Corporate Funding for Public Libraries

Corporate funding for public libraries involves financial contributions from businesses and wealthy individuals aimed at supporting library operations, programs, and facilities. While public libraries primarily rely on government funding, there is a growing trend toward plural funding, which combines public tax dollars with private donations and corporate sponsorships. Corporate contributions can take various forms, such as cash donations, in-kind goods, or partnerships that enhance library services. Historically, significant donations have come from notable philanthropists like Andrew Carnegie, whose foundation continues to impact libraries today.

However, the relationship between libraries and corporate donors can be complex, as libraries may struggle to provide the same incentives for sponsorship that arts organizations can offer. Concerns about conflicts of interest and the motivations behind corporate giving can arise, leading some libraries to carefully evaluate potential partnerships. Successful collaborations may also involve programs that resonate with corporate social responsibility goals, such as literacy initiatives. Overall, corporate funding presents both opportunities and challenges for public libraries seeking additional resources in a competitive funding landscape.

Published in: 2021

By: Erbschloe, Michael

Subject Terms

Corporate Funding for Public Libraries

Abstract

This article examines how libraries have benefited from contributions from corporations and corporate executives. The mechanisms that have facilitated contributions to libraries, including corporate social responsibility programs and the trusts established by company founders and executives, are reviewed along with some of the major milestones of giving to libraries. The process of building partnerships between libraries and corporations is explained, and examples of successful library efforts to obtain funding are reviewed. Some of the problems associated with libraries receiving corporate funds as well as those encountered by donors are also reviewed along with specific examples.

Overview

Public libraries have long been one of the main ingredients of a democracy. From the largest cities to some of the smallest towns in America, the public library has provided access to knowledge resources as well as a community meeting place. Funding for public libraries, as well as those on university and college campuses, have come from both public sources through taxation and bond issues as well as from private sources through contributions and community fund-raising activities. Corporations and wealthy corporate executives have contributed substantial funds to establish, expand, or support libraries in the United States.

However, most public libraries heavily depend on public funding such as local and state tax dollars for operating budgets. There has been a movement toward plural funding including memberships, major gifts, sponsorships, sales, and other earned income, as well as taxes. Public colleges and universities, museums, science centers, orchestras, arboretums, nature centers, and virtually all other cultural and educational institutions have pursued plural funding strategies for decades (Coffman, 2004).

There is a history of corporate contributions or private funding to the arts and cultural organizations as well as to libraries. Often corporate donations of cash or in-kind contributions have brought little more than recognition to the company, board member, or executive who organizes the contributions. In some cases, corporate giving has been a rent-seeking activity as managers leverage their involvement with arts and community organizations as a means to influence government officials or existing and potential clients and suppliers. Corporate contributions have also been made to help achieve or support strategic goals when businesses link their contributions with management objectives including staff development, corporate incentive programs, or image building (Stanziola, 2007).

Corporations have also been big purchasers of memberships in museums or theater organizations. This has generally involved payments for annual subscriptions by a company in return for benefits such as a number of event tickets or passes, the use of facilities, or discounts on advertising in printed programs or catalogs (Stanziola, 2007). Unfortunately, libraries do not have the same sort of leverage in corporate fund-raising because they cannot provide the membership perks that arts or cultural organizations can provide.

Although there are outstanding business libraries and special collections throughout the United States, many corporations are not in a convenient location to take advantage of those offerings. In addition, corporations have also been in need of rather specialized information, and as a result, many have established their own internal libraries. The Internet has helped replaced some of the hard copy that corporations need to keep in house, and the nature and the style of many corporate libraries has changed (Koss-Feder, 1996). But without an obvious direct benefit from supporting the local library, many corporate executives choose instead to support arts or cultural activities, which usually offer fund-raising and social events with network opportunities.

Historic Examples of Large Business Contributions. In 1899, the industrialist Andrew Carnegie began a long-term effort to establish free public libraries around the world (Rankin, 1999; Pierce, 2002). Carnegie funded many libraries in the United States and in 1911, the Carnegie Corporation of New York was established to handle his philanthropy. One hundred years later, the Carnegie Corporation of New York was still giving out money and, to celebrate the centennial, the giving campaign was granting $500,000 to $2 million to library systems in 25 cities with culturally diverse populations (Viadero, 1999). The Carnegie Corporation has also made contributions to the American Library Association ("Carnegie," 1989).

