CHICAGO — Illinois Gov. Rod Blagojevich announced his support yesterday for legislation approved by the General Assembly that raises the Chicago area sales tax to bailout the region’s transit system but only if lawmakers okay a provision allowing seniors to use the system for free.The bill now goes back to lawmakers and its fate was unclear late yesterday. The governor’s surprising move came after the House and Senate approved a bill that would raise nearly $500 million annually for the Regional Transportation Authority of Illinois and its service agencies primarily from a sales tax increase of one-quarter of a percent in Cook County and a half percent in surrounding counties.The legislation also includes Chicago Transit Authority pension reforms and borrowing $1.5 billion to shore up the agency’s unfunded pension and health care liabilities. Without the new funding, the CTA had planned to cut service and raise fares Jan. 20.Blagojevich has for a year vowed to veto any sales tax increase and backed an alternative approved in the House, using nearly $400 million in gasoline taxes collected in the Chicago area. “In the spirit of compromise, and with a keen awareness of what is at stake for millions of transit riders… I will act on the bill passed by the General Assembly as soon as it reaches my desk with one important improvement,” he said referring to the fare exemption that would cost up to $20 million annually.

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