to the NCES, and is public record available through their data services.
Thus, for seven of the eight reported cases, the necessary information required to examine the impact that outsourcing had on accountability, efficiency, and use/satisfaction was available. Additionally, each of those seven cases was reported on widely in their local press, the professional trade journals, and even, in certain cases, national newspapers. Thus, supple- mental sources of contextual information are available to expand the ana- lysis of the various data sets for each one of the seven cases.
In order to foster this examination, we will group the cases according to their areas of administrative failure as previously specified.