So i see a lot of software that has mp3 encoding and/or decoding and I'm pretty sure that they don't pay the royalties to Thomson as required here: http://mp3licensing.com/royalty/software.html
So I'm wondering, is there a loophole that i don't know about? Is there a library that doesn't require any royalties/licensing fees?
No, they are simply taking a risk that their project are too small for Thomson to care about.
LAME is an LGPL'd, top notch MP3 encoder. Should be exactly what you're looking for.
Some of the patent holders do not enforce patents on open source software and the patents are not valid in every country so open-source projects that are not legally bound to a single country are hard to stop so most companies don't bother unless there is a lot of money to get.
See:
http://en.wikipedia.org/wiki/MP3#Licensing_and_patent_issues
Disclaimer: I'm no lawyer and have no experience whatsoever on this field.
Now that this is said: Wikipedia's knowledge on this one:
In short, with Thomson, Fraunhofer IIS,[52] Sisvel (and its U.S. subsidiary Audio MPEG),[53] Texas MP3 Technologies, and Alcatel-Lucent[36] all claiming legal control of relevant MP3 patents related to decoders, the legal status of MP3 remains unclear in countries where those patents are valid.
If you need licenses, I'd ask the Fraunhofer Society (if you're Europe based). They seem to have the best arguments on who created what when.