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SUBJECT:

Sunnyvale Center for Innovation, Invention and Ideas FY 2002/2003 Anticipated Operating Results – Information Only

REPORT IN BRIEF

The expenditure overage will be absorbed by the Sc[i]³ Enterprise Fund reserve. However, in FY 2003/2004, the Fund may not be able to absorb a similar overage to support continued subscription to the USPTO. Council should be aware that if this same issue arises in FY 2003/2004, it is unlikely the Department of Libraries can absorb the cost in its reduced budget. Sc[i]³’s inability to recover its costs in future years may result in a recommendation to Council to terminate the program

BACKGROUND

In July 2001, the City Council approved a plan to redesign the services and relocate Sc[i]³ to the Main Library. A number of steps were taken to reduce the potential cost to the city for the operation of Sc[i]³. The entire operation was relocated in January 2002. The free public patent and trademark reference services have been fully merged into the existing Adult Services area Program 637 – Library Programs and Services. The services self-funded by fees remain in Program 635 - Sc[i]³. These remaining fee-based services were scaled back to include only those activities that were likely to result in total self-sufficiency of the operation. The cost of the lease was eliminated and staff size was reduced by more than half. Other economies were achieved by reducing the amount of equipment, materials and supervisory time needed to support the operations.

EXISTING POLICY

RTC #02-022, Completion of Sc[i]³ Special Project and Service Design, presented six alternatives, four of which were approved by Council. Alternative #3 addressed the expectation that the redesigned services of Sc[i]³ would be self-sufficient. It stated: "Maintain the fee based services separately and empower the Director of Libraries and the City Manager to eliminate and add services as necessary to maintain self-sufficiency. This is in recognition of the fact that providing self-supporting fee-based services poses some risk to the City. The ability to act quickly to maximize revenue will also minimize risk."

DISCUSSION

The Department, City Manager and City Council have repeatedly requested that the USPTO eliminate the subscription fee. It is felt that the value of the services Sc[i]³ carries out on behalf of the PTO offsets the costs the PTO incurs. At this time the PTO does not intend to eliminate the fee. This decision is likely to have a negative impact on the very lean Sc[i]³ budget in future years as well. Council should be aware that if this same issue arises next year it is unlikely the Department can absorb the cost in its reduced budget. Sc[i]³’s inability to recover its costs in future years may result in a recommendation to Council to terminate the program.

FISCAL IMPACT

The anticipated expenditure overage will be absorbed by the Sc[i]³ Enterprise Fund reserve. However, in FY 2003/2004, the Fund may not be able to absorb a similar overage to support continued subscription to the USPTO.

PUBLIC CONTACT

Public contact was made through posting of the Council agenda on the City’s official notice bulletin board, posting the agenda and report on the City’s web page, and the availability of the report in the Library and the City’s Clerk’s Office. Reviewed by the Board of Trustees at their regular meeting on June 2, 2003.

ALTERNATIVES

RECOMMENDATION

1. None

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