ADMINISTRATIVE MEMO # 44
Effective April 2006Earned Income
The Libraries' primary mission is to facilitate access to information. With the exception of Photocopying Services and room rentals, the Libraries are not in the retail sales business (i.e., selling small number of items to individual consumers). Therefore, the Libraries should not enter into externally funded agreements that would require the retail sale of a product (books, videos, CDs, etc.) or services (personal binding, film cleaning, etc.). Where possible, such entrepreneurial activities should be deferred to commercially available alternatives. Exceptions should be rare, integrally linked to the Libraries' mission, and require prior approval from the Library Executive Council (LEC). At a minimum, sufficient external funding should be required to adequately cover the Libraries' production, overhead, sale and distribution costs. A limited retail sales life for the product should be built into the agreement as well as the disposition of excess inventory as promotional items or returns to the external funding source. If permitted under the agreements for which they may have been produced, existing inventories of for-sale books, videos, CDs, etc. could be donated or distributed free as promotional items to area libraries or other relevant organizations.
Bulk sales to commercial vendors of donated material that is not added to the collection remains an acceptable practice. The proceeds from such sales will be deposited into the Libraries' collection development account and used to purchase additional items for the collection. Included in the bulk sales category are the current sale of Judaic gift material and Gifts-in-Kind's used-books bulk sales. Items not selected or sold via bulk will be donated to charitable or educational organizations or otherwise disposed of.
Fee-based services facilitate users' access to library collections. Although beyond the scope of fully subsidized services (i.e., what is normally provided for free), fee-based services are intrinsically linked to the Libraries' mission and may receive some subsidy from the Libraries. The amount of the subsidy will depend upon the merits of the service and what the Libraries can afford to divert from other priorities. Similar to other requests for incremental funding, additional financial support for fee-based services requires the approval of LEC.
There is no right of ownership to a particular unit of income earned in connection with the collections of or the services provided by the UM Libraries.
LEC's approval is required to initiate a fee-based library service and to set prices. Pricing for similar services should be the same throughout the Libraries. The Libraries Budget and Business Services Office will be involved in reviewing current prices and in future price-setting decisions.
To improve accounting/processing consistency and compliance with University requirements, revenue received from LEC-sanctioned retail and earned income activities will be processed and deposited into the Libraries' main operating account by the Libraries Budget and Business Services Office. Units may retain what they have already collected but may not add earned income to their accounts after the implementation of this administrative memorandum.
This administrative memo is based on the report of the Earned Income Committee to LEC, September 22, 2005. The report is on the Web at http://www.lib.umd.edu/PASD/ReportoftheLibrariesEIC.html.
