The Illinois Legislature has sent a bill to Gov. Rod Blagojevich that will increase sales taxes in the six-county Chicagoland area, as well as place a new real estate transfer tax for property in the city of Chicago in order to fund Chicago-area mass transit.
HB 656 calls for a 0.25 percent sales tax increase in Cook County, and a 0.50 percent sales tax increase in DuPage, Kane, Lake, McHenry and Will counties. The bill also creates a new tax equal to 0.3 percent of the value on any real estate transaction in the City of Chicago.
The legislation is designed to provide funding for the cash-strapped CTA, as well as for Metra and PACE suburban bus service. CTA has been threatening massive layoffs, fare hikes and route reductions if the General Assembly did not provide any funding by Jan. 20. However, tax proceeds may be used by the counties of DuPage, Kane, Lake, McHenry and Will for operating and capital costs of public safety services instead of mass transit.
Many lawmakers, particularly downstate, were opposed to the legislation because a capital bill for roads and bridges was not included with the mass-transit legislation. Illinois has not had a capital bill in nine years.
Downstate Senate Democrats refused to support any mass transit funding unless a capital bill was included. However, three suburban Republican senators broke ranks and voted for the bill, providing enough votes for passage, 30-25. One member voted present. The House passed the measure 62-51.
The bill now moves to the governor’s desk. Blagojevich has not indicated if he will sign the bill, and his staff indicated as recently as Wednesday, Jan. 11, that he would oppose any increase in sales taxes.