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Washington Public Library Trustee Wiki

Perhaps not glamorous or exciting, but an understanding of the ways in which libraries are funded and how those funds should be managed are critical to keeping the library’s doors open. This knowledge is essential for board members who are charged with the responsibility of ensuring that their community continues to have library services and programs.

It is the trustee’s responsibility to understand the details of their library’s funding, including where the money comes from and the district or municipal library budget process. Limitations on funding have been established by state law and the Washington State Constitution as well as various initiatives passed by a vote of the electorate.

Trustees must be advocates for adequate library funding within their communities, with city and county governmental authorities, and with state elected officials. Trustees must also consider investigating additional sources of revenue, especially for one-time projects.

Garnering support for the library is critically important. It is a task that requires the personal commitment of each board member to:

  • Understand how funds are allocated to the city or town library or levied by the district and how the laws that govern public finance and proposed laws, initiatives, or referenda that will affect the library financial needs and budgetary processes;
  • Explore the options for better support of library services in the community, from supporting Friends of the Library to establishing a library foundation;
  • Promote the board’s vision and long-range plans for the library and ask citizens for their support in a variety of venues in addition to library board meetings;
  • Plan ahead for community needs, such as constructing or remodeling library facilities;
  • Regularly ask citizens and library users what the community wants and actively work to achieve their priorities;
  • Work proactively with funding authorities to support the library.

Definitions Pertaining to Funding

Property taxes (RCW 84.04)

“Assessed value of property”
“… the aggregate valuation of the property subject to taxation by any taxing district as placed on the last completed and balanced tax rolls of the county preceding the date of any tax levy.”
Note: RCW 84.04.020 clarifies this, stating “The terms ‘assessed valuation of taxable property’, ‘valuation of taxable property’, ‘value of taxable property’, ‘taxable value of property’, ‘property assessed’ and ‘value’ whenever used in any statute, law, charter or ordinance with relation to the levy of taxes in any taxing district, shall be held and construed to mean ‘assessed value of property’ as defined in RCW 84.04.030.
“Assessment year,” “Fiscal Year”
“… shall commence on January 1st and end on December 31st in each year.”
“Legal description”
“… for property tax purposes, the parcel number is sufficient for the legal description.”
“Levy rate”
The amount of property tax revenue a library district can raise each year (i.e., its property tax levy) is its level rate (its tax rate per $1,000 of assessed valuation) times its taxable assessed valuation. Note: Limitations, such as those imposed by RCW 84.52.050 may affect this rate.
“Library district”
A library district is defined as a junior taxing district, included among “… all taxing districts other than the state, counties, road districts, cities, towns, port districts, and public utility districts” as defined by RCW 84.52.043(2), and, as such, is empowered to levy a tax against property specifically for the purpose of supporting the library. See also “Special purpose districts.”
“Regular property taxes,” “regular property tax levies”
“… a property tax levy by or for a taxing district which levy is subject to the aggregate limitation set forth in RCW 84.52.043 and RCW 84.52.050, as now or hereafter amended, or which is imposed by or for a port district or a public utility district.”
“Taxing district”
“… shall be held and construed to mean and include the state and any county, city, town, port district, school district, road district, metropolitan park district, water-sewer district or other municipal corporation, now or hereafter existing, having the power or authorized by law to impose burdens upon property within the district in proportion to the value thereof, for the purpose of obtaining revenue for public purposes, as distinguished from municipal corporations authorized to impose burdens, or for which burdens may be imposed, for such purposes, upon property in proportion to the benefits accruing thereto. RCW 84.04.120.

Other Definitions

“Local infrastructure financing”
“… the use of revenues received from local excise tax allocation revenues, local property tax allocation revenues, other revenues from local public sources, and revenues received from the local option sales and use tax authorized in RCW 82.14.475, dedicated to pay either the principal and interest on bonds authorized under RCW 39.102.150 or to pay public improvement costs on a pay-as-you-go basis subject to RCW 39.102.195, or both.” RCW 39.102.020(11)
“Library capital facility area”
“… a quasi-municipal corporation and independent taxing authority within the meaning of Article VII, section 1 of the Washington State Constitution, and a taxing district within the meaning of Article VII, section 2 of the state Constitution, created by a county legislative authority of one or several counties. A library capital facility area may include all or a portion of a city or town.” RCW 27.15.010(2).
“Library capital facilities”
“includes both real and personal property including, but not limited to, land, buildings, site improvements, equipment, furnishings, collections, and all necessary costs related to acquisition, financing, design, construction, equipping, and remodeling.” RCW 27.15.010(3).
“Special purpose districts”
As defined by the Municipal Research and Services Center of Washington (MRSC) in their publication, Special Purpose Districts in Washington State, “In Washington, special purpose districts are limited purpose local governments separate from a city, town, or county government. Generally they perform a single function, though some perform a limited number of functions. They provide an array of services and facilities including electricity, fire protection, flood control, health, housing, irrigation, parks and recreation, library, water-sewer service, and more recently, public transportation, stadiums, convention centers, and entertainment facilities. Special districts provide a means for citizens to obtain these services for a specific geographic area when they are not otherwise available from a city or county.” Page 7 of MRSC’s “Washington Special Purpose Districts Overview” features a very helpful graphical overview of the various types of library special purpose districts in the state.
“Tax code area”
“a geographical area made up of a unique mix of one or more taxing districts, which is established for the purpose of properly calculating, collecting, and distributing taxes. Only one tax code area will have the same combination of taxing districts, with limited exceptions.” WAC 458-19-005(x). See also WAC 458-12-140(1)(3).
“Value of the taxable property”
“… the actual value of the taxable property in a taxing district incurring indebtedness, as the term “taxing district” is defined in RCW 39.36.010, to be ascertained by the last assessment for state and county purposes previous to the incurring of such indebtedness except that in incorporated cities the assessment shall be taken from the last assessment for city purposes, plus the timber assessed value for the district as defined in RCW 84.33.035. RCW 39.36.015.

