So? Different places set up their tax support of local transit differently. In some places, the city (or state) collects sales and income taxes and then gives it to the transit agency. In other places, such as Illinois, the transit agency is authorized to collect the tax itself.

Downtown has it exactly right.

Bostonians don't pay a 1% sales tax specifically earmarked for transit - Chicagoans do. I'm not sure how much Chicago's contribution (via RTA tax) is this year, but it is certainly in the hundreds of millions.

Having the City of Chicago pay more is pointless. The entire RTA system for funding transit needs to be scrapped.

The big problem with RTA's operational subsidy is that it is based on sales taxes, which are too volatile to solely rely on for balancing a budget.

I would like to see the RTA scrap the sales tax subsidy in exchange for property taxing district overlay on the whole metro area receiving service. It could operate like any of the other taxing agencies and just be a separate line item on your annual property tax bill. It would be a much more stable source of revenue, and it can be graduated by county, i.e. a smaller percentage to pay in McHenry and Kane Counties versus Cook and Dupage.

Property taxes might be stable to the municipality, but they are anything but stable to the landowner. I'd rather see an uptick in income taxes. At least then, you know upfront what your taxes will be for every dollar you make. In Chicago, you have no idea what your property taxes will be until a month before they are due.

I don't mean to sound harsh, but if so, that's your own fault. The tax bills that recently arrived are for the second installment of the 2008 property tax - whose levies were set 2 years ago. Changes to assessed valuations (and thus potential increases/decreases outside of those implied by the changes in the levy) for the 2009 property tax bill, which will be paid in 2010, were published a couple months ago, giving time for people to either appeal their valuation or ballpark calculate their 2009 property tax (remember, the 2009 property tax levies are already set).

Maybe it would help (serious suggestion) if everyone were required to pay the property tax in escrow or other form of installment plan so that payments are perceived as more normalized and smoothed like an income tax, rather than receive very large bills every 6 months (of unexpected size, due to ignorance or incompetence) and then complain to elected officials about how evil the most economically rational and stable method of funding essential government services is.

That's a great idea. Other types of taxes may sum to large annual amounts, but every other form of tax is broken up into lots of small payments, lessening the perceived amount (and making refund time a joyous time of year :D ). Why is property tax only collected semi-annually?

By the way, I also agree that it makes more sense to fund transit out of property taxes. It's more stable, and you're directly taxing the places where transit runs.

Well, that's when you take your crop to market. Seriously, property taxes are a holdover from the 18th century.

For one thing, property taxes are inherently regressive. I would argue that a large portion of transit needs should be paid from a progressive income tax, which is a) based directly on ability to pay (in the year it's collected) and b) indirectly based on the economic prosperity caused by having efficient metropolitan transportation.

How is it regressive? You own property, pay for the services (including transit) that the city provides for that property. Your property's worth more? You pay more.

I disagree strongly. A property tax almost perfectly captures all economic activity (assuming fair/objective relative assessed valuations of course) in contrast to a sales tax (taxing consumption) or an income tax (taxing production). The increased density of economic activity afforded by transit access makes real property a natural tax source for re-capturing some of the value created by transit.

A high-income person not only pays property tax on his home - he pays it indirectly via his employer, who pays rent to a landlord who pays property taxes that are related to the relative value of his property, which is increased because high-income people work there (for a moment, ignore the existence of TIF districts...). Property tax is not strictly "progressive" - it scales based on a combination of production and consumption activity, rather than purely on personal income - but it certainly isn't "regressive." Again, being impacted by both production and consumption activities, it is less at risk of creating the sorts of potential perverse incentives other taxes induce, e.g. high income/gains taxes disincentivizing growth/investment or high sales tax disincentivizing consumption.

I would argue it's deeper and better than that, even, since even if one lives in a dump to minimize his residential property tax while banking a high salary, he is nonetheless contributing tax revenue indirectly on the production side via his job. Of course, one also pays property tax indirectly via retail shopping, since the retailer pays rent on a property whose value is determined by the amount of retail spending potential at the location. So even if Joe Six-Figure Slob lives in a dump so he can afford boutique clothes, bottle service nightclubs, and $100/plate dinners every night, he is still paying a sizeable amount of property tax.

Regressivity is so inherent in a property tax that it's usually mentioned in the first sentence of any description of ad valorem taxation. Consider the owners of three identical bungalows on Avers Ave.:

In 4411, a widow with annual income of $20,000, owes $4,000 property tax. That's 20% of her annual income.

In 4415, a young family with annual income of $40,000, owes $4,000 property tax. That's 10% of their annual income.

