Funding challenges

More operating and capital funding is needed for future adaptation
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It is easy to look at Northeastern Illinois’ vast network of trains and buses, the millions of riders it carries, and the thousands who operate it and assume it will always be here, as it has always seemed to be. It feels like common sense to assume that while it may never be exactly what we hope it could be, it will always somehow keep running about the way it is now — that it is “too big to fail.”

The Chicago region’s transit system is currently funded by a combination of regional sales tax, funding from the state of Illinois, and revenue generated by the system like fares paid by riders. While 80% of riders have returned to the system, because of changes in work and travel patterns brought on by the pandemic, they are riding less frequently, which means fewer fares are collected. Exacerbated by decades of underfunding, this reduction in fares means the RTA system — like many transit agencies across the county — faces an oncoming fiscal cliff.

The unvarnished truth is that without advocating on the state and federal level and working together to fund transit operations differently, while simultaneously committing to fundamental improvements, our region will hit a point in 2026 when it can no longer depend on full transit operations. Drastic service cuts could follow, further decimating ridership numbers and creating a downward spiral of revenue and riders. It is a harrowing picture.

By 2026, our existing regional transit system is projected to have a budget shortfall of $730 million every year.

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Figure 6: Projected Annual Operating Expenses and Revenues Including Budget Shortfall, 2026

A patchwork approach that “bails out” the system but does not address the improvements that we all know must be made may work for a year or two — and then would inevitably lead us back to this same spot.

The region and its residents deserve a public transportation system that works better for everyone, and is a preferred option for travel because it is efficient, affordable, and convenient. Transit is the Answer envisions an unrivaled network of trains and buses across six counties that connects people to opportunity, attracts economic investment, and serves as the beating heart of an active mobility network that enhances public health and serves as our greatest resource in fighting off the challenges of climate change. This vision is within our grasp.

Top 11 revenue options

Critical to achieving this vision will be taking this opportunity — this moment — to forge a fundamental change in how we fund transit that is less reliant on fares and recognizes the extraordinary value — the inherent public good — that a well-funded and well managed transit system brings.

The findings of our analysis demonstrate that no single funding proposal would be able to generate sufficient revenue to avert the projected fiscal cliff of $730 million in 2026 for the existing transit system let alone fund major improvements or expansions to the system that the public wants to see. The region will need to pursue several additional state and local funding mechanisms to close the financial gap and support future improvements. While dedicated federal assistance for transit operations would aid in closing the financial gap, the region cannot rely on federal assistance alone.

Figure 7: Annual Revenue Yield Ranges and Criteria Scores for Top 11 Revenue Options Evaluated by 10-Year Financial Plan Working Group

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We refuse to let transit collapse on our watch

Our region is faced with a choice. We can choose to come together and find new, sustainable ways to fund transit and invest in our region’s future. Or we could face an alternate future where we fail to act — isolating many of our most vulnerable residents, jeopardizing our economy, putting our environment in peril, and worsening the inequities across our region. Failing to invest in the transit system, including in operating funding, will set back the regional economy, exacerbate labor shortages, worsen education and health outcomes, and leave our region ill-equipped to face the converging crises of climate change and inequality.

The RTA is committed to change, to acting where we can, to advocating tirelessly where we cannot act, and to holding ourselves and our partners accountable. We ask those who share our vision and passion to join us, to provide your wisdom and feedback, and to work with us in achieving the public transit system we know is possible.