Your editorial of July 16 highlighted many of the problems facing state government at this time, including the problem of overreliance on borrowing. We agree that these are serious issues that must be tackled.

There is one point raised in the editorial, however, that we would like to clarify. You mentioned that the state is planning to “borrow” $1.6 billion to fund transportation improvements. This $1.6 billion in transportation bonds is part of the capital program enacted in 2009. The bonds are supported by a number of revenue increases, including three highway user fee increases: a $20 license plate fee increase, a $20 driver’s license fee increase and a $30 certificate of title fee increase. Motorists have been paying these fees since 2010; through the end of state fiscal year 2012, the fees have generated more than $700 million, all of which has been placed in a dedicated Capital Projects Fund.

Other sources flowing into the Capital Projects Fund include sales tax increases on candy and sweets, liquor tax increases, and lottery enhancements. Together these sources have generated about another $600 million.

Illinois has long used bonding as a tool for financing transportation improvements. There are two advantages to bonding. First, users get the benefit of the project today, rather than waiting the years it might take to accrue necessary amounts to build it without bonding. Second, because transportation construction costs generally rise with inflation, projects built today will cost less than projects built several years from now.

The critical link in bonding is the assurance that the revenues have been set aside to service the bonds. And that is what is occurring with respect to the recently announced $1.6 billion in bonds. Now it makes sense to move forward with building the projects.

Linda Wheeler

Policy analyst

Transportation for Illinois Coalition

Springfield