Have you ever wondered how your library can tap into private funding to better accomplish your mission? On today’s show, you will learn what programs and services are most appropriate for these kinds of efforts, who you can turn to do your fundraising and how, which activities are easiest to start with, and even gain insight into the big question, “Should our library have a gala?”
Today we talk with Peter Pearson an active consultant in the area of library fundraising and Board development with 25 years of experience as President of the Friends of the Saint Paul Public Library in Minnesota. His deep knowledge provides all of us valuable insights. Enjoy the show!
Nate Vineyard: [00:00:00]
This podcast is brought to you by the School of Library and Information Management from Emporia State University where library leaders are created with program sites in Kansas, Utah, Oregon, Colorado and South Dakota. And, by the Park City Library making film and podcasting possible with green screen and sound recording resources.
Adriane Herrick Juarez : [00:00:25]
This is Adrian Herrick Juarez. You’re listening to Library Leadership Podcast where we talk about libraries and leadership and speak with guests who share their ideas, innovations and strategic insights in the profession.
Adriane Herrick Juarez : [00:00:38]
Have you ever wondered how your library can tap into private funding to better accomplish your mission? On today’s show you will learn what programs and services are most appropriate for these kinds of efforts, who you can turn to, to do your fundraising, and how. Which activities are easiest to start with and, even gain insight into the big question: should our library have a gala? Today we talk with Peter Pearson, an active consultant in the area of library fundraising and board development with 25 years of experience as President of the Friends of the Saint Paul Public Library in Minnesota. His deep knowledge provides all of us valuable insights. Enjoy the show.
Adriane Herrick Juarez : [00:01:25]
Thank you for being on the show, Peter. It’s a great honor to have you.
Peter Pearson: [00:01:28]
I’m happy to be here, Adrian.
Adriane Herrick Juarez : [00:01:30]
Well, we are going to learn today about improving our library’s annual fundraising. You’ve got great experience in this area. So, let’s start out with the first question, where do our libraries need private funding to better accomplish our missions? That’s a big question.
Peter Pearson: [00:01:47]
It is, and it’s a question that a lot of libraries are asking themselves. Some of the libraries are asking that question because their budgets have been cut pretty dramatically. And, if they want to continue to provide the kind of services that they really love to provide to their communities they’re seeing private fundraising as probably one of the few ways that they can continue to provide that excellent service that our communities are expecting. I even tell libraries that feel that they are well funded that you really probably need to look more to the future when you think about your needs for private funding. Because, certainly your funding may be fine right now, but we all know that the next recession may just be around the corner and we can’t be guaranteed that our funding’s going to be there forever. So, I always say to a library – a great time to start your fundraising is when things are going really well and you’re not in a desperate spot, when your budget is good, when you seem to have the great support of the community and the elected officials. That’s a perfect time to begin some fundraising. So that when you do hit those tough times, you already having your fundraising program in place and you’re ready to take off from there.
Peter Pearson: [00:02:55]
The other thing of course, I always encourage libraries to think about is, it’s great to develop endowment funds. An endowment fund is where you invest money and keep it permanently invested and then you just take a small amount out each year to help support some of your programs and services. One of the best ways to create future stability in any library system is to have those endowments in place, too.
Adriane Herrick Juarez : [00:03:18]
That’s great. We always want strong and well-funded libraries. So, it’s good to think ahead. I appreciate the information on that. So, fill us in on what types of library programs and services are appropriate for private funding.
Peter Pearson: [00:03:31]
This is really a question that every library needs to ask before they jump in and begin doing fundraising. I always say the first thing you need to do is to decide what isn’t appropriate for fundraising. Most libraries have come to the conclusion and, I think this is very appropriate, that private funding should never be used to support the hours of operation of a library system or to pay the staff. These are basic responsibilities of your city or county and you don’t ever want to get into that position of letting the city or county off the hook by saying, We’re going to fund Sunday hours or evening hours or whatever it may be with private funds. That’s a sure fire way for them to continue to pull back from their public funding. So, try to avoid that type of infusion of private funds.
