The Best Your Money Can Buy - The Wacker Drive Project

After three years of the Illinois Jobs Now! state capital program, income streams are way below expectations. They are so far below, the state transferred money from the Road Fund, which is the major source for funding the Wacker Drive Project. This project is part of the infrastructure repair plan.

The money transfer was done to make the required debt service payments on $5.3 billion in bonds. The bonds were issued because no plan materialized from state leaders to replace funding.

Illinois Gov. Quinn signed the Illinois Jobs Now! program into law in 2009. This six-year, $31 billion infrastructure plan is the first extended capital program in ten years. Designed to create 439,000 jobs with infusions of critically required capital into Illinois’ failing infrastructure, the Metropolitan Planning Council saw Gov. Quinn’s support for the legislation as a mixed approach.

The jobs package has $160 million for water projects, with $18 billion for transportation, and $130 million for housing. The investments are intended to leverage around $4 billion in federal funding. The downside shows money slotted by this capital plan that wasn't matched to spending reforms. Evaluation of the advantages of the projects that support state goals, and financing of the plan was based on projected income sources such as video gaming. 

The Illinois Jobs Now! plan legislation was approved with both $31 billion in infrastructure spending and revenue additions to pay for it. The primary income source was dependent on installing video poker machines across the state. Laws allow establishments with liquor licenses to install five video poker machines. It also imposes 30 percent taxes on revenue. 

Other income streams include increases in driver's licenses and license plate fees. It also includes higher taxes on alcohol, candy, soft drinks and beauty products. Included in this are additional lottery proceeds from private marketing of state lotteries. 

These income sources were projected to garner up to $1.2 billion annually. They were intended to make the debt service payments on bonds for project funding. Unfortunately the actual revenues fell far short.. In the first fiscal year of revenues in 2011, this income only provided $457 million.

Delays have been a partial cause. An Illinois appellate court ruled that this legislation was in violation of the state constitution’s single subject clause. The Illinois Supreme Court finally upheld the capital plan. The lower court’s ruling blocked state reception of income from increased liquor taxes that were held in protest funds. 

The ruling delayed allowing the privatization of the lottery and video poker as well. Unfortunately, many communities “opted out” of implementing video poker, the biggest projected revenue available. Failure to connect the option out for communities with lost revenue proved a major oversight.

When the law was passed, cities and municipalities were allowed to “opt out” of installing video poker machines. It did not, however, tie opting out to the related loss in revenues. Communities that opted in can't install the equipment due to problems with monitoring contractors. There is currently no plan to replace this lost revenue.

All other revenue increase plans designed to pay for the bill have also fallen much shorter than projected.  As a result, the state has resorted to transferring Road Fund revenues to the Capital Projects. They do this to fund covering payments on the debt service. 

The Road Fund is a special revenue fund. This is the primary funding source for the state’s ongoing construction of roads, bridges and other transportation infrastructure. This source of funding for the Wacker Drive project dictates that any amount transferred from the Road Fund to the Capital Projects Fund must be repaid, which means even higher deficits in the Capital Projects Fund in the years to come.

There are lavish adornments included in the Wacker Drive project such as flower pits with irrigation. There are heating elements planned for under the roadway. There are high-end street fixtures and artistically created railings and support structures. There is even a mayoral/history plaque and countless other extravagances that are unnecessary and un-affordable.

All this is taking place at a time when taxpayers are being pinched and economically distressed. This financial mismanagement occurs while the homeless are walking these same streets.

Other revenue and funding sources include numerous fee and tax increases. The numbers are staggering at a time when the state is broke, Chicago is broke and the federal government languishes in historic debt. 

State leaders still have not come up with a way to replace video poker revenues or fund capital program deficits. The Municipal Planning Committee is still looking for more options. 

Some are promoting an increase in the state’s motor fuel tax. Some want it indexed to inflation. That move alone would bring in an additional $855 million annually. This is enough to make up the difference. Illinois sorely needs an infrastructure program.

These numbers are daunting and continue to highlight the lack of fiscal responsibility, oversight and accountability that plagues Illinois.  

Infrastructure improvements are long overdue. Yet, it is clear through the eye of the daily commuter passing through the financial district of Chicago, that taxpayer money is spent on lavish and ornate objects that are nonessential adornments at a time when we can least afford them. Our leaders continue to ignore Illinois’ fiscal plight, digging us an even deeper, debt ridden hole.

The Wacker Drive Infrastructure Project. It is a sight to behold. The best your money can buy.