HOUSE BILL REPORT

SSB 5168

BYSenate Committee on Governmental Operations (originally sponsored by Senators Bluechel, DeJarnatt, Sellar, Vognild, Cantu, Kreidler, Sutherland, Thorsness, Smitherman and Lee; by request of Washington State Library)

Authorizing the state library commission to move the western library network to private nonprofit status.

House Committe on State Government

Majority Report:  Do pass.  (7)

      Signed by Representatives R. Fisher, Chair; Anderson, Vice Chair; Hankins, Morris, O'Brien, Rector and Sayan.

House Staff:Barbara McLain (786-7135)

Rereferred House Committee on Appropriations

Majority Report:  Do pass.  (28)

      Signed by Representatives Locke, Chair; Grant, Vice Chair; H. Sommers, Vice Chair; Youngsman, Assistant Ranking Republican Member; Appelwick, Belcher, Bowman, Braddock, Brekke, Bristow, Dorn, Doty, Ebersole, Ferguson, Hine, Holland, May, McLean, Nealey, Padden, Peery, Rust, Sayan, Spanel, Sprenkle, Valle, Wang and Wineberry.

Minority Report:  Do not pass.  (1)

      Signed by Representative Silver, Ranking Republican Member.

AS PASSED HOUSE APRIL 6, 1989

BACKGROUND:

In 1976, the Legislature authorized implementation of the Western Library Network (WLN).  WLN has two major components:  a resource sharing network for libraries, and a multi-state computer service.  WLN has also developed and markets a number of "off-line" services, including licensing of a computer software package libraries can use to establish their own networks.

The original WLN consisted of 10 participating libraries in Washington State.  Currently over 300 libraries in six Western states and British Columbia use WLN online services, and software licensing has been marketed internationally.  WLN is financed through a revolving fund, and is self-supporting and non-profit. It employs 75 people and has an annual budget of about $5.5 million.

As a division of the Washington State Library, the WLN falls under the jurisdiction of the Washington State Library Commission.  The commission consists of the Superintendent of Public Instruction as ex-officio chair and four members appointed by the Governor for four-year terms.  An advisory council called the Network Services Council assists the commission in overseeing the WLN.  NSC members represent participating libraries from Washington, Alaska, Oregon, Montana, Idaho, and Arizona.

For several years, discussion has continued over whether WLN should remain as a division of a state agency or whether it should take the status of a non-profit corporation.  Sunset review reports by the Legislative Budget Committee in 1984 and 1987 have recommended that the WLN change its governance structure.  A study completed by the Network Services Council in May, 1988 recommends formation of a private non-profit corporation to assume the functions of the WLN.

SUMMARY:

The State Library Commission is authorized to cooperate with other agencies in establishing a private non-profit corporation to provide services currently offered by the Western Library Network.  The commission may terminate services of the Western Library Network before June 30, 1997 if a successor organization agrees to assume full responsibility for providing those services.

To establish the non-profit corporation, the commission may transfer equipment, contracts for services, and other assets for reasonable compensation determined by the commission.  However, for up to five years the commission has the right to repossess transferred property should the successor organization become bankrupt, insolvent, or fail to provide services satisfactory to a majority of users.  Repossessed property remains the property of the state, to be administered by the Library Commission.

The commission is authorized to provide personnel and other support services to the successor organization under contract for up to two years and is to be reimbursed for all costs of contracted services.  Library personnel are not precluded by conflict of interest provisions from employment with the new organization.

When the commission terminates Western Library Network services, any funds remaining in the Western Library Network Computer System Revolving Fund are to be used by the commission to meet outstanding obligations of the network, with the remainder going to the general fund.  Untransferred property belongs to the state and untransferred contracts become the obligation of the State Library.

The commission may designate one or more members of the board of directors for the successor organization, but the state is not to be held liable for those members or for the actions of the organization.  A status report is to be submitted annually by January 1 to appropriate Senate and House committees, with a final report in January, 1998.

Fiscal Note:      Available.

Effective Date:The bill contains an emergency clause, and sections 1 through 6 and 9 through 14 take effect on June 1, 1989.

House Committee ‑ Testified For:    (State Government)  Nancy Zussy, State Librarian; Mark Allen, Washington Library Association.

(Appropriations)  Nancy Zussy, State Librarian; Mark Allen, Washington Library Association.

House Committee - Testified Against:      (State Government)  None Presented.

(Appropriations)  None Presented.

House Committee - Testimony For:    (State Government)  The Network needs to be independent from state government in order to be viable and compete in its service market.

(Appropriations)  The bill will help local libraries that depend on the services of the Western Library Network.

House Committee - Testimony Against:      (State Government)  None Presented.

(Appropriations)  None Presented.