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Another loan proposed for transit * Updated x1 *

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* This mass transit “solution” is ludicrous…

Senate President Emil Jones is expected to ask lawmakers Tuesday to back a $24.6 billion capital-improvements plan that would be paid for by a major expansion of gambling, according to lawmakers briefed on the plan.

But Jones surprised Chicago lawmakers by proposing a short-term loan for the Chicago area’s struggling transit system rather than moving forward with a vote on a tax package that would raise $435 million a year for the Chicago Transit Authority, Metra and Pace.

The loan would be for $229 million, of which $200 million would go to Chicago-area transit agencies and $29 million to Downstate transit systems, said Sen. Donne Trotter (D-Chicago), Jones’ top budget expert. The agencies last week agreed to take a $91 million cash advance offered by Gov. Rod Blagojevich as a way to postpone what officials at the agencies called “Doomsday” service cuts and fare increases.

Jones is covering for the governor, who opposes the regional sales tax hike. Another loan? Ridiculous. Rep. Hamos had it right…

“It is very difficult for me to believe that the only immediate prospect for transit is a loan,” Hamos said. “As of last week, the transit system had to repay $91 million. It would be irresponsible to add another $200 million on top of that with the expectation that they could somehow pay it back — which we all know they could not.”

* More transit stories, compiled by Paul…

* Illinoize: State’s multi-billion dollar construction plans need safeguarding against politics

* Tribune Editorial: Chicago’s transit ‘disgrace’

* Chicago’s woes could aid Metro East transit

* Bethany Jaegar: All in one…gaming, capital, and mass transit

*** UPDATE *** From the governor’s office…

In response to this talk about a “loan” for transit agencies - it’s not a loan. It’s an advance - if there’s a permanent solution. If there is NOT a permanent solution, they don’t have to the pay the $229 mill back.

posted by Rich Miller
Tuesday, Sep 18, 07 @ 8:43 am

Comments

Any solution that doesn’t eliminate the CTA, remove the Daley regime from control and make the management of this regional system truly REGIONAL, is NOT a solution.

Gaming expansion is just going to cause the demise to suburban boats and borrowing money is one incredibly foolish idea.

Comment by Julie Tuesday, Sep 18, 07 @ 8:49 am
Someday the state’s Discover card is going to be denied.

More debt, brilliant!

Comment by OneMan Tuesday, Sep 18, 07 @ 8:52 am
My solution to transit funding - a tax on whatever Blago and Jones were smoking when they came up with this scheme. Come on you two, the hole is already big enough. Stop digging, put down the shovels and grab the ladder that Cullerton and Hamos have lowered down to you. Another loan is just begging for disaster.

Comment by Bluefish Tuesday, Sep 18, 07 @ 9:08 am
It is truly a Rancid Trappist system we have here. Huberman will have to change his name to Hercules if he is going to clean the Augean stable that is the CTA. The infrastructure is years behind in its periodic maintenance schedule.

The problems of what we call public transportation will not be solved until we realize that every kind of vehicle, every road and track, every, terminal and parking lot is part of a not very well integrated Transportation System of which Chicago is the major but not the only hub.

Comment by Truthful James Tuesday, Sep 18, 07 @ 9:12 am
You know, if I get a $300,000 loan to cover all my debts plus a $80,000 pay day, cash advance I can get that 4,000 sq ft home on the lake with a sweet audio system and a new SUV because all my current finances will be covered. I will be living large. How I will pay all that back plus interest will not matter because I will simply get a $400,000 loan and a $90,000 cash advance. Yeah, that’s the ticket! Debt? Debt is for suckers and little people. I am not responsible for debt when you gave me the money.

Comment by zatoichi Tuesday, Sep 18, 07 @ 9:28 am
I wonder why is no one trying make the difficult choice of raising a sales tax for the Chicagoland area. What’s the issue? I don’t like raising taxes either but that sounds like a better solution than offering a loan to a government entity that can’t seem to manage their money very well.

