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The Town of Lake City, Colorado and Hinsdale County established the Hinsdale County Regional Library District by joint resolution in 1979.  The library, doing business as the Lake City/John Wagner Public Library, is a taxing district that collects tax revenues for the operation of the library.

Other funding sources are donations, grants and special projects.  In 1995, the Friends of the John Wagner Library, a 501 (c)(3) non-profit organization, was formed as a support and service provider for the library.