During the 1990s, the New York Public Library (NYPL) received $20 million from Dorothy and Lewis Cullman. Dorothy Cullman was a vice chair of the library's board, and Lewis Cullman, was president of Cullman Ventures, Inc., a major contributor to Yale University and endowed the Cullman Professorship of Manufacturing at Purdue University. The Cullmans' gifts were the Library for the Performing Arts and the Science, Industry, and Business Library of the NYPL (St. Lifer & Rogers, 1995).

In 1997, retired teacher Thomas R. Drey, Jr., left the Boston Public Library his entire estate, totaling $6.8 million. This was the largest donation from a single named individual in the library's history. The money was to be used to increase hours, purchase additional computers and databases, and expand the collection of books and periodicals for the business library (Oder, 2001). An anonymous donor later gifted the library some $1.1 million between 2008 and 2013 to help preserve its collection of rare books (MacQuarrie, 2013).

In 2000, a new central library was being planned in London, Ontario, and it received a C$500,000 donation from the Wolf Family Foundation, which is funded by a family of businessmen. The contribution was to be used to upgrade the library's performance hall from 250 seats to a 400-seat auditorium. Shortly after, the Downtown London Business Association announced a gift of C$100,000 to support sound and lighting equipment for the new hall (Oder, 2001).

In 2004, as the Seattle Public Library Foundation was raising money for a new library, there were over 20,000 private donors to the project. These included Microsoft cofounder Paul Allen ($22.5 million), Microsoft CEO Bill Gates and his wife, Melinda ($20 million), and former Microsoft executive Charles Simonyi ($3 million). The total project raised over $80 million ("Gift to Seattle…," 2004).

Also in 2004, the Bentonville Public Library (BPL) in Arkansas received a $1 million donation from Wal-Mart to help kick off a $4 million fundraising drive ("Wal-Mart…," 2004). In addition, Horace Hagedorn, founder of the Miracle-Gro Plant Food company, donated $1 million to the Middle Country Public Library in Centereach, New York, to establish an endowment for the Family Place program ("A Miracle…," 2004).

In 2008, Commerce Bank announced that it was donating $200,000 to libraries in low- to moderate-income areas throughout the areas were the bank has branches. Fifty public libraries that would receive a $4,000 grant each for books, technology resources, or existing library programs. The bank was also promoting National Library Week and a kickoff to Commerce Bank's Summer Reading Program. The program encourages young people to read and provides a goal for them to learn the importance of saving and money by contributing $10 into a new or existing young savers account for each child who reads 10 books throughout the summer ("Donations Kick Off…," 2008).

Other Ways Libraries Work with Businesses. In addition to donations or in-kind contributions, there are a number of ways that libraries can benefit from their relationships with corporations. However, there have been problems in the past as corporate America and the wealthy leaders of corporations have attempted to leverage their contributions to libraries as they have done with art or through corporate sponsorships (Copeland, Frisby & McCarville, 1996).

Many libraries have courted private companies to use library services—which is a good method to bring value to the local business community and to make more friends—especially when it comes time to raise funds ("Corporate Borrower's Card," 1982). A few public libraries have even looked around their community and tried to make sure that they can indeed offer services that local businesses can use. Even if there is a fee for services, businesses may very well respond if fees are reasonable and if service is good (Rogers, 1992).

There are fledgling efforts to experiment with other means to obtain revenue from private companies. In the United Kingdom, one such experiment involved placing inserts in books that were being checked out of the library. The inserts were advertisements sponsored by local businesses or national brands and aimed to distribute three million inserts per month ("Partnership Launches…," 2007).

Applications

Library Partnerships with Businesses. In the 1980s, the concept of partnerships between organizations with the same fundamental goals of community development, the support of culture, arts, history, or learning became a popular way to coordinate activities and fund raising. Partnerships between libraries and businesses range from small-scale localized agreements to fund the costs of programs or facilities all the way to the support of large-scale projects such as major building campaigns (Bourke, 2007). Localized partnerships often provide speakers, trainers, or joint program development efforts focused on specific topics including how to use new technologies (Iser, 2008). Nationwide programs include funding for literacy programs or book acquisitions ("Grant Programs," 2009).

American Library Association. On a national level, the American Library Association (ALA) in the United States provides corporations with several alternatives to participate in partnerships and contribute to programs. The ALA sells tiered memberships that cost corporations $500 or $2,000 annually. Corporate members gain access to tens of thousands of individual and organizational members through discounted membership, preferred exhibit booth space at ALA events, and subscriptions to ALA publications ("Membership," 2013). The ALA also provides a higher level and profile membership for corporations called Library Champions. Most of the companies in this category either sell products or provide services that are directly related to libraries ("Library Champions," 2009).

