SUBJECT:  BUDGET POLICY AND PROCESS

I.	PURPOSE
Preparation of the Library’s budget is among the most important duties of the Library 
Board and the administrative staff.  The purpose of this policy is to set forth procedures for 
the orderly and timely development of the Library’s budget.

II. 	SCOPE
	Property taxes provide over 90% of the Library’s operating budget.  Illinois Statutes dictate 
that the tax levy for municipal libraries must be channeled through the corporate authority. 
Therefore, the Library’s tax levy request and those capital items that are incorporated into 
the City’s Capital Improvement Program (CIP) are submitted annually to the City Council 
for final approval.  This process requires the Library to transmit all budget documents to the 
City for inclusion in the City’s budget materials.  However, the Library Board of Trustees is 
responsible for determining the annual levy request and managing the monies in each of the 
funds in its jurisdiction.  The Budget Policy and Process outlines the various 
responsibilities, Library funds, and required deadlines involved in the development and 
management of the budget. 

III.	PROVISIONS
A.	Responsibility:   
1.	The overall responsibility for the assumptions and timely preparation of materials 
and presentations throughout the process rests with the Executive Director.
2.	The responsibility for development of the assumptions and preparation of the
fiscal plan belongs to the Executive Team and Finance Manager.

B.     Components: The Library will utilize the structure and components established by the 
City in the construction of its budget materials.  

C.	Library Funds 
1.	Operating Fund – This fund supports the Library’s routine operations.  It tracks 
the Library’s annual revenues (comprised primarily of property taxes, revenues 
generated by the Library through fines and user fees, and investments managed 
by the City) and expenditures (salaries and benefits, library materials, and all 
operational support such as supplies, utilities, and facilities costs). 
2.	Capital Reserve – This fund was established and is maintained by the transfer of 
unexpended balances from the operating budget.  Expenditures from this fund are 
restricted by State Statute to planned and emergency capital projects.  The Library 
Board reviews the purpose of this fund annually, and details for the planned 
expenditures are included in the total budget resolution passed by the Board of 
Trustees at their annual meeting.  The Library limits this fund to $250,000 per year 
for the purposes of minor maintenance and capital projects.  Capital projects in 
excess of what can be supported through the Capital Reserve are submitted to the 
City for review and approval through their Capital Improvement Plan (CIP) 
process. Deviations from this process will be communicated to the City when 
necessary.
3.	Gift/Grant/Memorial Fund – This fund was established to hold contributions of 
gifts and memorials to the Library.  Gifts come from individuals, civic groups, and 
businesses.  This fund also holds all grants with the exception of the Per Capita 
Grant.  Grants run on independent calendars and frequently bridge multiple years.  
The interest on investments from these gifts is also retained in this account.  
Undesignated gifts can be held in reserve for major purchases and are not 
necessarily spent during the current fiscal year.
4.	The Povinelli Endowment Fund – The Povinelli Endowment Fund was 
established to honor the memory of Dick Povinelli through the purchases of books 
and non-print materials on religion, spirituality, and emotional development.  The 
yearly expenditures cannot exceed the earnings on the principal, plus any 
undistributed earnings from prior years.
 
D.	Process and Timeline:  Preparation of the overall fiscal plan and budget is a 
progressive process that involves regular interaction between the Library Board, 
Library staff, and City staff, timed to provide necessary information to the City 
according to their budget calendar, established annually. Illinois Statutes require that 
the preliminary tax levy must be submitted in December and the final tax levy in 
April.  Beyond these restrictions, processes and timing occur as determined by the 
City in consultation with Library administration.  

E. 	 Changes to Approved Budget:  All line items are numbered.  Transfers between line 
items of $10,000 or less can be approved by the Library’s Executive Director. All 
other transfers shall only be made with the approval of the Library Board.
NAPERVILLE PUBLIC LIBRARY					    	    Policy No. 
120.1
                                                                                                 			                   
	  

Date Approved:  9/4/85									Page 1
Approved:  2/6/02; Approved: 2/18/04; Approved: 3/15/06; Approved: 3/19/08; Approved: 
3/17/10; Approved: 4/18/12.