Why should libraries, wholly paid for by local citizens, not demand citizen-units' papers to ensure they are local before allowing them to partake of all that juicy, non-rivalrous knowledge?
Because they are in the business of providing knowledge, not being gate keepers. (They have to gate-keep to some extent, of course, but that is more about keeping the collection healthy.)
Mike Masnik (Techdirt), I think, was the first to make the case that people's understanding of economics seems to break down when encountering zero-cost. It is a real problem.
The BBS example reflects a time when a island nation-state was looking for a way to fund public TV. The non-rivalrous nature of airwave reception led them to a (much mocked and hated, but functional) taxation system.
Now that "broadcast" generally means "internet", for that model to work, artificial scarcity must be employed, denying people benefits that could be provided at zero marginal cost to protect a funding mechanism that only makes sense in hindsight.
Fixing the mechanism to function in a changed world would seem to make more sense to me. But then I'm not British, a politician or dependent on an out of date system for my dinner, so what do I know.