Plan kicks off drive for Chicago area transit funding and reform

Stakeholders in the transit systems serving Chicago and its wider metropolitan area have delivered a plan to deal with financial shortfalls driven by the COVID-19 pandemic and the "fiscal cliff" coming when the last federal relief funding is spent.

All they need now is the money to pay for it.

The Plan of Action for Regional Transit was put together by regional leaders under the auspices of the Chicago Metropolitan Agency for Planning, at the direction of the state legislature.

A Chicago Transit Authority bus and a PACE suburban bus.
A new report designed to prepare Chicago-area transit for post-pandemic growth calls for better integration of agencies like the Pace suburban buses and the Chicago Transit Authority.
Chicago Metropolitan Agency for Planning

The plan was finalized in October, and regional leaders gathered Thursday for an event to launch a publicity push beginning the drive to get the state government to fund it.

CMAP Executive Director Erin Aleman hand-delivered the report to lawmakers Thursday in what was described as a symbolic gesture.

"These 129 pages include proposed solutions built on sound policy, data, research, analysis and consensus," she said. "Everything in this report is focused on strengthening our transit system for the people who call northeastern Illinois home."

The plan asks for $1.5 billion of new operating support for transit and at least $400 million annually of complementary capital investments.

The requested funding would come hand-in-hand with what supporters of the plan say is a much-needed restructuring of the way Chicagoland transit is governed.

"We have three separate transit agencies that do not work together as one regional system, and the basic formulas used to distribute transit funding haven't changed since they were first designed 40 years ago," Cook County President Toni Preckwinkle said at last week's kickoff event. "I look forward to working with the General Assembly to tackle these governance issues while also addressing the urgent need for new funding to prevent major fare hikes and service cuts that would harm the people for whom transit is a lifeline."

PART calls for the integration of the Regional Transportation Authority of Northeastern Illinois and the three service boards it oversees into one regional transit entity, or at least better coordination among them.

Those boards are the Chicago Transit Authority, which runs rail transit and bus services in the city; Metra, which runs commuter trains from the suburbs into downtown Chicago; and Pace suburban buses.

Though the service boards and the RTA are related, the RTA and the CTA issue bonds separately.

U.S. transit agencies won a total of $70 billion of federal stimulus funds in 2020 and 2021 to support service when ridership evaporated during the pandemic. The Infrastructure Investment and Jobs Act allocated an additional $18 billion annually for public transportation programs through 2026, according to the Congressional Budget Office.

The spenddown of federal funds has had an uneven fiscal impact on transit systems, falling harder on agencies that relied more heavily on farebox revenue before the pandemic than those that derived more funding from non-passenger sources like taxes.

The Chicago-area systems are feeling the bite from the former.

Both CTA and Metra were top 10 among U.S. transit agencies for farebox recovery before the pandemic, the PATH report said, with fares covering more than 40% of expenses.

Those fare revenues have declined, with ridership remaining well below pre-pandemic levels.

Commuter rail operator Metra, in the 2024 operating budget adopted in November, projected it would start the year with ridership at 47% of pre-pandemic (2019) ridership and finish the year at about 54% of pre-pandemic levels.

In June, the last month for which the Chicago Transit Authority provides a full ridership report, the agency said it carried 23.59 million riders — down 40% from pre-pandemic June 2019.

"With lower levels of ridership and fare revenue expected in the coming years, the region will need to consider a new model," the report said. "One where fare revenue still makes up a stable source of operating revenues, but at a lower level than before."

The report paints a picture of a transformed transit system, with more frequent service and the barriers between the three service agencies torn down for riders, in terms of integrated fares and seamless transfers.

To make up for its looming fiscal cliff — an operating budget shortfall the RTA projects as at least $730 million annually in 2026 — the report calls for $200 million in savings through efficiencies, but focuses on bringing in more revenue, suggesting increased state support and a potential raising and broadening of the existing sales tax that supports the RTA.

Additionally, the report suggests additional capital funding for a system that it says faces a more than $20 billion unfunded backlog of investments necessary to maintain the system in a state of good repair.

"Even if the current levels of capital funding are maintained, it will still take decades to eliminate the backlog," the report said.

The report suggests additional new sources to fund such capital requirements, including higher gas taxes and higher and/or expanded vehicle tolls.

Now the ball is in the court of state elected officials in Springfield.

"We want our transportation network to reflect an equitable plan that will bring much-needed improvements to communities that have faced barriers to affordable, accessible transit for far too long," State Sen. Ram Villivalam, D-Chicago, a sponsor of the bill that directed CMAP to produce the PART report, said at Thursday's kickoff event.

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