Peter Pearson: [00:04:22]
I think the places where private funds are most appropriate within libraries, first of all, is the collection because, the collection can never be big enough and broad enough. All libraries have to cut what they can buy. And, I hate to say it, censorship. But, in some ways we have to just limit what we can purchase just because we don’t have unlimited funds. So, many donors, and especially older donors – one of the things they love most is to have their private funds go toward purchasing books and materials. So, that’s a great way to use private funds.
Peter Pearson: [00:04:55]
Outreach efforts to under-served communities, this is a really popular library service that foundations, in particular, love to support. Children’s programs are another area. Almost every library I know has a Summer Reading Program. Most libraries receive either corporate sponsorships to help support the Summer Reading Program, or contributions from foundations. It’s a very popular program that people see as providing such a wonderful service. Again, it’s an ideal place for private funds.
Peter Pearson: [00:05:28]
Then lastly, one of the major areas that libraries can think of, in terms of using private funding, is when you are building a new building or renovating a building, in what we call a capital campaign where a certain percentage of the project is going to be paid for with public funds. Then there’s an opportunity for private donors to also pay for a portion of the project. You typically would involve some naming opportunities when that’s the case, when you’re raising private funds. This is an incentive for donors to either name the Children’s’ Room, or a meeting room, or certain spaces within the library. Those public/private capital campaigns are extremely popular. They also make the voters more appreciative of passing a bond measure when they know that there’s going to be private funds that will help support it, too. Those are some of the main areas where private funding can be extra important.
Adriane Herrick Juarez : [00:06:22]
So, collections, programs, capital funds – these are ideal for donors to get involved. And also, like you say, taxpayers like to see when there’s matching funds. It shows that librarians are willing to go the extra mile to bring in additional funds to match what the taxpayers are giving. Those are great suggestions. Who can do our fundraising for us? I know different organizations have Friends, foundations, trustees. Can staff do it? Where do we reach?
Peter Pearson: [00:06:49]
You’ve just mentioned that many libraries these days have two different support organizations. They have a Friends group and they may have a library foundation. The distinction typically is that Friends groups, first of all, have been around in many communities for a long, long time. In some communities for over 100 years they’ve had a Friends group and typically a Friends group is always going to be a volunteer effort. So, there would be no paid staff. Friends groups tend to focus on things like selling used books for the library, maybe doing programming, maybe you have a newsletter.
Peter Pearson: [00:07:27]
Then, the newer kid on the block is the library foundation. Library foundations are actually quite new, probably within the last 25 years is when most library foundations have been created. More are popping up every year and this seems to be very popular lately. A library foundation oftentimes will have a paid staff person who is a fundraiser. It will have a board of directors who see themselves more as community leaders, civic leaders, philanthropists rather than a Friends board member, who typically sees themselves more as a community volunteer, a book lover, but not a highly recognized person in the community. So, the two organizations have a very different feel about them. The important thing, I say, is when you’re doing fundraising for the organization it’s important not to confuse your donors.
Peter Pearson: [00:08:22]
If the Friends and the foundation are both out in the community doing active fundraising from individuals from corporations from foundations you might run into problems. You might run into individuals saying, you know I just don’t know where to give my money. When someone doesn’t know where to give, they tend not to give. So, first thing is if you’ve got the two organizations, have them come to an agreement who’s going to be the real fundraising entity for your library. And, I would always recommend that it be the foundation. That the Friends can stick to the used book sales, to the smaller little events within the library, but when it comes to really major fundraising you want your foundation to be the group that’s out there.
