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with a 'no late-fees' policy, truly is '100% off' (...your first 'purchase' only, probably)
My wife's library only charges a fee if you never bring it back. No late fees.
When is never?
45 days after the item is considered lost- checkout is 3 weeks, then several overdue notices. Essentially about 3 months. But you can also always renew aside from a few things.
In many places an overdue will automatically become lost after ~2 weeks - ~3 months. Then you'd be charged the cost of the item and sometimes a processing fee to cover the costs of preparing a replacement book. If you have a lost book, still bring it in, I would happily waive fees up until the point the replacement order was placed. Libraries generally just want the books back.