Illinois Transportation Authority Wants $10 Billion Subsidy Raise

Published May 1, 2007

The Regional Transportation Authority (RTA), which oversees public transportation in Chicago and its metropolitan region, wants the state of Illinois to cough up another $10 billion over the next five years to further subsidize commuter rail, suburban bus lines, and the Chicago Transportation Authority’s public transit system.

On February 9 the RTA board passed an unbalanced budget that asks the state legislature for an additional $2 billion a year for the next five years.

Waste, Mismanagement

Two weeks later, Illinois Auditor General William Holland issued a report citing wasteful management, turf wars among agency leaders, sky-high salaries and benefits for transit workers, and rampant absenteeism as problems the RTA must address. He said money alone would not improve the RTA’s many problems and recommended a complete overhaul of the RTA system.

The RTA’s request for $10 billion comes on top of billions of dollars of new spending also being considered for other projects in Illinois, including a universal health care plan backed by Gov. Rod Blagojevich (D), who in March proposed a $6 billion tax hike on businesses.

According to Steve Brown, spokesman for House Majority Leader Michael Madigan (D-Chicago), “transportation funding is only one of at least five mega-fiscal problems that are being brought to Springfield in 2007.”

Cautious Response

The RTA budget plan, called “Moving Beyond Congestion,” would use multiple state and federal financial sources to fund expanded transit service.

“If you don’t have good roads, if you don’t have good rail, you don’t have good business. [But] I think it would be very difficult to pass [the RTA’s request],” said state Sen. Larry Bomke (R-Springfield), minority spokesman for the state Transportation Committee. “The state is in a devastating situation as far as funding is concerned.”

A spokesman for state Sen. Michael Bond (D-Grayslake) said the Senate has been working on a bill that would pull together more funding for the RTA to maintain services, but he added, “We want to see how that lines up” before considering covering any additional RTA needs.

“The problem in transit is that the answer to every question seems to be more money. What is not on the table is the solution: the use of competitive contracting to reduce costs and make tax money stretch further,” said Wendell Cox, senior fellow for urban growth and transit policy at The Heartland Institute.

“London started doing it in 1985 and by 2000 had converted the entire fleet of buses–the largest in the world–to competitive contracting,” Cox continued. “Over the period they reduced overall operating and capital expenditures by approximately 30 percent, increasing service levels 32 percent.”

Outright Opposition

State Rep. Jack Franks (D-Woodstock) told the Northwest Herald for a February 13 article that he “would vote against any funding for the future based on what county taxpayers received now.”

Franks said “it’s the height of arrogance” for the RTA to ask his constituents to finance an expansion “when they haven’t been taking care of McHenry County.” He added, “We’re not getting what we pay in right now. Why would we make it worse?”

Calls for Reform

A spokesman for House Republican Leader Tom Cross (Oswego) said, “We want to make sure the transit agencies are running as efficiently as possible regardless of whether we are adding money or not. We need to address the wasting of taxpayer dollars.”

Holland noted in his audit, “The RTA needs to take more of a leadership role in all aspects of transit,” adding, “the oversight agency may need more authority from the legislature” to get the CTA (Chicago’s public transit system), Metra (the commuter rail system), and Pace (the suburban bus system) to fall into line.

“Given the dire financial situation facing the RTA and the service boards, the current planning process and structure is flawed,” Holland’s report found.

State Rep. Julie Hamos (D-Evanston) said she planned to introduce legislation addressing issues raised by the audit.

“I myself have been critical for eight years of the role and authority of the RTA and have always believed we need to provide some new responsibility and authority with respect to regional planning and coordination,” Hamos said.

John W. Skorburg ([email protected]) is a visiting lecturer in economics and finance at the University of Illinois at Chicago and associate editor of Budget & Tax News.