University libraries in many countries are facing major funding problems due to a variety of reasons such as non-growing or even decreasing appropriations from their university administration and other funding agencies, continuing inflationary increases for journals and library materials, needs for new or improved facilities, increased costs for new technologies and networks and more demands for services. Yet library administrators on the other hand are expected to improve services and facilities, offer the latest electronic information in an-up-to-date network environment and provide the best teaching and research support for all academic programs. To address these funding problems, library administrators need to find ways to supplement their budgets through existing as well as new creative external funding strategies including grants, fund-raising, resource sharing, contracting, fees and others.
Funding for university and research libraries has become increasingly problematic and competitive during the last part of the 20th century. Academic libraries manage, collect and provide access to an ever-growing arsenal of information for an increasing number of users in an environment of growing financial constraints. Libraries employ highly trained and educated staff, need complex facilities and sophisticated electronic technologies in order to operate successfully. The economic issues facing libraries in the 1990s and beyond are complex, and new approaches are needed to address academic libraries’ financial dilemmas.
In 1992 after unification of the two Germanies the Wissenschaftsrat accepted standards for German university library budgets, specifying that collection building in university libraries “ensures the supply of literature for universities.” Unfortunately, recommended standards and reality are miles apart due the incredible inflationary increases of library materials, the enormous need for collection development in the former East Germany and the need for new electronic materials. 
In Great Britain budget allocations for university libraries are being revised from a historic base line with periodic increases and a recommended standard for libraries of up to 6% of the university budget and allocation formulas, to an experimental process of “top slicing.” This would mean that the central university administration would fund central services including libraries in the range of 36% to 40%. Other parts of the funding would have to come from academic departments based on their particular library needs. The only certainty in this scenario is that budgeting for libraries will change. 
Australian university libraries are facing funding problems due to transformations occurring in the universities, the growth and continuing inflationary costs of scholarly publications, technology and increasing needs and demands from users. Library budgets currently range from 2.9% to 5.8% of their universities’ budgets. To contain costs and expand information access to their constituents, Australian academic libraries are utilizing CAUL (Council of Australian University Librarians) to share resources, particularly database access, networks, document delivery and electronic publications. 
In the United States funding models for academic libraries vary greatly, depending on whether the institution is private or public, a particular state’s budgetary regulations and funding formulas for higher education, and the overall budgetary situation of each university. The Association of College and Research Libraries (ACRL) Standards for College Libraries (1995) advocates that academic libraries “shall be at least six percent of the total institutional expenditure for educational and general purposes.”  Few academic libraries are funded at that level.
Usually, academic library budgets are allocated by the central university administration based on historic formulas or outdated needs, and libraries follow their institutional policies and mandates regarding budgets. Occasionally, an institution provides funding for its library through individual colleges and departments instead of centrally setting the library budget. In that case each department or university unit decides whether or not to fund the library each year based on satisfactory library service as well as need.
Based on the latest available U. S. statistics (1992), major components of the basic academic library budgets are the personnel budget (50%-60%), the serial budget (17.5%), the book budget (11.5%) while only a small part (10%-20%) is devoted to building maintenance, automation/systems and equipment. Academic library budgets in the United States have not grown enough during the last three decades to accommodate the annual inflation costs for library materials of 10% to 15%. This has resulted in smaller collection growths, although in 1991 the total number of volumes held in all academic libraries in the United States was about 749 million. 
Examples of innovative fund-raising campaigns include working with university athletic departments to raise funds for libraries as is currently done at the University of Nevada with the basketball team, and at the University of Louisville with the football coach.
At North Carolina State University part of new increases in student tuition is allocated to the library. At the University of North Carolina/Chapel Hill students are taxing themselves at $2.50 per semester to build the Student Endowed Library Fund. In some universities students are assessed specific library fees per semester and/or per credit hour, or they pay a technology fee of which the academic library receives a percentage.
Another innovative idea is being tested at Louisiana State University where the state government allocated over $2 million in bond proceeds to the university for library materials purchases. 
At Cornell University the library is experimenting with pooled endowments to fund research periodicals in an innovative manner and to combine small endowment accounts into one large account for easier management. Donors are recognized in the online catalog for their gifts.  This creative approach to using endowments could have much merit particularly in smaller institutions.
In 1993 Georgia’s university system created the Equipment, Technology and Construction Trust Fund with the help of the Governor and the General Assembly with proceeds from the state lottery. This fund helps with the purchase of equipment for classroom and high-technology research, as well as the building and equipping of technology related facilities to strengthen program quality. To qualify for these funds institutions must match the amount of money requested with an equal amount generated from private fund-raising. 
Friends groups can be successful fund-raising mechanisms in academic libraries, an excellent example of which can be found at the University of Mississippi. Although founded in 1940, a reorganization in 1983 required dues and moved them into fund-raising. At this time they have an endowment of $75,000 and gifts of $200,000. Fund-raising activities include special parties, auctions and other creative events. 
The Connecticut legislature passed what is known as Ucom2000 in 1994-95 to give the University of Connecticut bonding authority to raise almost $1billion over the next ten years. This will be a welcome funding aid since state support for the university has decreased by 40% during the last five years. Library needs are included in this innovative plan for which fund-raising has begun. 
Successful fund-raising is based on several key factors as outlined by two experienced librarians at Ohio University where $9 million was raised in support of the library.  These factors include:
Stating the library’s goals and financial situation;
OhioLINK in Ohio is an interesting example of innovative resource sharing among academic libraries in one state. Supported by state funding amounting to approximately $18 million a year, OhioLINK now includes more than 50 public and private libraries and the state library. Sharing an integrated automation system (Innovative Interfaces) has enabled them to build a database of more than 7 million items, accessible to all participants through an efficient and effective state-wide physical document delivery system. OhioLINK libraries also share full-text and bibliographic electronic databases, training, networks, cataloging and many other collection and service programs. Library users appreciate OhioLINK’s quick, effective document access and delivery. The state of Ohio is building similar library networks for public and school libraries with the goal of future cooperation between all these library networks.
A number of companies in the nation are now offering an array of possibilities to outsource such operations as cataloging, processing, acquisition. However, most academic libraries are not yet ready to take advantage of such services. They have not assessed the exact costs for most of their operations and services to help them decide when outsourcing is most economical and they have not yet concluded which operations and services to discontinue as new ones are demanded. Most academic libraries are just beginning to rethink and reengineer their operations and services so they can take advantage of available outsourcing services.  Once academic libraries assess the costs of their services and operation they will be able to reallocate resources and take advantage of outsourcing as well as insourcing and contracts.
Fee-based services can also contribute to corporate giving. If the customers are satisfied and the librarians work successfully with the Development Office on campus, new resources for the library may be obtained from corporate and other business sources which have been satisfied customers.
Libraries can also form partnerships with businesses on a contractual basis for information provision, specialized research or library operations. Some academic libraries manage business, governmental or museum libraries under special contracts with a particular business or a museum or a governmental agency. The academic library involved usually runs such an operation on a completely separate basis and receives some type of overhead compensation for it. This is another way to begin fund-raising with such groups.
University libraries can also form partnerships with other types of libraries such as public and school libraries to improve information provision in a given community. Special funding in the form of grants are usually available for such partnerships.
However, budgets for academic libraries will continue to need increases as information in print and digital formats continues to be balanced, preserved, organized and made accessible in an environment of licensing and copyright regulations.
Entrepreneurial librarians will be much in demand in the future just as corporate entrepreneurs have always been in demand. Librarians need to have visions, ideas and courage to experiment with new and creative ways to fund their libraries. They need to be less territorial and realize that staff will be a most important resource.