Peter Pearson: [00:09:01]
Now obviously, if you don’t have a foundation then it’s up to the library director to turn to the Friends to say, you know you’ve only been doing book sales up till now, we’d love to see the Friends take on a more active role in fundraising. Are you interested in doing that? And I would have to tell you that the vast majority of Friends groups will say no, they’re not interested in that. Then it’s up to the library director to decide whether or not they think the library should create a foundation to do this higher level fundraising. I would always discourage the trustees and the library staff from becoming the fundraisers for the library.
Peter Pearson: [00:09:40]
And the reason I say that is most major donors, and I’m not talking about someone that gives you $5, $10, or $25, but someone that wants to give you $5000 dollars, $10,000 dollars or more. They want to put you in their will or estate plan. They’re looking for a separation between the fundraising arm of the library and government. Most private donors who give larger amounts of money like to see that separation from government. The library staff and the library trustees have the feel of the government institution in a donor’s mind. So, they would not be appropriate people to do your fundraising. You’d want to have the Friends or foundation be your fundraising group because they’re a separate 501(c)(3). It feels private. It doesn’t feel like government because it’s not government.
Peter Pearson: [00:10:28]
The other thing to think about is, library staff and trustees certainly are not recruited to those positions for fundraising. It’s just not a skill set that we expect in a library trustee or a library staff person. Whereas foundation board members and staff, this is why we recruit them. This is why we hire them, because they are fundraisers. This is their profession. This is something that they do all the time. So, you want to go with where the experience is, and who’s got the expertise.
Adriane Herrick Juarez : [00:10:55]
Good to note. Thank you for bringing that to our attention. I know that as the President of the Friends of the Saint Paul Public Library for 25 years, your group was unique in that the Friends and the foundation were combined. Is that right?
Peter Pearson: [00:11:11]
That’s right. It is the model that we’re seeing more of lately, because there’s confusion in the community when two different groups exist. Also, it just makes a lot of sense to have one organization with one board of directors that can accomplish all the support you need for your library. That model worked extremely well in St. Paul and I’ve seen it work well in other communities too. Not to say that’s the only way to go because I’ve also observed library systems where a Friends and foundation will work very collaboratively side by side. So, it is truly what works best in your community. There’s no one answer for everybody but it’s an interesting model and one that I’m seeing more of, frankly.
Adriane Herrick Juarez : [00:11:52]
That is interesting. And, each library as a unique organization will have to assess their own needs in terms of that. But, it’s something to think about. What types of library fundraising activities are easiest to start with for these groups?
Peter Pearson: [00:12:06]
I always recommend the best and easiest and the most important fundraising activity for a library is to conduct what’s called, an annual fund. An annual fund is a solicitation. It happens typically through mail, not email mind you, an actual letter going out that talks about the great things that the library has done that year and asking people to make a charitable contribution at year’s end. We typically do the annual fund in November and December because that’s when people are thinking about charitable contributions and the tax deductibility.
Peter Pearson: [00:12:45]
I want to clarify between memberships and annual fund because if you have a Friends group, no doubt your Friends group does an annual membership appeal. And, it can happen anytime of the year. And, in some cases I’ve seen Friends groups that have a membership fee as low as $2, and $3 a year. I’ve seen Friends groups that have a membership fee of $25, $50 or $100, kind of on a sliding scale. But, it’s typically a fairly small amount of money that the friends are asking for someone to become a member. When we think of the word membership, it doesn’t conjure up the idea of charitable giving. It’s just an opportunity to affiliate. It’s the kind of base level affiliation we have with an institution, or an organization.
Peter Pearson: [00:13:35]
So, when someone says, I’m a member of the Friends of the Parks City Library, to them that’s just a way that they can identify and say, I’m a part of you. This is an institution I care about. But, they don’t necessarily see their $25 membership as a charitable tax deductible contribution.
Peter Pearson: [00:13:54]
That’s where the annual fund is different because, in the annual fund we’re really appealing to people’s interest in making a charitable donation. What you like to do in an annual fund is talk about the various great programs and services the library provides and then ask someone to make a contribution to help support those programs and services without specifying which one. When you get contributions, one of the things you hope for is that the vast majority of contributions will come in unrestricted, so that the library can get to use them for just about anything they choose to. That’s a really important piece.
