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The Limitation of Administrative Costs Worksheet must be filed with the Illinois State Board of Education (ISBE) by November 15 of each fiscal year, in accordance with Section 17-1.5 of the School Code. The worksheet should report the actual administrative expenditures for the previous fiscal year and the budgeted administrative expenditures for the current fiscal year.

School district's budgeted administrative expenditures can not increase more than 5% over their prior year actual administrative expenditures. The following functions are included under administrative expenditures:

  • 2320 Executive Administration Services
  • 2330 Special Area Administration Services
  • 2490 Other Support Services - School Administration
  • 2510 Direction of Business Support Services
  • 2570 Internal Services
  • 2610 Direction of Central Support Services

"Administrative expenditures" do not include early retirement or other pension system obligations required by law.

School districts with administrative expenditures per pupil in the 25th percentile and below (the fourth quartile) for all districts of the same type (elementary, high school, or unit) may waive the limitation imposed under Section 17-1.5 for any year following a public hearing. Waiving this limitation requires the affirmative vote of at least two-thirds of the members of the school board. Any district waiving the limitation shall notify ISBE within 45 days of such action. Adoption of the limitation waiver does not relieve a district of the requirement to file the one-page report discussed above by the November 15 deadline.

A school district ineligible to waive the limitation on administrative expenditures by board action may request a waiver from the General Assembly pursuant to Section 2-3.25g of the School Code, if exceeding the limitation solely because of circumstances beyond the control of the district and the district has exhausted all available and reasonable remedies to comply with the limitation. If approved, this waiver shall only apply to the specific school year for which the request is made. For more information on the waiver process, districts may contact the Department of Wellness ​at (217) 782-5270 or waivers@isbe.net or visit the ISBE Waivers page .

If the report and information required by Section 17-1.5 are not submitted on time, are determined to be incomplete or inaccurate, or show the district has failed to comply with the limitation, the district shall be notified in writing of the reporting deficiencies or violation. The school district shall, within 60 calendar days of the notice, address the deficiencies identified or provide adequate assurance that appropriate corrective actions have been or will be taken. If the district fails to provide adequate assurance or to undertake the necessary corrective actions, the State Superintendent may impose progressive sanctions against the district, which may culminate in withholding all subsequent payments of Evidence-Based Funding until the assurance is provided or the corrective actions are taken.

The Limitation of Administrative Costs Worksheet is included within the Annual Financial Report (AFR), and the worksheet may be submitted to ISBE in conjunction with the AFR. Alternatively, the completed and signed worksheet may be sent as an email attachment to finance1@isbe.net.  

  • History and Code References
    Public Act 90-548 (House Bill 452), effective January 1, 1998, added Section 17-1.5 to the School Code, and Public Act 90-0653 (House Bill 1640), effective July 29, 1998, amended the section. This legislation establishes limitations on the growth of administrative expenditures in all school districts having a population of less than 500,000. City of Chicago School District 299 is the only district exempted from the provisions of this Section. School District 299, however, has been subject to a limitation on its administrative expenditures since the 1989-90 school year under the provisions of Section 34-43.1 of the School Code. 

 Frequently Asked Questions (FAQ)

  • Administrative costs are school district expenditures properly attributable to the expenditure functions specified in Section 17-1.5 of the School Code (105 ILCS 5/17-1.5).   The following functions are included under "administrative expenditures" as prescribed by statute:

    • 2320  Executive Administration Services (example: Superintendent & Assistants)
    • 2330  Special Area Administration Services (example: Supervisor - Federal Programs, Special Programs & Title Programs)
    • 2490  Other Support Services - School Administration (example:  Department Heads and Deans [not principals])
    • 2510  Direction of Business Support Services (example:  Chief School Business Officials and Business Manager)
    • 2570  Internal Services (example:   Distributing supplies, duplicating, etc. for the school system)
    • 2610  Direction of Central Support Services (example:  Director / Manager of Planning, Information Services, Staff Services, etc.)

    These total expenditures should include salaries, employee benefits, purchased services, supplies and materials, capital outlay, and other objects.  Explanations and descriptions may be found within 23 Illinois Administrative Code – Part 100 (Requirements for Accounting, Budgeting, Financial Reporting, and Auditing).

  • The Limitation of Administrative Costs legislation states that state-mandated retirement costs are not included, e.g., payments to the Teachers' Retirement System (TRS) and the Illinois Municipal Retirement System (IMRF).

    What districts are affected by this legislation?

    All school districts except Chicago School District 299 are affected by the legislation. However, school districts with administrative expenditures per pupil in the 25th percentile and below (the fourth quartile) for all districts of the same type (elementary, high school, unit) may waive the limitation. 

  • Districts may contact the School Business Services Department of the State Board of Education at 217.785.8779 or access the information on-line at http://www.isbe.net/sfms/AdminCaps/AdminCaps.htm

  • The rankings are based on school district's administrative costs per pupil. The administrative costs per pupil are calculated by dividing the administrative costs by the 9 months average daily attendance. The figures are derived from the most recently available Annual Financial Report and General State Aid Claim.

  • A public hearing must first be conducted. After the hearing, the local school board must approve the waiver by a two-thirds vote. The district must then notify the State Board of Education within 45 days. The law does not provide specific details for how the hearing should be conducted.  We recommend the same process used for budget hearings be applied in this case.

  • Districts should first determine that the administrative costs will increase more than 5% prior to waiving the cap.  The State Board of Education is required by statute to publish a list of all school districts waiving the cap.

  • Some districts, in the past, have included costs in the administrative functions which may be more appropriately charged to other functions, e.g., instructional supplies. Also, district enrollment impacts the level of administrative costs per pupil.

