Chicago area transit's capital needs far exceed its funding

CHICAGO – The Regional Transportation Authority of Northeastern Illinois has begun laying the groundwork for a campaign to raise public funds to fully fund $30 billion of priority projects over the next decade.

The RTA board late last week adopted a plan that outlines those projects, the funding shortfalls, and strategies designed to build public and legislative support. The five-year outline is called Invest in Transit, supported by an accompanying document that goes into detail on the projects, called Invest in Transit Priority Projects.

They are part of the authority’s efforts to develop a campaign to secure more local and state support and identify new sources of revenue.

Demonstrators march near the elevated train during the second annual Women's March Chicago in Chicago, Illinois, U.S., on Jan. 20, 2018.
Demonstrators march near the elevated train during the second annual Women's March Chicago in Chicago, Illinois, U.S., on Saturday, Jan. 20, 2018. One year after the inauguration of President Donald Trump, thousands of people will again gather to protest for equal rights at the 2018 Women's March. Photographer: Christopher Dilts/Bloomberg

A portion of the funding needed for the $30 billion is programmed in the authority’s capital program. The RTA board – which provides fiscal oversight to three local transit agencies -- signed off on $1.2 billion in capital spending for 2018 that’s part of a five-year program of more than $4 billion, far short of what it says it needs. The board also approved a $3 billion operating budget.

“Trains and buses are our region’s most important mobility assets. We should be investing $2 to $3 billion in capital each year to keep our system in good shape and move forward with new innovations,” said RTA executive director Leanne Redden. “However, we’re currently not even investing half of that each year.

“The agencies are already doing what we can with fare increases, TIF funding, and other local solutions to the problem. Ultimately, we must find a sustainable funding source that will enable us to continue to provide excellent service to our riders and fund the capital projects that will keep us competitive,” she added.

The RTA has little room left in its state-approved bonding authority and the state’s 2009 capital budget that provided $2.7 billion for Chicago area transit projects has mostly expired.

The Chicago Transit Authority accounts for $2.7 billion of the five-year program, Metra commuter rail accounts for $1.16 billion, and Pace suburban bus service $299 million. The unfunded gap is $17.9 billion for the CTA, $11.6 billion for Metra, and $1 billion for Pace.

All three agencies raised fares in their 2018 budgets approved by the RTA in December to offset a 10% cut in fiscal 2018 state aid and a new 2% administrative fee imposed by the state on sales tax collections.

The plan outlines a series of goals over the next five years: to promote the importance of public transit to the region’s economy, to better outline how new funds would be spent and their expected result as well as efforts to improve reliability and invest in technology.

As the RTA works on a funding campaign, it will look at pursuing new revenue sources or an expansion of existing ones such as a gasoline tax hike. Congestion pricing is on the table and the agency will continue to explore public-private partnerships and pursue more federal funding.

Bipartisan support is strong for a new capital plan. Whether Republican Gov. Bruce Rauner and the General Assembly’s Democratic majorities can put aside their divisions to agree on a plan and devise a funding mechanism is in doubt, especially with statewide elections looming in November. A capital plan could also take a backseat to passage of a fiscal 2019 state budget and efforts to pass pension reforms.

The 2018 capital plan is funded by the CTA’s plans to borrow $179 million by leveraging its new city approved ride-share tax and $287 million under its existing credits that leverage sales taxes or federal grants, and $15.5 million of PACE borrowing. Federal funds accounts for $645 million. No new state dollars or RTA borrowing are expected.

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Transportation industry Infrastructure Illinois
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