The National Association of Counties (NACO) provides more definitions in their Research Brief, Finance Terms Every Commissioner Should Know. The Washington State Office of Financial Management has an extensive A – Z Glossary with clear explanations of many fiscal terms.

Sources of Funding

Washington libraries are funded in a number of ways. They may levy a property tax, contract for services, or submit a budget to municipal authorities. Each requires that the board of trustees knows in detail the unique processes, schedules, and the relationships with local authorities that will affect their own library.

Property Taxes

Property taxes are the chief source of revenue for library districts in Washington, but the laws governing them are extremely complex. As expressed by MRSC in the opening line of both of their revenue guides, “One longtime legislative analyst from Olympia says that the Washington property tax is the most complicated in the nation. We plan to limit this discussion to what officials and staff… really need to know. Even that is pretty complicated.”

Check out the MRSC revenue guides where you will find clear explanations of property taxes, levy lids, and related topics:

The MRSC also provides a summary of “Property Taxed Based Revenue Sources” on its web page devoted to Revenues of Special Purpose Districts. In describing taxing districts, it states:

“Taxing districts are defined in RCW 84.04.120. They have the power to impose tax burdens upon district property in proportion to property value, as opposed to obtaining revenue for public purposes in proportion to the benefits accruing to it. The statutes classify taxing districts into senior taxing districts (the state, the county, city or town, county road, port, and public utility districts) and junior taxing districts (all others).”

A wealth of information on property tax levies may be found in the Property Tax Levies Operations Manual (also known as the Property Tax Levy Manual) from Washington’s Department of Revenue. A link to this document has been provided by MRSC on their web page, Revenues of Special Purpose Districts.

An in-depth look at Special Purpose Districts may be found in MRSC’s online publication, Special Purpose Districts in Washington State.

The Washington State Department of Revenue is another rich resource, offering workshops, publications, and information related to taxes in Washington State. Get help on their “Doing business” page. Need to find a county assessor or treasurer? The Department of Revenue makes it easy - just go to their “County Assessor and Treasurer Websites” page.

Levy Lid Lifts and Excess Levies

What is the difference? In response to a question regarding excess levies and levy lid lifts, a legal consultant from MRSC provided the following extremely clear explanation of what can be a very confusing topic:

“The difference is that [City A] is doing a LEVY LID LIFT under RCW 84.55.050 and you have been doing an Excess Levy under RCW 84.52.052. Now, the question is, can you do a levy lid lift? And, the answer is, “yes” but in doing so, you would be “borrowing” levy capacity from your fire district, which they could take back at any time by having a vote to do a levy lid lift themselves. In fact, even right now, without your doing a levy lid lift, you are borrowing capacity from the fire department and could lose it. So, let’s make certain you understand your current situation first before I discuss a levy lid lift.

Your Current Situation: Get out your copy of A Revenue Guide for Washington Cities and Towns and look at page 1. You are in a fire district. So your maximum guaranteed levy rate is $2.10 ($3.60 less the maximum possible fire district levy of $1.50). For 2012, your levy rate is $2.698378 according page 13 of your assessor’s report. [The “County Assessor and Treasurer Websites” page provides contact information for county assessors.] And, that of Fire District No. 6 is $0.402768. Added together they equal $3.101146. This is less than $3.60, so everything is “fine.” But, what if your fire district decided that for 2013, it wanted to levy $1.00 and went to the voters with a lid lift under RCW 84.55.050 and was successful? Your levy rate would fall to $2.60 because the two rates together cannot equal more than $3.60. If the fire district had a vote on a levy rate of, say, $1.30, and was successful, then your levy rate would have to fall to $2.30, which is less than your current rate.

Now, it is probably unlikely that the fire district would try to jump from a levy rate of approximately 40 cents to a dollar or more all at once. But, you need to be aware that when your regular property tax rate is anything over $2.60, you are “borrowing” some of your from the fire department’s rate. Think about how you would handle your budget if all of a sudden the fire district raised its rate a lot!

Note that an excess levy such as you now have for your library is outside all these limits. It is outside your maximum guaranteed regular levy rate of $2.60 and the maximum rate for you and the fire district together of $3.60.

Could you do a levy lid lift like [City A]? [City A] has a maximum tax rate limit of $3.60 and it is lower than that now. It doesn’t have to worry about what a fire district does because it is not part of a fire district. It is not “borrowing” any part of its levy rate. So, in that sense, you cannot be like [City A]. However, you can do a levy lid lift as long as you realize that at least some of the levy lift would “go away” if the fire district did one also. Let’s say, for example, that you put a lid lift on the ballot for 50 cents, which is what your excess levy has been. So, assuming your rate is still $2.698378 (it would probably be a little different, but we don’t know what it would be), with a lift of 50 cents, your total would increase to $3.198378. Assume the fire district stays at $0.402768. The two rates added together come to $3.601146, which is more than the allowed $3.60. Your levy lift would have to be a little less than 50 cents.

