This is an interesting and important topic to me, as well, and unfortunately one that requires a little follow up in terms of what you want the catalog to do and what skills y'all have in your group and how much time folks can put in, now and ongoing.
Milo Miller from QZAP writes:
If they're going to be doing ILL and playing with more traditional libraries, care about MARC, etc. and have someone who can do the implementation, I'd tell them to take a look at Koha
I'm still super jazzed about Collective Access, and think it might be a good solution as well.
I'm guessing that there's probably also a way of doing implementations through Drupal, LibraryThing (though I'm pretty sure it's not FOSS [It's neither free as in speech nor as in beer for more than 200 items cataloged, but it is an easy solution--Jenna]), or maybe even just building good databases with LibreOffice?
Eric Goldhagen, the developer of our site follows up:
First they need to better define what they want, a website with information; a catalog that has MARC data and can handle things like circulation; a searchable archive of their collection using complex metadata?
