Legislative Update: Lawmakers pass state budget, action on transit funding still needed ahead of fiscal cliff

The Illinois General Assembly adjourned this year’s spring legislative session after passing an overall $53.1 billion budget for State Fiscal Year (SFY) 2025 and an accompanying revenue package, as well as some transit-specific initiatives. The governor signed the budget after lawmakers adjourned, and some transit-specific measures await his signature before becoming law. Although the budget provides some additional funding for transit, the $730 million fiscal cliff projected for 2026 remains and action will be needed in future legislative sessions.

State budget, revenue package advance with modest revenue enhancements for transit

This year’s state budget appropriations for transit were largely in line with recent years, although with some enhancements. The budget included an increase in the appropriations for ADA Paratransit and free and reduced fare programs—an additional $911,600 and $1,905,000, respectively, for a total of just over $28 million for the programs.

Full funding for ADA Paratransit and free and reduced fares is a key part of RTA’s strategy to address the fiscal cliff. Though the programs are required, state funding covers less than 20% of the actual costs. In previous fiscal years these programs were supported with as much as $40 million—which would be about $70 million in today’s dollars. Today, fully funding ADA Paratransit and free and reduced fare programs would eliminate a significant amount of the projected fiscal cliff.

There was also a change to how the state meets its mandatory match of the Public Transportation Fund (PTF)—an additional portion of the state’s match will come from the Road Fund, which already funds PTF, and a portion will come from other state funds. This change is not an increase in funding for transit, but only a change in where the funding comes from.

The General Assembly also made changes to the sales tax that could enhance transit revenues. These changes, which will take effect in 2025, include capping the discount that retailers keep for collecting all sales taxes, and collecting local sales taxes on certain online transactions. The exact impact of these changes is largely dependent on economic performance, and the revenue itself will take several months to reach the transit system, all under the urgent context of the fiscal cliff.

Other legislation affecting transit

Outside of the budget, other legislation that has the potential to affect transit was passed and discussed this session. Lawmakers advanced legislation that will require the RTA to publish an annual report on implementation of National Transportation Safety Board (NTSB) rail safety recommendations. Lawmakers also passed a bill which allows the Service Boards to donate rolling stock to non-profit museums in the state. Finally, the proposals aimed at clean and equitable transportation, which included the Metropolitan Mobility Authority (MMA) legislation, did not advance in this legislative session.

Looking ahead

The remaining transit measures that passed both chambers of the General Assembly are expected to be sent to the governor to sign into law in the coming months. The need to address the fiscal cliff remains, and the RTA is working with policy makers at all levels of government to develop sustainable funding solutions and improve the system for all riders. State lawmakers will return to Springfield for two weeks in November for the fall veto session. Join the Transit is the Answer Coalition to help bring about the legislative changes needed to support transit at this pivotal moment.