For years, Illinois lawmakers and governors have turned to the state’s road fund in times of financial distress, repeatedly using money drivers cough up at the pump and secretary of state’s office to patch budget holes instead of repaving highways or repairing railways.
But that money pot soon could be declared off limits. Voters will see a question on the Nov. 8 ballot asking if the Illinois Constitution should be changed to prevent the state from raiding funds intended to be used on transportation projects.
If the so-called Safe Roads Amendment is approved, all money collected through gas taxes, tolls, driver’s license fees and vehicle registration stickers would be put into what amounts to a budget “lockbox.” That means those dollars could only be used for transportation-related expenses, such as road construction, enforcing traffic laws, mass transit and expanding airports.
What’s behind this out-of-nowhere push to preserve the road funds? As is usually the case in politics, just follow the money.
The referendum is heavily backed by those who would most directly benefit — asphalt companies, contractors, engineers, excavators, carpenters and labor unions whose members lift the shovels and lay the pavement. As of early October, Citizens to Protect Transportation Funding has raised $3.3 million to build support for the ballot initiative among the public, including a $1 million television ad buy.
Among the largest contributions is $1 million from the Fight Back Fund, headed by Marc Poulos, executive director of the Indiana, Illinois, Iowa Foundation for Fair Contracting, which represents the powerful International Union of Operating Engineers Local 150. The fund is classified as a tax-exempt political advocacy group, meaning it does not have to disclose its donors, though Poulos said it’s funded largely by union members.
That’s led to some criticism, mostly from newspaper editorial boards, that the proposed change amounts to a windfall for unions. Meanwhile, other groups like the Civic Federation, a nonpartisan budget watchdog, argue the amendment would eliminate the flexibility the state may need to tap into special funds given the ongoing budget crisis.
Those arguments come as Republican Gov. Bruce Rauner has spent much of his tenure attempting to limit the power of unions in Illinois, which he says have too much influence over the legislature and state government. Democrats, meanwhile, have only strengthened their resolve to protect their traditional political allies in organized labor, contending Rauner’s attacks on unions would undermine the middle class.
If Rauner has objections to the constitutional amendment, he’s not sharing them publicly. Asked whether he had concerns the measure would tie his hands or amount to a jackpot for unions, Rauner said, “There’s a lot of pluses and minuses to it.”
“At this point, it’s in front of the voters,” Rauner said. “Let’s let the voters decide.”
Indeed, Rauner had no say in whether the question ended up on the ballot. That was up to lawmakers, who during the spring session voted overwhelmingly to put the amendment question on the fall ballot. Just four legislators voted against the proposal.
The measure’s popularity at the Capitol is a demonstration of what’s at stake politically. Lawmakers like to cut ribbons on new projects back home, but with less money to go around amid the state’s historic budget impasse, opportunities for good publicity are few and far between.
While transportation advocates have called for a tax hike to pay for transportation projects, that’s a tough sell at any time, but especially during an election year. Protecting those dollars through a constitutional amendment was a more palatable option. Anti-tax Republicans would benefit from the influx of transit money that drivers already are forking over, and Democrats can keep unions happy as they ask for labor’s help on the campaign trail as Rauner pours millions of dollars of his own money into House and Senate contests as he seeks to diminish Democratic control of state government.
Furthermore, advocates like the Metropolitan Planning Council note the change could help ease the way for an eventual tax increase to modernize the state’s aging infrastructure, saying people can’t be asked to pay more if there’s no guarantee the money will go to upgrading roads and bridges.
It’s not just road builders who are backing the amendment. Dozens of organizations have lined up behind the proposal, uniting conservative groups with agricultural interests, the business community and unions. Their reasons are varied.
The anti-tax group Americans for Prosperity argues the change will force more transparency and honesty when it comes to budget-making, saying taxpayers should know where their money is going. Unions want to put members to work. Businesses want to make it easier to distribute and transport products, and to make sure their workers can report for duty on time.
“There are an awful lot of arguments in favor,” said Todd Maisch, president of the Illinois Chamber of Commerce. “For us, it really starts at the very obvious notion of how important our transportation infrastructure is to the Illinois economy.
“When you think of the importance of agriculture to the Illinois economy, if you can’t get agriculture products from the field to the elevator or the processing plant because of the inability to put fully loaded trucks on certain rural stretches, that’s a very real and immediate concern.”