  • In accordance with Section 17-1.5 of the School Code, the State Superintendent may impose progressive sanctions against districts for non-compliance that may culminate in withholding all subsequent payments of General State Aid due the district. The State Board of Education is required by statute to publish a list of all school districts violating the limitation.

  • A district may request a waiver pursuant to Section 2-3.25g of the School Code if exceeding the limitation is solely because of circumstances beyond the control of the district and the district has exhausted all available and reasonable remedies to comply with the limitation. If approved, this waiver shall only apply to the specific school year for which the request is made. For more information on the waiver process, districts may contact the Wellness Department at the ISBE at 217-782-5270.​

 5% Limitation of Administrative Costs Violations and Waivers

In accordance with Section 17-1.5 of the School Code (Limitation of Administrative Costs) the State Board of Education must publish each year a list of the school districts that violate the limitation and a list of the school districts that waive the limitation by board action.​​

​FY 16 Actual Expenditures / FY 17 Budgeted Expenditures​
FY 16 Actual Expenditures / FY 17 Budgeted Expenditures ViolationsPDF Document
FY 16 Actual Expenditures / FY 17 Budgeted Expenditures ​Waivers​PDF Document
​FY 15 Actual Expenditures / FY 16 Budgeted Expenditures​
FY 15 Actual Expenditures / FY 16 Budgeted Expenditures ViolationsPDF Document
FY 15 Actual Expenditures / FY 16 Budgeted Expenditures ​Waivers​PDF Document
FY14 Actual Expenditures / FY15 Budgeted Expenditures
FY14 Actual Expenditures / FY15 Budgeted Expenditures ViolationsPDF Document FY14 Actual Expenditures / FY15 Budgeted ExpendituresWaiversPDF Document
FY13 Actual Expenditures / FY14 Budgeted Expenditures FY13 Actual Expenditures / FY14 Budgeted Expenditures ViolationsPDF Document FY13 Actual Expenditures / FY14 Budgeted Expenditures WaiversPDF Document
FY12 Actual Expenditures / FY13 Budgeted Expenditures FY12 Actual Expenditures / FY13 Budgeted Expenditures ViolationsPDF Document FY12 Actual Expenditures / FY13 Budgeted Expenditures WaiversPDF Document
FY11 Actual Expenditures / FY12 Budgeted Expenditures FY11 Actual Expenditures / FY12 Budgeted Expenditures ViolationsPDF Document FY11 Actual Expenditures / FY12 Budgeted Expenditures WaiversPDF Document
FY10 Actual Expenditures / FY11 Budgeted Expenditures FY10 Actual Expenditures / FY11 Budgeted Expenditures ViolationsPDF Document FY10 Actual Expenditures / FY11 Budgeted Expenditures WaiversPDF Document
FY09 Actual Expenditures / FY10 Budgeted Expenditures FY09 Actual Expenditures / FY10 Budgeted Expenditures ViolationsPDF Document FY09 Actual Expenditures / FY10 Budgeted Expenditures WaiversPDF Document
FY08 Actual Expenditures / FY09 Budgeted Expenditures FY08 Actual Expenditures / FY09 Budgeted Expenditures ViolationsPDF Document FY08 Actual Expenditures / FY09 Budgeted Expenditures WaiversPDF Document
FY07 Actual Expenditures / FY08 Budgeted Expenditures FY07 Actual Expenditures / FY08 Budgeted Expenditures ViolationsPDF Document FY07 Actual Expenditures / FY08 Budgeted Expenditures WaiversPDF Document
FY06 Actual Expenditures / FY07 Budgeted Expenditures FY06 Actual Expenditures / FY07 Budgeted Expenditures ViolationsPDF Document FY06 Actual Expenditures / FY07 Budgeted Expenditures WaiversPDF Document
FY05 Actual Expenditures / FY06 Budgeted Expenditures FY05 Actual Expenditures / FY06 Budgeted Expenditures ViolationsPDF Document FY05 Actual Expenditures / FY06 Budgeted Expenditures WaiversPDF Document
FY04 Actual Expenditures / FY05 Budgeted Expenditures FY04 Actual Expenditures / FY05 Budgeted Expenditures ViolationsPDF Document FY04 Actual Expenditures / FY05 Budgeted Expenditures WaiversPDF Document
FY03 Actual Expenditures / FY04 Budgeted Expenditures FY03 Actual Expenditures / FY04 Budgeted Expenditures ViolationsPDF Document FY03 Actual Expenditures / FY04 Budgeted Expenditures WaiversPDF Document
FY02 Actual Expenditures / FY03 Budgeted Expenditures FY02 Actual Expenditures / FY03 Budgeted Expenditures ViolationsPDF Document FY02 Actual Expenditures / FY03 Budgeted Expenditures WaiversPDF Document
FY01 Actual Expenditures / FY02 Budgeted Expenditures FY01 Actual Expenditures / FY02 Budgeted Expenditures ViolationsPDF Document FY01 Actual Expenditures / FY02 Budgeted Expenditures WaiversPDF Document
FY00 Actual Expenditures / FY01 Budgeted Expenditures FY00 Actual Expenditures / FY01 Budgeted Expenditures ViolationsPDF Document FY00 Actual Expenditures / FY01 Budgeted Expenditures WaiversPDF Document
FY99 Actual Expenditures / FY00 Budgeted Expenditures FY99 Actual Expenditures / FY00 Budgeted Expenditures ViolationsPDF Document FY99 Actual Expenditures / FY00 Budgeted Expenditures WaiversPDF Document
FY98 Actual Expenditures / FY99 Budgeted Expenditures FY98 Actual Expenditures / FY99 Budgeted Expenditures ​ViolationsPDF Document FY98 Actual Expenditures / FY99 Budgeted Expenditures WaiversPDF Document

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