I have about 30 items in the museum. O have at least one donation in each category (art fish fossils and bugs) and for some reason he still wont wake up and think so I can get the project for it. Please help!
For how long have you been in the state of having donated one of each category and a total of 20 donations or more? It can take several days for him to think about it, and I would suggest going there everyday until you see him thinking.
"The Museum Renovation is a Main Street upgrade and costs 198,000 Bells. It is requested by Blathers once the player has spoken to him on 14 different days and donated at least 20 items, with at least one item in each of the four exhibit categories (fish, insects, fossils, and art)."
(http://animalcrossing.wikia.com/wiki/Public_Works_Projects)
Are you sure you have talked to him on 14 different days? That could be it, maybe.