Analysis of Rep. Hamos' RTA Powers Bill

The previous post summarized Representative Hamos' bill amending certain provisions of the RTA Act. This post will focus on a few key sections of that bill. Unfortunately, while well-intentioned, the bill is surprisingly limited in scope and permissive in language. It is unlikely to shift the balance of power from the service boards to the RTA when it comes to key issues that make a difference in how transit works for the average customer and the region.

It is important to understand the limited scope of Representative Hamos' bill. The bill does not address: (1) the plea for massive increases in operating and capital funding that the RTA and the service boards have made as part of the Moving Beyond Congestion effort; (2) the rate differential in the RTA sale tax between Cook County (1 percent) and the collar counties (0.25 percent); (3) the statutory allocation of sales tax revenue among the three service boards depending on the region from which the tax was collected; (4) the structure of the RTA board; or (5) the wisdom of having three separately chartered service boards provide transit service in the region.

It is rather odd that the bill has a 10 year sunset provision. If the goals promoted by the bill, such as better coordination among the service boards, are important, and if the means to reach those goals, such as various expanded RTA powers, are so necessary, then why have them last for only ten years?

Another odd feature of the bill is that it vests the RTA with the authority to exercise new powers but does not require the RTA to exercise those powers. Thus, the various grants of authority to the RTA in section 2.01a(b)(1) - (8) are drafted such that the RTA "may" exercise the new powers. Query why Representative Hamos did not provide that the RTA "shall" exercise these powers if she thought that these powers are necessary in order to achieve the stated goals of her bill in improving the region's transit system.

Let's now look at key features of the bill.

Fares and Transfer Charges

The bill (2.01a(b)(3)) states that the RTA "may require one or more of the service boards to change its fare and transfer charges, terms, conditions, or policies established by those Service Boards in order to promote the coordination of services and service interconnections, to prevent unnecessary duplication of services, and to promote transfers among transit services."

Some media reports have suggested that the bill will give the RTA expansive powers change fares. To the contrary, the bill appears to contemplate RTA intervention into fare setting only when necessary "to promote the coordination of services and service interconnectins and to prevent unnecessary duplication of services, and to promote transfers." This probably involves a narrow subset of fare-setting decisions. Thus, the difficult task of raising base fares remains with the service boards and the RTA can escape the heat.

As a practical matter, the RTA currently has the power to insist on changes in fares and transfer charges. It can do so by conditioning its approval of the service board capital plans and/or operating budgets on service board compliance with RTA policies on things like coordination of service and promotion of transfers. Likewise, the RTA could condition its allocation of discretionary capital and operating funds to the service boards on compliance with RTA polices.

There is a real question whether it is in the cultural DNA of the RTA to exercise this "new" power when it has failed to exercise its existing powers.

Scrutiny of Capital Plans

The bill (2.01a(b)(5)) gives the RTA the power to require evidence that proposed projects for the planning and development of transit stations or station improvements support "maximum transit use by promoting transfers among transit services or supports transit-oriented land development intended to generate ridership increases."

Note that this type of review is limited to "stations and station improvements." It is puzzling why this requirement to demonstrate transit-oriented development, ridership increases, etc. before approving capital investments is not extended to other forms of transit investment such as new bus and rail lines.

A bold and innovative RTA might seize upon this language to require that local communities have transit-oriented development policies in place before the RTA will approve funding for stations and station improvements in those communities. The RTA also might rigorously allocate capital dollars based on expected levels of trip generation.

In light of the RTA's 25-year history of non-confrontation with local communities about their land-use policies and its obvious willingness to put capital dollars into low return-on-investment projects, how likely is it that the RTA will read this tepid statutory language as a mandate to condition to investment in stations on aggressively holding local communities to transit-oriented development policies and holding itself to allocating capital money based on appropriate criteria such as expected trip generation?

After all, the current RTA Act (2.01(b)) empowers the RTA as follows:

The Authority shall subject the operating and capital plans and expenditures of the Service Boards in the metropolitan region with regard to public transportation to continuing review so that the Authority may budget and expend its funds with maximum effectiveness and efficiency.

