Metra commuter rail agency and Pace suburban bus agency have more funding on hand than expected thanks to the combination of savings and higher-than-expected sales tax revenue, pushing off the fiscal cliff to the fall of 2026 and the start of 2027, respectively.
Both agencies’ boards of directors met Wednesday morning. While neither agency will release a budget draft until early October, their CFOs gave a broad overview of what will be in store.
While neither Metra nor Pace plan to cut any service in 2026, they are planning to increase fares. Back in March, Regional Transportation Authority, which provides oversight over CTA, Metra and Pace, identified 10% across-the-board fare increases as one of the “efficiencies” the transit agencies would adopt to help delay the cliff. Metra CFO John Morris also said that, if the state doesn’t come through with the funding solution by summer 2026, it may need to hike fares a second time to push the fiscal cliff off to 2027.
While Morris didn’t share the fare increases except to say that they would be at least 10%, Pace CFO Maggie Schilling gave a more detailed breakdown. Standard Pace fares would go up from $2 a trip to $2.25 a trip, the same as the current CTA bus fares. CTA/Pace 3-Day pass would be eliminated, and the prices of other CTA/Pace passes and Pace-only passes would go up.
Metra and Pace boards will release their budgets for public comment Oct. 10 and Oct. 15, respectively, and hold public hearings throughout October and early November. The boards will adopt the budgets in November, sending them to RTA for final approval.
Delaying the fiscal cliff
Last March, RTA estimated that the four transit agencies would collectively face a funding shortfall of around $771 million. Ridership has been lagging behind prepandemic numbers, hurting revenues. Furthermore, the state requirement that at least 50% of the operating budget must come from passenger revenues, which has been suspended since the pandemic, will kick in.
The Illinois General Assembly is expected to address transit reform that would fill the funding gap during its veto session, scheduled for Oct. 14 to Oct. 16 and Oct. 28 to Oct. 30. Metra and Pace are expected to release the draft budgets in Oct. 10 and Oct. 15, respectively. This will include a budget that assumes no bailout, and what Morris called a “funded” budget, which assumes the fiscal cliff has been averted.
Both Schilling and Morris said that higher than expected sales tax revenue is delaying the fiscal cliff, since having that money means they can stretch the stimulus funds over a longer period of time, but doesn’t close the gap entirely.
For Pace, there is also the issue of paratransit operations. The suburban bus agency provides service for riders with disabilities in both Chicago and the suburbs. This includes “traditional” paratransit minibuses riders can reserve ahead of time and that usually transport more than one passenger at a time, and two programs that subsidize ride-hailing trips — the Taxi Access Program, which subsidizes taxi trips that either originate or end in Chicago, and Rideshare Access Program, which subsidizes rideshare trips in the city and the suburbs so long as they’re within ¾ mile of a bus route or a rail station.
The fixed-route operations and paratransit operations have separate budgets and use different funding sources. For the latter, RTA provides much of the funding directly. While Pace’s fixed-route operations won’t reach the fiscal cliff until 2027, paratransit already exhausted its federal funding.
In August, RTA’s board of directors voted to shift some capital funding from Metra and Pace to help cover CTA operations, since it is expected to reach the fiscal cliff early next year. The board also voted to shift $8.3 million sitting in RTA paratransit reserve fund, $17.5 million in RTA sales tax revenue and $16.6 million of 2025 Innovation, Coordination and Enhancement (ICE) funding previously meant for Pace capital programs.
During Wednesday’s Pace board meeting, board chair Richard Kwasneski said that the agency previously offered to “take some of our reserved finds, and lend it to the RTA to be able to fully fund [the paratransit] program” until the state comes through with the funding, but that “there appears to be reluctance for them to do this” because they worry what might happen if the bailout doesn’t materialize.
During the Metra board meeting, Metra director Stephen Palmer, who represents western Cook County suburbs, wondered if pushing the fiscal cliff forward a few months would reduce the urgency for state legislators.
“I fear that we have all those meetings, and it’s like the boy crying wolf,” he said
Fare increases
While both Schilling and Morris said the proposed budgets will include fare hikes, Schilling provided numbers. As the chart acknowledges, not all fare increases represent a 10% increase.
Aside from base fares, increases will affect transit passes that are good on CTA and Pace. Back in February 2023, Pace agreed to accept all CTA passes while keeping some Pace-only passes. The 1-Day CTA/Pace pass would go up slightly from $5 to $6, joint 7-Day pass would go up from $20 to $25 and the joint monthly pass would go up from $75 to $85. Regional Connect Pass, the add-on Metra monthly pass users can buy so that it can work on CTA and Pace, would go up from $30 to $45.
Morris said that, if the state doesn’t come through with the bailout, Metra would do another fare hike in “the second half of 2026.” The goal, he said, is to avoid service cuts as long as possible. As he and Metra board director Kenneth Koehler, who represents McHenry County, explained, the issue is that Metra shares most of its lines with freight railroads. On railroads where it operates the trains but doesn’t own the tracks, freight railroad owners can claim any spaces service cuts free up, and once it happens, it’s hard to get those slots back.
“That’s why we’re looking to, if necessary, fare increase as opposed to service cuts in 2026,” Morris said.
Union Pacific North Line, which serves Evanston, doesn’t get as much freight as some of the other railroad-owned lines. But Union Pacific and Metra have been at odds for years over what Metra would pay to use it tracks, and UP has consistently argued that, while it doesn’t want to stop commuter trains from running, it reserves a right to do so.
Morris also said that he is proposing annual fare increases pegged to inflation — something that, he acknowledged, Metra discussed shortly before the pandemic.
He said that fare hikes would delay the cliff, but not stop it.
“Absent the action from the state, we will need to have significant service cuts,” Morris said. “We haven’t identified the exact type of service cuts that would be enacted by 2027. We know the scale, we know kind of how many trains, we have a general concept, and the idea would be not to target particular lines.”
Metra director Romayne Brown, who represents Cook County at large, said she was concerned that CTA wouldn’t increase fares if Chicago Mayor Brandon Johnson tells them not to. Chicago mayors appoint four out of seven Chicago Transit Board members, but only two of the current members — Roberto Requejo and Michael Eaddy — were appointed by Johnson. It should also be noted that CTA and Pace must mutually agree to increase joint pass fares, which suggests that the transit agency isn’t averse to some increases.
“Previously, Metra has increased fares, and then the mayor, whoever was there at the time, [said] no fare increase for the CTA,” Brown said. “So, do we know where the city is [on this]?”
Morris responded that, as “a major appointing authority,” Johnson would have sway over the CTA board, but RTA has leverage of its own.
“I would say that RTA has the power to reject CTA’s budget if they don’t include that fare increase,” he said.
Metra, Pace won’t make cuts, will raise fares next year as fiscal cliff still looms is from Evanston RoundTable, Evanston’s most trusted source for unbiased, in-depth journalism.
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September 18, 2025 at 09:39PM
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