Peter Pearson: [00:14:33]
So, the reason I mentioned the membership, and contrasting it to an annual fund is, I always encourage libraries that only have a Friends group that they should do their membership campaign and an annual fund instead of just doing a membership campaign. So, if you take that advice, I would suggest doing your membership campaign in the middle of the calendar year, sometime around May or June – doesn’t matter what fiscal year you have. Your membership year can run any 12 months you choose. And then, go back to those same Friends members in December and then ask them, not for a membership contribution, but for a charitable contribution to support the collection, to support the Summer Reading Program.
Peter Pearson: [00:15:17]
Then in their minds, they’re now looking at supporting something on a higher level. So, those same members who give you $10 or $25 in May or June as a membership, they’re likely going to give you a $100, or $500 for a charitable purpose for the library at the end of the year. And yet, so few Friends groups seem to do that. That’s one thing that I always encourage libraries that just have a Friends group to think about doing that.
Peter Pearson: [00:15:45]
Two other simple ways to raise money, one would be to ask the vendors for the library to make a contribution. All libraries purchase a variety of things to keep the operation going each year. And, those vendors have a vested interest in you purchasing their services. There’s no reason why we can’t go to those vendors at the end of the year and ask them to make a charitable contribution to the library also.
Peter Pearson: [00:16:09]
And then a third simple fundraising effort is to create what’s called a bookplate program where donors are able to pay a certain amount money. Most libraries determine the typical cost of a book let’s say $25. That for every $25 you donate, the library can place a bookplate into one of the newly purchased books that says, this is in honor of somebody, or in memory of somebody.
Peter Pearson: [00:16:37]
The great part about this kind of a program is what you can do instead of spending that $25 immediately. This could be a great way for you to start an endowment fund. So, the $25 comes in, you purchase the bookplate. You know that the library’s already going to purchase a certain number of books anyway. So, you’re still purchasing the books but you’re honoring the donor with a bookplate and you’re saving the money that they contributed, putting it into an endowment fund so that in the future you can draw out from that endowment fund on an annual basis for the purchase of books. It’s a simple program it’s one that makes donors feel really good. It’s a really simple way to honor them. So, those are three of the ways that I think you can get into fundraising pretty easily.
Adriane Herrick Juarez : [00:17:22]
Those are great ideas and some libraries go into bigger fundraising efforts, particularly a gala. What do you say in terms of that? Should libraries do that?
Peter Pearson: [00:17:35]
I could give you one really quick and easy answer, no.
Adriane Herrick Juarez : [00:17:39]
Peter Pearson: [00:17:40]
It’s funny, that’s the first thing when I help libraries with their fundraising – almost the first thing that they say is, well, we want to do a gala. And, I say OK, tell me why. What’s your reason for wanting to do that? They say, well, we want to raise a lot of money. I say, well that’s not necessarily going to happen.
Peter Pearson: [00:18:01]
Most organizations that run special events find that it takes many, many years for those events to finally become profitable. So, initially you may just break even with a special event, and yet you’ve put so much time and effort into it. So, I always encourage libraries that are new to fundraising to hold off on events. Once you’re more established, once you have more volunteers on your board, and you’ll have a reputation in the community as a fundraising group, then it’s possible to make money at a special event. But, before that really, about all they do is raise awareness.
Peter Pearson: [00:18:39]
The other issue that I should mention with these special events is for instance, if they hold a special event, they can’t hold it in the library because the library’s not large enough. So, now you’re going to get a venue for your event. Let’s say you’re going to a hotel, and let’s say you’re having a dinner event. Let’s say we charge $125 for a ticket to the event. Well, about $100 of that is going to go to the hotel. So, the library is only going to receive a very small piece of the contribution. Whereas in the donor’s mind they’re thinking, I gave $125 to the library. It gives them this false sense to what extent they’re supporting you. And, in reality, the donor is giving you $25 and they received a very nice hotel dinner for the remainder of their money.