In 4421, a pair of lawyers-in-love with annual income of $160,000, owes $4,000 property tax. That's 2.5% of their annual income.

I'm sure you can see the problem. It's not as insistently regressive as a sales tax, but there's only the slightest relationship between the size of your house and your ability to pay. Only a tax on gross wealth is more related to ability to pay than a graduated income tax.

And what kind of accounting are you doing where an employer's rent is paid by the employees rather than the shareholders?

While I agree with you to an extent, there are plenty of people not savvy enough to understand this city's property tax system. They get their assessment every year and shrug their shoulders at it.

Bought my property in 2007, it was a new building. Finally got the assessors office to subdivide the property last year. The first assessment came late, but we had a ballpark idea of where it would be. Then the assessment came in for next year in August. Surprise, it's 38% higher than what it was assessed for last year. I appealed, they declined it. According to the tax assessor's website, my property assessment should be worth $688k. Meanwhile, the penthouse unit in my 4 story condo building is on the market for $569k. Fuck em. I'm selling come spring. I refuse to pay $12k in property taxes on my place.

An important distinction is that in stark contrast to a regressive tax like a sales tax, the struggling widow can sell her property. (assuming she isn't at 150% LTV with HELOC's up the wazoo to pay for LCD TVs in every room and a new kitchen...). I never bought the argument the rising property values unjustly forces people out of their (owned) homes; fixed-income granny can cash out and sell if the 5.8% 2008 COLA on her fixed-income isn't cutting it for gas money to get to community meetings to complain about kids these days and taxes.

Highly conceptual here, but shareholders or more generically investors are expecting a certain ROI or profit margin. Rent for office space is an operating expense just like wages and benefits, competing for the same slice of the budget within the constraints of investor targets. Yes, in reality the picture is much more complicated and circular, but I'd maintain that in the overall scheme it more or less nets out as evidenced in the very high property values (and ergo property taxes paid) in downtown office skyscrapers. And yes, this also requires one to ignore the presence of TIF districts in high-income employment zones, which are highly distortative.

Which suggests maybe a mechanism to blend the payments (mandatory low-fee escrow?) would make the tax less of a political nightmare?

Something's not right. Have you hired an attorney to appeal? When all is said and done with the various multipliers and equalization factors, most Chicago condo owners pay in the *rough ballpark* of 1 - 1.5% of their market value in annual property tax - so $12k sounds punitively and unjustly high.

The attorney filed the appeal on behalf of everyone in the building. The letter I got a few weeks ago said that the assessment was not adjusted due to "your property's uniformity with comparable properties." The 10/25 ordinance says that my assessment should be for approximately 10% of the market value of the property. I called the assessor's office and told them they can buy my house at a 20% discount... Seriously, I'm ready to go down there are strangle someone. Nobody's property taxes should go up 40% in one year.

Not true, you never know exactly what the second installment will be, but the first installment is always exactly 1/2 of your total tax bill from the previous year. The second installment is usually about 55-60% of the previous year, making your bill about 105-110% of the year previous. Sometimes the increase is less though.

Not even that conceptual, how is a shareholder going to pay property taxes? Hello, shareholders pay nothing after they purchase their share of the company. How are the "paying" for anything. No, it is the customers (in the form of higher prices) and the employees (in the form of lower wages) that end up paying when property taxes increase. Most companies don't pay a dividend so there isn't even any income going to the shareholders to cut into...

Also, property taxes are totally not regressive since they don't affect the poor more unless the poor own proportionately more expensive goods. If a poor man suddenly wins the lottery and his income jumps to $1 million dollars and now he has to pay 50% tax, does that suddenly make our income tax system regressive? No. Same applies if a poor person buys a proportionately more expensive house. They don't have to buy a $500k house when they make $50k, they could buy a $100k one and let the people with $250k a year buy the $500k one. Then they both pay the same tax rate...

The key word there is "usually"... But when the assessor's office goes and totally fucks you, as they have for a boatload of people this year, we don't take comfort in that assumption. My example, given above, is classic Chicago bullshit, and they are going to lose a taxpayer in Lakeview because of it. I'd rather move downtown where I can live in River North, pay the same mortgage amount and enjoy a third of the tax that I have in Lakeview.

^^^ I dunno, in your case it seems like something is grievously wrong with the system. Did you buy a 4 unit building and subdivide it, or did you buy into a recently subdivided building? We've defended people before because the Assessor is stupid and put a tax lien on their recently subdivided condo because the owner didn't pay the full tax bill for the entire building before it was subdivided. One time the Assessor tried to put our client on the hook for a like $60k tax bill that was for the entire 20 unit building, instead of the 1/20th bill it should have been for their single unit.