You could do one and you could put it on the ballot for as many years as you want. But, remember that part or all of the lid lift money could go away if the fire department wanted to raise its rate. You might say, “Well that’s better than having to go out for a vote every year! And it only requires a simple majority vote. If the fire department raises its rate, then we could go back to doing an excess levy.” That’s a good argument. Just realize that every penny the fire department raises its rate would lower your lid lift by a penny. You would not be getting the 50 cents you are currently getting from the excess levy.

So, that is where you are. Since you already have passed an excess levy this past February for collection in 2013, you have a year to think about a lid lift. There is information about a lift on pages 10 and 11 of the city revenue guide referred to above. Also see our web page, Levy Lid Lift.

Other Revenue Sources


A city may choose to allocate additional funds for special library projects. When large capital projects are planned, the city, with the library’s support, may ask voters to approve a special bond issue. Capital projects can include:

  • A new library building;
  • Extensive remodeling of an old library;
  • Technological improvements to an existing library building.

“A rural county library district, A rural county library district, intercounty rural library district, or island library district may contract indebtedness and issue general obligation bonds not to exceed an amount, together with any outstanding nonvoter approved general obligation indebtedness, equal to one-tenth of one percent of the value of the taxable property within the district, as the term "value of the taxable property" is defined in RCW 39.36.015. The maximum term of nonvoter approved general obligation bonds shall not exceed six years. A rural county library district, island library district, or intercounty rural library district may additionally contract indebtedness and issue general obligation bonds for capital purposes only, together with any outstanding general indebtedness, not to exceed an amount equal to one-half of one percent of the value of the taxable property within the district, as the term "value of the taxable property" is defined in RCW 39.36.015 whenever a proposition authorizing the issuance of such bonds has been approved by the voters of the district pursuant to RCW 39.36.050, by three-fifths of the persons voting on the proposition at which election the number of persons voting on the proposition shall constitute not less than forty percent of the total number of votes cast in such taxing district at the last preceding general election. If the voters shall so authorize at an election held pursuant to RCW 39.36.050, the district may levy annual taxes in excess of normal legal limitations to pay the principal and interest upon such bonds as they shall become due. The excess levies mentioned in this section or in RCW 84.52.052 or RCW 84.52.056 may be made notwithstanding anything contained in RCW 27.12.050 or RCW 27.12.150 or any other statute pertaining to such library districts. RCW 27.12.222

See also Library Capital Facility Areas.

Contract Fees

Libraries may realize some revenues through contracting fees. “Instead of establishing or maintaining an independent library, the legislative body of any governmental unit authorized to maintain a library shall have power to contract to receive library service from an existing library, the board of trustees of which shall have reciprocal power to contract to render the service with the consent of the legislative body of its governmental unit. Such a contract shall require that the existing library perform all the functions of a library within the governmental unit wanting service. In like manner a legislative body may contract for library service from a library not owned by a public corporation but maintained for free public use: PROVIDED, That such a library be subject to inspection by the state librarian and be certified by him or her as maintaining a proper standard. Any school district may contract for school library service from any existing library, such service to be paid for from funds available to the school district for library purposes.” RCW 27.12.180.


When exploring funding possibilities, think about grants. A wide variety of funding entities, including state agencies, library and professional associations, nonprofits, and private foundations, can provide help in the form of sponsorships and grants.

Individual or programming grants
Capital Funding grants

Leasehold Excise Tax

(1)(a) The legislature hereby recognizes that properties of the state of Washington, counties, school districts, and other municipal corporations are exempted by Article 7, section 1 of the Washington State Constitution from property tax obligations, but that private lessees of such public properties receive substantial benefits from governmental services provided by units of government.

(b) The legislature further recognizes that a uniform method of taxation should apply to such leasehold interests in publicly owned property.

(c) The legislature finds that lessees of publicly owned property or community centers are entitled to those same governmental services and does hereby provide for a leasehold excise tax to fairly compensate governmental units for services rendered to such lessees of publicly owned property or community centers. For the purposes of this subsection, "community center" has the same meaning as provided in RCW 84.36.010.

(2) The legislature further finds that experience gained by lessors, lessees, and the department of revenue since enactment of the leasehold excise tax under this chapter has shed light on areas in the leasehold excise statutes that need explanation and clarification. The purpose of chapter 220, Laws of 1999 is to make those changes. RCW 82.29A.010.

See also RCW 82.29A.

Library Capital Facility Areas

RCW 27.15.050 provides for the financing of library capital facility areas by authorizing general obligation bonds for such purposes. The legislature finds that it is in the interests of the people of the state of Washington to be able to establish library capital facility areas as quasi-municipal corporations and independent taxing units existing within the boundaries of existing rural county library districts, rural intercounty library districts, rural partial-county library districts, or island library districts, for the purpose of financing the construction of capital library facilities. RCW 27.15.005.

