Under the scheme, councils will be able to compete for Public Library Grants for local library improvements and upgrades. A Shellharbour City Council spokeswoman said they would be applying for funding according the their library strategy.

‘‘We will start improvements at Oak Flats in 2015 and a grant would further assist with this,” she said.

Whether Albion Park, Warilla and Shellharbour village library’s will receive a grant under the scheme can not be confirmed at this stage. Council recently received funding of $200,000 - under the library development grants- which will go to the new city library to be developed as part of the new City Hub.

Kiama MP Gareth Ward said the grants start at $2.99 million in 2014/15 and will increase to $3.99 million from 2015-16 to 2017-18.

“The Public Library Grants and subsidies will total a record $27.5 million,” Mr Ward said. 

“We have heard the need for increased support for public libraries so I am pleased to see this additional funding come to fruition.

“Libraries will be able to apply for funding for projects and programs with a focus on demonstrated need and community benefit. 

“The program also seeks projects which enable greater access to library facilities and services by the broader community, as well as those which work with other cultural organisations within the community,” Mr Ward said.

Public Libraries NSW Chairman, Graham Smith said associations welcomed the budget boost, however remain concerned the state government had not recognised impacts on recurrent funding. 

Mr Smith said associations had identified a “crunch” in funding over the next 12 months, if the recurrent funding formula was not reviewed. 

“This would mean for the first time in the quarter of a century there could be a cut in recurrent funds to public libraries,” Mr Smith said.

“There will be cuts to disability and geographic funding which support libraries in many suburbs, regional centres and rural areas.

“The places it will hit is small country towns, the western suburbs of Sydney and potentially parts of the Illawarra. Many of those places rely on the funding for special programs and classes for their communities.”

Grant applications can be submitted to the Public Libraries Consultative Committee as early as July 14 in Shellharbour.