What would be the correct fund classification for donations aimed strictly at supporting a library?

For donations specifically earmarked for supporting a library, the correct fund classification is a Permanent Fund. This classification is used for resources that are legally restricted to the extent that only earnings, not principal, may be expended. In the context of a library, donations can be seen as funds that should be invested to generate income, which can then be used to support ongoing operations or programs of the library without diminishing the principal amount of the fund.

In contrast, the other fund classifications do not align with the nature of the donations for library support. A Special Revenue Fund is appropriate for resources that are spent for specific purposes but do not have the restriction on the principal like those of a Permanent Fund. A Private-purpose Fund is designated for resources that benefit private individuals or organizations rather than public entities. Lastly, a Capital Projects Fund is intended for the acquisition or construction of major capital assets, which does not align with the intended use of library donations focused on operational support.

Thus, the classification of donations for library support as a Permanent Fund is justified, as it allows for the preservation of the principal while providing for the library's operational funding needs.