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Car title fee hike, cigarette tax increase and higher fares proposed for bailout

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* The “secret plan” to bail out mass transit is no longer a secret, but it could prove even more controversial than the original idea…

Less than two weeks before the latest “doomsday” deadline for the Chicago Transit Authority, a House Republican bailout plan funded by a cigarette tax hike and vehicle title fee increase went nowhere Wednesday.

* I’ve been reporting for a while that Cross wants to divert gasoline sales tax revenue to mass transit and replace the cash with a cigarette tax hike. Gov. Blagojevich appeared to reject using a tax increase on cigarettes for anything other than health care several weeks ago, but the Trib says it’s back on the table. More…

House Speaker Michael J. Madigan (D-Chicago) questioned the political feasibility of asking Downstate lawmakers to raise taxes to save Chicago mass transit, while he also continued to publicly turn thumbs down at House Republican leader Tom Cross’ desire to tie CTA help to gambling expansion for a public works program.

* And a few more details…

Though the transit plan backed by Madigan would rely on small sales tax increases in the metro area, Cross said he would prefer to help the system by diverting $300 million in revenues generated by the sales tax on gasoline. Cross said those funds could be replaced by increasing the fees on automobile titles and fund sweeps of other agencies to eliminate unnecessary spending. Cross also suggested fare increases.

* So, the secret plan that the governor said he had “signed off” on would include slapping motorists with higher title fees and transit riders with increased fares? Could this be true? What about Blagojevich’s oft-stated opposition to any tax hikes on “PEOPLE”? No wonder the guv didn’t divulge any details earlier this week.

* The competing proposals set up an interesting choice…

“I don’t like the fact that we’re looking at a sales tax. I don’t like the fact that every time we turn around, we see another tax proposed or an increase in a tax. I think there’s a way to do it without raising taxes,” Cross said. […]

Madigan contends “regional taxes for a regional problem” are the way to go, and the strategy has fewer political problems than Cross’ idea.

* More stories, compiled by Paul…

* Gov wants to fund mass transit with $350 million from gas tax

* Local schools fear fund cuts amid feuding in Springfield

* Clout Street: Goodbye veto overrides

* GOP hopes to exploit Gov’s weakness in ‘08

I’ll have more on the poll mentioned in that last article later today.

Thoughts?

posted by Rich Miller
Thursday, Oct 25, 07 @ 9:47 am

Comments

Using gas tax revenues for transit is fine, but it’s important to remember that state gas taxes are charged per gallon, not a % of sales, so as cars get more fuel efficient, revenues go down. Also, the federal highway trust fund will be out of money in 2009, so we won’t be able to count on that money to repair highways and bridges within the next few years.

Likewise, cigarette tax increases can only go so far, especially if public smoking bans end up being effective at reducing cigarette usage.

Taxes are a stable way to fund transit as a public service - everyone benefits from trains and buses, so everyone should pay for them.

Comment by Kuz Thursday, Oct 25, 07 @ 10:25 am
As much as you seem to abhore this idea, it actually seems more likely to pass (not that I think it is preferable).

Mostly because there are Republican votes there. Even Sen. Radogno was saying back in September that she prefers increasing user fees on cars (like the title fee/sticker fee) to pay for transit.

And liberals like the idea of targeting cars to pay for transit.

So, the concept in general seems more palatable. However, I can’t quite figure our where the politics on this is going, so I don’t know if it will ever become reality.

Comment by GoBearsss Thursday, Oct 25, 07 @ 10:29 am
Something to ponder …

Take that higher title fee, combine it with higher alcohol taxes, use the proceeds to fund billions in construction, never mind the no tax promise, and what would you have?

George Ryan and Illinois FIRST.

Comment by anon Thursday, Oct 25, 07 @ 11:43 am
Raise the cost of fares! Every other price or service has gone up because of the increase in gas costs, why should public transport be an exception.

OR find ways to increase ridership so you can generate more revenue at the same rate. I would not hurt chicago to have fewer folks commuting in cars. Provide them incentive to CTA/RTA it. For those chicagoians who commute to work every day, what would get you out of your car?

Comment by Ghost Thursday, Oct 25, 07 @ 11:47 am
No reasonable person objects to moderate fare increases. But the Hamos Plan still seems to be the best available alternative.

I’m flexible - I don’t presonally object to the Cross plan if the Hamos Plan fails to get a veto proof majority. Cross is not going to be able to stop his suburban metropolitan members from voting for the Hamos Plan next week.

But Madigan intends to push the Hamos Plan next week. and since he can count heads pretty well must think he has a cahnce of succeeding. Senator Jones had better be prepared to act promptly next weekend, one way or another.