Instead of paying for services out of one pot of money, state government relies on a complex system that includes hundreds of specialized funds. In theory, fees and taxes are paid by users of a specific service, which in turn are used to operate related programs. For instance, fishers buy special licenses, and the money collected is then used to stock or maintain waterways.
But with state government facing a severe cash shortage, those special funds are often inviting targets for lawmakers and governors looking to keep universities open, pay for programs for the elderly and provide food for prisoners.
That’s particularly true for the Road Fund, which is one of the largest and most flush funds because every driver pays into it through gas taxes, registration and other license fees. And since that money usually isn’t spent until the summer construction months, it has all winter to swell again — making it seem like an easy source of money when lawmakers and the governor turn to crafting a budget each spring.
Last year, Rauner and lawmakers agreed to drain $500 million from various transportation-related funds as they sought to plug a $1.6 billion budget hole. Of that, $250 million came from the state’s Road Fund. Another $50 million came from a fund earmarked for construction.
The Road Fund had a balance of more than $1 billion to start the month. If that money is tapped for day-to-day government operations, however, that means less money for summer construction projects.
“I think people can recognize that it’s a tough way to run any business, when from year to year you are not certain about what kind of revenue is coming in to sustain the running of the business, how many people you can keep on the payroll,” said Mike Sturino, president and CEO of the Illinois Road and Transportation Builders Association. “What that really leads us to is a boom-and-bust cycle, and that is an inefficient and more wasteful way of doing it.”
Taking money from the gas fund at a time when the gas fund gets less money is a double whammy when transportation spending already has fallen behind the state’s wish list.
The Metropolitan Planning Council estimates Illinois must pour an extra $43 billion into transportation during the next 10 years to do away with a maintenance backlog and bring roads, bridges and highways into good condition. Illinois imposes a base tax of 19 cents per gallon for gasoline and 21.5 cents a gallon for diesel, though other fractions of a penny are added on to pay for costs associated with environmental cleanup and underground fuel storage.
The state gas tax has not increased since 1991, and money raised has remained relatively flat as vehicles become increasingly fuel-efficient but construction costs go up.
“Our concern is that we need a lot more funding for transportation, but one of the obstacles to doing that is polls show pretty clearly that people don’t trust government, period, in some respects, but they don’t trust that an increase in the gas tax would actually be used for transportation, and there’s good reason for that,” said Jim Reilly, an Illinois government veteran who is now a senior fellow at the Metropolitan Planning Council focused on transportation issues.
“So to us, the two things tie together. We do think that if we can get the lockbox amendment, people would be more willing to raise taxes,” Reilly said.
Other supporters don’t see a path to more money anytime soon given the standoff between the Republican governor and Democratic lawmakers, saying the amendment is designed to take politics out of the equation.
“Transportation funding should not be feast or famine. It should not be pay as you go, we should not have to rely on a governor or lawmakers coming in who say, ‘We are going to spend on transportation.’ We should be doing this every day,” said Poulos, director of the union group.
“We don’t believe in the tenure of this governor that Democrats and Republicans are going to come to a position where they can agree on some kind of a (transportation funding) bill, so we look at this as protecting what we have,” Poulos said.
Amending the state’s constitution is not an easy undertaking, and this latest effort emerged from a decade-old legal challenge by ABATE of Illinois, a motorcycle advocacy group.
In 2003 and 2004, then-Democratic Gov. Rod Blagojevich received approval from lawmakers to sweep $1.2 million from the Cycle Rider Safety Training Fund, which is funded in part through motorcycle registration fees. ABATE sued, arguing the money came from fees levied for the specific purpose of funding the safety training and therefore was an “irrevocable trust” that should be protected.
The Illinois Supreme Court ruled that the dollars were public money and the state had the ability to tap into the fund when it wanted, adding that designating the fund as off-limits would place an “unconstitutional restraint” on the actions of future legislatures. Put simply, one legislature cannot tie a future legislature’s hands when it comes to spending.
Hence, the push for constitutional protections for transportation money.
For the push to be successful, it must get “yes” votes either from at least 60 percent of people who vote on the amendment itself, or by a majority of those voting in the election overall.
To try to hit those benchmarks, advocates are airing scare-tactic TV ads. The 30-second spot features black-and-white shots of deteriorating roads and bridges and warns that without proper investment, “it’s not a matter of if disaster will strike, but when.”
Thirty states already have constitutional restrictions on how transportation funds can be spent, including Wisconsin, where voters approved a similar lockbox measure in 2014.