Government, Higher Education, and Nonprofits

IRS approves nonprofit status for Kent District Library

Surprisingly, not all public library systems in Michigan have 501(c)(3) status.

August 29, 2014
| By Pete Daly |
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Kent District Library
Linda Krombeen, KDL’s fund development manager, says nonprofit status will enhance fundraising efforts for special projects. Courtesy Kent District Library

Linda Krombeen’s job just got busier — and in one respect, easier. She probably won’t have to hear "no" so often when she’s trying to get a grant or donation.

Krombeen, fund development manager at Kent District Library, said she is “so excited, I can hardly stand it.”

KDL was notified by the IRS Aug. 21 that the 18-branch library system serving most of Kent County has been approved for 501(c)(3) status. 

Ann Arbor and Jackson may be the only other public library systems in Michigan to have that status, Krombeen said, because most have charitable foundations that do the fundraising for them.

“The biggest thing this does for KDL is it helps individuals and organizations that want to give recognize that we are a charitable organization,” she said. 

“There are a lot of corporations and foundation funders who will only donate to 501(c)(3)s. In the past year, we have had two investment corporations that have donor-advised funds contact us about giving, who pulled away when they learned we did not have 501(c)(3) status.”

One of those was Merrill Lynch. If one of its clients wants to make a charitable donation, Merrill Lynch will only refer that client to 501(c)(3) organizations.

The 501(c)(3) certification “means the IRS assures the public that we are a charity in good standing and that their gifts are tax deductible,” said Krombeen. She has since contacted those Merrill Lynch clients and let them know KDL now has 501(c)(3) status.

In the past, the KDL has “borrowed” the 501(c)(3) status of its Alliance of Friends, according to Krombeen, when that route for donating was acceptable to the donor. 

The Alliance of Friends is a small volunteer organization that supports KDL in various ways, including fundraising, grant writing and soliciting donations for special projects. It is also a clearinghouse for information on the activities of the local Friends of the Library groups, provides training for Friends members, and holds an annual All-Friends Linking workshop.

But when an individual or an organization wanting to donate would ask KDL to produce its own 501(c)(3) certification, that donation wouldn’t happen. Krombeen said many individuals who want to make tax deductible donations and organizations that offer grants are not comfortable giving to an organization that is acting simply as a fiduciary and passing the money on.

Grand Rapids Public Library has the Grand Rapids Public Library Foundation, which “exists solely to help the Grand Rapids Public Library,” as stated on the GRPL website. It provides funding to GRPL in two major ways: through grants from its endowment fund and by raising funds for specific capital and special project needs.

Krombeen, who has held the fund development manager position at KDL since August 2012, said she knew when she accepted that job that 501(c)(3) status was a priority. 

She has more than 20 years of experience in fund development on behalf of large and small area organizations.

The process for getting the status involved “lots of paperwork,” according to Krombeen.

“It was a nine-month process of working with an attorney to make sure everything was filled out correctly and then waiting for the IRS to either ask more questions, deny your request, or provide you with the status. I am happy to say that we had no additional questions from the IRS and received our designation nine months after it was submitted.”

KDL’s charitable status comes at a time when voters in Kent County had just approved a library millage for the next 10 years — about $200 million.

“The support of voters provides stability to KDL and the opportunity to ensure more hours, boost our materials budget and improve our IT infrastructure — all of which have suffered over the past five years,” Krombeen said. “What private donations provide are more engaging and targeted programming, increased technology, faster response to community needs and greater opportunities for hands-on learning.”

All libraries do fundraising above and beyond their millage revenue, according to Krombeen. She said it is the same at colleges and universities, which don’t stop fundraising efforts just because there has been an increase in tuition or in state aid.

“There is never enough money to do what you want to do” in the nonprofit world, she said.

“We’re lucky to have the millage support,” she said. “It means we don’t have to worry about paying the bills; we know we can keep the lights on.”

Fundraising, she said, permits the library to do “those extra things that make us more valuable to the community,” such as bringing in professional speakers or focusing on a special aspect of local history.

KDL serves 395,660 people in all areas of Kent County except the cities of Grand Rapids and Cedar Springs, the village of Sparta, and Solon and Sparta townships.

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