To establish a library capital facility area, the following process is laid out by RCW 27.15.020:

  • A written request, signed by a majority of the members of the board of trustees of a library district, or board of trustees of a city or town library, is submitted to the county legislative authority of the county (or counties) in which the proposed area is to be established.  The request must include two goals:
    • To establish a library capital facility area;
    • To submit a ballot proposition under RCW 27.15.050 to finance library capital facilities.

The request must also include:

    • A description of the boundaries of the library capital facility area;
    • A copy of the resolution of the legislative authority of each city or town, and board of trustees of each library district, with territory included within the proposed area indicating both of the following:
      • Its approval of the creation of the proposed area;
      • An agreement on how election costs will be paid for the ballot proposition.
  • The legislative authority of the county or counties affected by the proposal submits separate ballot propositions to the voters at a general or special election to authorize establishment of such a district and to finance the library capital facilities by issuing general indebtedness and imposing excess levies to retire the indebtedness.
  • A simple majority vote is required for approval of the creation of a library capital facility area.

See also RCW 27.15.040

Local Infrastructure Financing Tool Program (LIFT)

The legislature recognizes that the state as a whole benefits from investment in public infrastructure because it promotes community and economic development. Public investment stimulates business activity and helps create jobs; stimulates the redevelopment of brownfields and blighted areas in the inner city; lowers the cost of housing; and promotes efficient land use. The legislature finds that these activities generate revenue for the state and that it is in the public interest to invest in these projects through a credit against the state sales and use tax and an allocation of property tax revenue to those sponsoring local governments that can demonstrate the expected returns to the state. RCW 39.102.010.

See also RCW 39.102

Timber Tax Revenues

The MRSC provides the following description of this tax on their web page, County Timber Revenues - Payments and Taxes:

“Counties are authorized to impose an excise tax on each person engaging in business as a harvester of timber on private land. This tax, based on the stumpage value of timber harvested for sale or for commercial or industrial use, is credited against the state's excise tax. The Department of Revenue certifies to the State Treasurer the amount of the excise tax collected to be distributed to participating counties each quarter. The four percent county tax on timber harvested from private lands, less prorated administrative costs, is distributed back to the county of origin.”

More information about the Timber Excise Tax may be found in the online publication, Understanding Washington’s Timber Excise Tax from the Washington State Department of Revenue.

See also RCW 84.33.

Funding Models for Public Libraries in Washington

Library Districts – Rural County

Supported by direct taxes specifically for the purpose of supporting libraries that are levied annually on properties in the district or region. 

Levy rates are established by the board of trustees within the constricts of state law, and are expressed as a ratio of cents per thousand dollars of taxable property (up to 50 cents per $1,000 assessed valuation) in the library district.

See also RCW 27.12.050 and RCW 27.12.222.

Library Districts – Intercounty Rural

Supported by direct taxes specifically for the purpose of supporting libraries that are levied annually on properties in the district or region. 

Levy rates are established by the board of trustees within the constricts of state law, and are expressed as a ratio of cents per thousand dollars of taxable property (up to 50 cents per $1,000 assessed valuation) in the library district. The levy rate must be uniform in all counties.

See also RCW 27.12.150

Library Districts – Island

Supported by direct taxes specifically for the purpose of supporting libraries that are levied annually on properties in the district or region. 

Levy rates are established by the board of trustees within the constricts of state law, and are expressed as a ratio of cents per thousand dollars of taxable property (up to 50 cents per $1,000 assessed valuation) in the library district.

See also RCW 27.12.420

Library Districts – Rural Partial-County

Supported by direct taxes specifically for the purpose of supporting libraries that are levied annually on properties in the district or region. 

Levy rates are established by the board of trustees within the constricts of state law, and are expressed as a ratio of cents per thousand dollars of taxable property (up to 50 cents per $1,000 assessed valuation) in the library district.

"Except as provided in this section, a rural partial-county library district is subject to all the provisions of law applicable to a rural county library district and shall have all the powers, duties, and authorities of a rural county library district, including, but not limited to, the authority to impose property taxes, incur debt, and annex a city of town with a population of less than one hundred thousand at the time of the annexation that is located in the same county as the rural partial-county library district."

See also RCW 27.12.470

Regional Libraries

Regional libraries are composed of two or more governmental units, serving the populations of all of the units. Expenses are borne by all units, apportioned under terms of a contract. Sources of funding (e.g., property taxes, city appropriation) may vary, depending on the types of governmental entities that comprise the regional library.

Expenses are apportioned between contracting parties on the basis of the contract. (See also Interlocal Cooperation Act, RCW 39.34.) The treasurer of one of the governmental units, as specified in the contract, has custody of the funds of the regional library; the treasurers of the other governmental units transfer all moneys collected for free public library purposes in their respective governmental units to the custodian of funds on a quarterly basis.

Note: Although many library systems in Washington are popularly called “regional libraries,” most are in fact either rural library districts or intercounty rural library districts under Washington law.

See also RCW 27.12.080

Municipal Libraries

As a department of the city, municipal public libraries are funded through annual appropriations from the city’s general fund. The general fund is derived from property tax, sales tax, licensing fees, etc.

Note: The city may choose to allocate additional funds for special library projects. When large capital projects are planned, the city, with the library’s support, may ask voters to approve a special extensive remodeling of an old library, or technological improvements.