Did you have a lawyer dispute the assessment? You might want to at least consult a RE or Tax lawyer and see if they can do anything.

Lower dividend; lower share value. Employment markets are competitive and so is product pricing. You guys live in a strange theoretical world where an accountant in the Loop is paid less than one in Downers Grove because the property taxes are higher on the Loop office building.

But why would you think a system that requires that much personal anguish is an admirable one?

The only advantage of property taxes is that, because they're unrelated to actual economic activity, they don't decline during recessions. Well, that makes them stable for local governments, but a punishing burden on taxpayers who no longer have the corresponding ability to pay the taxes.

You know very well how property taxes encourage--even demand--poor land-use decisions as villages compete for rateables. Taxation rates in Dixmoor or Glenwood end up being several multiples of what they are in Northbrook or Libertyville. The relationship to public transportation benefit is casual at best. How can you defend property taxes except in the most macroeconomic and theoretical terms, oblivious to the real world?

That's a fallacy, you aren't taking into account the per-capita distribution of those taxes or the dozens of other factors that determine wages. Yes an office building in the Loop pays much more in taxes, but it is also much larger and contains many more accountants than the one in the suburbs. Also, taxes aren't the only thing that determine wages, that is ridiculous. Your example is flawed because, if the CPA on Madison makes more than Mr. Downers Grove, then its likely because hes a "better" CPA and serves clients that are willing to pay him more and cover the higher costs of him being in the loop so he can serve them better.

Also, like I said before, 99% of companies pay no dividend, so no, they won't see a lower dividend at least 99% of the time. Maybe the share price would be slightly lower, but then again 95% of companies are not publicly traded (if they ever trade hands at all), so thats unlikely as well.

Why do you assume the personal anguish is caused by the taxation? Maybe if people didn't become violently attached to material objects like family homes the probably would be eliminated outright? I don't see people assigning sentimental value to material possessions as a reason to create a less efficient society and economy. I thought the "moral" position was to rant against materialism...

Minor gripe - but isn't MBTA partially funded by a statewide 1% sales tax, in addition to levies on the municipalities served?

Sales tax is definitely not the best way to fund transit, but it is statewide in Massachusetts, which is much better than our RTA set up. The municipal taxes in Mass account for about 10% of transit funding while the RTA county taxes here account for almost half of transit funding, with little statewide contributions.

My main point is that Chicago does pay a lot for transit - it just goes directly to the RTA without passing through the city at all. Daley could certainly do more to champion transit, but the funding of it is not in the hands of the city. All other US transit agencies get much more support from the states they are in, the last thing Chicago needs to do is make it's transit funding even more local.

That's not true. Texas gives local transit agencies nothing. They're all funded via Federal grants and local sales taxes.......

I don't believe ValleyMetro in Phoenix gets much or any state funding either. It's funded by the cities and MAG (Maricopa Association of Governmnets). And I'm quite certain that transit in New Mexico is funded by the cities or the MRCOG (Mid-Region Council of Governments) in the case of the Rail Runner from Belen to Santa Fe, although both the states of Arizona and New Mexico helped pay for the infrastructure to build the light rail (Arizona) and Rail Runner (New Mexico).

Perhaps it is more common for smaller states like Massachusetts to take a larger role in directly funding transit while larger states (in terms of area) like New Mexico, Arizona, Illinois, etc. have more rural voters that limit the amount of state money that can go to transit in any one city.

I don't think state funding is particularly common, because in most states there are large constituencies who don't see local transit as relevant to them. Maryland, New Jersey, Delaware, and maybe Massachusetts and New York are the only places that come immediately to mind for significant state funding.

Right - it's not only the size of transit's constituency, but that size relative to the rest of the state. Greater Boston totally dominates Massachussets politics, New Jersey is the most urbanized state in the country with the bulk of its population tied either to the NYC or Philly urban regions, and New York City's influence in Albany is proportionately greater than Chicago's influence in Springfield. Chicagoland is big enough in Springfield (IL) that local issues can get taken care of if there is local concensus (e.g. Chicagoland can easily pass a tax on itself), but not so much that local issues can totally dominate the agenda as they can in Albany, Trenton, or (obviously) Boston.

^ Not sure I agree with this.

In what way is the Chicago area's influence over Springfield any less than these other places? Chicagoland is Illinois. And unlike the case of NYC (with Buffalo), there are really no other large cities to compete with Chicago for attention.

