I have always been under the impression that it is illegal for public libraries to fundraise on their own, aside from 2 book sales per year. If a school district public library no longer has a Friends Group, can it host fundraisers? For example, could the library itself host a bingo night and raise money? Can a school district public library send out a fundraising letter?
Or is it important that all library staff and trustees refrain from fundraising efforts in order to separate public funds from fundraising? I am struggling because we have a lot of great ideas, but the future of our Friends Group is unclear. I am wondering what options are available to me as a library director, and my Board of Trustees, if the Friends Group were to dissolve.
Thank you so much.
There are a lot of questions packed into this submission!
Let's take them one at a time.
First question: "I have always been under the impression that it is illegal for public libraries to fundraise on their own, aside from 2 book sales per year." 
It is not illegal for a public library to fundraise. It's just that, like starting sourdough, fundraising by a public library has many complications.
For more on that, see the analysis in the "Ask the Lawyer" answer posted here: https://wnylrc.org/raq/donations-solicitations-public-libraries.
Second question: If a school district public library no longer has a Friends Group, can it host fundraisers?
Yes, but to briefly summarize the "caveats" mentioned above: a public library should never rely on fund-raising to meet basic operational and strategic needs (that funding must come from the tax base and via established agreements for service). In addition, a public library's fund-raising must adhere to the extensive laws and regulations applying to the solicitation, accounting, use, and investment of such moneys.
Third question: For example, could the library itself host a bingo night and raise money?
Yes, but any event that involves "games of chance" should follow the state law regarding gaming. For more on that, see the guidance at the "Ask the Lawyer" answer here: https://wnylrc.org/raq/donations-solicitations-public-libraries.
Fourth question: Can a school district public library send out a fundraising letter?
Technically, yes, but because of the caveats, I would say such a letter should go out after:
- the fund-raising initiative was built into an established fund-raising plan passed by the board of trustees;
- the fiscal controls for accounting for the money were reviewed and approved by the library's accountant and lawyer; and
- the text of the letter was reviewed by the accountant and lawyer for compliance AND approved by the board of trustees for adherence to the strategic plan.
Fifth question: Or is it important that all library staff and trustees refrain from fundraising efforts in order to separate public funds from fundraising?
I wish it were this simple, but it's a bit more complex. If a public library deeply plans for and builds capacity for fund-raising for special initiatives, it is possible for paid staff to engage in what is called (in the fund-raising biz) "advancement". However, once serious planning is happening on that scale, there are a variety of reasons for a non-association library to work with an affiliated not-for-profit (like a "Friends" or a foundation) to achieve the same objectives.
Sixth question: I am struggling because we have a lot of great ideas, but the future of our Friends Group is unclear.
To the director who submitted this question: you are not alone. "Friends uncertainty" can happen, and when it does, it is a lousy situation for a director to be in.
Also: I am not surprised you have good ideas for fund-raising; library directors are some of the best sources for good ideas for "Friends" and other library supporters. After all, directors are the people with the closest eye on the well-being and day-to-day needs of the library.
But as your fourth question suggests, the energy of you and your staff is best spent focused on those day-to-day needs, which should only include fund-raising if the board has initiated a well-thought-out plan and strategic support for employees assisting with it (translation: there is a budget, wording in a job description, and at least three pages in the updated strategic plan for this, then the director can have responsibilities related to fund-raising... which should never be more than a very small fraction of their duties).
Third: If at all possible, when a "Friends" group is rocky, this is a time for library trustees to step up and see if they can help revitalize the organization.
Seventh question: I am wondering what options are available to me as a library director, and my Board of Trustees, if the Friends Group were to dissolve.
There’s an array of options for a public library in this situation:
Legal considerations of fund-raising
"Friends Free Lite": A public library without an affiliated "Friends", who fund-raises for small initiatives like an added story hour or to fund contracted events and performers (only up to 1% or less of operating costs).
Fund-raising efforts, even at this small level, must be very strategic and tightly planned for compliance and to not generate operating funds. Fiscal policies related to fund-raising must be well-developed and strictly adhered to.
Fund-raising capacity will be more constrained than that of a "Friends" (by both practical and legal considerations) and requires careful attention to fiscal policy.
