See the end of this article for October 29 updates.
The General Assembly is in the middle of their Fall Veto Session, and it’s widely understood that one of items on the to-do list is a transit bill, with whatever modifications are needed to get passed through the House, the bill which was passed in the Senate on May 31, HB3438 (amendment 3).
At the time, the bill got a lot of last-minute press, and a lot of outrage, because of the $1.50 delivery tax and the 10% rideshare tax. In the summer there was a lot of further noise as the transit cliff was less dire than originally reported. And there is a real issue beyond sound and fury around taxes and spending: the drop in white collar commuters is real and permanent, and they provided a measure of rush-hour density that subsidized the rest of the system, and that subsidy is substantially reduced, and that’s true even if the issues are compounded by mismanagement, by commuters staying away for safety reasons, and fare evasion.
But is this bill the right way to resolve these issues?
Yes, I read the bill. It’s 807 pages, though large portions are a quick skim because it’s existing law with strikethroughs to change the name of the agency. The core promise is that this is more than a mere name change, from RTA to NITA, but that the management of the transit system will be dramatically improved, by means of
- A new centralized governance structure,
- A unified fare structure,
- A new set of strategic priorities,
- A new set of audits and reports,
- And a lot of new money.
Alongside this, the farebox recovery requirement drops down from 50% to 25%, and there are mandates to be environmentally-friendly, such as purchasing electric buses.
But what assurances are there that this set of board members will be better than those who currently run the system, and that the set of directives will be carried out?
Here are four concerns that go beyond merely the tax hikes.
Issue 1: “trust us.”
The transit systems will get a lot more money to spend, on the promise of increasing reliability, safety, frequency, and number of routes. But what is there to ensure this happens? Merely new governing officials to replace the old ones, and promises of audits and reports. Is there any track record of a government system, newly showered with money, using it with exceptional prudence?
After all, this is a significant new sum of money: the agencies currently receive $4.1 billion (including the last of the COVID money), and the new taxes would boost this by an estimated $1.2 – $1.5 billion. It could be spent on all these worthy items, or it could be frittered away with inefficiencies (to put it nicely) or waste, used to boost salaries and increase headcount and all the other reasons why CTA is in this position in the first place.
Promises to boost fare enforcement could likewise easily fall victim to local politics and the insistence that enforcement is a detriment to social justice. (Indeed, the promises of increases in safety primarily take the form of additional money spent, but its provisions regarding cultural sensitivity suggest it would be at risk of falling victim to the same anti-policing politics as elsewhere.)
And the drop in the “system-generated revenue” requirement down from 50% to 25% is really quite substantial and takes away from meaningful “market pressure” to succeed.
Could there not be some holding back of at least some portion of the new funds, to be spent elsewhere if certain metrics are not met?
Issue 2: Are the benefits and subsidies proportionate and fair relative to the taxes paid?
The new interoperable fare plan is anticipated to significantly reduce costs for suburbanites coming into the city, funded by a significant portion of the new revenue. Fare capping is intended to likewise increase travel (though this is “subject to appropriation” so it may or may not happen or it may require further subsidies). At the same time, mandates for reduced fares for low-income residents will primarily benefit city residents/the CTA system, by the nature of the geography of transit.
It appears that people using the suburban bus system may be left out in the cold, with PACE obliged to stretch its budget further, or at any rate without the ability to use new money to add new services (or restore Covid cuts).
Issue 3: is the Delivery Service Surcharge a viable and sustainable source of revenue in the first place?
The justification is that these drivers “use our roads,” though in city centers delivery workers are increasingly using e-bikes or e-scooters to avoid congestion. But the emergence of these delivery services is a very recent development, and new trends could emerge just as quickly. After all, to a large but unquantified degree, Uber Eats, DoorDash, etc. depend on immigrant workers, many of whom are legally unable to work but use “rented” accounts. Were the federal government to crack down on this practice, prices would increase and the “burrito taxi” would become much less desirable – and, for that matter, the practice of using a “burrito taxi” has been widely mocked as an imprudent use of money by those who live paycheck to paycheck. Alternately, it’s been proposed that companies such as Amazon may turn to drone deliveries, which would be another way that this revenue would vanish.
Issue 4: the bill empowers the new agency to do a lot more than just run buses and trains.
The new agency is empowered to act as a developer, or to acquire and sell land for the purposes of creating “transit-supportive” and “trail-supportive” developments, as well as to create a Transit-Supportive Development Incentive Program, which would fund not just local government planning grants and increased mass transit near new transit-supportive developments (both of which seem fine, really, especially if a new bus route has the potential to be sustainable in the long term), but also investment in the developments themselves. There is no specified amount to be dedicated to these projects, and it truly appears to be at the discretion of the agency.
Now, I’m all in favor of development which makes transit more sustainable. In Arlington Heights, for example, there are multiple new projects at or near the two remaining local bus lines, 208 which trundles along Golf, and 606, along Algonquin and onto the tollway, though whether the proximity to transit was a consideration or not I can’t say. But is the transit authority really the right “home” for this sort of development-encouraging task? It’s a diversion from the core focus they need to have now.
Late updates:
Late in the day on October 28, Rep. Eva-Dina Delgado filed a new bill (using as a “shell bill” Senate Bill 2111, to which she added House Amendment 2). I’m not going to take this apart but will wait and see along with all the rest of the hoi polloi, but the bill aims to raise even more money, but the new taxes seem all the more absurd including a billionaires’ tax which, beyond its various problematic features, is inherently entirely unsuited as a significant funding source to fund transit as it would vary so much from year to year.
