Chicago Area Local News

CHICAGO (CBS) ― Gov. Rod Blagojevich said Thursday he'll sign a bill to increase sales taxes in the Chicago area and the real estate transfer tax in the city to fund local mass transit systems, but only if the legislature approves free bus and train rides for senior citizens.

The governor plans to use his amendatory veto powers to require that senior citizens do not have to pay to ride public trains or buses in Illinois. The House and Senate would have to approve such a change and neither chamber is scheduled to return to Springfield anytime this month, meaning another special session would be needed.

"I'm particularly concerned about seniors who live on fixed incomes and who don't have the ability to absorb a higher sales tax without making cuts in other areas," Blagojevich said.

It's not clear what impact free rides for seniors would have on the overall mass transit system or, more importantly, whether Illinois lawmakers would go along with the governor's plan.

Blagojevich said a senior using public transit twice a week could save more than $150 a year on Chicagoland buses and $400 annually on commuter trains. It would cost about $20 million a year.

The governor originally opposed a sales tax hike to fund mass transit, but agreed to support it "in the spirit of compromise."

"What I will do is essentially take what I believe to be a lemon and turn it into lemonade," Blagojevich said. "I'm going to sweeten the deal, I'm going to improve the bill and I'm going to write in a line that provides free public transportation to every senior citizen who lives in the state of Illinois."

CTA President Huberman said the Chicago Transit Authority is prepared for what could be a flood of new senior riders on trains and buses. "We're ready," Huberman said.

"We would hope that would happen. We would love nothing more than seniors off the road and into transit," Huberman added.

He hopes seniors will ride trains and buses even more, because that would ultimately help the economy if they go out more often to shop, adding more money to the area's sales tax base.

Regional Transportation Authority Chairman Jim Reilly said, "This is a real act of political courage and statesmanship by the governor."

The House adopted the transit funding measure 62-51 after the Senate approved it 30-25 earlier in the day.

Approval of the measure would avert extensive service cuts and fare hikes slated for the CTA and the Pace suburban bus system on Jan. 20.

Blagojevich had opposed tax increases such as those in the bill and wanted to divert taxes on gasoline sales in the Chicago area to pay for mass transit. But he said he'll OK the measure in a "spirit of compromise" if lawmakers approve his changes.

The bill increases sales and real estate taxes in the Chicago area by more than $500 million for the Regional Transportation Authority, which includes the CTA and the suburban PACE bus system. But the measure does not address mass transit capital construction needs, only day-to-day operating costs.

Some lawmakers, particularly Republicans, wanted to tie a transit bailout with a statewide construction program, but "the clock ran out" on those hopes, said Sen. Rickey Hendon, D-Chicago. And without quality mass transit, Chicago can kiss hopes for a 2016 Olympics goodbye, he said.

"Chicago doesn't just lose. If the Olympics come here, we all win," Hendon said before the Senate vote. "If the Olympic committee sees that we don't have a world-class transit system, why come here? We all lose."

Sen. James Clayborne, a Belleville Democrat who did not vote for the legislation Wednesday, voted "yes." He said it was clear House Speaker Michael Madigan would not go for linking mass transit and a capital construction program and that the measure had money for buses running in his home turf of suburban St. Louis.

Blagojevich and lawmakers have been unable to agree on a capital program for five years. The latest idea is to expand legalized gambling to pay for one, but that politically volatile proposal will take time to work out.
 
"The chances of passing a capital bill with gambling as the revenue source are about as great as the Chicago Cubs winning the World Series in the next 10 years," Republican Senator Kirk Dillard of Naperville said in support of the bailout plan.

For CTA riders across Chicago, there was a sense of relief about not having to face another transit doomsday scenario.

They were facing fares of as much as $3.25 and deep service cuts that were scheduled to take effect in ten days.

CTA Rider Stephanie Colunga said, "I don't have the extra money to take, you know, like for the increases, especially during rush hour. I was very upset about it, so I'm pleased."

That's how many were reacting Thursday afternoon to a bill approved by the state's legislature to fund the CTA, Metra and Pace.

But many are not happy about the fact that the plan relies on increasing sales taxes.

CTA Rider Tina Gutowski said, "We can sock the tourists, but there's going to be a point where they're not going to be willing to pay the money and they're going to stop coming. They're going to stop staying here, and we're all going to suffer. I just think taxes is a bad way to go."

Anita Giraldo said, "I am relieved that at least they were able to come up with money. I know that there were, especially the CTA employees that their jobs were at stake, so hopefully it won't affect them."

Mayor Richard M. Daley, who repeatedly called on state legislators to act on the CTA funding crisis, this morning said he was tired of the political wrangling in Springfield that stalled negotiations.

"To make this so personal that you can't get anything done, I think it's completely wrong on everyone's part; it doesn't matter. It is wrong. You can't make government politics personal. If you do, then you really hurt the people who need help the most," Daley said.

CBS 2's Mike Parker and Rafael Romo and the Associated Press contributed to this report.

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