This existing grant of authority certainly seems sufficient for the RTA to condition its approval of the operating and capital plans of the service boards on service board performance in areas like maximizing transfers between types of service, generating ridership, and the other goals set forth in the Hamos legislation. RTA's failure to exercise effective leadership in these areas is not for lack of existing statutory authority.

Alternatives Analyses

The bill (2.01a(b)(7)) provides that for new transit lines or line extensions the RTA may conduct "the analysis of all available alternatives and options, in conformance with regional plans, objectives, and performance standards, in order to identify the alternatives that should be considered for more formal assessments."

Some commentators have read this language as giving the RTA to take the lead in the process for obtaining federal grants for transit projects. They state that "the RTA, and not the boards, could conduct the needs-assessment studies required under federal law for any proposed new service expansion, such as the CTA’s Circle Line or Metra’s STAR Line."

However, the bill is not nearly so sweeping. The RTA "may" conduct such analyses, just as today it presumably can study proposed capital projects and conduct alternatives analyses to its heart's content. Nowhere does the bill preclude the service boards from doing such studies or submitting them to the federal government in support of their applications for federal funding.

We've been down this road before. The current RTA Act (section 4.02(b)) states that:

The Authority shall be the primary public body in the metropolitan region with authority to apply for and receive any grants, loans or other funds relating to public transportation programs from the State of Illinois or any department or agency thereof, or from the federal government or any department or agency thereof.

As the "primary public body" to apply for capital grants from the state and federal governments, the RTA long ago could have taken the position that it was the public body responsible for conducting alternative analyses and the like and that it is is the final arbiter of which transit projects in the region should get funded and in which order. Instead, the RTA has ceded these powers, which has created the very problems that Representative Hamos hopes to correct with tepid new statutory language.

Again, why should we assume the RTA will exercise powers that it appears to have ceded already?

Regional Transit Innovations Fund

One surprise in the bill was the Regional Transit Innovations Fund, which the RTA is to use to fund "projects or investments that further the purposes of this Section."

The RTIF is funded by "up to 15% of any State-authorized or appropriated capital or operating funds" received by the RTA that are (1) not authorized or earmarked by the state or the federal government for a specific purpose and (2) are in addition to any State, federal, or tax revenues available to the Authority as of the effective date of the bill.

One question is whether "in addition to" available State, federal and tax revenue means literally any money that comes in on top of what the RTA now has on hand, or refers only to new streams of income that the General Assembly might provide.

As a practical matter, how likely is it that the RTA in its current configuration will take it on itself to "hold back" funds for RTIF projects when doing so will fare increases and/or service cuts by the service boards. Methinks the RTA will shy away from being put in that trick box and, at least in its current configuration, is unlikely to do much with the RTIF idea other than fund some limited and politically easy projects--more scrolling signs in train stations anyone?

After all, and I know that this sounds like a broken record, the RTA already has 15% of the RTA sales tax revenue for its discretionary use on transit operations and projects. The vast majority of this money is now pumped into the CTA. But nothing in the RTA Act stopped the RTA years ago from using this money to fund capital projects that advanced the RTA's goals.

Indeed, the RTA currently spends about $7.5 million annually to fund projects that seem perfect candidates for RTIF funding. (Here at pg. 12 of 50). These projects include the universal fare care and development of transit hubs. Why should we expect that the permissive new statutory language will prompt the RTA to fundamentally change its approach to capital investments?

We may examine the planning aspects of Representative Hamos' bill in another post. Suffice it to say that calling for more coordination among planners guarantees more meetings. Whether the Chicago Metropolitian Agency for Planning can do something more rigorous that its log-rolling predecessors when it comes to scrutinizing transportation projects remains to be seen.

Conclusion

Unfortunately, Representative Hamos' bill is unlikely to prompt much improvement in the way transit is rolled out to the public in northeastern Illinois. The permissive language in the bill for the most part only restates the RTA's existing powers. Based on the RTA's history there is little reason to believe that the RTA and the service boards will view the bill as a mandate for the kind of fundamental changes that from her public statements Representative Hamos appears to believe are necessary.