Several companies that have become Library Champions sell products or provide services that are not directly focused on libraries, such as Brodart Company (office furniture), Dollar General (retail stores), Home Depot (home products and hardware chain), Lord & Taylor (department store), Verizon Communications (telecommunications), and Walgreen Company (drug store chain) ("Library Champions," 2005; 2009). These companies are directing some of the funds they allocate for corporate social responsibility programs into funding for libraries ("Corporate Member Recognition," 1997).

The Dollar General Literacy Programs. Dollar General's cofounder, J. L. Turner, was functionally illiterate when he started the company. He worked to build the company and to learn to read and write along the way. Dollar General's corporate social responsibility program focuses considerable funding to support literacy programs across the United States. The Dollar General Literacy Foundation has awarded over $81 million in grants across its forty-state market area (“About Us,” 2013). Dollar General also established a Learn to Read free literacy referral program that program is promoted through the Do You Want to Read Better? brochures displayed store checkout counters ("Dollar General Library Champion," 2009). The Dollar General Adult, Family, and Youth Literacy programs provide funding to nonprofit organizations that provide direct service to adults in need of literacy assistance ("Grant Programs," 2009).

Friends of the Library Groups. Many libraries have an auxiliary organization that is frequently called the Friends of the Library (FOL). FOL groups have several roles with their library, but most often focus on fund raising and have shown incredible ability to raise money. In St. Paul, Minnesota, for example, the local FOL group raised $5.4 million through contributions from over 1,200 individuals and corporations (Rogers & Oder, 2000). In addition, endowments for several libraries have been supported through such fund-raising efforts or bequests from patrons ("$600,000," 1984; St. Lifer & Rogers, 1998; Bennett, 2002).

One of the most popular mechanisms for these fund-raising efforts is the FOL book sale. Books are sold to the public for anywhere from 10 cents to 10 dollars and sometimes more. In 2006, the Friends of the San Francisco Public Library, for example, reported $247,000 in sales for its 42nd Big Book Sale, at which over 130,000 books were sold in a 40-hour period. Many of the first people through the door to buy books at these sales are book resellers, some of whom have small businesses that resell books or are operating larger and highly profitable enterprises in the used book market (Hogan, 2008).

Many of the FOL book sale efforts have some sort of support from local businesses that provide in-kind contribution, such as space for the sale or equipment to support the sale (Oster, 1980). As the FOL book sales evolved, so did the used book business. In addition, FOL groups often contract with local booksellers to buy remainders from their sale. The booksellers offer a lot price and take care of boxing and hauling the books away ("Simplified Book Sales," 2008). Local FOL groups are also starting businesses, and many have opened bookstores to help raise funds for their libraries.

Better World Books. One of the companies that has built a thriving business by helping libraries sell books is the online bookseller Better World Books (BWB). In 2007, BWB donated $470,000 in proceeds from its Library Discards & Donations Program to hundreds of city, county, and university libraries ("Better World Books…," 2008). BWB collects discarded and donated books from libraries nationwide and resells them through online marketplaces, including BetterWorld.com, Amazon.com, and Half.com. By late 2016, it had generated over $13 million in funding for libraries and secondhand stores and an additional $10 million in funding for nonprofit literacy initiatives (“Our Impact,” 2013).

Not all friends feel the need to be so formal when they help libraries. In 1993, the then Illinois secretary of state and state librarian George Ryan announced a program to provide used books to libraries and other institutions in the state. The people of Illinois donated tens of thousands of books. The books were distributed to many of the state's regional libraries and representatives from libraries, literacy programs, English as a Second Language (ESL) programs, and schools could pick up the books that they thought would be most helpful to their organizations ("News in Brief," 1993).

Library Foundation of Los Angeles. In 1993, the Library Foundation of Los Angeles may have executed one of the grandest of all community-library-business partnership activities ever accomplished. After fires caused considerable damage to the central Los Angles Library and subsequent fires damaged two branch libraries, the community response in Los Angles was unprecedented. The buildings were reconstructed in grand style, and the city celebrated the year of the book in 1993. Virtually every major cultural and arts organization was able to participate in some manner (Reagan, 1993).

