Despite the backdrop of economic shifts and future financial unknowns, Naperville officials are proposing a balanced 2026 operating budget and capital improvement program, based on preliminary information.
Top-level city staffers had the second of three budget-related workshops with the city council Tuesday, Oct. 28. The initial workshop, held in late September, focused on capital projects.
A big-picture look at revenues and expenditures
As both sides of the city’s financial ledger came into sharper focus in recent months, pieces of the puzzle came together. The city’s vote in September in favor of a continuation of the 1% grocery tax, for instance, provided clarity on what historically has been a reliable revenue stream.
But even with the grocery tax in place, Finance Director Raymond Munch early this year indicated Naperville was still set to face a $2.5 million deficit in the year ahead if a status quo approach to the budget continued. Updated projections in August inched the figure higher to $4 million.
There are multiple reasons behind the deficit, Munch indicated during the Oct. 28 workshop presentation.
“Some revenues have moderated or even declined in recent years,” Munch said. “As those revenues produce less, we’ve been cautious to maintain property tax stability.”
Changes in consumer behavior have been cited as causes behind some of the revenue shifts. Examples include remote work and electric vehicle use, each impacting the city’s receipts for commuter parking fees and the local gas tax. The steady decline in landline phones and cable TV, by way of cord cutting, also has meant less fees and taxes.
“At the same time, we’re spending more, investing in both our professional city staff and our infrastructure,” Munch said. “We’re navigating all of this in the face of continued uncertainties at the state, national, and global levels, as far as the financial climate is concerned.”
Several efforts have been taken to backfill the $4 million shortfall projection, Munch indicated, including expense reductions based on historical spending, staff allocations, and budget assumptions. Efforts toward debt reduction and pension stabilization are also working favorably on the city’s budget, Munch added.
The city’s electric use tax for commercial customers also has been refined to address what Munch described as a “long-standing error within our utility billing system.” The change is expected to infuse an additional $1.8 million into the city’s operating budget in 2026.
“We took a hard look at all of our general fund revenues and expenses,” Munch said.
Three new smaller-dollar initiatives planned in 2026
Throughout the most recent budget workshop, city officials emphasized the municipal spending plan for the year ahead is reflective of a more cautious and measured approach to help navigate any potential choppy waters that might loom ahead.
But three new, specific initiatives for 2026 are being baked into the proposed operating budget for the year ahead.
“These initiatives are not high dollar value, but they’re public-facing, which is why we’re presenting them tonight,” City Manager Doug Krieger said.
The Naperville Police Department is seeking a $150,000 contribution toward a pilot program known as Drones as First Responders. It would supplement the existing drones the department has been using the past four years.
Police Chief Jason Arres said Drones as First Responders would give NPD the opportunity to harness the latest in rapidly evolving technology and give agency personnel the ability to deploy the drones in specific incidents.
“I think we need to realize the ROI (rate of investment) on this in our busiest areas of town and then adjust it from there,” Arres said.
The drones included in the funding proposal have higher technological capabilities than those currently in use within the department, flying at speeds of up to 65 miles per hour. Arres said only a few Illinois communities — Oak Brook and Rockford being two of them — have used the Drones as First Responders program.
Other proposed funding initiatives highlighted during the presentation include $100,000 toward an upgrade of the city’s website to improve accessibility, enhance cybersecurity and better reflect contemporary service delivery expectations.
Additionally, city staffers are proposing $150,000 for one “special area” study. A study could be commissioned for either the I-88 corridor or the 5th Avenue area, based on the plans in motion.
Naperville Public Library, Naper Settlement funding
The budget workshop also delved into funding allocations for two entities — the Naperville Public Library and Naper Settlement — which operate autonomously, but receive funding through the city’s property tax levy.
David Della Terza, the library’s executive director, presented a proposed 3.7% increase in the library’s share of the city tax levy.
“We always do our best to present a fiscally responsible budget, and our property tax rate has decreased every year, for the past 11 consecutive years,” Della Terza said. “Additionally, our property tax rate remains lower than all comparably sized libraries in the region.”
Amid belt-tightening within the library, Della Terza said several initiatives still remain on the docket, including improved children’s play spaces and a continued investment in e-book collections.
Rena Tamayo-Calabrese, president and CEO of Naper Settlement, presented city officials with a 2.5% tax levy increase.
“The levy increase will accommodate 32% of the increase in salaries and benefits, and the balance will go toward the contractual services,” Tamayo-Calabrese said.
In her presentation, Tamayo-Calabrese also touched on a few highlights within the Naperville Heritage Society, including the receipt of $500,000 in state funding for multiple programs in 2026.
“(The funding) will foster intergenerational connections, it will combat social isolation, provide equitable opportunities for seniors and underserved children, and it will provide quality education and development for teachers in need.” Tamayo-Calabrese said.
NCTV17 funding, other misc. services reviewed within SECA cap
One additional component that feeds into the municipal budget — funding allocations for miscellaneous services — was also under the microscope during the Oct. 28 workshop.
Councilmembers and city staffers hashed over dollar allocations for what Krieger described as “outside groups that provide services through agreements with us.”
The list of funding allocations includes a proposed $915,000 contribution from the city toward Naperville Community Television, up from $715,000 in 2025.
The NCTV17 funding increase dovetails into a potential raise in the city’s Special Events and Community Arts grant program, which currently is capped at $2.14 million. A new proposal for 2026 sets the threshold at $2.51 million.
Additionally, Downtown Naperville Alliance is requesting city funding of $510,000 in 2026, up from the 2025 allotment of $435,650. Also in the mix is a contribution toward Naperville Downtown Partnership, which is seeking a flat $1.365 million in city funding.
Naperville’s third and final budget workshop will be held Monday, Nov. 10. A public hearing on the 2026 budget, as well as an estimated tax levy, will be presented at the council’s Tuesday, Nov. 18 meeting.
Budget approval is scheduled for Tuesday, Dec. 2, and adoption of the property tax levy is to be voted on at the council’s Tuesday, Dec. 16 meeting.
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