See also RCW 35.32A.030

Municipalities Affiliated to Library Districts by Contract

Municipalities that contract for service with a library district pay an annual fee. The fee amount and/or the method of determining the fee is set in the contract. The fee is usually equal to the library district’s levy rate, if it would be applied against the assessed valuation of the property in the city. The contract fee is usually paid from the city’s general fund.

Note: Cities in some districts also provide and maintain the library building.

Municipalities Annexed to Library Districts

Annexed municipalities pay for library service through a direct tax on property. The levy rate adopted by a library district is uniform throughout the district, including annexed areas.

Note: Cities in some districts also provide and maintain the library building.

Privately Funded

A few communities have libraries that are open to the public although they receive all, or most, of their funding from private sources such as endowments, trusts, or donations. It is especially critical for trustees to reach out and tell donors how much the library appreciates their support. Never be complacent!

Creating a Budget

The process for creating a budget, including deadlines, is defined by state laws. MRSC has created budget calendars that reference the RCWs governing the scheduling of budget-related activities while breaking down budget preparation into basic steps:

The budget is the mechanism by which the board ensures oversight of the library’s finances. The library board is legally obligated to monitor the finances of the library through:

  • Informed discussion and adoption of the budget;
  • Review of financial statements - how well is the library staying on track?
  • Use of an effective accounting system that is regularly audited;
  • Careful attention to financial audits.

Budgeting and planning are interwoven. The budget should be viewed as a planning tool, the map that the library follows during a fiscal period to attain its mission and planning goals. The budget outlines the library’s financial limitations and indicates the priorities that the board and staff plan to accomplish during a fiscal period. The board should maintain a broad perspective on the operation of the library and represent the community’s interest in the budget while ensuring that the budget reflects the mission statement, planning goals, and objectives of the library.

Major expenditure areas to consider when planning the budget include:

  • Salaries and benefits;
  • Collections (e.g., print books, print magazine subscriptions, e-books, databases, audiobooks, etc.);
  • Overhead (e.g., utilities, maintenance, insurance);
  • Technology (e.g., computers, telecommunications, software);
  • Capital expenditures (e.g., furniture, shelving, equipment).

While virtually all public libraries are supported by public funds, city and district library boards receive funds and relate to their funding authority in different ways. In spite of these differences, the budget processes are comparable. Trustees are encouraged to become familiar with the mechanics of both district and municipal budgeting, regardless of their library’s funding pattern. 

The Municipal Research and Services Center of Washington (MRSC) explains the budgeting process in plain English in two helpful publications:

Help for preparing budgets, including calendars that include the RCWs pertaining to budgeting preparation schedules for city and county governments, revenue forecasts, as well as current initiatives that may affect budgeting, may be found in 2018 Budget Suggestions from the MRSC. Best Practices from the Government Finance Officers Association (GFOA) provide guidance on developing budgets, fiscal policy, and other related matters.

Looking for help with general ledger accounts? Puzzled by accounting terms? Help is available from the Washington State Auditor’s Office:

The Budgeting Process

The board of trustees and the library director have distinct and separate roles in the budgeting process. The director develops the budget and presents it to the trustees for review, refinement, public hearings, and adoption. In municipal libraries, advocacy for the library’s budget is another important role because final approval of the city budget is the responsibility of the municipal governing authority. Because the governing structure of municipal and district libraries is different, the budget process is different.

Municipal Libraries

  • The library director prepares a recommended budget request based on the long-range plan, present and anticipated needs of the library, as well as budget parameters established by the city;
  • The library director submits the budget proposal to the library board;
  • After a thorough discussion, review, and changes, the board approves the proposed budget;
  • The proposed budget is then submitted to the appropriate budget authority, where it undergoes further review and revisions;
  • Upon approval, the library receives its annual appropriation from the city’s general fund.

Note: The municipal library board should take the opportunity to support the library director in presenting the budget to the governing body, usually during a city council hearing, as it considers adopting the city’s budget. In some cases, the board chair makes the budget presentation along with the library director. The board of trustees should be strong advocates for the library and be present at the presentation of the budget to the governing authorities. In an age of shrinking budgets, it is important to present the budget in a way that is clear and compelling. MRSC provides guidance and examples on their web page, “Communicating About Government Spending (What We Get for Our Dollar).”

Although the library’s budget proposal has been developed to ensure adequate funding for library services and programming, there are no guarantees that the final appropriation will equal the amount requested. The city may mandate parameters for budget development that could affect the final appropriation. The library’s budget is but one of several budgets that will comprise the city’s total budget and must compete with the needs of other city services. 

Library Districts - Rural, Intercounty Rural, Island, and Partial County

  • The library board adopts policies regarding the authorization for disbursement of funds, applications for grants or other supplemental funding, and accounting for expenditure of public funds;
  • The library director prepares the budget based on the current and anticipated needs of the library and potential revenue and submits it to the library board;
  • After a thorough discussion, review, public hearing(s) and revisions, the board adopts the budget, which results in setting the levy rate.
Note: Unlike municipal libraries, the library boards of district libraries do not report to, nor take budgeting direction from, appointing authorities. Also, unlike a city budget that may have some leeway for funding priorities or special projects, the library district levy is restricted to the revenue allowed by its maximum property tax levy and some minor revenue sources.

