Last week I attended the reception celebrating the UW Library Research Award for Undergraduates. One of the professors whose student took an award in the Senior category said something very interesting. Not only do the winners receive $1000, but the award can make a big difference in graduate school admissions. It can not only make the difference between getting accepted or not, but in getting a fellowship or TA position or not. It could literally pay for your grad school. It is open to any UW undergrad.
Here' s a link with details: http://www.lib.washington.edu/researchAward/
There's also another writing competition with financial rewards -- the Library Student Employee Scholarships. This is only open to students who are also library employees, and is given in the form of scholarship funds.