In October of that year, more than 800 major library donors along with many other top-tier supporters of Southern California cultural and arts organizations were invited to a $500-a-plate dinner and champagne and were treated to preview tour of the reconstructed central library. This event kicked off a series of than 150 author appearances, seminars, and receptions that would take place day and evening at the library through the month (Reagan, 1993).

Disaster Relief and Corporate-Library Partnerships. In 2005, in the wake of Hurricane Katrina’s devastation along the Gulf Coast, tech giant IBM and a journal subscription provider teamed up with Louisiana State University library students to create a temporary library in a Baton Rouge, Louisiana, community to help evacuees get information about federal disaster relief and provide children a space in which they could do homework (Dempsey, 2005). Similarly, after Hurricane Sandy swept through the Northeast and destroyed many public and school libraries in the greater New York City area in 2012, publishers Random House, Scholastic, Houghton-Mifflin, and Simon & Schuster all donated thousands of books to help reestablish collections in some public and school libraries in the hardest hit areas (Springen, 2013).

Shared Space. As libraries have increasingly faced budget cuts to public funding due to the Great Recession, they have turned to alternative means of raising funds. Among these have been joint development ventures in which they and one or more partners share a parcel of land; construct a shared building space in which one or more parties has an ownership stake; enter a condominium arrangement in which the library typically owns the site and parties each own their space within it; or serve multiple library communities simultaneously (Murvosh, 2012). Partner organizations have ranged from local government agencies to academic institutions to residential units to real-estate developers (Murvosh, 2013). For these partner organizations, which have also felt the economic consequences of the downturn, the lowered costs of building and/or maintenance prove the big draw.

Viewpoints

Bumps in the Road to Private Library Funding. The relationship between corporations and corporate executives that fund nonprofit or charitable organizations has been successful on most occasions. But there are pitfalls and problems that emerge on both sides of the giving and receiving equation. In some cases there have been concerns about appearances, politics, and even religion (Tinnish, 1996). As the corporate social responsibility (CSR) movement evolved from localized philanthropy to global image building efforts on the part of corporations, the need for company executives to assure that there is a positive return on CSR has intensified (Bendell, 2005).

Librarians and their boards of directors remain skeptical and seem to have considerable defensiveness about the fact that corporations want a return on their investment when they make contributions or when they sponsor events (Kniffel, 1995; Woodsworth, 1996). On the other hand, libraries and other nonprofit organizations feel considerable pain when there are shifts in corporate giving (Denitto, 1999). But regardless of how librarians may feel about trends in library-corporate relationships, libraries have long been dependent on the kindness of benefactors (Goldberg, 1998).

Modern corporations have considerable experience in giving and leveraging their gifts. They also have staff or agencies that understand corporate goals and know to manage corporate giving to help achieve those goals. They work to develop giving objectives that help meet the business goals of the company, which are often directed toward serving its constituencies, including employees, customers, and consumers. Corporations also do considerable follow-up to measure what their giving programs accomplish (French, 1991).

Some Bumps Are Big, Others Are Not. In the early twentieth century, Stratford, Ontario, turned down a contribution from Andrew Carnegie to help build a new public library. One of the big reasons behind the rejection of the money was the Homestead riot. During a labor dispute in 1892 between armed Pinkerton guards hired by the Carnegie steel mill near Homestead, Pennsylvania, seven strikers and three Pinkertons were killed. Carnegie had also (in the minds of many) expressed a patronizing attitude toward Canada in his 1885 book Triumphant Democracy. Although Carnegie had donated millions of dollars to help build libraries in the United States and Canada with no strings attached, his reputation was not particularly good in Canada, and his offers of donations were turned down by other Canadian cities and towns. It took almost a decade for Carnegie to overcome the backlash, but many of the donations he offered in Canada were eventually accepted (Goldenberg, 2008).

In 1997, the Floyd Memorial Library in Greenport, New York, turned down $3,500 from the Cross Sound Ferry Company. Many residents felt that that the ferry company was to blame for nonresidents crowding their small town. The ferry brought about 80,000 visitors there every year from New London, Connecticut. Local citizens had been opposing the ferry company's efforts to expand its parking area to service more travelers. The library wanted to stay clear of the controversy and decided that the donation was not worth the potential hassles it might bring along with it (Rogers & St. Lifer, 1997).

