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62nd IFLA General Conference - Conference Proceedings - August 25-31, 1996

Financing library services: changing approaches - Finding new sources of financial aid for libraries

Joan M. Hood
Director of Development and Public Affairs
The Library of the University of Illinois
at Urbana-Champaign


The paper, Finding New Sources of Financial Aid for Libraries, presents background and principles concerning library fundraising conducted in North America. It examines the reasons why personal philanthropy through voluntary gifts of financial resources has developed on a broad scale in the United States.

Because democratic principles and the concept of private enterprise are developing in many countries throughout the world, fundraising experience in the United States will be of assistance to librarians in other countries during their quest for new sources of financial support.

The paper explores the basic reasons why people give to an institution and how librarians can adapt these principles to their benefit. The four key words in fundraising: identification, cultivation, solicitation, and stewardship, are explained in a fundraising context. The differences between raising funds from individuals and from corporations and foundations are addressed.


It is a great pleasure for me to talk with you about strategies to raise new sources of funds, especially private funds for libraries. Today we will discuss basic principles of fundraising and their application.

When we speak about voluntary philanthropy for financial purposes, we find it is more developed on a broad basis in the United States than anywhere else in the world. Historically, worldwide, there have always been generous people: patrons of the arts and libraries, for example. However, in the United States, personal philanthropy through voluntary gifts of financial resources has developed on a very large scale.

Two of the major reasons are reflected in the way both our society and our economy are organized. Our society was built on democratic principles, freedom of expression, speech, and assembly as reflected in our Bill of Rights and in our Constitution. Our economy was built on the concept of private enterprise, a free market place, and private ownership.

Although our societal and economic freedoms are guaranteed to us, democracy carries with it a heavy responsibility on the part of the individual to be informed, to participate in elections and other decision making forums. We also have the responsibility to support through taxes and voluntary contributions those institutions that exist for the common good, schools and libraries, for example. Li braries in the United States and throughout North America are funded by public tax monies, private funds, or a combination of both.

Sources of financial support for libraries are derived from individuals, corporations, private foundations, and governmental agencies. During the past decade in the United States, we have seen an erosion of federal, state, and local tax monies that have been appropriated for libraries. Because of this decline libraries have had to reach out to find alternative sources of funding, basically priv ate voluntary support. As libraries in other countries are required to change from total governmental support to partial governmental support, I submit that some of the lessons and experiences we have gleaned will be useful to you.

In the United States in 1993, more than $126 billion was raised in private contributions for all types of not-for-profit organizations: hospitals, churches, libraries, art museums, for example. Of that $126 billion, individuals gave 87%, private foundations gave 7.3%, and corporations gave 4.7%. Those percentages have remained constant for years. Therefore, the most promising source of support in the long run is from individuals with additional or supplementary support coming from corporations and foundations. In the short run, building relationships with international corporations doing business in your countries, with national companies, and with international foundations is a very good first step.

At the outset I will emphasize that development is a long-term process. Development and fundraising activities require patience, a lot of hard work, commitment and continuity. To be successful, the library director of a local library, a university library or a research library, must make a total commitment to the effort. That commitment must include a personal involvement of time and energy. In establishing a development program, a specific person should be identified to be in charge of those activities. That person will work closely with the head of the library to develop a fundraising program.

When discussing development, one segment being fundraising, we should also be discussing public relations and publications. One does not raise money in a vacuum. It is through heightened public visibility that private support can be garnered.

In organized fundraising a good way to begin is to learn as much as one can about people. Harold Seymour, who wrote in 1966, revised in 1988, the classic text, Design for Fundraising, pointed out two universal aspirations of people.

  1. What people want most is to be sought, to be asked to participate.
  2. Every individual needs to feel that he or she is a worthwhile member of a worthwhile group.

Another basic motivation to give is responsible concern for continuity. As one develops a case or proposal, one must put the emphasis on the needs that exist in society, not the emphasis on the organization's needs. When a donor's needs and society's needs are joined, an effective program has been developed. The donor's main motivation to give is the opportunity to reinforce his or her self im age as a person helping society.

Donors also think of their gifts as investments. They want to know "Will my money be well spent?" They want to know how his or her gift will make a difference, how it will provide a program that is not currently available, how it will help solve a problem that is important to them. In a research or academic library, we would emphasize the effect on society of the research being conducted with materials in the library.

For all types of libraries we talk about people using the materials and how the information will make a difference to the world. We talk about the role of the libraries and the librarians making it easier for people to find and use information. We provide shared benefits and promote a vision of how their gift can make a difference. People give because they believe in the institution's mission and in its programs.

There is no great mystery to fundraising. It boils down to a simple point. Somebody has to ask someone to part with an asset, whether it is a gift of cash, a collection of materials, or a special set of books. It could be a gift of property, such as a house or a farm. As countries around the world expand private ownership, in time this type of gift will become a reality.

The secret is in the asking. The basic reason gifts are not made is because no one has asked. In many countries there has not been a tradition of going out and asking people to help for a specific purpose, in our case for libraries. As we ask for gifts, opportunities are provided to the donor and to the institution. An opportunity for real satisfaction is provided to the donor who is giving t o something in which he or she truly believes. It is also a great opportunity for the recipient of the gift, because the gift is providing an opportunity to expand a program, to construct a new building, to gain in a very tangible way.

There are four key words in fundraising: identification, cultivation, solicitation, and stewardship, all the result of careful planning, patience, and continuity. Identification means finding the potential sources of support from among individuals, corporations, and international foundations. Cultivation means nurturing, educating the sources about your program, getting them involved. Solicit ation means asking for the gift, but only when the time is right, when enough involvement with the program has occurred. Stewardship means continuing a relationship with someone who has already made a gift to your library, to make sure that the money or the gift is used as the donor intended, and to report to the donor on the uses of the gift. Once the relationship has been established with a d onor, it is appropriate to return to the donor to ask for a second or a third gift. It is a recognized fact that second and larger gifts will come from people who have made a previous gift.

In North America there are three traditional ways to ask for a gift. The first is by direct mail or a written appeal to a donor. The second is through telemarketing, i.e. a telephone call to a prospective donor, and the third is through personal visits. When we ask for major amounts of money, it is only done on a person to person basis. After a major prospect has been identified and sufficien tly involved to know the library's goals and plans, then a request can be made. An important fundraising tenet is that people give to people. They give to people whom they trust and respect. Fundraising is a business of relationships, building and maintaining relationships with many types of people.

Raising funds from corporations and foundations is considerably different from raising money from individuals. Corporations are created to make money--not to give money away. Any money that is given to a charitable institution must be justified to the shareholders of that company. Corporations give money to institutions to help expand markets. Corporate visibility is an essential condition fo r giving.

What is a foundation? In the United States foundations are non-profit, non-governmental entities established under a section of the United States Tax Act for the purpose of supporting educational, cultural, religious, health-related and other causes primarily by awarding grants to eligible non-profit organizations. They derive their money from a combination of invested monies, i.e. principle, d onor contributions, and in the case of many corporate foundations, operating income from a parent company. In order to maintain their status under the U.S. Internal Revenue Act, foundations are required to distribute a certain percentage of their invested assets each year. Therefore, the foundation's purpose is to award money for projects in which they are interested. Every foundation has guid elines which must be followed carefully for funding application. Libraries must research those guidelines and apply for projects of mutual interest. Many U.S. foundations are international in scope and have established offices in various parts of the world. The Soros Foundation, headquartered in Hungary, has established foundations throughout Europe.

By carefully cultivating a variety of sources, individuals, corporations, and international foundations, your libraries will be able to gain funding for collections, preservation, technologies and personnel.