Library Administration Information Mid-Hudson Library System


Frequently Asked Questions (FAQs)

1.                 What is the difference between funding and fundraising?

Funding is how your library is financed for its regular, ongoing operations. All or most of this money should come from stable tax support.  Public votes on your library’s budget can accomplish stable tax support for your library.

Fundraising is for other types of library needs.  The most important is capital development and/or building campaigns.  Examples of other uses are special programs, special collections or equipment.

2.                 What types of fundraising are available for a public library?

There are many types of fundraising for a public library. Some examples are:

·        Annual campaign: An annual appeal letter requesting a

donation to your library is effective (matching funds from employers may be available; be sure to remind your donors to ask about the possibility of matching funds when contributing to the library).

·        Special Events: such as a book fair, auction, dinner, a “non-event” (people send in money in lieu of attending an event), a special program with a famous author or public figure, or a cruise on the Hudson River.

·        Online Fundraising: if your library has 501(c)(3) status you may solicit funds online through, or submit grant applications online at such sites as and .

·        Planned Giving: encourage patrons to remember the library when developing their will; develop a library policy brochure on this issue to distribute to patrons and estate lawyers

·        Grants: apply to area businesses, local foundations and other grantmakers for funds.

·        Friends Groups: these can serve as the fundraising arm of the library. Membership fees enable the group to act.

For more ideas and helpful web sites about different types of fundraising, prospect research, grant writing, online fundraising, and grant makers visit the MHLS Fundraising Resource section of this web site at

3. Can special district or school district or municipal libraries participate in fundraising projects, or are only association libraries able to fundraise?

All libraries are able to fundraise. However, Friends Groups are the preferred vehicle for fundraising activities.

4. How does a library go about getting 501(c)(3) (i.e. tax exemption) status?

Libraries must file IRS Form 1023 (available on the IRS web site (PDF). It is advisable to have a lawyer familiar with not-for-profit law review your application before submission. Consult the following sites for more information on application for 501(c)(3) status:

o       Application for Recognition of Exemption (IRS), at,,id=96109,00.html

o       Step-by-step help for filing with the IRS for tax-exempt status is available from this excellent site, which is based on a free class taught in Seattle WA since 1995--   . Here you can find information for established organizations on "Do's and Don'ts," information on political vs. legislative activity, UBI, inurement & excess benefit, etc.

5. Are there limitations on what types of public libraries are eligible for 501(c)(3) status?

Special District Public Libraries should consult their legislation. Resources under number 4 provide more information on eligibility for 501(c)(3) status.

6. Can a library use the Foundation for Hudson Valley Libraries’ 501(c)(3) status?

Yes. The Foundation for Hudson Valley Libraries (FHVL) is authorized to pass through grants/donations for libraries who do not yet have a 501(c)(3) designation and who need such in order to receive donations from granting agencies and/or donors.

The Board of the FHVL has set in place a simple procedure for expediting this service:

o       Each request must be presented in writing to the Board of the FHVL with complete details.
o       Each request is distinct and will be decided on its merits by the Board.
o       After an affirmative decision is made, the FHVL will confirm such with the member library and with the donor/granting agency supplying requisite documentation on 501(c)(3) status.
o       At this time, there is no fee for this service, but a modest one for administrative costs is under consideration by the Board.
o       The Board encourages libraries to apply for and receive their own 501(c)(3) designation within two years of requesting the FHVL to serve as their fiscal agent.  Use to see if you are listed as a 501(c)(3) or call the IRS Tax Exempt Organization help line at 877.829.5500. .

Please note:  The Foundation for Hudson Valley Libraries meets multiple times a year and will consider requests at other times if necessary. Address: Foundation for Hudson Valley Libraries c/o Executive Director, Mid-Hudson Library System, 103 Market Street, Poughkeepsie, NY 12601.

7. What can a paid fundraising consultant do for my library’s fundraising efforts?

A paid fundraising consultant can serve your needs in a variety of ways. In recent years member libraries have used consultants to conduct feasibility studies of their communities to better focus fundraising efforts. Consultants can frame a fundraising plan from the information gathered about your library and your community and do a lot of legwork for you – special event arrangement, public relations, grant writing. Remember they work for you so use them as best you can to maximize the time and money invested in the consultant. A list of fundraising consultants is available. For more information contact Rebekkah Smith, MHLS Coordinator of Member Information.

8. Should monies raised from fundraising events be put into the library’s general operating funds or should they be kept separate?

Monies raised through fundraising events are one-time donations to your coffers. Putting such monies in your general operating budget masks the need for sustained funding for your library from year to year.

9. Is there special paperwork or reporting that my library needs to do if a capital campaign or building fund or other special project fundraising is undertaken?

Organizations that are tax exempt must file a form 990. Remember to acknowledge donations that are over $250; a donor can deduct a charitable contribution of $250 or more only if the donor has written acknowledgement from the charitable organization.

10. Are there any online resources on fundraising?

Yes, there are many sites with useful fundraising information. Check out these clearinghouses:

o       MHLS’ Fundraising Resources web page

o       Fundraising for the Small Public Library

o       Selected Grants and Fundraising Resources from the New York State Library

o’s Fundraising links

Other electronic resources for libraries are:
·      MHLS Fundraising Listserv
·      Foundation Center resources such as the FC Search CD-ROM are available at all five area Fundraising Information Center (FIC) Libraries

11. What training is available?

Along with workshops and training facilitated by MHLS, other organizations also provide assistance, such as the New York State Library, the Council of Community Services of NYS, Inc., and the Foundation Center Cooperating Collection at the Adriance Memorial Library of the Poughkeepsie Public Library District. Subscribe to the MHLS Fundraising Listserv for training announcements or watch the MHLS bulletin and listserv for opportunities.

12.            How do you find out who to ask for money?

Visit a Fundraising Information Center library or the Foundation Center Cooperating Collection at the Adriance Memorial Library (PPLD) to research funders interested in libraries and special programming you have in mind.

For answers to more of your fundraising questions visit the Fundraising Resources section of the MHLS web site,



Need more help? contact Rebekkah Smith Aldrich, Coordinator of Member Information [].