In 2007, the city of Santa Fe, New Mexico, ended up forgoing a $1 million donation from the family of late businessman Michael J. Maloof. The family wanted the benefit of branch library naming rights in exchange for their donation, which was apparently not consistent with city policy. After considerable controversy, debate, and city council votes on naming rights, the offer became tainted with politics and emotion, and the donation was declined ("Naming Flap…," 2007).

McDonald's Support of Reading Programs. In the early 1990s, McDonald's restaurants supported a large-scale reading program. McDonald's supported the development of reading kits prepared by the Association for Library Service to Children (ALSC) and then paid for production of the kits and the distribution of the kits to every library in the United States. In return, the McDonald's logo was placed on the kits. Then, in a surprise move, the ALA Social Responsibilities Round Table (SRRT) sent a resolution condemning McDonald's corporate sponsorship of an ALA program to the ALA president and chief executive officer of McDonald's ("ALA Round Table Defends Actions," 1993). In the end, McDonald's did continue to support the reading program ("For Third Year," 1995). In 1993, at the same ALA meeting that the SRRT condemned the sponsorship, the ALA Council voted to tell McDonald's that the ALA was grateful for the support (Berry, 1993).

Corporate Sponsorship Investment. The history of private donations to public libraries shows that business, corporate executives, and the foundations established by the companies or executives have been generous to libraries. Large donations have allowed many libraries to be built or to sustain operations. Many of the large contributions covered in this article were made in the style of twentieth-century philanthropy.

Things have changed in many ways. Most libraries need money not only to meet traditional goals but also to expand and maintain their technology services in the age of the Internet. Corporations are facing greater competition in the global economy and need to make sure that every dollar they spend on sponsorships or donate to arts or cultural organizations and even to libraries provides a good return on investment.

The modern corporate manager needs to examine every contribution and ask two questions: "What's in for the company?" and "How much will it cost?" The trade-off is weighed between what will be gained and what will have to be given up. One way that corporations view their investments in sponsorships or contributions is in media mentions or impressions based on a dollar value of the paid advertising rate. Media impressions can include television, print, radio, event attendance, and promotions.

Spending trends are rather clear. Between the late 1980s and early 2000s, the rate of growth in corporate sponsorship outpaced that of investment in any other form of marketing communication or promotion vehicle. In 1987, sponsorship spending in the United States amounted to $1.3 billion, but by 2003, it had escalated to over $10 billion. Worldwide sponsorship investment spending was $51.1 million in 2012 and projected at $53.3 million for 2013 (IEG, 2013). In North America, the region with the highest level of corporate sponsorship spending, sports sponsorship represented an estimated 69 percent of all sponsorship monies for 2013, followed by entertainment at 10 percent (IEG, 2013).

Competition for Funds. Libraries are not only facing budget cuts to public funds but also more and more competition when it comes to raising private funds. It is not just the local arts council or theater group that wants private funding but high-profile sporting events are also in line for the dollar. Sports are popular and can provide considerable exposure for a sponsoring company. Arts and cultural events provide some benefits of media exposure but can also provide networking opportunities for sponsors and their families, not to mention the occasional great party and cultural event.

As time goes by, corporate donors will want more and more for their money. Libraries are faced with the challenge of determining what they have to offer and how to make that more attractive to corporations in order to draw contributions. When private companies are facing money issues, they have several alternatives. They can borrow, they can merge with another company, or they can just close down. Every now and then, a company reinvents itself and lives on happily for many more years.

But it is not just the library side of the equation that bears examination. Corporations should take a harder look at what they can gain from contributing to libraries. Unlike the sponsorship arena and the world of arts and culture, there is less competition when donating to libraries, and thus, it may be easier to gain high-level recognition for such contributions.

Terms & Concepts

Bequest: A gift to an arts organization or other nonprofit that is made in the will of a person and is generally executed after his or her death.

Book Resellers: Companies or individuals that buy used books, remainders, or closeouts and resell them online or through storefronts.

Corporate Social Responsibility (CSR): The movement of corporations toward funding organizations and activities in the localities that contribute to corporate functioning and success or in those communities in which employees, customers, or suppliers work and live.

Plural Funding: The use of multiple funding sources including public funding (such as tax dollars), foundation funding, corporate funding, and private philanthropy.

Private Funding: Financial contributions or gifts to libraries or arts organizations contributed by private businesses, publicly traded companies, or individual citizens.

Public Funding: Financial support for libraries or arts organizations derived from tax dollars and granted by a federal, state, or local government agency.

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Corporate Funding for Public Libraries

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Corporate Funding for Public Libraries

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