Chicago's regional public transit system is headed toward a financial cliff. Without new funding, CTA, Metra, and Pace face a budget gap in 2026 that will grow substantially in future years. Read the latest in our Fiscal Cliff Fact Sheet (Updated October 13, 2025).
A budget task force made up of finance and planning staff from RTA, CTA, Metra, and Pace now projects a preliminary budget gap of approximately $230 million in 2026 that will increase to $834 million in 2027 and $937 million in 2028 without new state funding.
Higher-than-expected RTA sales tax revenue starting in 2025 and short-term cost savings have reduced the 2026 shortfall as the transit agencies work to delay impacts on riders. Fare increases, service cuts, and staff layoffs are expected in 2026 and rolling cuts will worsen in future years.
Following is a breakdown of approximately $540 million in new revenue and efficiencies in the preliminary regional budget that resulted in the cliff dropping from an estimated $771 million to approximately $230 million for 2026:
Note: These figures have been updated on 10/13/25 based on updated budget submissions from CTA, Metra, and Pace from the 10/3/25 Ad Hoc Committee presentation. These projections define the scope of the challenge but may be updated as the budget process advances.
Read a full statement from RTA Board Chairman Kirk Dillard on the changed fiscal cliff number at the October 3, 2025 meeting of the Ad Hoc Committee on Transit Funding and see slides from the meeting. View slides from CTA, Metra, and Pace presentations or watch the meeting above.
The RTA and the Service Boards have acted early and together with transparency and accountability. But waiting means more chaos, wasted taxpayer dollars, and a system that fails to deliver the reliable service riders want and deserve.
The RTA has long supported transit reform and in January proposed Transforming Transit — a plan built with riders put first to ensure sustainable funding, seamless fares, better customer service, and clear accountability.
This is a moment of crisis — but also a moment for transformative investment that could bring the world-class system our region deserves.
Without state action to close the transit fiscal cliff, the region will face rolling service cuts and fare increases starting in 2026 and continuing throughout the year.
2026 will be a difficult year without new funding. A systemwide fare increase is planned for February. CTA could face a 25% service cut later in the year, which could mean up to 39 bus routes eliminated, one entire L line closed, and some mid-day, late-night, early, or overnight service eliminated. By early 2027, CTA estimates it may be forced to cut up to 1,800 union and non-union positions, with layoffs beginning in the summer of 2026. Cuts to the ADA Paratransit service area and the rideshare (RAP) and taxi access programs (TAP) are also expected.
An empowered RTA, supported by sustainable increased funding, can transform transit in the Chicago region. With $1.5 billion in additional operating funding, service investments could include more frequency that could cut customer wait times in half.
Frequency unlocks freedom; the freedom to step outside and trust that a bus or train will be there. It’s the kind of freedom that transforms a city and connects a region.
Learn more about what the transit agencies would do with additional funding by watching presentations from Service Board leaders to the March 2025 Board of Directors meeting
The RTA is planning responsibly for the fiscal cliff, but action is necessary.
The RTA is legally obligated to pass a balanced budget on its regular schedule and is moving forward with that process based on known available funding.
To prepare for a variety of outcomes, the RTA and transit agencies are creating a regional budget with two scenarios: one where we go off the fiscal cliff, and one where a funding solution is found.
If the General Assembly passes a funding solution this year, new revenue can take time to begin flowing to agencies. Depending on the structure of the bill and number of legislative votes, new revenue measures may not take effect until July 1, 2026—halfway through the fiscal year. That delay could still force agencies to implement temporary cuts or rely on one-time fixes for the first six months of the year.
2025 Key Dates and Milestones
Date | Event |
Early October | CTA, Metra, Pace release proposed budgets for 2026 |
October 14–16 and 28–30, 2025 | Illinois General Assembly Fall Veto Session – final window to pass funding and reform legislation for 2026. |
| Late October and early November 2025 | Public hearings on the proposed budgets held throughout the region by CTA, Metra, and Pace |
| Early November | CTA, Metra, and Pace vote on final budgets for 2026 |
November 14, 2025 | RTA releases proposed regional transit budget for 2026. |
Early December | Public hearing on the proposed regional transit budget held by RTA |
December 18, 2025 | RTA Board votes on final 2026 budget. |
January 1, 2026 | Start of fiscal year. Without a funding solution, service cuts and fare increases may take effect. |
The RTA has been educating legislators, stakeholders, and the public about the fiscal cliff for more than three years. A public campaign in spring 2025 resulted in more than 16,000 letters being sent to state elected officials asking them to enable $1.5 billion in new annual transit operating funding and reforms that increase efficiency, coordination, and accountability. The RTA is committed to working with all parties to find a solution that is best for riders. During summer 2025, ongoing work at the RTA includes:
The fiscal cliff has been years in the making, stemming from structural underfunding for transit and exacerbated by the pandemic and changing travel trends. Large transit systems around the country face similar cliffs.
Decades of underfunding. Illinois has underfunded public transit for decades, investing less than peer states and regions in sustainable, modern systems. Despite this, agencies across the region have continued to provide critical service through tight budgets, collaboration, and creative efficiencies. Many of the vehicles the Service Boards operate and tracks they use are decades beyond their useful life.
Expiring COVID relief and changing ridership patterns. Federal COVID-related relief funds helped maintain transit service during the pandemic, but those dollars will be exhausted by the end of 2026. Careful financial management allowed the RTA and the service boards to stretch their federal COVID-related relief dollars further than many peer regions. But those funds were always temporary—and now they are nearly gone, a pattern that is consistent across the country.
Inflationary Cost pressure. Like all industries, the transit agencies have incurred significantly higher costs (e.g., labor, fuel, materials, paratransit services). These costs are not able to be fully covered by current revenue streams, which relies on fare revenue and regional sales taxes.
Limited opportunity for additional revenue. The RTA and transit agencies have minimal authority to raise new revenue on their own and are heavily reliant on existing sources of funding. State and regional funding has not been restructured to match post-pandemic needs and are not sufficient to cover expenses at current service levels. State funding for public transit remains the lowest in our region compared to peers across the country.
No solution passed in 2025. The Illinois General Assembly adjourned its spring legislative session without taking final action on transit funding or reform, but both chambers introduced major transit legislation. The Senate’s proposal (House Bill 3438, Senate Floor Amendment 3,4,5), which included more than $1 billion in estimated new operating revenue and significant structural changes, passed late on the final night of the session, but was not called for a vote in the House.
We need riders to stay involved and informed the rest of 2025. Tell your legislators we need a solution to the transit fiscal cliff.
