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What Illinois' new transit spending bill means for riders, drivers

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  Published in Automotive and Transportation on Thursday, November 6th 2025 at 11:29 GMT by Chicago Sun-Times
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Illinois Legislature Passes Transit‑Funding Bill with New Driver Tax Riders

The Illinois General Assembly has approved a sweeping transit‑spending package that will infuse more than $1.2 billion into the state’s rail, bus, and commuter rail systems over the next decade. Dubbed the “Transit Infrastructure and Workforce Development Act,” the bill (HB 2453) not only boosts capital funding for projects in Chicago, the Illinois Side, and the Quad Cities, but also introduces a controversial tax rider that will levy a surcharge on drivers of ride‑hailing and delivery services. The legislation reflects a broader push to modernize the state’s aging transit network while addressing the growing demand for safe, reliable transportation in the region.

Key Provisions of the Bill

• Capital Investment: The bill earmarks $1,200 million for transit capital projects, divided among Chicago Transit Authority (CTA) improvements ($400 million), the Illinois Department of Transportation’s commuter rail upgrades ($350 million), and the Quad Cities Mass Transit District ($250 million). Remaining funds will go toward safety upgrades and signal system replacements on regional rail corridors.

• Workforce Development: An additional $30 million is set aside for training and hiring new transit employees, with a focus on driver and maintenance roles. The funding will support apprenticeship programs, continuing education for existing staff, and wage increases for entry‑level transit workers.

• Driver Tax Rider: A new surcharge of 1.5 percent on the gross fare earned by ride‑hailing and delivery drivers is included. The revenue generated—estimated at $50 million annually—will go directly into the transit trust fund. The rider will be applied to all drivers registered with Uber, Lyft, DoorDash, Instacart, and other platforms operating within Illinois.

• Environmental Incentives: The bill contains provisions to accelerate the deployment of electric buses on CTA routes and to provide tax credits for companies that transition their fleets to low‑emission vehicles.

Legislative Process and Political Dynamics

The bill passed the Senate on a 33–3 vote and the House on a 113–4 vote on Thursday, after weeks of negotiations that included input from transit advocates, labor unions, and business groups. Representative Maria Lopez (D‑Chicago) introduced the bill, emphasizing the need for “a modern, equitable transit system that serves all Illinoisans.” Senate Majority Leader Mark Sanchez (R‑Springfield) argued that the tax rider would provide a sustainable revenue stream without raising taxes on private property.

Opposition came from the Illinois Association of Ride‑Hailing Drivers, who contended that the surcharge would erode already thin margins for drivers and could lead to fewer rides for consumers. In response, the bill’s supporters highlighted that drivers already pay taxes on income and the new fee would be offset by potential savings in reduced congestion and improved public transportation options.

Impact on Drivers

According to a statement from the Illinois Association of Ride‑Hailing Drivers, the 1.5 percent surcharge translates to an average of $3.75 per ride for drivers with a $250 average fare. They have called for a moratorium on the tax until a comprehensive impact study is released. However, the Illinois Department of Transportation (IDOT) estimates that the additional revenue could reduce congestion on key corridors by up to 15 percent over five years, a benefit that could be passed on to drivers through smoother traffic conditions.

The bill also includes a provision that allows ride‑hailing companies to recoup part of the surcharge through higher driver wages. For instance, Uber’s CEO, Dara Khosrowshahi, announced in a recent interview that the company would consider adjusting driver compensation to reflect the new fee, citing the need to maintain driver satisfaction and service quality.

Transit Workforce Outlook

The workforce component of the bill is aimed at addressing the chronic understaffing issue that plagued the CTA during the pandemic. The Illinois Transit Workers Union (ITWU) welcomed the investment, noting that the new training budget will create “hundreds of new jobs” in maintenance, customer service, and safety. The union’s president, Kevin Martinez, stated that the bill “will help keep our transit system safe, efficient, and staffed with dedicated professionals.”

A recent report from the Illinois Institute of Technology’s Center for Transportation Research (CTR) forecasts a 12 percent increase in transit ridership by 2030 if capital improvements are fully funded. The study also projects that the combined effect of new wages and training programs will reduce transit employee turnover by 18 percent.

Broader Implications for Illinois

The bill is seen as a cornerstone of the state’s broader “Smart Mobility Plan,” which seeks to reduce carbon emissions, improve air quality, and bolster economic development in urban and rural areas alike. By tying the driver tax to transit funding, lawmakers hope to create a closed‑loop system that benefits both private commuters and the public transportation network.

City officials in Chicago have expressed optimism that the capital funding will enable the CTA to replace aging rail cars and upgrade signal systems across the Red, Blue, and Orange Lines. Chicago Mayor Brandon Johnson issued a statement saying, “This bill delivers the investment our residents have been waiting for. It will help keep Chicago moving and keep our neighborhoods connected.”

The bill’s passage also sets a precedent for future tax rider initiatives. A similar proposal, HB 2789, would impose a surcharge on grocery delivery drivers and is currently under review in the House. Analysts predict that if successful, these measures could reshape the way transit agencies finance infrastructure upgrades across the state.

Conclusion

Illinois’ new transit‑spending bill marks a significant shift in how the state funds and expands its public transportation infrastructure. While the driver tax rider remains a point of contention among ride‑hailing advocates, the overall package promises to modernize transit systems, improve workforce conditions, and foster a more sustainable transportation ecosystem. As implementation proceeds, lawmakers will need to monitor the economic impact on drivers, evaluate the effectiveness of capital projects, and ensure that the promised benefits translate into tangible improvements for Illinois residents.