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SANTA CLARITA, Calif. — A private company, Library Systems & Services, in Maryland, has taken over public libraries in ailing cities in California, Oregon, Tennessee and Texas, growing into the country’s fifth-largest library system.
The basic pitch that the company L.S.S.I. makes to cities is that it fixes broken libraries — often by cleaning house.
Now the company, has been hired for the first time to run a system in a relatively healthy city, setting off an intense and often acrimonious debate about the role of outsourcing in a ravaged economy.
A $4 million deal to run the three libraries here is a chance for the company to demonstrate that a dose of private management can be good for communities, whatever their financial situation. But in an era when outsourcing is most often an act of budget desperation — with janitors, police forces and even entire city halls farmed out in one town or another — the contract in Santa Clarita has touched a deep nerve and begun a round of second-guessing.
Can a municipal service like a library hold so central a place that it should be entrusted to a profit-driven contractor only as a last resort — and maybe not even then?
The company is majority owned by Islington Capital Partners, a private equity firm in Boston, and has about $35 million in annual revenue and 800 employees. Officials would not discuss the company’s profitability.
Some L.S.S.I. customers have ended their contracts, while in other places, opposition has faded with time. In Redding, Calif., Jim Ceragioli, a board member of the Friends of Shasta County Library, said he initially counted himself among the skeptics.
But he has since changed his mind. “I can’t think of anything that’s been lost,” Mr. Ceragioli said.