As the Indian Prairie 204 School District closes out one school year and looks to the upcoming one, officials are grappling with a mixed bag of certainty and uncertainty from a financial perspective.
On one hand, district officials are heading into the 2022-23 school year with long-term signed contractual agreements with two major labor unions — one representing teachers, the other for classified employees.
Inflation Challenges
But many of the widespread challenges facing individual consumers and businesses alike is weighing on IPSD 204 as efforts to keep both sides of the financial ledger in line continue.
“Our main challenge, going into the 2022-23 budget year, is dealing with an inflationary environment and what that impact is to the district,” Matthew Shipley, chief school business official, said as he provided a budget forecast at IPSD 204’s most recent school board meeting on May 16.
Shipley last went before the board with a budget forecast update in February and said some of the big-picture projections — which could include an eventual recession and a slowing of the economy — have come to the forefront since his last presentation.
“There’s obviously been a lot of change over the past several months, with general economic data and information that’s come out,” Shipley said. “We’re in a transition period, where there’s a lot of uncertainty. We will continue to monitor that.”
Amid the economic uncertainties ahead, Shipley and other IPSD 204 administrators have indicated there are no plans at this time of trimming staffing, curricular offerings or programs.
“I appreciate the effort to keep staffing levels consistent,” school board member Allison Fosdick said. “Having the staff levels remain the same benefits the teachers, the kids and the support staff.”
Consumer Price Index
The consumer price index (CPI) for IPSD 204’s 2021 tax levy is 1.4%. Looking ahead, Shipley is forecasting it to be 5% for the 2022 levy.
“It’s important for people to understand that we are limited to that 5%, in terms of what we can do here,” Laurie Donahue, board president, said.
Donahue was referencing the Illinois Property Tax Extension Limitation Law (PTELL), which caps statewide districts’ levy increases at 5%, even if actual CPI exceeds that.
New Construction
To keep pace with rising expenses, IPSD 204 officials are hoping new construction will continue to add to the property tax base. The finalized 2021 levy reflected $55.5 million in valuation for new properties throughout the district’s footprint.
The tentative 2022 and 2023 levies include an estimated $45 million in additional new construction for each year.
Another factor in play is the tax rate, which tends to fluctuate as property values increase or decrease. As has been widely reported, the housing market has remained strong as demand as outpaced supply.
But Shipley offered a word of caution on that front as future factors come into play.
“During a recession, we tend to see declining property values,” he said. “Even though, as a district, we might be able to increase our levy each year, that puts a higher rate burden on our taxpayers if the property is not increasing at the same rate.”
For Naperville News 17, Dave Fidlin reports.
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