Adriane Herrick Juarez : [00:19:28]
Good things to keep in mind, yeah. And, if libraries are doing it and having success that’s fantastic – it can just take some time definitely, to get those established.
Peter Pearson: [00:19:37]
Exactly, and in fact, I’ll give you the example from where I’m from St. Paul, after we had been in existence for 15 years, we decided to take on a special event. We did a sit-down dinner with five New York Times best-selling authors each year. It was an event that was heavily corporate sponsored. We had 1000 people in attendance. It became one of the most popular events in the Twin Cities. We made a profit of over $200,000 per year on that event plus, had all kinds of goodwill and great publicity.
Adriane Herrick Juarez : [00:20:13]
Wow. So, it can be a success with the right efforts.
Peter Pearson: [00:20:17]
Absolutely, and again, waiting until that critical time when your fundraising organization is really fully developed. That’s key. It’s not something that a brand new group should take on.
Adriane Herrick Juarez : [00:20:30]
So, what are the best ways to increase our fundraising potential, would you say?
Peter Pearson: [00:20:35]
I always say the key to effective fundraising is your board of directors. If I hear from an organization that they don’t seem to be doing very well at their fundraising, the first thing I ask them is, what’s the composition of your board of directors? If they say that the composition of the board of directors is people who love books I can almost assure you they’re not going to be a major fundraiser. Because what we’re looking for is not just people who love books and libraries, but people who are civic leaders, people who are philanthropists, people who think broadly. And, here’s the really strange part about this, most of the people who give a lot of money to libraries don’t use them.
Adriane Herrick Juarez : [00:21:22]
Peter Pearson: [00:21:22]
Isn’t that? It’s a strange thing. It’s very different than in the arts where the main donors to the opera are people who go to the opera. But, in the library world people who understand the need for a good public library system may not use it themselves but they understand that if we want to have a strong community we need good public schools, we need good public libraries. They understand that these civic assets are so important that they’re worth supporting.
Peter Pearson: [00:21:51]
So, I always say the best way to improve your fundraising is to get the best possible board of directors available for the job. After that, I think it’s important to have a really good marketing program for the foundation and the library. Because, marketing really goes hand in hand with fundraising. One thing that I’ve seen is that in many libraries marketing and communications is kind of the weak point in the library services. If there’s a need to conserve funding obviously, we’re going to put it into direct service first. And, if cuts come across it’s probably going to be cuts from the marketing department rather than the collection budget. So, for a whole bunch of reasons it seems like libraries need to do a better job on marketing. And, foundations probably can be the group to do that for you. So, that needs to go hand-in-hand with their fundraising and with the creation of this better connected board of directors.
Adriane Herrick Juarez : [00:22:50]
That’s helpful. And, as we think about the board of directors can you share what their role is, as a nonprofit organization?
Peter Pearson: [00:23:00]
Absolutely. So, the board of directors of a nonprofit organization, first and foremost, what their responsibility is, is to hire and supervise the head of that organization, the executive director, the president, the CEO – whatever title is used. That’s a very important job that they have. They have fiduciary responsibility. They need to make sure that the funds are being spent appropriately. That there is an oversight, that there is an audit happening each year. Those are kind of the critical activities that a board needs to do. But then, after that, the board is really charged with being the primary fundraisers and door openers for the organization.
Peter Pearson: [00:23:41]
So, when you’re asked to join the board of a library foundation, again, you’re not being asked to come to a book group and discuss books you’re being asked to be a steward of the library’s private funds. You’re being asked to be an ambassador in the community and more than anything, opening doors to foundations, corporations, and individuals who can provide the needed funding to the library. That’s a critical role for all nonprofit board members, and they should never forget that.