There are these people called rural voters, who tend to dislike giving their money to the big cities and who tend to have a disproportionate amount of voting power because of the way voting districts get drawn. There doesn't need to be a competing metro area to compete for funds, there just need to be enough people/voting power that aren't all in 1 metro area to axe state funding for city issues.

^ But they exist everywhere. Look at upstate NY.

That was my point.

Boston doesn't completely dominate Massachusetts politics, there are more representatives from just Worcester and the Berkshires than there are from inside Rte. 128. I think the relationships between Boston area/Western Mass and Chicago/downstate are pretty similar.

RTA daily ridership is around 2 million, that is 15% of Illinois residents using transit every day (a higher percentage that MBTA riders in MA). I think the constituency is there.

^That's 1.9 million unlinked rides, not individual riders. So you can start by halving the number, and reducing it further for anyone who has to transfer. And the MBTA number is 1.4 million.

New York is definitely the more similar - an upstate capital and some other minor urban regions as X factors (Illinois has Metro East, recall, with a ballpark of 600,000 residents depending on how one counts it).

Boston is both the major city and the capital of Massachussets, making state and city politics inherently more intertwined since they occur steps apart from each other. And it's surrounding 6 county area (we'll call it the commuter shed, being served by commuter rail) accounts for over 70% of the state's population, in contrast to about 61% for Chicago's 6-county area (and that's including McHenry County, which is a stretch to include in any political grouping with Chicago).

And even if we assume general regional unity, ongoing debates in our national government highlight the immense difference between a 60% majority and a 70%. 60% still requires compromises and heavy lifting to get tough votes like taxes/revenues done.

^^

From my link above:

I'm not exactly sure how they arrived at that number for the RTA, but the CTA alone has about 1.7 million boardings daily, and with Metra and PACE added I could see it being close to the number they claim. It may not be as high as they are claiming, but it is certainly more than half.

Boarding = ride = unlinked trip. None of these are the same as rider or journey. 1.7 million boardings is probably fewer than 500,000 riders.

If its a revenue boarding (don't know the definition used in those stats) then it's a paid boarding. It doesn't matter if it's a discretely different rider or not. It's revenue.

^You're missing the point. It matters if you're trying to calculate how many people in a state or region are transit users by looking at unlinked trips.

The national average is about .78 to go from unlinked to linked trips, but that's skewed by the massive number of New York City subway trips and by small-city systems in which transfers are very inconvenient. CTA is a system designed around bus-rail transfers.

With the recent issues on the CTA with doors (the stroller and then the door that stayed open), I thought I'd point out we're not the only city with door issues on public transit:

From Portland:

Frantic on the MAX

Is there a name for those rail yards around/south of Roosevelt between Canal and the River?

EDIT: I'm calling them Amtrak's Chicago Yards and 14th Street Shop (I needed to caption a photo I took of them for a book)

I don't know the name, but I always thought that that would make a good place for a stadium. It's close to the Metra stations and a blue line stop.

Edit: Actually, not as close as I thought to those stops. But if these were ever developed into something, perhaps a Clinton St. Subway would serve them well.

http://www.ltlprints.com/blog/wp-con...9/05/fail2.jpg
http://www.ltlprints.com/blog/wp-con...9/05/fail2.jpg

Amtrak's 14th Street Yard seems to be the right term for the east side. Historically they belonged to the Pennsylvania Rail Road.

The west half, BNSF's half, historically belonged to the Chicago, Burlington & Quincy R.R. It was also called 14th Street Yard.

New PACE suburban express routes launching next week...
 

On November 30, 2009, Pace will expand service on Route 855 Plainfield - East Loop Express and launch three new Express Routes: Route 655 Bolingbrook - Schaumburg Express, Route 755 Plainfield - IMD Express and Route 889 Harvey/Blue Island - Rosemont Express.

These routes, along with Pace’s Express Service to Popular Destinations (ESPD), comprise a new addition to Pace’s family of services: the Express Service Network. For only $4 per one-way trip, Pace’s Express Service Network is designed to improve connectivity throughout Northeast Illinois and provide access to jobs, schools, medical care that may not be available in a rider’s local area. These service improvements which are a part of Pace’s Vision 2020 long range strategic plan, have been made possible by ICE (Innovation, Coordination, and Enhancement) funding and JARC (Job Access and Reverse Commute) Program grants.

Route 655 Bolingbrook – Schaumburg Express will operate weekday rush hours between the Pace Bolingbrook Park-n-Ride on Old Chicago Drive and the Pace Northwest Transportation Center in Schaumburg via I-355 with intermediate stops in Downers Grove, Addison, and Itasca, with the latter two offering Park-n-Ride lots.

