My library has no late fees but we do charge for lost or damaged item fees. We really just want the materials back. Fines are a PITA to deal with for both staff and patrons, more hassle than they're worth. They also can scare patrons into not bringing items back because they're worried about either the fee or being yelled at (our patrons skew young and maybe aren't used to how libraries work: they often ask about the cost for "renting" books instead of "checking out" books, and we have to explain it's a free service.)

edit: scary librarian voice. a lost item will go on your permanent record and you won't be able to graduate until you pay it off