Naperville 2026 Budget Workshop: Oct 30, 2025 - Preliminary Operating Budget

The City of Naperville convened its second workshop on October 30, 2025, to discuss the preliminary operating budget for 2026. Mayor Krieger chaired the session, emphasizing that no final actions were taken as this was a workshop. The meeting focused on balancing a projected $4 million deficit against a 6.8% total budget increase to $685 million, driven primarily by rising personnel and health care costs. The session featured public testimony on staff capacity, planning strategies for Fifth Avenue versus I-88, and funding caps, followed by detailed presentations from Finance, Police, and community partners regarding specific budget items.

Consent Calendar

• No consent calendar items were processed during this workshop, as the session was strictly designated for discussion and review of the proposed operating budget.

Public Comments & Testimony

• Mary Lynch White expressed strong support for maintaining the "money with a mission" theme but raised concerns regarding three specific areas:
  • Staff Capacity: Expressed concern that staff is "stretched thin" and that the Council scrutinizes spending on staff too heavily compared to other services, warning against being "penny wise and pound foolish."
  • City Website: Urged the Council to ensure the website strategy includes the open data portal and the "rather deficient help center."
  • Special Area Planning: Expressed full support for prioritizing the Fifth Avenue initiative over the I-88 corridor, stating it would be difficult for the city to transform I-88 if it cannot successfully complete Fifth Avenue. She argued that planning strategies for I-88 should follow the 2022 land use plan and that data centers should not be approved in residential areas.
  • Funding Cap: Expressed opposition to raising the SECA spending cap until a thorough public analysis of the food and beverage tax is available.

Discussion Items

• General Fund Overview & Deficit Resolution: Director Ray Munch and Deputy City Manager Doug Munch presented the financial landscape, noting a projected $4 million deficit. Staff highlighted a correction to a utility billing error in the electric use tax calculation for commercial customers, which is estimated to net an additional $1.8 million in revenue for 2026. Councilman Kelly questioned the decision not to backbill commercial customers for the estimated lost revenue from 2025; staff explained the decision was made to avoid equity issues for businesses that had already budgeted.
• Revenue Trends & Diversification: Presentations detailed a shift in revenue diversification, with state sales and income taxes now accounting for over 70% of the general fund (up 6% from 2019). Staff warned that this reliance on economically sensitive sources poses a risk during economic contraction.
• Personnel & Health Insurance: The budget reflects an 18.5% increase in health insurance premiums. Director Munch attributed this to pharmaceutical costs and serious health conditions, noting the city is fully self-insured. Councilman McRum asked if the city should consider joining risk pools; staff advised against a knee-jerk reaction based on one year of data.
• Drone Pilot Program: The Police Department requested $150,000 to expand its drone program into a "Drones as a First Responder" (DFR) pilot. Chief Harris explained the drone would autonomously fly to 911 calls, arriving in under two minutes, with strict privacy protocols (30-day retention unless evidence of a crime). The pilot will be implemented on the north side of the city. Councilman Kelly requested further data on projected mission counts.
• City Website Rebuild: Council approved a allocation of $100,000 to procure a new content management system and hosting solution to ensure compliance with new Department of Justice accessibility rules and improved cybersecurity.
• Special Area Planning Study: TED requested $150,000 to initiate a study for either the I-88 Corridor or Fifth Avenue. Director Munch noted that while NDP is conducting marketing for I-88 independently, the city must choose one study to fund in 2026 due to resource constraints. Councilman White asked if the I-88 marketing would conflict with a zoning study; Director Munch stated they are distinct activities.
• Commuter Parking Fund: The fund is projected to deplete its cash balance by 2027. Director Munch explained expenses have outpaced revenues due to deferred capital maintenance and rising operating costs. Councilman White questioned a potential conflict between parking fund needs and future special area planning; staff confirmed they are separate issues.
• Community Partners (NCTV 17 & SECA): A significant discussion occurred regarding raising the SECA cap to $2.51 million to fully fund NCTV 17.
  • Speaker positions varied: Councilwoman Gibson and Councilman Wilson expressed full support for NCTV 17 as a vital news amenity. Councilman McRum expressed strong opposition, citing concerns about the city moving toward 100% funding (slippery slope) and a lack of broad public value perception. Councilwoman Jane was "partially supportive" but suggested trimming other categories. Councilman Kelly expressed support, noting a positive path forward has been developed.
  • Staff clarified that the funding would technically come from the food and beverage tax via the SECA obligation process, though Councilman White suggested creating a separate category under the food and beverage tax distinct from SECA.
• Naperville Development Partnership (NDP): NDP requested a flat budget of $1.37 million, including a permanent $150,000 allocation for I-88 corridor marketing. Monica Connors clarified this marketing targets six specific industries and operates independently of any zoning study.
• Naperville Public Library: Executive Director Dave Delatorza requested an operating budget increase of 3.7% ($18.48 million) to cover rising health insurance costs and maintain facilities. He noted a shift toward electronic circulation (25% total) and outlined capital requests for boiler and storm drainage repairs.
• Naper Settlement (Naperville Heritage Society): The organization requested a 2.5% property tax levy increase to cover personnel and benefit costs. They detailed progress on the Mary and Richard Bank Agricultural capital campaign and the 250th-anniversary planning.

Key Outcomes

• Budget Status: The 2026 budget remains balanced at $685 million, with a 6.8% total increase. The General Fund shows a 4.4% revenue increase and 4.5% expense increase.
• NCTV 17 Funding Decision: The Council reached a consensus to include NCTV 17 in the City Obligation within the SECA framework at the requested level (approx. $180,000-200,000 depending on final categorization), despite some members expressing reservations about the cap increase. Staff confirmed they will not lower the allocation based on the dissent.
• Drone & Website Approval: The Council moved forward with the concepts for the $150,000 DFR pilot and the $100,000 website rebuild, directing staff to proceed with planning.
• Parking Fund Review: No immediate rate increase was authorized; staff will return in 2026 with a detailed plan to address the projected 2027 depletion of the commuter parking fund.
• Next Steps: The third workshop is scheduled for November 10, 2025, to focus on the property tax levy. A public hearing and final vote on the 2026 budget are scheduled for December 2, 2025, with final levy approval following in a December meeting.