Illinois House Speaker Emanuel “Chris” Welch on Friday defended the revenue choices state lawmakers made to deliver a $1.5 billion mass transit bailout that he believes will serve as a long-term fix for Chicago area transit agencies.
The package that made it to Gov. JB Pritzker’s desk looked nothing like the version championed by Welch’s chief transit negotiators. Gone were taxes on streaming services, tickets to large events and an untested “billionaires tax” on unrealized capital gains.
At a time when Mayor Brandon Johnson has been beating the drum for progressive revenue, the Illinois General Assembly chose the most regressive tax of all to help fund mass transit — a 0.25% increase in the already high sales tax in Chicago and the suburban and collar county region served by the Regional Transit Authority.
Welch said the revenue mix that ultimately made it out of the station was an example of “how a legislative process should work.”
The Senate’s version was dead on arrival in the House because it relied on ride-share and delivery fees that Welch said his members could not support. When the House countered with taxes that Pritzker could not back, the speaker said he “asked the governor what were his thoughts.”
“We had some very productive conversations that… really led to the package that passed both the House and Senate, and the governor has said he will sign it,” the speaker told the Sun-Times.
Welch noted that the “big wheel that’s going to fund this thing” is Illinois’ $8 billion road fund.
More than $1 billion will be generated by redirecting the state’s sales tax on motor fuel to transit operations, and by siphoning all of the interest on road fund money to the CTA, Metra and Pace.
State lawmakers also gave the Regional Transportation Authority power to raise the regional sales tax by 0.25% because, as Welch put it, “That is the money that will be readily available immediately.”
“This is something that needs to be jump-started and… that RTA region is where most of the immediate monies are needed,” Welch said. “So giving the RTA that authority was seen by all as something that was very important.”
Yet another piece of the revenue puzzle is an increase in tolls — 45 cents more on passenger vehicles, a 30% increase for commercial vehicles and annual increases after that to match the rate of inflation.
Welch said the toll hike was the price that needed to be paid for labor support.
“It was important to them, if they were going to agree to give up almost a billion dollars a year from the road fund, that they can point to something that will help keep working people working and keep roads getting repaired,” the speaker said. “I believe it’s a very minimal fee: 45 cents on passenger vehicles per toll to help keep our toll roads some of the best in the country and still some of the lowest fees in the country.”
Although the CTA and Metra boards had already agreed to raise fares, the transit bailout gives riders a reprieve. Fares will be frozen for one year after the bill takes effect on June. 1.
Pressure to raise future CTA fares will be further reduced by a reduction in the so-called fare box recovery ratio. It’ll be cut in half — from 50%-to-25% — until 2029 and to 20% after that. In 2018, the CTA raised fares by 25 cents — to $2.25 on buses and $2.50 on trains. It was the first fare increase in nine years.
Why not end that long gap between fare hikes immediately?
“We can probably nitpick at a lot of things that are in the package. But everyone agrees that this is a transformative package that is going to… help improve transit throughout this state,” Welch said. “By doing it the way we did it the first time — addressing governance before talking about funding — I believe it’s going to be a long time before we see them again — if we do see them again.”
Earlier this week, Johnson pressured lawmakers to deliver the progressive revenue he says Chicago needs to protect working people from funding cuts imposed by President Donald Trump. Johnson has called those cuts potentially life-threatening.
The mayor came up empty again, but Welch believes Johnson is “getting a better footing here in Springfield” with “a lot more presence” than he had at the start of his administration.
“They weren’t looking for something to be done in veto session. They were setting the stage and the groundwork for things that could come possibly in the spring session. I think that was the right approach,” he said.
Even so, Welch joined Pritzker in declaring his opposition to Johnson’s proposed, $21 a month per-employee head tax. “I don’t think that’s good policy for the city of Chicago,” Welch said.