The Illinois House failed to approve a regional sales tax increase to help fund the mass transit systems in and around Chicago today, leaving little time for the House to gain the 10 votes needed to prevent the Regional Transportation Authority from laying off employees and cutting services. Legislation sponsored by Rep. Julie Hamos, an Evanston Democrat, is expected to come back as soon as House Speaker Michael Madigan thinks he reversed the votes of some House Republicans and downstate Democrats. That’s not going to happen this week, and it might not happen before the September 16 “drop dead” date outlined by the RTA’s budget plan.
The RTA oversees the three separate agencies of the Chicago Transportation Authority, Metra rail services and Pace suburban bus services. It was subject of a state audit in March that said the systems’ “serious financial shortfall” combines with representation problems on the separate boards, an outdated funding formula and an aging infrastructure.
Hamos’ measure would enact many of the recommendations in the audit. It foremost would increase a regional sales tax, raising money to be split among the CTA, Metra and Pace. It also would allow a Chicago-only real estate transfer tax that would have to be voted on by the Chicago City Council and would cover CTA’s pension and retiree health care costs. Metra also would gain authority to borrow up to $1 billion to secure a federal match for capital projects, especially for suburb-to-suburb routes. And the legislation would reform the three agencies’ pension systems by such changes as requiring higher employee contributions, higher retirement age for pensions and limits on health care benefits.
Without the legislation, Hamos said the region and the state would feel its effects through job loss, limited transportation routes, increased traffic congestion, air pollution and a poorer rating for Chicago’s bid to host the 2016 Olympics.
Standing next to Madigan in a Statehouse press conference following the floor vote, Hamos said, “People did not so much pick at the substance of the bill, which was very promising, actually, but instead were talking about other agendas that they still continue to bring to the table.” She said the only portion that would be looked at for possible change is what Rep. Bill Black, a Danville Republican, said was concerning.
Black said while the legislation would require the state to match 5 percent of new tax revenues to help mass transit services for disabled riders, he didn’t like that it would not cap the state’s contribution as tax revenue increased over the years. “You’re talking the state share growing by hundreds of millions of dollars over the next four to five fiscal years,” he said on the House floor. “It could be in excess of $1 billion by FY10, considerably more money than it has ever been in the history.”
House Republican Leader Tom Cross said his caucus rejects Hamos’ plan because members are holding out for a more comprehensive capital bill to fund school and road construction projects around the state. “You can’t do one without the other,” he said, but added, “The belief from a lot of us is we will never see a capital bill.”
He said even if there were movement on a capital bill, underlying tensions could stymie a deal. “I’m a little concerned about the trust issue that permeates around here — or lack of trust that exists in this building. I think we need to work through that. I don’t think we left … on a good note, so we’ve got to find a way to work through some of those trust issues.”
Willing to look at a Chicago casino previously promoted by Senate President Emil Jones and the governor, Cross said that’s not looking too good, either. “The more that discussion goes on, it just seems tougher and tougher to do. We may need to look at a different avenue.”
The governor issued a statement about the House vote that said “Speaker Madigan’s tax increase” was a “backdoor fare hike” and that the legislature was correct to reject that approach. He said he would continue to advocate the end of some business tax credits (a.k.a. closure of “corporate loopholes”) and find other sources of revenue to fund mass transit.