To upgrade from the base at Level 1, you'll first need to be at least level 27 and have 1800 or more citizens in your town. Once that's done, you can begin the actual upgrade process by inviting additional crew members to work in what will be a larger building. You'll need to invite ten new crew members, or pay City Cash to fill the crew positions instantly. At Level 2, the College Library will support 750 citizens, up from the original number of 600.
Is 750 not enough? If not, you can upgrade yet again to Level 3. Before beginning the crew member process yet again (yes, you'll need to add an additional 10 crew members to the Library), you'll need to have at least 3200 citizens in your town. Those requirements out of the way, you'll be left with a totally transformed College Library (that is, one that is incredibly different visually) that supports 1,000 citizens in your city. Whether or not the additional 400 citizens slots will be worth asking 20 friends to help you, however, will be up to you.
Do you like completing Community Building upgrades, or do you just upgrade businesses instead? How far have you made it into your College Library upgrades so far? Sound off in the comments.