Last May, several Illinois House Democrats complained bitterly that their mass transit negotiators were ignored and even shut-out by the Senate Democratic mass transit negotiators.
The House members had a point. The Senate passed a bill which was an almost purely Senate Democratic creation. They literally gave the House a “take it or leave it, but you have to decide right now” moment during the final minutes of the spring legislative session.
But when it came time for the House to draft a bill, it chose basically the same route as the Senate Democrats. Its end product unveiled last Tuesday was based on an internal survey of House Democratic members with no buy-in from Senate Democrats or the governor.
The Senate Democrats were furious. The House proposed taxes that had never been…
Last May, several Illinois House Democrats complained bitterly that their mass transit negotiators were ignored and even shut-out by the Senate Democratic mass transit negotiators.
The House members had a point. The Senate passed a bill which was an almost purely Senate Democratic creation. They literally gave the House a “take it or leave it, but you have to decide right now” moment during the final minutes of the spring legislative session.
But when it came time for the House to draft a bill, it chose basically the same route as the Senate Democrats. Its end product unveiled last Tuesday was based on an internal survey of House Democratic members with no buy-in from Senate Democrats or the governor.
The Senate Democrats were furious. The House proposed taxes that had never been discussed before, including a tax on unrealized capital gains that has never been tried by any state in the country. The Senate didn’t believe a revenue estimate claim on an “amusements” tax, which would hit everything from online streaming services to concerts. And they weren’t enamored with the plan to significantly expand speed limit enforcement cameras.
Gov. JB Pritzker held a press conference the next day and declared several of the revenue ideas to be nonstarters. But that meant it was back to the drawing board after months of work with one day left in the scheduled fall veto session.
“We need a leader,” insisted one powerful insider Wednesday. The person has been advocating for a mass transit reform bill and was worried that the whole thing could fall apart.
By Thursday evening, that very same insider marveled at how he had watched as Pritzker and his staff took charge of the collapsed transit talks and steered them to a conclusion.
And the final deal was a whole lot less visibly painful to the average Illinoisan than has been feared during the last year or more.
About a third of the $1.5 billion plan will come from a quarter-point sales tax increase in counties served by the Regional Transportation Authority. It’ll cost those folks 25 cents on every $100 purchase.
The other two thirds comes with no new tax money.
Back in 2019, the legislature decided to wean the state’s General Fund off sales tax revenues from motor fuels. That money was gradually shifted away from the state budget and sent to the Road Fund. But the final annual phase-out has not happened. That money has instead been used for mass transit, partly because the Road Fund is so flush with unused cash. The road building unions objected, but they were persuaded to go along for just a little while longer.
The heart of the transit funding package is a decision to use all state motor fuel sales taxes to fund mass transit instead of sending that cash to the Road Fund. That brings in about $860 million. Another $200 million will come from a Senate Republican proposal to use annual interest on the massive Road Fund account to fund transit capital projects.
So, how did the governor convince the politically powerful road-building unions like Operating Engineers Local 150 to go along with diverting sales taxes and earned interest from their precious Road Fund to mass transit?
A toll increase. Local 150 had opposed an earlier plan to use increased tolls to fund mass transit because it wanted to increase tolls for tollway capital projects. Pushing a toll hike after the tolls were already increased would be difficult, to say the least.
So, the bill allows a toll increase of up to about $1 billion a year, with a 4% inflation cap. Passenger vehicle tolls haven’t been increased in 13 years, but they’ll go up by 45 cents and commercial vehicle tolls will rise by 30%.
But there’s a catch: 85% of the sales tax money would go to northeastern Illinois and 15% to Downstate. And 90% of the Road Fund interest would go to what’s now called the RTA region, and 10 percent would go to Downstate capital projects.
Sean Stott with the Illinois Laborers’ Union testified against the bill in the House Executive Committee, saying it would take money away from Downstate road and transit projects. The Republicans claimed the new formula would take $500 million from Downstate.
But Stott told legislators later: “While we remain opposed to this funding mechanism, we are not asking members to refrain from supporting it.”
Stott explained that a promise had been made in the Senate to find a way to “soften the blow” to Downstate road and transit projects during the spring session.
Rich Miller also publishes Capitol Fax, a daily political newsletter, and CapitolFax.com.