Other than the resonable fare increase aspect of the Cross plan, I’m not sure why anyone would prefer the Cross statewide gas tax diversion to the Hamos regional sales tax approach. I wouldnt mind seeing the sales tax increase coupled with modest fare increases and eliminating the real estate tranfer tax part of the package. Compromise between Madigan and Cross still seems possible.

Comment by Captain America Thursday, Oct 25, 07 @ 12:51 pm
I think the key here is: They don’t need a veto-proof majority.

They need an immediate effective supermajority.

It is essentially the same vote total. But the Governor’s veto threats are irrelevant here. Because if they get it passed with the votes they need, they have the votes to override.

Comment by GoBearsss Thursday, Oct 25, 07 @ 1:15 pm
Ah, yes.

Force motorists to subsidize those privileged enough to be able to take a bus or train to work.

Wait.

That’s been done before.

That’s what the RTA Act provided for in 1974.

I guess Tom Cross didn’t notice the revolt it caused.

And, raising title fees Downstate to bail out the CTA.

Someone will recreate the county by county table to how much the subsidy is.

Pass it.

It will be fun watching a repetition of the RTA fall out.

Comment by Cal Skinner Thursday, Oct 25, 07 @ 1:49 pm
===It is essentially the same vote total.===

It is exactly the same vote.

Comment by Rich Miller Thursday, Oct 25, 07 @ 2:18 pm
Thanks for the correction.

I had written - It is essentially the same.

Then added “vote total” at the end without correcting the rest of the sentence.

Regardless - they just need something that can get the votes.

Comment by GoBearsss Thursday, Oct 25, 07 @ 2:49 pm
Give the RTA a 2% Gas tax in the six county area.

Comment by Truthful James Thursday, Oct 25, 07 @ 2:54 pm
verybody wants to have somebody else raise the money and give it to them. Let’s get up front with these taxes. See my suggestion above. Then, give the same authority to Transportation Authorities to be established by other Counties.

Comment by Truthful James Thursday, Oct 25, 07 @ 2:57 pm
What has essentially happened is that Blagojevich blew his wad on a really stupid idea this spring and summer. Not only was he defeated, he frankly embarrassed anyone who needed to propose a tax increase, however slight.

The governmental meltdown, the feuds, the GRT tax, the deadlines missed, the entire summer was filled with one message - “Government is out of control and no one knows what to do!”. The City, County and State all crashed and the smoking wreckage was reported daily.

So the folks we have in office currently don’t have a lot of credibility. They blew it, didn’t they? And not only did they blow it on something personal and stupid - they didn’t even FIX the problems normal budget sessions fix. They couldn’t even CARETAKE this mess!

So now that we are hurling towards the end of the year without any stability, voters are just not in the mood to listen to these guys anymore. Even perfectly good proposals are being shunned by one faction or another.

We are locked-up without leadership credible enough to be heard over the din of voter skepticism.

Blagojevich proves repeatedly that doing nothing is better than doing something poorly. The only time this man has an uptick in his poll numbers is when he disappears for a while. When he shows up on television and starts talking, he comes up with more crazy nonsense that just piles up on top of the smoldering wreckage we’ve witnessed since May 31st.

He is like a chef trying to convince us that his dessert recipe is fabulous as the corpses from his main course surround him and his kitchen is still on fire! It is a tad difficult to listen while your jaw is still dropped and your eyes are still returning to their sockets after his last performance, isn’t it?

We just don’t want to hear about how much more taxes these failures want to take from us. The Illinois Democrats running this state have lost too much credibility or why would anyone even care about what Watson or Cross says? These guys are making news? It is like watching Germany, France and Britain listening to Liechtenstein and Malta regarding EU leadership problems!

Comment by VanillaMan Thursday, Oct 25, 07 @ 3:17 pm
Metra trains are standing room only during express runs and the fares are pretty cheap. Raise the fares on the users. History shows that ridership will drop, but then maybe I can get a seat.

Comment by Mr. Ethics Thursday, Oct 25, 07 @ 6:38 pm
Where is the logic in having people who drive cars pay a gas tax so others can ride the mass transit system with a cheaper fare. Raise the fares! Make the people who use the system pay for it.

Comment by Logic? Thursday, Oct 25, 07 @ 8:25 pm
The best reason why drivers should pay for transit services is that transit reduces traffic congestion. Chicago Metropolis 2020 released a study showing that every $1 that the region invests in maintaining or improving transit pays back at least $1.21 in time saved in traffic jams.

Allowing the system to decline, on the other hand, will result in 48,000,000 MORE hours a year wasted in traffic jams.

Transit fares have already increased much faster than either inflation or the cost of driving (which has actually declined relative to inflation).

A headline from The Onion that says it all: Report: 98 Percent Of U.S. Commuters Favor Public Transportation For Others

Comment by PCC Friday, Oct 26, 07 @ 12:37 am