Illinois approves $1.5 B plan to reinvent transit funding and oversight
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In a sweeping move to stabilize the financial future of its regional transit systems, Illinois has passed a $1.5 billion legislative package that restructures how public transportation is governed and funded across the Chicago area. The measure, approved in the early hours of Oct. 31 by both houses of the state legislature, is designed to prevent looming service cuts and budget gaps at the Chicago Transit Authority, Metra and Pace.
At the heart of the bill is the creation of a new oversight body, the Northern Illinois Transit Authority. This organization will replace the decades-old Regional Transportation Authority and will assume control over fiscal planning, coordination and strategic investments for the region’s three major transit agencies.
The legislation, Senate Bill 2111, now awaits the signature of Gov. JB Pritzker, who has publicly expressed support and is expected to sign it into law. The bill’s provisions are scheduled to take effect beginning in June 2026.
New revenue streams to fill funding gaps
Facing projected operating shortfalls of $230 million in 2026 and more than $830 million in 2027, lawmakers chose to redirect existing revenue rather than raise broad-based taxes. Key to the new funding structure is the allocation of $860 million from state sales tax revenue on fuel purchases. An additional $200 million will be drawn from interest earned on the state’s Road Fund.
The approach avoids a politically sensitive statewide tax hike, although it does introduce increases in local sales taxes and tolls in the Chicago region. These changes are paired with an expansion of the Illinois Tollway capital program, which includes modernization and bridge replacement efforts along I-294 and I-90.
The plan also allocates $129 million annually to downstate transit operators. While this is less than the $200 million requested by rural systems, the allocation is significant in that it separates operating funds from capital appropriations.
A unified governance model for regional coordination
A major structural reform within the bill is the consolidation of planning and oversight authority under the new Northern Illinois Transit Authority. This shift is designed to streamline operations, enhance transparency and facilitate the introduction of universal fare payment systems and integrated scheduling across CTA, Metra and Pace.
The NITA board will consist of 20 members appointed equally by the governor, the mayor of Chicago, the Cook County Board president and the leaders of surrounding counties. It will also oversee a newly created Office of Transit Safety and Experience and a dedicated law enforcement task force aimed at improving rider safety and service quality.
Supporters of the measure say this governance model brings long-overdue accountability and regional alignment to a fragmented system. “This act ensures that our transit agencies can provide safe, reliable and equitable service,” said Sen. Ram Villivalam, a lead sponsor of the bill. Rep. Eva-Dina Delgado, who led negotiations in the House, called the legislation a pragmatic step toward fiscal sustainability.
Gov. Pritzker praised the plan for laying the groundwork for what he called a “world-class transportation system.” CTA Acting President Nora Leerhsen said the bill would prevent layoffs or service cuts and enable future investment in service expansion and transit technology.
Concerns about road funds and regional equity
While the plan was broadly supported by urban lawmakers and transit unions, some opposition emerged from suburban and downstate legislators. A key concern is the use of Road Fund interest, which has traditionally supported highway infrastructure.
Critics argue that relying on those funds could strain maintenance budgets for roads and bridges. Sen. Donald DeWitte of St. Charles described the strategy as “robbing Peter to pay Paul,” expressing skepticism about the long-term implications for the state’s highway system.
In response, proponents noted that the Road Fund interest in question is not currently earmarked for any specific project and is expected to continue growing. They argue that the tradeoff is justified in order to preserve essential transit services for millions of daily riders.
There were also concerns about centralized control. Some suburban officials warned that the new board structure could concentrate too much power in Chicago, potentially sidelining the priorities of surrounding counties. However, the bill’s framers point to the board’s evenly divided appointment structure as a built-in check on that risk.
Preparing for a capital-intensive future
Beyond short-term operating stability, the law is expected to support long-term infrastructure investment. Agencies like CTA and Metra carry multibillion-dollar capital needs, including signal modernization, zero-emission vehicle deployment, station rehabilitation and accessibility upgrades.
Under the new legislation, the Northern Illinois Transit Authority will assume control over existing five-year capital plans and will be empowered to reprioritize projects. Toll increases enacted under the bill, 15 percent for passenger vehicles and 25 percent for trucks will generate roughly $180 million annually, which will be directed toward a parallel Illinois Tollway capital program worth $2.5 billion through 2030.
The predictable revenue stream created by SB 2111 also ensures continuity in procurement and contracting schedules for ongoing infrastructure work. According to planning documents from the agencies involved, deferred maintenance and long-standing service deficiencies could be addressed more efficiently once structural deficits are resolved.
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