Transit fiscal cliff shrinks in 2026 but will grow in 2027

The Regional Transportation Authority is expected to downsize the “fiscal cliff” facing Metra, Pace and the CTA in 2026 by over half at a Friday meeting.

The agency earlier had projected a $771 million shortfall when COVID-19 federal aid runs out next year.

That number will be closer to between $200 million and $300 million, Chairman Kirk Dillard said.

However, the revenue gap goes back up significantly in 2027, as all of the COVID-19 money will be used up, Dillard said.

“State sales tax changes, relatively strong economic performance and cost-control efforts will produce a smaller cliff in 2026 than the $771 million projected in last year's budget,” Communications Director Tina Fassett Smith said.

Also, Metra, Pace and the CTA were asked to budget for a 10% fare increase in 2026, and the RTA allocated $74 million in discretionary funds to the CTA to delay cuts, she noted.

“Even after these actions, CTA will exhaust their federal funding in mid-2026 and Metra at the end of 2026; Pace will not confront a gap in 2026 for their mainline suburban services,” Fassett Smith said.

Some lawmakers have said the new sales tax revenues could reach $250 million.

The Illinois Senate approved a transit reform bill on May 31 creating a new oversight agency with greater authority over Metra, Pace and the CTA. It also would have generated more than $1 billion for transit through a number of new taxes such as a controversial $1.50 fee on numerous online deliveries.

The House did not vote on the measure but is expected to take up the legislation in its veto session this month.

“Illinois is last, at 17 % in America, in state support for mass transit. Also, historically we have the lowest operating cost in the U.S. per mile,” Dillard said.

Labor, transportation and environmental groups said the crisis should not be downplayed because of the revised numbers.

The “RTA is applying a patchwork of short-term funding solutions, fare increases and slow-rolling much needed improvements to a system that drives so much of Illinois’ economy, and which so many Illinoisans rely on,” Illinois Clean Jobs Coalition spokesperson Amy Rynell said.

“It’s time for the Illinois General Assembly to reverse transit’s downward spiral and finally take action to reform the RTA and invest $1.5 billion in transit.”