Comment by Levois Tuesday, Sep 18, 07 @ 9:50 am
Levois –

So you propose just giving them more money instead of loaning it

“…to a government entity that can’t seem to manage their money very well.”

Will giving them the money result in more disciplined spending?

I agree that there must be huge capital funding expenditures made. But let’s make sure those are properly monitored. Perhaps they should be paid back out of the sales tax — Chicago sales tax for the CTA improvements.

Comment by Truthful James Tuesday, Sep 18, 07 @ 9:55 am
(”It is very difficult for me to believe that the only immediate prospect for transit is a loan,” Hamos said. “As of last week, the transit system had to repay $91 million. It would be irresponsible to add another $200 million on top of that with the expectation that they could somehow pay it back — which we all know they could not.”)

The politics are supposed to end after the election when the governing is supposed to begin. Yet here we are just a few short months away from the next primary election, with a petition deadline looming, and all we can do is think about extending a “loan” to an entity that is already insolvent, in order to try to sneak past the next milestone when action would be required, in order just to gain some perceived political advantage.

I think it is time for the CAPFAX Store to introduce Bobblehead Dolls of all of the lead clowns in this circus; with the money going to the designated charity of course.

At least this way, all of the individuals and groups that are getting yanked around by this process would be able to have a token voo-doo icon of the culprit of their choice that they could box around to at least relieve some of the tension.

Comment by Equal Protection Tuesday, Sep 18, 07 @ 10:05 am
Illinois Democrats and Republicans have no idea what real public transportation looks like. China has a train that goes 500 km/h (That’s approximately 300 mph for those of you in “developing” countries that have not yet adopted the nearly universal International System of Units.) China, France, Japan, and Germany put the United States to shame when it comes to public transportation; and Democrats and Republicans are talking about adding lanes to the Interstate. That would be great, if they were bus and carpool (HOV) lanes; but, unfortunately, they’re not.

Comment by Squideshi Tuesday, Sep 18, 07 @ 10:12 am
TJ - Hamos’ bill would strengthen the RTA’s oversight of CTA, plus CTA would be cleaning up their long-term pension and retiree healthcare obligations. So the bill is not just a blank check for CTA.

Comment by Bluefish Tuesday, Sep 18, 07 @ 10:12 am
Julie, TJ,

Do either of you have any idea what’s in SB 572? Have either of you actually read the bill, or summaries of it?

The sheer and utter stupidity of suggesting another loan for the transit system is proof enough that our state’s “leaders” should be drop-kicked into the dustbin of history.

Nobody likes to, or wants to raise taxes, but raising the RTA sales tax is the only viable, LONG-TERM funding solution for — and read this carefully, because it’s not just a Chicago problem — the RTA, Metra, Pace and CTA.

And Julie, once you “eliminate” the CTA, with what do you replace it?

Comment by Nort'sider Tuesday, Sep 18, 07 @ 10:28 am
I thought the Gov said the State had no money for things like Bridges and ambulances. So where is this money coming from since it does not have to be repaid??? If the IL constitution requries a balanced budget, how does it not violate the constitution for the gove to spend money beyound the allocations in the budget. Where is the approval for this appropriation by fiat? If the Gov agencies have this much extra cash laying about, lets use it to refund all those other cuts that were made.

Comment by Ghost Tuesday, Sep 18, 07 @ 10:33 am
The Governor is “Peter and Pauling” everywhere. He acts like a young kid, out on his own for the first time and trying to make ends meet. But unlike the young person, he has revenue streams, licenses and other services he can draw from.

The national debt just hit $9 trillion. Borrowing and loaning money is no way to run any government agency.

So this is essentially a grant. Hey, Hot Rod: just call a spade a spade. Please. Enough spin.

Comment by Team Sleep Tuesday, Sep 18, 07 @ 10:42 am
“China, France, Japan, and Germany put the United States to shame when it comes to public transportation.”

You can not build good public transportation, education, or healthcare systyms when you are constantly spending billions on war. Imagine how nice othoughs systems could be without post WWII foreign policies.