Route 755 Plainfield – IMD Express will operate weekday rush hours between a new Park-n-Ride lot adjacent to the Plainfield Village Hall and the University of Illinois at Chicago via I-55 with intermediate stops at the Pace Bolingbrook Park-n-Ride on Old Chicago Drive, the Ashland CTA, and the Illinois Medical District.
(This route will also serve the UIC east campus, ending at the Racine Blue Line station)

Route 855 Plainfield – East Loop Express is an existing route that will be expanded to operate select trips to and from the new Park-n-Ride adjacent to the Plainfield Village Hall. The route also serves Pace Park-n-Ride lots in Romeoville, Bolingbrook, and Burr Ridge, and travels to North Michigan Avenue in downtown Chicago via I-55.

Route 889 Harvey/Blue Island – Rosemont Express will operate weekday rush hours between the Harvey Transportation Center and the CTA Blue Line Rosemont station via I-294 with courtesy stops in Harvey, Calumet Park, Blue Island, and Alsip.

High-speed rail

If you look at the Russian HSR bombing today, diminishing public concern about global warming, undiminished government concern about terror, and state and national budget miseries for the foreseeable future, it seems that HSR network buildout would be much less likely now than it was just six months ago.

Wasn;t that the second bombing on that Russian HSR route? If so, then I don't know how it really changes anything. China, Japan, France, Italy, Germany, Benelux and the UK have had no such terrorist acts on HSR. The Spanish incident was Basque terrorism, no?

You cannot cower and avoid implementing needed transportation policy because of the potential of terrorism. You just have to adapt to it.

^ I share your aspirations and optimism. However I don't think what you've mentioned addresses the concerns..

Chances of recurring terrorism is what worries people. A one-off event can fade into the past.

Well, none of those have notable terrorist enemies, do they? (With the exception of the UK as a US ally, and of course they did get attacked. Not their HSR, but their capital's subway - which is much more disruptive to them than their barely-existent HSR link.)

The US Congress and state legislatures can (cower and avoid), and they would, many of them. Politicians will tend to avoid blatantly risky security decisions. Look at all the years and years of contortions that have taken place in the air travel system to adapt it to a "post 9/11" world. After all that, some will argue it is foolish to build a brand new system with blatant vulnerabilities.

You can fortify the air travel system to the point where the average person is comfortable that it is virtually totally free from threat. In contrast, HSR is the opposite -- nothing anyone can do can give similar comfort.

Anyhow, I'm just suggesting that's how some politicians will feel. And a couple HSR incidents like this over the span of a few years and more of them will feel that way.

Well, you can secure the ROW unlike the Russians, for starters.

In terms of securing the vehicles, of course it starts to become more like air travel in terms of passenger and baggage screening, which would start to eat into the potential time-savings of rail, which does call into question how much money we should be throwing at this to compete with existing transportation systems if such security requirements are inevitable before too long.

Ideally -- but, nearly impossible. You could try building it Japanese Shinkansen style -- the entire thing on a robustly constructed (in Japan, because of earthquakes; in the US because of explosions) elevated viaduct for hundreds of miles and therefore prevent access to the tracks -- but that would be cost prohibitive and possibly rejected as ugly.

Or you could install surveillance cameras every 50 yards for hundreds of miles, including under viaducts, and pay people to watch them. That would be cost prohibitive, and could be circumvented (if the Secret Service can let in an uninvited guest to the White House and the FAA can fail to timely get the military involved with a passenger jet out of contact for over an hour, how reliable could an attempt at 300 miles of 24/365 surveillance be?).

Motion detector technology... it's pretty simple. If you fence off the ROW, there won't be animals crossing or anything, so the only motion would be the trains, occasional birds, and trespassers, be they friend or foe.

You also have to keep in mind that any terrorists are not going to redouble their efforts simply because we built some new rail lines. Since 2001, Homeland Security has prevented pretty much every terrorist plot. Preventing terrorism is not a matter of increased security in airports and busy locations, it's a matter of better intelligence, and so far the government has shown themselves to be good at this. If it gets to the point where airport security or track surveillance is necessary, then several lines of defense have already failed. This only applies to terrorist organizations and foreign-agent saboteurs, of course - a Timothy McVeigh can really only be stopped by security procedures.

Russia and Spain to the US are apples-to-oranges, too. The US has nowhere near the levels of domestic unrest that those countries do. Hell, we have less domestic unrest than Canada.

Haha the Teabaggers and Faux News would beg to differ!

I've yet to see them turn to violence. They disagree strongly with the current administration, but many consider themselves patriots and wouldn't dare perpetrate a terrorist attack on US soil.

Face meets palm...