SPRINGFIELD -- Gov. Rod Blagojevich borrowed his way out of a looming mass transit meltdown Friday, buying a few more weeks to find consensus on a long-term financial fix for the Chicago region's people movers.
With "doomsday" route cuts and fare hikes set for Sunday, Blagojevich proposed the state borrow $27 million and send it to the transit agencies. The problem is that money comes from a line of credit that can be used only for construction or buying things like buses and train cars, not day-to-day costs of running CTA and Pace.
So the state dollars will take the place of federal construction dollars the agencies have. Those federal dollars can more easily be converted for daily use and have been in recent years. Federal authorities must OK the move.
They did that Friday afternoon, meaning the looming crisis is over, for now.
"There's good news for riders," Blagojevich said during a brief appearance outside his Capitol office. "But there's more work to do."
The governor's borrowing plan gets the transit agencies through the end of the year with no route cuts, fare hikes or layoffs. Now it's up to lawmakers to strike a deal on how, or whether, the state should come up with more money for the transit agencies.
The Illinois House had returned to Springfield this week for the purpose of voting on a suburban sales tax and higher Chicago real estate transfer tax to come up with $500 million for bus and train agencies. But it became obvious the plan didn't have the votes for approval and few other viable alternatives existed as time was running out.
A growing number of suburban and downstate lawmakers say mass transit funding should be considered only as part of a statewide plan to address construction needs. That plan would be funded with gambling expansion -- primarily a Chicago casino, at least one additional casino and slots at horse tracks. Legislative leaders say they hope to have a construction and gambling deal pieced together in the next two weeks.
But transit officials needed a deal before Sunday.
It became apparent Friday that Blagojevich's borrowing plan was essentially the last option for averting the meltdown. Transit leaders took it just hours after all but ruling out accepting another short-term fix. The key difference is this money does not need to be repaid by the transit agencies.
"This is very important to all our customers. Facing $95-a-barrel oil and having no alternative in the suburbs except reduced transit service would be a very strange message to send," said T.J. Ross, Pace executive director.
Blagojevich has been roundly criticized for borrowing his way out of state budget problems. But even his critics appeared resigned to go along with this deal.
"From a financial standpoint it's not ideal, it's not perfect, but I don't think riders of the CTA care too much about how the money gets there," House Republican leader Tom Cross of Oswego said.
A Blagojevich spokeswoman said the state transit borrowing would be paid off by whatever final, long-term deal lawmakers and the governor strike.