Transportation and software costs, state funding challenges, construction work and the possibility of a future sales tax were all on the table for discussion by Indian Prairie School District 204’s board on Monday, as the board heard an update from the district on its budget for the 2025-26 school year.
At Monday’s meeting of the school board, District 204 Chief School Business Official Matt Shipley shared how the district’s revenues and costs are shaping up for the school year so far, noting continued cost and funding challenges and providing projections for the future.
Compared to the figures in the district’s operating budget for the 2025-26 year, which was passed in August, the district’s spending is currently on track to outpace what it had budgeted for, according to Shipley’s figures.
The total budget for the year came in at around $455 million, whereas Shipley’s projections put the district’s spending by the end of the year at around $458.6 million.
However, revenues are also up, his presentation on Monday noted, currently projected at around $457.8 million.
Still, that puts the district at a slight deficit — it had initially planned for a surplus of about $211,000 for the year, but is now expected to come in at around $800,000 above its expected revenues for the year.
Shipley noted that the district is more in line with its budget than it was at the same time last year, but noted that some budget issues remain.
He said that the rising costs the district was seeing last year “had the potential or have the potential to represent recurring expenditures,” which “really put (the district) in motion to really review expenditure trends and identify what was causing some of these variances.”
Last year, for example, the district had 13 more employees than it had budgeted for, and have been seeing increases in the costs of digital licenses and software, he noted.
Another major expense the district is having challenges with is special education transportation, which Shipley said has been an ongoing issue.
“Similar to last year, where we had some things come up at the last minute in this … support services or special education area,” Shipley said, pointing to things like an expanded use of bus aides and additional adult support on those routes. “That’s become a real challenging cost center to manage for us.”
On the revenue side of things, however, Shipley’s presentation notes that property tax revenue is projected to keep growing, with the property tax rate continuing to decline.
Shipley explained that property tax revenue is affected by the Consumer Price Index, or CPI, a measure of inflation set by the U.S. Bureau of Labor Statistics, along with an allowance for new construction. State law caps taxing bodies’, including school districts’, tax extensions at 5% or the previous year’s CPI, whichever is lower. That number therefore impacts the amount the district can receive from property owners within the district.
The CPI in 2024 was 2.9%, and the district in December approved a $360.5 million property tax levy for 2025, which is for taxes to be paid next year and amounts to a roughly $14.4 million increase over the 2024 levy.
The district’s property tax revenue is also affected by new construction in the area, for which Shipley is projecting continued growth.
However, though the property tax rate for the district is going down, Shipley noted that homeowners are seeing an increased tax burden overall because of increasing home values and the values of commercial properties remaining more stagnant.
The district continues to remain largely reliant on property taxes, Shipley noted, which make up around 77% of the funds the district brings in. The remainder comes from state and federal funding, and a small amount from other local sources.
Shipley said the state budget was “about as positive as (the district) could’ve expected” in terms of funding for education for the coming year. Illinois Gov. JB Pritzker’s spending plan includes a $305 million increase for elementary and secondary education over the current year, helping bring overall funding to $10.7 billion, according to reports.
One major issue the district is facing in terms of revenue, however, does concern state funding, Shipley noted, which the district has previously said has not kept up with cost increases due to inflation.
Shipley noted in particular state funding for “mandated categorical programs,” which are funds earmarked and mandated by statute for a particular purpose or population, according to the Illinois State Board of Education. This funding provides reimbursements for transportation costs and tuition costs for special education students that are served out of the district.
The district’s overall mandated categorical revenue from the state was around $750,000 less than in 2025, according to Shipley’s presentation. Indian Prairie received slightly more funding for transportation in 2026, but Shipley noted that the district’s allocation for special education tuition was lower this year.
According to Shipley, that decrease is tied to state legislation passed in 2024 that was intended to expand reimbursements to tuition payments for special education students at both public and private facilities. Shipley said that additional funding wasn’t allocated as the eligibility was expanded, and that Indian Prairie, being a larger district in the state, was serving some of its special education students in-house and wasn’t making use of public facilities.