"Friends Lite": A public library with an affiliated "Friends" where the "Friends" fund-raise for small special initiatives (under $50K a year).
Fund-raising by the Friends in the name of the library should be per CONTRACT that makes mutual commitments of legal compliance, cooperation, and transparency.
Small Friends groups can be operationally lax, leading to the type of uncertainty in the member's question. For this reason, a contract between a library and Friends should set the stage for good succession planning.
"Friends Powerhouse": A public library with an affiliated Friends, who fund-raise for large special initiatives (over $50K a year).
Fund-raising by the Friends in the name of the library should be per a CONTRACT that makes mutual commitments of legal compliance, cooperation, and transparency, with extra care about required financial filings to the New York State Charities Bureau and the IRS.
Very often, a group operating at this level may have employees or contracted assistance. Such a group should be paying deep attention to and have policies regarding use of paid consultants, lobbyists, and accountants. Such a high-functional group will good succession planning.
"Advancement without or without Friends"
In this model, a public library makes strategic use of deeply planned fund-raising for long-range objectives, and it plans and budgets for in-house capacity to fund-raise, including planned giving and other planned solicitations.
Planning to have in-house "advancement" requires a deeply committed board who has mapped this strategy out in a well-developed strategic plan.
If a public library develops a deep "reserve" fund, there is a risk the public (and the NYS Comptroller) will regard it as stockpiling surplus funds. For this reason, if there is a decision to do this, the board must be very strategic about it.
All of this brings me to the spirit of the question, which is: if fund-raising isn't going so well, what is a director to do?
Trustees who are reading, this is your chance to shine. If you are so fortunate to have a director with good ideas, it is a good idea to listen to those ideas and see if they can fit into fund-raising by the Friends or by the library itself. But unless a job description is re-written to include specific responsibility for fund-raising, and such activity is supported by the library's policies and strategic plan (after being carefully reviewed by the library's accountant and lawyer), a director or other staff member should NOT be fund-raising.
In other words: no aspect of fund-raising should ever, ever, EVER be a casual add-on to a library director's list of duties. While a director's talents can be tapped for fund-raising, if things are going beyond brainstorming, such responsibility should only be imposed to the degree there is a clear and vetted plan for doing so.
I thought this reply was written for directors, but really, it is written for boards, treasurers, and finance committees: if a director is to work on any aspect of fund-raising (which if they do, should only be the merest fraction of their duties), or if a public library is going to fund-raise, make sure the right infrastructure is in place!
 I know this statement is not technically a question, but at "Ask the Lawyer", the quest for truth trumps grammar.
 Like many librarians, I am a polymath who loves learning new things... but the rules and risks of sourdough starter have me flummoxed. It seems to be like having a very delicate pet you need to weigh every three days.
 I know, that's a lot! This might be why some people default to "it's illegal" (which it isn't).
 This is what could be called a "sticky wicket" (or where I'm from, a far starker phrase I'll leave to your imagination). Library trustees should not do double-duty as "Friends" leaders, but if the Friends are in free-fall, they can step in to offer a reality check and support. Think of it this way: if your neighbor's house is burning, you can't fight the fire or fix the house once it's damaged, but you can call 911, offer blankets, and help them find a licensed contractor when they decide to rebuild.
 Call it an "MOU", an "MOA", an "Agreement" or whatever, but it should be an enforceable contract by which the library can dis-affiliate and deny use of its name for fund-raising purposes if the Friends stop be so friendly. For more on that, see https://wnylrc.org/raq/friends-and-library-cooperation-agreement.
 COMPLIANCE NOTE: The work of any paid fund-raiser MUST be per a contract... that is the law in the New York! For more on that, see: https://ag.ny.gov/publications/you-hire-fundraiser.
 To risk breaking my sourdough metaphor from footnote #1, if fund-raising by a public library is complicated like starting sourdough, then internal advancement is having a sourdough bakery. Not impossible, and impressive when operational, but it requires a lot of planning!
 The hallmarks of such plan are a board-approved strategic plan with a fund-raising section, fiscal policies regarding fund-raising and accounting for donated moneys, and a job description with precise responsibilities.