Regional Libraries

  • The library board adopts policies regarding the authorization for disbursement of funds, applications for grants or other supplemental funding, and accounting for expenditure of public funds;
  • The library director prepares the budget based on the current and anticipated needs of the library and potential revenue and submits it to the library board;
  • After a thorough discussion, review, public hearing(s) and revisions, the board adopts the budget, which results in setting the levy rate.
Note: Unlike municipal libraries, the library boards of regional libraries do not report to, nor take budgeting direction from, appointing authorities. Also, unlike a city budget that may have some leeway for funding priorities or special projects, the regional library district levy is restricted to the revenue allowed by its maximum property tax levy and some minor revenue sources.

Expenses are apportioned between or among the contracting parties. See also RCW 27.12.080


The budget has been proposed and approved and the library has received its funding. Now the money must be spent. As expressed by the MRSC in their online publication, Purchasing and Bidding: Definitions, Exemptions and Auctions, “Units of local government in Washington must accomplish projects and purchase goods and services in the course of doing business. Statutes governing purchasing are intended to insure that quality projects, goods and services are purchased at the least cost. Other goals are to reduce, if not eliminate, the impact of favoritism and cronyism in purchasing and to prevent fraud.”

This may seem daunting, but help is available. MRSC makes it (relatively) easy with a wide range of free online resources including:

Another useful resource may be found in the Public Library Policies page on the WebJunction Washington website, which provides examples of policies relating to purchasing, credit card use, and more.

Frequently Asked Questions (FAQs)

May a public library use the Master Contracts Usage Agreement (MCUA)?

Yes. Nineteen (19) libraries are currently a part of the Master Agreement, including Fort Vancouver, Jefferson County; King County; Kitsap Regional; Mid-Columbia; North Central; North Olympic; Pierce County; San Juan Island; Seattle Public; Sno-Isle; Spokane County; Tacoma Public; Timberland; Whatcom County; and Yakima County Libraries.

Are taxing districts required to use the same rate on all taxable property within their boundaries?

Yes. Article VII, Section 1 of the Washington State Constitution requires that regular tax levies be uniform throughout the taxing district.

Is there a limit on the regular property tax levy?

Yes. Article VII, Section 2 of the Washington State Constitution limits the regular property tax levy on real and personal property to 1% of its “true and fair value,” or $10.00 per $1,000 of assessed valuation (e.g., $1,000 for a $100,000 home). This is the combined rate for all units of government (state, county, and special districts), but excludes voted levies, such as school special levies and bond issues.

When are taxing district boundaries established?

In general, the taxing district boundaries are those in existence on the first day of August.

See also RCW 84.09.030 and WAC 458-12-140.

Does a levy lid lift request have to go through county commissioners first?

It depends on how the library is established. As an example, if the library is an Intercounty Rural Library district, it would have to go through the county commissioners first.

See also RCW 27.12.120 and RCW 27.12.150.

Can the Timber Excise Tax be used as a source of funding for libraries?

Some taxes, such as the Timber Tax, may contribute to the support of public libraries, but these differ from area to area and are not reliable sources for regular library operations.

Is there a taxing authority for a non-charter city library?

In response to this question, a Legal Consultant from MRSC had the following response:

“Unfortunately, there is no taxing authority for a noncharter city library. The city library is a general fund responsibility, so unless the citizens vote to raise the property tax rate, the library has to be funded out of the city’s current budget. [A library district does have taxing authority, but a city does not.] Here is the funding authorization established for local libraries (RCW 27.12.240):

After a library shall have been established or library service contracted for, the legislative body of the governmental unit for which the library was established or the service engaged, shall appropriate money annually for the support of the library. All funds for the library, whether derived from taxation or otherwise, shall be in the custody of the treasurer of the governmental unit, and shall be designated by him in some manner for identification, and shall not be used for any but library purposes. The board of trustees shall have the exclusive control of expenditures for library purposes subject to any examination of accounts required by the state and money shall be paid for library purposes only upon vouchers of the board of trustees, without further audit. The board shall not make expenditures or incur indebtedness in any year in excess of the amount of money appropriated and/or available for library purposes.”
Could a city give nondesignated funds (e.g., log forest “windfall” monies) to the library?

RCW 35.22.280(19) allows for a city to include language in its charter that would permit this.

See also RCW 35.21.020.

After the library’s budget is approved, is the library director free to allocate funds as he or she sees fit?

Once the budget is adopted by the board or approved by the city authorities, the director has the authority to allocate funds within the budget allotment to accomplish the plan, though it is the responsibility of the director to discuss with the board or city authorities any significant budget revisions that may be necessary. 

What role does the library board play in the budget?

Trustees are legally responsible for the finances of the library. (RCW 27.12.240) To carry out that responsibility, they both monitor the broad financial picture and authorize payment of funds that have been approved for library purposes. To oversee library finances adequately, the board should:

  • Read all materials related to the budget closely;
  • Ask questions;
  • Look for variances;
  • Make comparisons;
  • Ensure there are adequate reasons for any apparent contradictions;
  • Pay attention to any audits and attendant recommendations, thus maintaining its own as well as the library’s fiscal integrity.
What is the role of the library director in helping the board to monitor the budget?

