The new library will open on to the shopping centre's village green and the extra money from Lotteries will fund additions such as a community space for small exhibitions and a meeting room.
Details of what the $200,000 will buy were being worked on by the council in conjunction with the winning design and build contractor, Greerton-based Marra Construction.
The full $400,000 would have funded a community meeting room for up to 50 people, an improved learning centre, better space for teenagers and an art and exhibition area. It would have extended the new 900sq m library by 150sq m.
Mr Crosby said the building plans were being rejigged to maximise the community space benefits from the extra $200,000. He stressed that the additions would not be a community centre in the true sense of the word, like at Merivale and Arataki.
Greerton Village Mainstreet manager David Hart welcomed the decision, saying $200,000 was definitely better than nothing.
"We will take that as good news."
The silver lining to Lotteries granting half the amount applied for was that there would be a slightly smaller encroachment of the new building into the village green, he said.
Mr Hart said it will be interesting to see how the library steering group adjusts the design to make most use of the money.
On the issue of some of the $3.45m library cost being funded from selling adjoining council-owned properties, he questioned whether in 10 years' time the community would look back and think how things could have been if the land had remained in public ownership.
Mr Hart said there was always the hope that the council would rethink the sale or that a local philanthropist would chip in to ensure the land was held in trust for the community so that the library complex could expand without further encroachments into the village green.