I got this idea from a fellow librarian, Anna at Atascocita Springs Elementary in Humble, TX. It has been awesome at our school in just two weeks.
First, take old boxes of household items.
Turn them into bookmarks!
It's great for several reasons. First, it reinforces recycling. Sure, we do a great job of putting our paper in the recycle bin, but what about taking recycled materials and making something new you can still use. Second, the kids love picking out a bookmark. Third, it saves the library/school money and paper to buy or to make bookmarks.
The only negative is that I have about 100 boxes in my library workroom waiting to be cut.