The 0.25% Regional Transportation Authority sales tax increase authorized under the Northern Illinois Transit Authority Act took effect on August 1 across Cook, DuPage, Kane, Lake, McHenry, and Will counties, activating the single largest new revenue stream for Chicago-area public transit in decades. The increase is projected to generate $199 million in partial-year revenue for 2026 and more than $500 million annually beginning in 2027, funding a system that was facing a 40% service cut scenario across the CTA, Metra, and Pace as recently as last fall. The RTA Board approved a 2026 Operating Budget Amendment directing $132.2 million of the new funding toward near-term rider experience improvements, including nearly $60 million for safety and security investments that began rolling out this summer.
Key Takeaways
- A 0.25% RTA Sales Tax increase took effect August 1 across the six-county Chicago region, projected to generate $199 million this year and over $500 million annually starting in 2027.
- Nearly $60 million is directed toward safety and security, including additional transit officers, a crisis intervention pilot, operator bus shields, and new security technology.
- CTA, Metra, and Pace are expanding summer service as the first rider-facing improvement; CTA is increasing bus route frequency and Metra is adding trains on portions of the Rock Island and Metra Electric lines.
- The NITA Act provides $1.5 billion in annual transit funding without creating new statewide taxes, replacing a scenario that would have eliminated 74 of 127 CTA bus routes and closed over 50 rail stations.
- The Regional Transportation Authority continues operating until September 1, when the new NITA Board is formally seated and assumes governance authority.
What the Sales Tax Increase Means for Six-County Residents
The 0.25% increase applies to all purchases already subject to the RTA Sales Tax across the six-county region. For context, on a $100 purchase, the increase adds 25 cents. On a $1,000 purchase, $2.50. The increment is small on individual transactions but substantial in aggregate across a metropolitan economy of more than 8 million people. The RTA estimates the tax will generate approximately $478 million annually at full-year run rate, making it the largest single component of the NITA Act’s $1.5 billion annual funding package.
The remaining revenue comes from two other redirected streams: a portion of the existing state sales tax on gasoline, previously directed to the General Revenue Fund, now dedicated to transit operations at approximately $860 million annually; and 90% of the interest generated on the state Road Fund and State Construction Account, raising an additional $200 million annually for capital projects. Governor JB Pritzker’s office emphasized when signing the NITA Act in December 2025 that the legislation creates no new broad-based statewide taxes, a politically significant distinction that shaped the final negotiations in the General Assembly.
The tax increase does not affect downstate residents. The 0.25% applies exclusively within the six-county NITA region. However, a portion of the NITA Act’s capital funding, specifically 10% of the Road Fund and State Construction Account interest, is allocated to downstate transit operations, giving the legislation a statewide reach despite its regional tax footprint.
$60 Million in Safety Funding Addresses the System’s Most Visible Problem
The safety allocation reflects what CTA, Metra, and Pace have each identified as the most pressing barrier to ridership recovery since the pandemic. Nearly $60 million from the new revenue will fund a package of security measures designed to make the system feel safer for riders and operators. The investments include additional transit officers deployed across CTA rail stations and bus routes, a crisis intervention pilot program that pairs trained responders with law enforcement on high-need lines, expanded outreach services for individuals experiencing homelessness or behavioral health crises on the system, and new physical security infrastructure including operator bus shields and camera technology.
CTA Acting President Nora Leerhsen identified safety and cleanliness as her two leading priorities for 2026 in a City Club of Chicago address earlier this year. The funding gives the agency resources to act on those priorities at a scale that was not available during the crisis years. Leerhsen also outlined goals around bus priority infrastructure, including dedicated bus lanes that would require cooperation from the Chicago Department of Transportation, and continued progress on the Red Line Extension, the 5.5-mile heavy rail project extending the existing line from 95th Street to 130th Street on the Far South Side.
The Red Line Extension, which received a Full Funding Grant Agreement from the Federal Transit Administration in January 2025 with a projected revenue service date of August 2031, faces its own funding uncertainty. The Trump administration froze nearly $2 billion in federal funds for the project, citing concerns about the agency’s contractor diversity requirements. The CTA has maintained publicly that the project remains on track, though the freeze has created questions about the agency’s ability to sustain payments if the hold continues.
Service Expansion Replaces What Would Have Been Catastrophic Cuts
The scale of the averted crisis is worth revisiting because it provides the baseline against which the NITA Act’s impact should be measured. Without the legislation, the CTA had projected eliminating some or all service on at least half of its train lines, closing or significantly reducing service at more than 50 rail stations, and cutting 74 of its 127 bus routes. Metra would have eliminated all early morning and late evening trains, reduced weekday service to one train per hour on each route, and cut weekend service to one train every two hours. Pace would have eliminated all weekend service and all weekday service after 8 p.m. Overall wait times on some routes would have increased to 30 or 60 minutes.
Instead, all three agencies are expanding service this summer. The CTA is increasing frequency on multiple bus routes, Metra is adding trains and converting limited stops to regular stops on portions of the Rock Island and Metra Electric lines, and the reduced-fare Access Program is being extended to CTA and Pace riders later in 2026. Customer information upgrades are also rolling out across all three systems. The contrast between the projected cuts and the actual outcome represents the most dramatic reversal in Chicago-area transit policy since the RTA’s creation in 1974.
Governance Transition: RTA to NITA by September 1
The funding changes are running parallel to a governance overhaul that will reshape how transit decisions are made in the region. The RTA continues operating under its existing structure until September 1, when the new NITA Board members are formally seated. Mayor Brandon Johnson announced Chicago’s appointments to the NITA and transit agency boards in July, selecting individuals with backgrounds in labor law, transportation policy, census operations, and community development.
NITA will hold expanded authority compared to the RTA, including direct oversight of service planning, capital projects, fare collection, and funding allocation. The operating divisions, CTA, Metra, and Pace, will retain day-to-day service delivery responsibilities but will operate under NITA’s regional coordination framework. One of NITA’s mandated early priorities is the development of a unified fare collection system across all three agencies, a long-sought reform that the RTA lacked the authority to implement. The board structure includes cross-membership provisions, dual chairs, and minimum professional experience requirements designed to ensure both expertise and regional accountability.
The Illinois Department of Transportation is required to procure a transition consultant by September 1. A 15-member Transition Working Group will be seated by October 1 and tasked with submitting a comprehensive transition plan to the General Assembly by July 1, 2027. The farebox recovery ratio, which measures how much of operating costs are covered by fare revenue, has been set at 25% from 2026 through 2028 and drops to 20% starting in 2029, acknowledging the post-pandemic shift in commuting patterns that has permanently altered the revenue side of the transit equation.
FAQs
How Much Does the NITA Sales Tax Increase Cost Shoppers?
The 0.25% increase adds 25 cents to every $100 in purchases subject to the RTA Sales Tax. The tax applies across Cook, DuPage, Kane, Lake, McHenry, and Will counties. It does not affect purchases made outside the six-county region.
What Happened to the Threatened 40% Service Cuts?
The NITA Act replaced the projected cuts with $1.5 billion in annual transit funding. Instead of eliminating 74 CTA bus routes, closing 50+ rail stations, and cutting Metra and Pace service, all three agencies are now expanding service, adding safety personnel, and upgrading rider-facing infrastructure.
When Does NITA Officially Replace the RTA?
The RTA continues operating until September 1, 2026, when the new NITA Board members are formally seated. A 15-member Transition Working Group will be established by October 1 to develop a comprehensive transition plan due to the Illinois General Assembly by July 1, 2027.