Comment by Nickname Tuesday, Sep 18, 07 @ 10:57 am
Also, it is important to remember that this RTA scheme would eliminate all pension reform. The agreement on SB 572 is subject to adequate and reliable funding.

Comment by Nickname Tuesday, Sep 18, 07 @ 10:59 am
Oh it’s an advance that makes it all ok…

Comment by OneMan Tuesday, Sep 18, 07 @ 11:01 am
The Gov. is absolutely right. the CTA get an advance.
If it was a loan, one of Wyma’s clients or golf partner’s future employers could have made a fee!
(Hmmm, there is juicy little teaser for Rich media readers)

Comment by CaseyJones Tuesday, Sep 18, 07 @ 11:12 am
It’s a baptismal gift, like the $1,500 check.

Comment by Little Egypt Tuesday, Sep 18, 07 @ 11:18 am
Supporting the Hamos mass transit funding and reform proposal is a complete political “no brainer” to almost everyone, except Governor Blagojevich and die hard regional mass transit opponents like Cal Skinner. Borrowing more money makes absolutely no sense. Even Tom Cross knows tht the Hamos bill deserve bipartican support. Despite the diagreement about gambling, one can only hope that the legislature will be able to come up with some modest,but sufficient, capitol funding bill that will enable Cross to claim victory and enable Hmaos to achieve s veto proof super-majority in the House.

Comment by Captain America Tuesday, Sep 18, 07 @ 11:54 am
Why don’t they just declare another “pension holiday” for the 5 state employee pension plans and give the CTA that 650 million. They’ve done this before and never bothered to pay it back. Its like free money to them.

Comment by Bill Tuesday, Sep 18, 07 @ 12:06 pm
Squid –

Thanks for your video of the Chinese bullet train hitting 500kph. It is of course not the answer for the RTA/CTA. That train runs relatively long haul (Shanghai-Beijing, I blieve) It would be ideal for a set of routes with Chicago as the hub connecting major midwest cities with passenger and freight service

Considering the huge capital cost for track and bed and getting rid of any grade crossing en route we would be looking at a huge subsidy to minimize the operating fares. Fast freight must be part of the mix as well. Note how few passengers were accommodated, Given the fewer existing roads in China, there would be much fewer grade crossings to be eliminated per mile in that country.

It would relieve airport congesteion dramatically once in service. Landing slots for the commuter aircraft are take up runway time now. I see a Federal and multistate organization to build out the track and existing and new formed private companies to lease time slots and provide the equipment.

It does nothing for the local CTA/RTA problem.

Nort’sider –

Capital repirs can never be paid from current income. Income streams will be needed to pay the current portion of the debt as well as the operating expenses. — the latter augmented by State and local subsidies.

To borrow money for construction and rebuilding, the lender would like to see a dedicated revenue stream. Properly constructed, physical assets should last a period of years. Financing should be paid off over a similar period. Sales and property taxes are useful for this.

Comment by Truthful James Tuesday, Sep 18, 07 @ 12:28 pm
Truthful:

The Transrapid train runs from central town Shaghai to one of two international airports. Running parallel to one of the major highways to the airport, it looks like a blur when it goes by your tour bus that is stuck in traffic. Great idea to run parallel to the Kennedy on a Friday night…..

Comment by Concerned Citizen Tuesday, Sep 18, 07 @ 1:01 pm
Well…the price of doing business just got cheaper…Feds cut prime by .5 percent

Comment by Siyotanka Tuesday, Sep 18, 07 @ 1:35 pm
Squid-

China is also building 1,000 miles of freeway a year. That’s a real “green” solution, inn’it?

Comment by Six Degrees of Separation Tuesday, Sep 18, 07 @ 2:19 pm
Speaking of transit… maybe when all this is over, someone ought to come up with a new name and acronym for the Chicago transit system kind of like what they recently did in Seattle with something called the South Lake Union Trolley. There is a story on AP about the way local residents are having some fun with the acronym…

Comment by Lainer Tuesday, Sep 18, 07 @ 3:10 pm