So, going forward, the district is anticipating continued revenue growth from property taxes, but expecting state and federal funding to remain fairly flat, Shipley said at the meeting.
The district is looking to make $2 million in reductions from the current budget while “minimizing impact on school-based positions,” Monday’s presentation notes. It is also looking at department budgets and licensing and subscription costs, and have already approved a new transportation service contract at a 5% increase, which Shipley said is closer to the CPI than the past few years.
Shipley also gave an update on the district’s ongoing facilities overhaul, which is being funded by the district selling $420 million in bonds. The bond sale was approved by voters via a referendum in 2024.
The use of the bond funds is restricted to capital projects, Shipley said on Monday, and noted that the eight-year capital program is designed to be the “primary or sole” source of capital funding during that time. The total project budget for the renovation work is $466 million, he said, made up of the $420 million in bonds and some other related capital funds, like bond interest earnings and bond premiums.
He said the projects are currently on-time and on-budget, and that the district has been able to accelerate the schedule for work in some cases. The district is also projecting savings in future years from making its buildings more efficient as a result of the referendum-funded improvements.
At the meeting, board member Susan Taylor-Demming asked about the district’s fund balance. Figures from Monday’s presentation indicate that the district is planning to end the year with a little under $156.6 million in its reserves, which is around 34% of the district’s revenues for the year.
Shipley said that the district’s policy is to have a fund balance of at least 25% of its yearly expenditures, a figure that has to do with when the district receives its revenues and pays its expenses. He explained that, since the district receives its first property tax installment in June, the 25% balance is essentially the minimum the district needs to have at the end of June so there’s no point during the year where the district cannot pay for its expenses.
Board member Justin Carubas, at the meeting, noted that the district “always seem(s) to be in a deficit” when it comes to building maintenance, and said he thinks the district “is not spending enough on a yearly basis to fully maintain (the district’s) buildings.”
Shipley noted that all capital spending has been shifted to being paid for with funds from the bond referendum question, rather than the district’s operating budget. But he noted that the district needs to consider how it will position itself to pay for routine maintenance past 2032, when the referendum funds have all been used.
And board President Laurie Donahue asked about the developments the district is seeing, and if there is anything not projected by the district or cause for district concern.
Shipley said that, when it comes to residential properties, the number of students being generated by development is in line with the information the district has. He noted that enrollment has come down slightly, and noted that birth rates are continuing to decline across the country.
“I don’t know that we’re in a … position where we have as many concerns about capacity and being able to serve students as maybe we have in the past,” Shipley said, though he noted that the district is still pushing Aurora and Naperville for commercial development where possible.
On the rising costs the district is seeing, school board Vice President Allison Fosdick asked if there were any “mechanisms currently in place to limit the growth of the cost of special education transportation.”
Shipley said this issue is a broader trend outside of Indian Prairie, and that part of the growth in these costs for District 204 comes from it being a “destination district” for services like special education. This “creates more issues” financially, Superintendent Adrian Talley said, in the sense that the district has to provide more classrooms and staff for these programs.
Carubas also pointed to concern about how local revenue is paying for the majority of increased spending on student education, but that state contributions are not keeping up.
Carubas also brought up the possibility of a county sales tax in the future. A sales tax relies on non-resident contributions, rather than just property owners, but he also noted that it’s a regressive form of taxation, which essentially means lower-income individuals pay a higher portion of their income on the tax. Putting a sales tax question to voters would also require getting multiple school districts on board with the idea.
Shipley said at the meeting that a sales tax was considered in Will County in the past, but it ultimately fell short of getting sufficient support from the counties’ school districts.
He also noted that the district could propose a sales tax in both DuPage County and Will County, but that those would be separate ballot questions if the district went that route. He also said that other counties have a sales tax for school districts, but none of the collar counties do, and doing so would be “a little unprecedented.” A similar school sales tax question is being put to Winnebago County voters in March, Shipley pointed out.
“We’ll see if it is … something that gets talked about and is potentially gaining a little bit of traction in some of the larger districts in the state,” Shipley said.
According to Shipley, the district will be providing another budget update in May and an update on the ongoing facilities work in June.
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