You can share and manage your books through Amazon - manage your kindle, you will need your amazon email address which you can also find in your amazon account.
You will need to add someone's Amazon email address (visa versa) for them/you to borrow from your library and then delete them to do the same with the next person.
You can add up to 5 at a time but borrow a book for a fortnight so probably best to manage one at a time or more if you read quicker than I do 
Do we need a spread sheet and to get some pm's for amazon addresses going?
One thing I'm not sure about is security, I'm assuming as long as no one asks for/gives away their password along with the email (Amazon one not personal one) it should work well?