Midwest High Speed Rail Association and Transit Riders Alliance
Spring 2009 Illinois Legislative Update

I'm Dan Johnson-Weinberger and I've been your lobbyist for the last four years. Let me share with you the progress we've made building support for high speed rail and transit in Illinois government this year. This report is in three parts: high speed rail in the capital program, transit in the capital program and the annual operating budget.

High speed rail in the capital program

Photo: Governor Quinn announcing his $400 million request for high-speed rail, joined by Senator Sandoval (left) and Representative Nekritz (right).

Governor Pat Quinn emerged as the nation's best governor for high speed rail advocacy this month. As part of shaping a $12 billion state capital program (a type of state stimulus), Governor Quinn made it clear that his highest priority is high speed rail. He successfully pushed for including $400 million in the state program – more money than any other state (besides California) has ever invested in high speed rail.

Just as President Barack Obama transformed federal high speed rail policy by putting far more federal money into rail than ever before, so too has Governor Pat Quinn transformed state high speed rail policy by putting far more state money into rail than ever before.

These funds are in addition to $300 million in state money for the CREATE project that will improve both freight  and passenger service in the entire Midwest by untangling the Northeastern Illinois knot of freight traffic and $150 million in Amtrak Illinois projects (such as new service to the Quad Cities and to Rockford-Galena-Dubuque as well as potentially new trainsets).

Thus, the total rail investment in the entire $12 billion state capital program is $850 million – an extraordinarily high number. That's the entire capital program, not just the transportation program.

At a press conference that we helped to schedule and arrange, Governor Quinn stood with our legislative champions Senator Martin Sandoval, Representative Elaine Nekritz and our Executive Director Rick Harnish and called for this major investment in rail. It was clear that over the last week of the legislative session, the Governor's priority for the capital program was high speed rail.

Governor Quinn deserves our thanks for his extraordinary leadership for high speed rail, as does Senator Martin Sandoval and Representative Elaine Nekritz.

Please click here to thank the Governor.

Transit in the capital program

Senator Martin Sandoval deserves much of the thanks for successfully securing a greater investment in transit in the capital bill. He is the Chairman of the Transportation Committee and he has been leading the battle for a balanced ratio of roads to transit spending in the state capital program.

Your emails supporting those efforts and calling for a dollar-for-dollar ratio of roads to transit spending definitely helped build support for the improvement in this capital program.

The last capital bill in 1999 (Illinois FIRST) had a 2:1 ratio of roads to transit spending. We wanted to improve on that. In the final capital bill, we ended up with a 1.5 to 1 ratio of roads to transit spending ($3 billion in road projects compared to $2 billion for transit projects). This was considered a bit of a revolution, and Senator Sandoval and Representative Julie Hamos deserve our thanks for their advocacy for a better balance between roads and transit.

State of operating budget and capital program

Our success in helping to shape the capital program to invest in high speed rail and transit is the good news. The bad news is that the State of Illinois is still broke. The multi-billion dollar deficit in the operating budget is not only bad news for transit and high speed rail, but it also imperils the capital program.

Unlike the federal government, the State must have a balanced budget every year. That means we not only need to raise taxes and fees this year to finance the capital program to get the investment in high speed rail and transit that we want, we also must raise taxes and fees and cut spending on the annual operating budget.

The General Assembly is paying for the $12 billion capital program by legalizing video poker, allowing online sales of Illinois Lottery tickets, raising liquor fees, raising the drivers' license fee and taxing a few beauty products like dandruff shampoo at the regular sales tax rate instead of at the low medicinal rate. All of those sources raise about $1 billion every year, which over the next 15 or 20 years can pay for a $12 billion program this year.

The deficit in the operating budget, however, is between $7 billion and $11 billion all in one year. There really isn't any way to cut government spending by that much to balance the budget in one year. If we did, then all state payments to transit and Amtrak Illinois would likely be slashed or eliminated. The State of Illinois currently spends almost $200 million every year on transit's operating budgets and $28 million on Amtrak Illinois service. If the State of Illinois doesn't raise any taxes or fees for the annual operating budget, then transit and Amtrak payments could be eliminated altogether. That would require service cuts and fare hikes for transit and the potential elimination of all Amtrak Illinois service.

Governor Quinn has proposed balancing the budget by raising the state income tax from 3% to 4.5%. Note that Illinois' 3% income tax is currently the lowest income tax of any of the 41 states that have an income tax. (Our sales tax is high and our property tax is only used for local governments, not the state). The Illinois Senate passed a bill to raise the income tax in late May but the Illinois House rejected a bill to do so.

We would prefer to raise the income tax to balance the budget rather than cut transit and rail, as we think our economy will benefit more from the continued investment in better transit and rail service than will be hurt by a higher income tax. It is also essentially impossible to cut that much spending. The size of the deficit is simply too large to balance the budget on spending cuts alone. There will definitely be billions in cuts (and we will have to try to protect transit and rail from the operating budget cuts that are coming as best we can), but there will have to be new taxes and fees. The Blagojevich years of pretending that we don't have to balance the budget have come to a close.

It is not clear when the operating budget will be resolved. It is also not clear whether the capital program will be implemented before the operating budget is balanced.