Governor Blagojevich’s last-minute bailout spared CTA riders long-threatened doomsday hikes in fares and cuts in services–for the moment. Still, without a permanent tax hike to close the budget gap of $110 million a year the CTA is likely to slash bus routes and raise fares to as much as $3 a ride. At the same time, the local property tax machine is gearing up to send out property tax bills that will jump as much as 100 percent for some home owners. And what’s the city’s response to this pending crisis?

Well, Mayor Daley had a nice vacation in France, reportedly scouting out new ideas for his 2016 Olympics bid. The mayor even sent a postcard of sorts, in the form of a Tribune photo that showed him pedaling around Paris on a bicycle.

Upon his return he blasted his favorite targets, Blagojevich and state legislators, for failing to send him more money to pay the CTA’s bills–as though he had nothing to do with the current mess. But the mayor appoints four of the CTA board’s seven members. The current president, Ron Huberman, used to be Daley’s chief of staff; his predecessor Frank Kruesi also was the mayor’s chief of staff. Kruesi ran the CTA for ten years during which Daley steadfastly ignored the pleas of legislators, employees, and riders to fire him. Just why Daley remained so loyal to the rude and prickly Kruesi is one of those City Hall mysteries that may never be solved.

Aside from asking the state for handouts, Daley has offered no suggestions for how to finance public transportation. On the other hand, over the last few months the Community Development Commission, another mayorally appointed rubber stamp, has OK’d $51 million in property taxes to build 300 condos and retail at the old post office building in the South Loop, $58.5 mil-lion to add an 18-story tower with another 200 condos to the top of Union Station, and an estimated $50 to $60 million to start the process of buying up the east side of Western between Lawrence and Ainslie so the buildings can be demolished and replaced with, among other things, 85 condos. In the meantime, sellers can’t get rid of all the condos already on the market.

The development money comes from the tax increment financing districts, Daley’s favorite program, a virtual slush fund he controls that diverts over $400 million in property taxes a year from the schools, parks, and county. Not a dime of it goes toward a dysfunctional public transportation system.

Oh wait–in 2005, the city approved $42.4 million in TIF funds to help build a $213.2 million underground train station at Block 37, in the heart of the Loop. Block 37, of course, is the economic development project at Randolph and State that’s sucked up well over $100 million in property taxes over the last 20 years as one proposed scheme after another has crashed and burned. Now it looks as though something will finally be built to replace the businesses and buildings the city razed in 1989 and ’90: a high-rise that will feature, among other things, new headquarters for WBBM TV and for Morningstar, Inc., a financial services company. Both already operated in Chicago. Rather than bring in new businesses, we’re spending hundreds of millions of tax dollars to help existing businesses move from one end of the Loop to the other.

As the story goes, Mayor Daley, who rarely rides the CTA, got the idea to put the station in Block 37 after taking an express train in China from the airport to downtown Beijing. Theoretically the underground megastation would provide round-the-clock service to both airports. Apparently no one at the CTA told the mayor that we already have 24-hour train service from downtown to O’Hare and Midway or that there are no tracks for the express train to run on. Instead, Daley’s underground station was pushed to the top of the CTA’s to-do list, ahead of buying new buses and repairing decrepit lines.

When I asked CTA and city officials why they were replicating existing service, I was told that the express train will get passengers to the Loop from O’Hare ten to fifteen minutes faster. When I pointed out that there are no tracks for the express I was told the CTA would deal with that problem later. When I asked why in the world the city would waste so much money on such a goofy idea, I was told it was the mayor’s pet project and that when the mayor wants something you don’t stand in his way. The CTA and the City Council approved the deal with hardly any debate.

So now we’re two years into construction on the mayor’s pet project, and the CTA has discovered the project is about $150 million over budget. Meanwhile, it turns out that the Blue Line, which currently takes passengers to and from O’Hare, is falling apart. On July 11, 2006, a derailment on it injured 150 passengers. The National Transportation Safety Board’s recently released report on the accident harshly criticizes the CTA, judging that “the CTA’s ineffective management and oversight of its track inspection and maintenance program and its system safety program . . . resulted in unsafe track conditions.” According to the report, the problems with the line included broken emergency call boxes, outdated subway maps at the CTA’s control center, wet and rotting rail ties, corroded rails, and broken screws and tie plates.

Not to worry. Huberman and Daley blamed Kruesi, who conveniently retired a few weeks after February’s election. The CTA board announced that it will fix the tracks, corroded rail ties and worn-out screws included, with a $91.2 million repair project. How will the bankrupt agency pay for it all? They’re going to borrow the money from future federal grants, selling bonds and paying back the bondholders with the money. If the feds don’t come through, well, they’ll deal with that later too.

In an ideal world, the CTA would have avoided last year’s Blue Line breakdown and this year’s financial meltdown by spending some of the money they wasted on the underground station. For that matter, Daley could have paid to repair rail lines all over the city if he hadn’t wasted hundreds of millions of dollars underwriting condos.

So far the mayor’s been curiously absent from negotiations over how to finance the CTA–he still hasn’t gone to Springfield to lobby for more public transit money. His publicists tell me that this is all a part of his strategy: as long as the public’s anger is directed at the governor and legislators, there’s no need for Daley to get involved. If all goes well for the mayor in the coming weeks, the clamor over the threatened doomsday cuts will force Blagojevich and the legislators to send more state money to the CTA, allowing Daley to keep spending tax dollars on condos and white elephants.

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Art accompanying story in printed newspaper (not available in this archive): illustration by Paul Dolan.