How Do Libraries Get Money?

Money: it makes the world go ’round whether we like it or not. For libraries, money is both a wonderful and a terrible thing. A nice increase in funding can lead to endless possibilities for a public library, like new programming, more modern technology, or even renovations to the actual building itself. On the other hand, lack of proper funds can lead to elimination of staff positions, decreased hours of operation, and less opportunities for programming. So, where does the money come from? Although that yearly book sale provides some supplemental money for most public libraries, we know that that isn’t where the majority of the budget is procured 😉

Fun fact: public libraries weren’t always the public institution that they are now. Learn more about the history of libraries from The Library Diary here.

The most common way libraries get funding is through appropriations from the general fund of their jurisdiction (city, town, county, township, or other governmental structure). A government’s general fund is comprised of revenues from several sources, but usually the biggest chunk of it is from taxes that are not set aside for a particular service. These “non-earmarked” taxes include property, income, and sales tax, which are then pooled into a general fund for the municipality. Libraries prepare annual budget proposals to be submitted to and reviewed by the municipal budget committee. These libraries must compete with all other municipal departments’ proposals that are vying for the same general fund. If community support for the library is strong, they have a much better chance of getting their budget approved. If there is outspoken discord regarding the library or the taxes that support it, chances are much lower of the budget getting approved without changes and funding cuts.

Another potential source of income is a library tax. Remember that one time you voted, maybe even in this last election, and there was a proposed millage or millage increase for your public library? I bet a lot of you were thinking to yourself: “What the heck does this even mean? Taxes are confusing.” Thankfully this quote from the book Administration of the Small Public Library by Darlene E. Weingand explains it pretty well: “Many state library laws contain permissive legislation making it legal for any jurisdiction to levy a tax for the establishment and operation of a public library. In most cases, this type of tax is on real estate, and tax revenues are based upon taxpayer-voted levels of millage – for example, 1.5 mills or 4 mills – on the assessed valuation of the taxable property within the taxing unit.” A mill is 1/1000th of a dollar, which equates to $1 per every $1000 of property value.

Still not quite sure what this means? Here’s an example… Let’s say a millage rate of .58 is proposed in your town as a “library tax.” This means you will be paying 58 cents for every thousand dollars of your real estate value that is taxable (the taxable amount is usually about half of the market value of your property). If the taxable value of your home is equal to $100,000 (market value of $200,000), this means you would be paying $58 annually in taxes to fund your public library. All in all, this equals $4.83 per month. These millages are voted upon by the public in a local election, which means you have a say in how your library is funded. Personally, I think a monthly price of $4.83 is a bargain to get unlimited access to my public library. However, others who don’t hold such a fervor for this important public institution might not be a fan of paying taxes for the operation of their public library, especially if they don’t visit it often.

Scrabble pieces spelling out "TAX" on top of several dollar bills.

Additionally, there are national funds allocated to supporting the operation of libraries across the United States. The Library Services and Technology Act provides federal grants to libraries across the country to:

  • promote continuous improvement in library services in all types of libraries in order to better serve the people of the United States
  • facilitate access to resources in all types of libraries for the purpose of cultivating an educated and informed citizenry
  • promote literacy, education, and lifelong learning and to enhance and expand the services and resources provided by libraries, including those services and resources relating to workforce development, 21st century skills, and digital literacy skills.

Funding in the amount of $189.3 million is currently proposed to support this act in 2019. Other budget proposals for 2019 include: $242 million to improve administration of the Institute of Museum and Library Services’ grant programs and provide additional research for libraries and museums, and $27 million to fund the Innovative Approaches to Literacy program. These programs offer thousands of different grants to public libraries around the country that choose to apply for them.

While all of this funding may seem adequate enough, think about this: according to the American Library Association, there are currently 116, 867 public libraries in the US. That is an average of 2,337 public libraries per state. Crazy, right?! Some libraries are pretty well-endowed by any combination of government funding. However, for those libraries that aren’t so fortunate, huge gaps in the budget can be left unfunded, prompting the need for creative self-fundraising techniques. This is where those annual and ongoing book sales come into play. Some other common fundraisers include auctions, publishing and selling cookbooks, promoting deferred giving, conducting a capital campaign, corporate grants, and live music events. I have also heard of garden tours, mini golf tournaments, 5k runs and bike races, and my personal favorite: a 21+ adult “sip and spell” spelling bee (someone do this in Maine please!). Most of these are not easy feats to organize and successfully raise money from, and consequently take a lot of hard work from the library director and other staff members or volunteers.

As you can see, funding for public libraries is more complex than just assuming taxes take care of everything. Without proper funds, libraries are forced to cut back on operating hours, eliminate certain programs, or decrease the number of employees, all of which impact how effectively your library can provide the services you need! If you have any questions about how your particular local library is funded, just ask. As a publicly funded institution, your public library’s budget is open and accessible information. Also, if you have a great fundraising idea or want to get involved in campaigning for more local funding, ask your librarian! Any amount of public support you can offer to your library is probably both wanted and needed. Whenever you get the opportunity to advocate for your public library, whether by donating, participating in fundraising events, or voting, relish it and choose to support.


Administration of the Small Public Library Fourth Edition, by Darlene E. Weingand

Fundraising for Libraries: 25 Proven Ways to Get More Money for your Libraries, by James Swan

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