Peter Pearson: [00:24:11]
I always say the job of a board member of a nonprofit organization, while it’s volunteer, it’s so important that you have a job description. That job description needs to lay out the things that I’ve just talked about, the supervision, and hiring of the executive, the fiscal oversight, and the role of fundraising for the organization. They’ve got to be clearly stated in a job description that every board member receives.
Adriane Herrick Juarez : [00:24:37]
People who come to these organizations give such a gift to the libraries that they raised funds for and we’re so appreciative of that. So, thank you for outlining some of those roles. And, as people change in those roles it helps to have all of that in place so that there’s easy transition and that the board and foundations stay strong over time. Is there anything else you’d like to share Peter, or any kind of recap on your information?
Peter Pearson: [00:25:04]
The one thing I would say in summary is, that what we really need to do with a library foundation, and the library, is to create a culture of fundraising because libraries don’t naturally have the culture of fundraising built into them because everything libraries do is done free for people coming in to use the services. So, we don’t have that natural affinity of thinking about fundraising. But, I think if we think about fundraising being an annual event that happens all through the year that there are opportunities for fundraising all the time. I think it gives a whole new way of thinking that this becomes part of business as we do business on a regular day-to-day basis, rather than being something special that we set aside and only do once a year. So, creating that culture of fundraising, in my mind, is probably the most important thing that we can do to make fundraising successful.
Adriane Herrick Juarez : [00:26:02]
Do you have a favorite book or resource you’d like to share, and why?
Peter Pearson: [00:26:05] I do. The book is called Servant Leader by Ken Blanchard and Phil Hodges. I am such a proponent of the fact that leaders really shouldn’t have an ego. Leaders should be people who we look up to, who we know are visionary, but who really are so happy to take a backseat when it comes to being recognized. So often that’s not the case. We have so many people that want that recognition, I did it, and it’s all about me. I really like the idea that leadership is getting people to work together for a common cause, and it doesn’t matter who gets the credit. That’s why I love the premise of the book.
Adriane Herrick Juarez : [00:26:48]
Truly giving of self. That’s nice. Sounds like a fantastic resource.
Peter Pearson: [00:26:53]
Adriane Herrick Juarez : [00:26:54]
In closing, what is supporting libraries mean to you personally?
Peter Pearson: [00:26:58]
Well, it’s no surprise that in my mind supporting libraries comes down to two things. One, raising the private funds to help them do their jobs better. And second, something that we really haven’t talked about in this podcast is the role of political advocacy. I really view myself as a very strong political lobbyist for libraries. It’s critically important that our elected officials hear from us. Those of us who are library supporters, we need to be in front of our elected officials all the time. So, I love library foundations that have created an ongoing political advocacy program. And, I see that as so critical because, as important as private fundraising is, let’s face – if public funding is going to make up 95% of the library’s budget, and if we’re not out there all the time in front of our elected officials reminding them of how important the library is, we can’t expect that public funding is going to be stable and/or increase. So, I see support of libraries as those two activities, the fundraising and the political advocacy.
Adriane Herrick Juarez : [00:28:09]
Peter, you’re a strong advocate for libraries, keeping libraries well-funded and well supported over the years has been your career. We are so thankful that you are here today to share with us many ideas and innovations about ways we can do this as libraries and to get many caring people involved. Thank you so much.
Peter Pearson: [00:28:30]
It’s great to be here with you, Adrian. Thank you.
Adriane Herrick Juarez : [00:28:35]
You’ve been listening to Library Leadership Podcast. I’m your host, Adrian Herrick Juarez. Our producer is Nate Vineyard. More episodes can be found at libraryleadershippodcast.com, where you can now subscribe to have new shows delivered right into your email inbox. You can also find the show on Apple iTunes, or wherever you get your podcasts. Thank you for listening. We’ll see you next time.