To facilitate the board’s monitoring of library finances, the director must:

  • Present them with financial statements that the library board and other constituencies can understand;
  • Provide them with monthly financial reports that include:
    • Year-to-date revenues and expenditures compared to initial projections;
    • The total budget delineated by BARS (Budgeting, Accounting, and Reporting System) categories;
    • The balance of budgeted funds remaining for the fiscal year;
    • An explanation of any significant changes.
Who oversees a library capital facility area?

The governing body consists of 3 members of the county legislative authority from each county in which the area is located. If a county has more than 3 members of their legislative body, the 3 persons to serve on governing body of the library capital facility area are chosen by the full membership of the county legislative authority. Where the library capital facility area is located in more than one county, a county may be represented by less than 3 members by mutual agreement of the legislative authorities of the participating counties.

RCW 27.15.030

How much should a city or county have in general fund reserves?

The Government Finance Officers Association's (GFOA) provides guidance on unrestricted fund balances in their Best Practice, “Appropriate Level of Unrestricted Fund Balance in the General Fund (2002 and 2009) (BUDGET and CAAFR).” “GFOA recommends, at a minimum, an “… unrestricted fund balance of no less than two months of regular general fund operating revenues or regular general fund operating expenditures.” Bear in mind that no amount of reserves may be adequate in the event of a major financial crisis, natural disaster, or other extraordinary event.

Do nonprofit organizations pay or charge sales tax on their purchases or sales in Washington?

The Washington State Department of Revenue responds in the following FAQ:

“Generally, nonprofit organizations must pay retail sales tax on all purchases of tangible personal property and must collect retail sales tax on their sales of such items. However, nonprofits conducting qualifying fundraising activities may purchase goods and services that will be resold at such events without paying sales tax by providing a reseller permit to the seller. Additionally, the income generated from qualifying fundraising event is not subject to either retail sales tax or the business and occupation tax.”

WAC 458-20-169, in discussing fund-raising activities that would not be tax-exempt, states:

“(iv) Nonqualifying activities. Fund-raising activity does not include the operation of a regular place of business in which services are provided or sales are made during regular hours such as a bookstore, thrift shop, restaurant, legal or health clinic, or similar business. It also does not include the operation of a regular place of business from which services are provided or performed during regular hours such as the provision of retail, personal, or professional services. A regular place of business and the regular hours of that business depend on the type of business being conducted.

(v) Fund-raising sales by libraries. RCW 82.04.3651 specifically provides that the sale of used books, used videos, used sound recording, or similar used information products in a library is not the operation of a regular place of business, if the proceeds are used to support the library. The library must be a free public library supported in whole or in part with money derived from taxes. RCW 27.12.010.”

Confused? The Washington State Department of Revenue offers a very helpful video, “Nonprofits in WA” on this complex topic. Additional guidance may be found in the Department of Revenue’s brochure, “Nonprofit Organizations.”

Are MARC records subject to sales tax?

According to a response from the Department of Revenue, because a MARC record is an inventory or cataloging system that includes the purchase of prewritten software and software updates, retail sales tax should be charged on the purchase of MARC records.

Are digital goods and services subject to sales tax?

Although a tax was imposed on digital products and services during the 2009 legislative session, a provision in this law provided an exemption for libraries for “digital products or remote access software that will be made free of charge for the use or enjoyment of others.”

WSL’s web page, “Tax Information and SDL Project History,” provides additional information on this topic.

What process must a city or town use to accept a donation?

MRSC posts the following response:

“Every city and town in the state has the authority to accept donations. There is no specific process set out in state law, and a public hearing is not required before the donation can be accepted.

RCW 35.21.100 provides:

Every city and town by ordinance may accept any money or property donated, devised, or bequeathed to it and carry out the terms of the donation, devise, or bequest, if within the powers granted by law. If no terms or conditions are attached to the donation, devise, or bequest, the city or town may expend or use it for any municipal purpose.

Although this language can reasonably be interpreted to mean that a city must pass an ordinance to accept each and every donation it receives, many cities interpret it to mean that the city must establish by ordinance a procedure for accepting donations. Some cities authorize a particular city official, such as a clerk-treasurer or city manager/administrator, to accept donations on behalf of the city. Others provide that the council will do so, and, unless specified, that could be done by motion or resolution.

In the absence of a delegation of authority to accept donations, we recommend, at a minimum, that the city council pass a motion or resolution accepting the donation.”

Does state law require libraries to go out to bid for a periodical subscription service if it exceeds a certain amount?

Although RCW 39.04.190 provides a uniform process when using a purchase contract in lieu of formal sealed bidding, it does not specify a dollar amount to determine when this approach is to be used. It simply states the following:

“The state statutes governing a specific type of municipality shall establish the maximum dollar thresholds of the contracts that can be awarded under this process, and may include other matters concerning the awarding of contracts for purchases, for the municipality.”

An alternative approach would be to sign an interlocal purchasing agreement with another library. Information about using interlocal agreements and examples may be found on the Interlocal Purchasing Agreements page from Procurement Services at the University of Washington. The Bidding Book for Washington Cities and Towns and The Bidding Book for Washington Counties from MRSC, provide step-by-step, easy-to-understand guidance on going out to bid.

See also RCW 39.34.

What does a county assessor do?

The county assessor’s duties include determining the value of all real and personal property in the county and maintaining records regarding tax exemptions. For more information, consult the County Commissioner Guide from MRSC.

See also RCW 36.21.

