A new report is offering bold solutions to bolster the long-term sustainability of public transit in the Chicago area as the region’s transit agencies contend with fewer riders and a massive budget shortfall worsened by the COVID-19 pandemic.
The Chicago Metropolitan Agency for Planning, or CMAP, spent the better part of a year trying to come up with solutions to keep the Chicago Transit Authority, Metra and the suburban bus system Pace affordable. The group has released a plan that it claims will keep these agencies, which have been relying on federal COVID relief funds, financially afloat.
The planning group researched how people’s transit habits have shifted over the past three years in response to the pandemic. Before the pandemic, the region’s three public transit agencies provided more than 1.8 million rides on an average weekday. Now, they together average about 1 million trips, roughly 60% of pre-COVID levels.
“We’re not expecting transit ridership to return to 2019 levels, even by the end of this decade,” said Erin Aleman, CMAP’s executive director.
The plan includes recommendations for new revenue sources, incentives to bolster ridership – such as reduced fare cards and universal fare passes – and a complete restructuring of the governing boards tasked with keeping the buses and trains running.
The draft plan will go before the planning agency’s board for a vote next month. Here’s what riders should know.
How bad is the financial situation for public transit in Chicago?
CMAP researched how people’s transit habits have shifted over the past three years in response to the pandemic.
“Maybe they’re riding during the daytime hours as opposed to the peak rush hours,” Aleman said, “maybe two or three days a week” instead of the old Monday through Friday commute.
With declining fare box revenues the region’s three main transit agencies – the Chicago Transit Authority, Metra and Pace – have been relying on federal COVID relief money to fund operations.
When that money runs out in 2026, all three agencies face a combined $730 million budget shortfall. That shortfall could top $1.2 billion by 2031 if nothing is done.
Riders would feel the budget pain: The planning group said that 20% reduction in funding would equate to a 40% cut in operations.
What are the fresh revenue ideas?
Increasing fares to cover operations is not a viable option to keep public transit afloat, the planning agency argues, because it would price out customers who depend on buses and trains to get around. And the current funding formula – a sales tax revenue portioned out based on a state statute – isn’t enough to keep the system afloat.
Public transit in Illinois is primarily funded by the RTA sales tax that the state established in 1979. It has only been amended expansion of the state’s sales tax based once, in 2008, when the state legislature enacted an updated sales tax funding stream to cover specific projects. Currently, the RTA imposes a 1.25% sales tax in Cook County and a 0.5% rate in DuPage, Kane, Lake, McHenry, and Will Counties.
CMAP proposes an expansion of the sales tax base to include services — one of the last untapped revenue streams in a state that has struggled to cover budget holes caused by the massive underfunding of public pension systems.
“Because services are growing over time whereas goods have really been diminishing,” Aleman said. A separate policy memo on the sales tax proposal notes that services are less sensitive to economic downturns and less regressive than taxing goods.
It’s not the first time lawmakers have been asked to consider expanding the sales tax base to include services. Illinois already has the eighth largest sales tax rate in the country at 6.2%. Chicago’s 10% rate is the second highest in the nation.
More broadly, the planning agency suggests the current funding system is too restrictive – with each agency receiving a set amount every year. Instead, they argue, funding should be “performance based” and allocated towards specific projects or shared goals outlined by the agencies.
CMAP also suggests a dedicated funding stream for bus priority improvements so agencies can take advantage of matching federal grants. The report suggests additional security measures, like automated camera enforcement of bus lanes and stops would compliment this investment.
How does the plan make public transportation more accessible and affordable?
One of the big ideas in the plan is a fully integrated fare system among agencies – that is, one card that would allow riders to seamlessly transfer between, say, a Metra train and a CTA or PACE bus.
“Right now, if you are riding CTA, you have your CTA monthly fare card, if you’re riding Metra, you have a different monthly fare card. And if you’re riding Pace, there are [limited] connections to CTA,” Aleman said. The current system discourages price sensitive riders from transferring between the CTA and Metra and reduces overall transit ridership. Fare integration would especially benefit lower income communities underserved by the CTA, like the far south side of Chicago, where Metra is the only option.
CMAP also recommends a complete restructuring of the governance of public transit in the region. Right now, CTA, Metra and Pace serve as autonomous and separate agencies under the supervision of the RTA, each with its own governing board. Together, that totals 47 board members, all of whom receive between $15,000 and $25,000 a year in compensation.
At the same time, Aleman said more can be done to make public transit more competitive with alternative modes of transportation such as Uber and Lyft, Divvy and e-scooters.
The report also suggests offering fare subsidies for youths and low-income individuals and fare caps across all agencies.
What’s the timeline for making these recommendations a reality?
The report requires two rounds of approval within the planning board before advancing to the Illinois General Assembly and governor’s office by January.
CMAP’s board and Metropolitan Planning Organization Policy Committee will have joint meetings on Wednesday, Sept. 13 with a vote scheduled for Oct. 11. Both meetings are open to the public.
Claudia Morell is a metro reporter covering government and transit issues for WBEZ.
Corrected: An earlier version of this story misstated the size of a budget shortfall across all three of the Chicago region’s public transit agencies by the year 2026. The correct number is $730 million.