Chicago Transit Doesn’t Need Another Bailout

Like many other transit systems with falling ridership, the Chicago Transit Authority is awash in cash. Over a fifth of the CTA’s ever-increasing budget has recently come from the federal government’s pandemic-era bailouts. Also like other transit agencies, the CTA faces a fiscal cliff next year when the federal largesse runs out.

In a preview of what might happen elsewhere, the Illinois legislature has stepped in with a $1.5 billion bailout of the system. This cash will reinforce the worst tendencies of Chicago transit. The CTA should have trimmed and modernized its services to meet the needs of a work-from-home era. Instead, it wants to use the new funds to further existing bloat.

State Representative Eva-Dina Delgado sponsored the bailout bill. Delgado previously worked at the CTA as a government affairs officer. In the legislature, she has helped her former employer extract revenue from already beleaguered Chicago citizens.

Despite unprecedented voter concern with living costs, the bailout bill increases the sales tax in the region by 0.25 cents. That bumps Chicago’s combined state and local sales tax to 10.5 cents per dollar, the highest in the nation. The act also raises fees on car drivers and truckers. Charges on the Illinois Tollway will go up by as much as 60 percent.

Extra revenue might make sense if the system needed funds to meet greater demand, but the opposite is the case. Last year the CTA had 309 million riders, down from 456 million in 2019. The pandemic decline is only part of a long-term trend. The system had more than 500 million riders in 2014.

Thanks to the state bailout, the CTA approved a new budget last month that expands spending and services above even the levels of the federal bailout years. But more train and bus trips amid falling demand means fewer riders per vehicle and increased costs.

The CTA’s president now promises to make the Orange Line train to Midway Airport run 24 hours a day. Yet Midway flights typically start around 5 a.m. and end around 10 p.m. The agency also wants to spend billions more to supplement a grant, awarded in the Biden administration’s waning days, to expand the Red Line further.

The CTA also hopes to use the new state funds to bolster its equity programs. A few years ago, the CTA adopted the Equity in Infrastructure Project Pledge and promised to give more contracts to minority- and women-owned firms, even if those firms charged higher prices. It hopes to award 21 percent of its contracts to supposedly disadvantaged businesses, largely through what it called “race-conscious means.” The agency has also promised to convert more buses from gas to electric in order to battle global warming—not a top concern for commuters dealing with Chicago winters.

The biggest winner of the bailout might be the CTA’s unions. The CTA finished its last big collective bargaining agreement in 2022. Despite devastating long-term financial problems, the agreement provided workers with 9.25 percent pay increases and a big bonus. Last year, eight union workers made over $300,000; 160 made more than $200,000.

The CTA is no longer pretending to be a service supported by its customers. Historically, the agency aimed to get half of its revenue from fares. Now it seeks only a fourth, but at present, it can’t even achieve the reduced goal.

National transit ridership is down sharply from the pre-pandemic era. Instead of leveraging earlier bailouts to modernize services and prepare for the future, the CTA and other agencies used them to keep empty trains and buses running. The forthcoming transit fiscal cliff is a rare opportunity for customer-oriented reform. But the CTA and other systems would rather burn through more taxpayer funds to provide services that customers don’t want.

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