What does a county treasurer do?

Major responsibilities include collecting taxes and disbursing funds. Find out more at the Washington State Association of County Treasurers website. Additional information may be found in the County Commissioner Guide from MRSC.

See also RCW 36.29.

Are charitable contributions to governmental units tax-deductible?

Yes, according to the Governmental Information Letter on this topic from the Internal Revenue Service, “Charitable contributions to governmental units are tax-deductible under section 170(c)(1) of the Internal Revenue Code if made for a public purpose.”

Are there any restrictions on library boards with regard to direct fundraising (independent of foundations and Friends groups)?

Lawyers at MRSC could find nothing that would prohibit a district library from direct fundraising and cited the following phrases from RCW 27.12.210, which they felt gave trustees broad authorization to do what is necessary to maintain a library:

  • (5) “Have exclusive control of the finances of the library;
  • (6) Accept such gifts of money or property for library purposes as they deem expedient;
  • (10) Do all other acts necessary for the orderly and efficient management and control of the library.”

However, they believed that a library under a city might be prohibited by city rules, although they were unable to find the same constraint for a self-governing library district.

May a public library charge user fees for the services provided by the library?

According to AG Opinion AGO 2005 No. 5, “Existing statutory law prohibits public libraries from charging fees for traditional library services, such as borrowing books or reviewing materials at the library. Libraries may charge fees for services which are beyond the traditional purposes of a library and are provided as a convenience for the public.”

This Opinion reaffirms AGO 1992 No. 31, which notes that the library can charge a fee to nonresidents.

Does a public library operated by a city organized under the Optional Municipal Code (RCW 35A) have authority to charge fines for overdue books and other library materials?

According to AG Opinion AGO 2005 No. 5, “[p]ublic libraries have authority to impose and collect fines for keeping library materials beyond their due date or otherwise abusing the right of free access to the library.”

Can a library charge user fees for services provided to non-residents?

MRSC posts the following response (Reviewed November 2013):

“Yes. AGO 1992 No. 31 reviews this issue, noting that basic library services must be provided free of charge to residents of the political jurisdiction which supports the library through taxation. The corollary is that public libraries can charge user fees to those who do not live within the jurisdiction which provides the tax revenues to pay for the library. In fact, if a public library provides services to non-residents without charging a fee, an argument can be made that the library is violating the "gift clause" of the Washington State Constitution. [ Article VIII, Section 7 – CREDIT NOT TO BE LOANED — “No county, city, town or other municipal corporation shall hereafter give any money, or property, or loan its money, or credit to or in aid of any individual, association, company or corporation, except for the necessary support of the poor and infirm, or become directly or indirectly the owner of any stock in or bonds of any association, company or corporation.” ] Libraries can charge for ancillary services such as copying machines, phones, fax machines, etc. - that issue is also covered in the AGO.”

Who should hold title to property purchased by a rural county library district or intercounty rural library district using district funds?

An informal AGO Opinion issued 4/2/1952, signed by Assistant Attorney General Lyle L. Iversen and addressed to Maryan E. Reynolds, Washington State Librarian, states:

“It is our conclusion that property purchased by a rural county library district or an intercounty rural library district should be held in the name of the district and not that of the county… Rural county library districts and intercounty rural library districts are municipal corporations in their own right. As such they are authorized to acquire property and hold it in their own names. It is our opinion that such districts in acquiring property should take title in their own names and not in the names of the counties in which they lie.”
May a city that participates in a regional library keep and independently manage the proceeds of bond sales for regional library costs?

AGO Opinion AGO 57 – 58 No. 89 (1957) states:

“The treasurer of a regional library is the sole custodian of the proceeds of the sale of bonds, which bonds were issued to raise money for the construction of a regional library building… [B]y statute, and as a matter of contract, the proceeds of [all] bonds must be deposited in a common construction fund to be administered by the… treasurer of the regional library.”
May the board of trustees of a rural county library district or an intercounty rural library district file a revised budget with the county commissioners after the county budget date if unanticipated funds arise?

AGO 57-58 No. 231 (1958) states:

"The board of trustees of a county or intercounty rural library district may file a revised budget with the county commissioners after the approval of the budget in October to provide for the expenditure of unanticipated income not affecting the tax levy… No change can be made in the amount of the annual tax levy by the board of trustees of the library district after the final budget hearing held by the county commissioners… In the situation presented here the funds were unanticipated and thus not included in the budget submitted to the county commissioners and approved in October at the time the levy was made. However, the funds will be ‘available’ in [the same year], and it is our opinion that the library may legally use such funds during the course of the year even though such funds have not been included in the budget approved in October.
Does a library district hold the authority to contract for insurance coverage of library property?

An informal AGO Opinion issued 6/6/1975, signed by Assistant Attorney General Wayne L. Williams and addressed to Maryan E. Reynolds, states:

"It would seem to me to be a prudent and perhaps very nearly necessary part of the care of the property of a library, to insure that property against loss. For this reason, it is my view that one may safety imply from the language contained in RCW 27.12.210 the necessary power to secure such insurance coverage… It would appear to be reasonable for the district to exercise that power to employ an insurance broker if the district felt the need for expert advice as to the acquisition of such coverage."


The materials on this website are provided for informational purposes only and do not constitute legal advice. Always consult legal counsel for specific concerns.

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