State of the State: Outdated roads, rails and buses won't drive Illinois into the economic future

May 1, 2007

Bethany Carson
Credit WUIS/Illinois Issues

"A modern economy needs a modern platform, and that's the infrastructure. It has been shown that the productivity of an economy is related to the quality of its infrastructure."

Felix Rohatyn 
The New York Times, April 9, 2007

Felix Rohatyn helped save New York from bankruptcy in the 1970s when he chaired that city's Municipal Assistance Corporation. The former U.S. ambassador to France also has written plenty about the nation's need for public investment in its infrastructure. And Illinois politicians should note his most recent comments on the subject.

That's if they can shed some of the partisanship and refocus on their shared belief that infrastructure is linked to the state's economic well-being.

Charlie Wheeler, director of the graduate Public Affairs Reporting program at the University of Illinois at Springfield, has monitored state politics and government since his days as a Statehouse reporter for the Chicago Sun-Times. Though he says politics don't necessarily trump Rohatyn's philosophy, he adds, "I think they're just ignoring it in that political questions seem to be more paramount."

That's been true for the past four years. The General Assembly hasn't approved a significant number of capital projects since Gov. Rod Blagojevich took office in 2003, though the state has provided funding for some projects each year. As Wheeler says, the Illinois Department of Transportation never stopped paving the roads and building new ones, but "they've been limping along, finishing multiyear stuff that was approved in the past and doing the bare minimum to get by."

If lawmakers adjourn once again this spring without approving a capital plan, the state will postpone road and school construction projects and the jobs that go along with them. Illinois also will risk losing available federal matching dollars and a competitive edge when Congress creates its next capital program for roads and mass transit.

"I don't think the economy will grind to a halt," Wheeler says, "but there will be a cost in terms of added travel time, added wear and tear on vehicles using these roads that aren't up to snuff and lost productivity time on the congested roads in the suburbs."

Meanwhile, nearly two dozen Illinois school districts sit on a waiting list for state funding to match local tax levies to build schools. Municipalities also need to upgrade water and sewer systems, particularly those serving the sprawling suburbs in the northern and central reaches of the state. And there's a need throughout the state to improve roads, rails, public transportation, parks, prisons, colleges and universities, veterans' homes, mental health facilities and state buildings.

Those capital projects are usually mapped out in a long-term capital budget, separate from the state's annual operating budget. The state pays for such projects over many years through borrowed money, federal grants, general state revenues and dedicated funds, such as driver's license renewal fees that help pay for roads.

Blagojevich has proposed two capital plans that have been denied by lawmakers. This year, he seeks legislative approval for $4.5 billion in new bonding authority that gives priority to new school construction, economic development, renewable energy sources, public transportation and public universities. In addition, he wants to attract federal matching funds, particularly for mass transit.

Any significant capital plan requires agreement between Republicans and Democrats because a three-fifths majority is needed in both chambers to borrow capital funds. And no one is blameless for the long-running partisan standoff. Negotiation isn't the Democratic governor's strong suit. Democrats, who have maintained control of both legislative chambers since Blagojevich's first term, blame Republicans for withholding the necessary votes. And Republicans argue they're holding out for a proposal they consider fiscally responsible.

Last year, Republicans, who were excluded from budget negotiations altogether, said they oppose borrowing unless a revenue source is identified to repay the debt. Politically, they also feared capital funds wouldn't go to their districts.

Wheeler says Democrats used that technique 12 years ago, when Republicans controlled the executive branch under former Gov. Jim Edgar and the legislature under former Senate President James "Pate" Philip and former House Speaker Lee Daniels.

"So there's a lot of politics involved in it," Wheeler says. "Some of it is defensible in terms of policy. I think a reasonable argument can be made that when you are going to embark on borrowing, you should be able to identify where the money's going to come from to repay the loan."

Tom Ryder, a former House GOP budget negotiator from Jerseyville and a current lobbyist in Springfield, says compromise has always been difficult because minority parties "desire their participation to be extended beyond just the capital budget."

The dynamic changed, however, when Democrats gained enough seats in the Senate to approve a capital plan without GOP help. House Republicans are still needed for approval of a capital plan in that chamber, enabling them to withhold votes if they aren't satisfied.

In fact, earlier this session, House Republicans proposed their own $5 billion capital plan using money generated by adding positions on existing riverboats. David Dring, spokesman for House Minority Leader Tom Cross of Oswego, says the caucus is willing to negotiate, given the dire needs for infrastructure around the state. "We're not locked [in] to the expanded positions," he says. "We're open to other options."

Something's got to give, he says. "Legislators are hearing greatly from their constituents, from the leaders of their municipalities, from business folks that there's a need for [projects]. I don't think legislators want to go home without some sort of capital bill with this budget. I truly believe that."

Ryder says three criteria need to be met for both parties from both chambers to agree on a plan: a dedicated and reliable revenue source, a level of trust and an agreement about where the money is going.

The General Assembly accomplished all three in 1999, when the state enacted a significant capital program called Illinois First, he says.

Illinois First matched federal funds and then some, says Linda Wheeler, who worked with the Illinois Department of Transportation for 28 years and now does consultant work for the Transportation for Illinois Coalition, a labor and business advocate. 

She says the state got the greatest bang for its buck out of federal earmarked funds through Illinois First, enabling the state to get the existing system back into repair, relieve traffic congestion and further economic development.

While Illinois First tapped into the existing federal road and highway program, that federal program will run out in 2009. Linda Wheeler says that puts Illinois in a position to create another plan to attract federal capital funds when Congress writes its next capital bill.

But those funds pay for much less than the actual cost of finishing the projects, she says. And the feds might not feel inclined to give Illinois more funds if the state hasn't aggressively spent its earmarked dollars from the current capital program.

Illinois transit is at a worse disadvantage in competing with other states for federal money, she says. Illinois funds the Regional Transportation Authority and 50 other systems, but for the past three years, the amount of state funding for transit capital projects has been $0. When the feds look at states that have matched their transit funding, Illinois doesn't fare well against the competition. 

"Illinois is coming to the table without cash," she says.

Blagojevich proposes a $425 million authorization for bonds over three years, geared toward getting those federal transit dollars. But, she says, given the cost of inflation on such construction materials as cement, oil and diesel, Illinois transit would still lose out in the global economy.

If Illinois goes one more year without a capital plan, the state will continue to delay the projects that improve infrastructure that established it as a national hub in the 1920s, says Jim Nowlan, a former state lawmaker and a senior fellow at the Institute of Government and Public Affairs at the University of Illinois.

"To go four years without a capital   construction bill is — I wouldn't say it's a crime — but it's a travesty that risks diminishing the capacity of our infrastructure to produce the wealth that infrastructure generates." 

 

Bethany Carson can be reached at 
capitolbureau@aol.com.