I have a picklist I would like to allow users to add new entries to if the entry they need does not exist. Is there a way to allow users to add new entries while filling out the web form?
No. Select list options are controlled by administrators - the whole point of them is to prevent users entering invalid data.
Your options are
1. Find a plugin that implements this (and prepare to spend a lot of time housekeeping it)
2. Have an "other" option and additional text field that they can fill in (and then have your admins spend time merging all the assorted options together)
3. Use a labels field instead - they can add what they want as labels (And you'll get a good feel for the mess they'd make if they had the freedom to add to select lists...)
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