The ever expanding tollways, mainly in the suburbs

Whose interests are being served
when the quasi-governmental agency that builds and runs
the tollway system gets the go-ahead?

By ROBERT HEUER

Created by the General Assembly in 1953, the tollway entity was empowered to build large-scale urban public works that might otherwise not get past the blueprint stage. The idea was sold to taxpayers with the promise that the roads would become free — and maintained by gas tax monies — once construction bonds were paid off. Instead of downsizing the authority, lawmakers have expanded its powers through the years, codifying its freedom to circumvent some of the usual methods that citizens and interest groups often use to pressure elected officials.

"We're the avenue because we don't have all the bureaucratic nonsense," explained Robert L. Hickman, the latest in a long line of governor confidantes to be executive director. Governors have always chosen the person who runs what now is a 2,102-employee authority. Hickman is like a private cornpany's chief operating officer, implementing policies devised by a nine-person board of directors chosen by the governor with approval from the Senate. Toll expansions require authorization from the General Assembly, which essentially gives the authority a free hand to operate as it sees fit.

In the early 1970s, Hickman owned a Charleston Ford dealership, when he raised money for Edgar's first campaign for state representative. In 1990, he left his post as assistant secretary of state to direct the gubernatorial campaign's fundraising effort — drumming up $ 12 million for Edgar. After winning the race, Edgar chose him to run the tollways. Despite rumors he'll leave the authority to work full time for Edgar's reelection, Hickman may accomplish the same end by staying where he is. (In 1988, the Chicago Tribune reported 22 of 28 engineering firms doing work on the 17.4-mile DuPage County tollway had contributed to then Gov. James R. Thompson's reelection campaign.)

Construction is slated to begin in March 1995 to extend 1-355 from 1-55, east of Bolingbrook, 12.5 miles south to 1-80, east of Joliet. In 1996, the authority hopes to break ground on the Route 53 extension from Arlington Heights, to go 18 miles north and east to connect with the Tri-State. The authority effectively executes plans devised by the Illinois Department of Transportation (IDOT). So while lawmakers regard tollways as a win-win proposition, serving transportation needs at no cost to the state, the fact is that tax dollars do finance the groundwork. On these first two phases of the toll expansion, IDOT has done environmental and engineering studies, center-line sitings and "strategic buys." The state owns almost 50 percent of the Route 53 right of way, having banked some of that expensive real estate for 20 years. (IDOT never bought land in the 58-mile Fox Valley corridor that the governor recently said would not become a toll road.) The authority will buy the land from the state, acquire the plans and underwrite more extensive ones before building — hiding all the while behind a no-tax-dollar fiction that helps dispel public input. In effect, IDOT is like a basketball guard, bringing the ball up the court before passing to the authority for the slam dunk.

"We don't want to commit any fouls," observed Hickman, describing the threat of environmental lawsuits as a new hazard in the game. A high school basketball star in Terre Haute, Ind., and 1958 All-American at the University of Kansas, Hickman occupies a spacious office in the authority's new Downers Grove headquarters, overlooking its latest achievement: the three-year-old 1-355 that created enough bond indebtedness to keep the authority — a state-sanctioned money machine — humming well into the 21st century.

One thing about the tollway authorities: They either sell bonds or die. The first roads — 294, the Northwest Tollway (I-90) and East-West Tollway (then Illinois 5) — could have become freeways by 1980. Realizing a great power brokering mechanism in their hands, lawmakers chose in 1968 to keep those roads generating coins.

The authority took in over $258 million in toll monies last year. Including concessions and interest, 1993 revenues totaled $274 million from a 273.4-mile highway system that accommodates about one million motorists each workday. About $119 million went to operate and maintain the Tri-State, Northwest, East-West and North-South tollways, and $70 million to capital improvements like new interchanges, toll plaza expansions and road widenings.

Bonds, though, are what make the tollway business spin. Last year, the authority shelled out over $77 million to pay the principal and interest on bonds whose outstanding debt totals $900 million. As a percentage of operating revenue, the authority's debt service averaged well over 25 percent for many years, dipping as low as 12.61 percent in 1986. As new construction looms, Hickman said the authority hopes to meet bond industry goals — indebtedness to financiers will hover near 40 percent of operating revenues for at least two decades.

The authority also means jobs (over 900 people staff toll plazas, 360 maintain roads, 64 fall under the category of "cash handling"), millions of dollars in sealed bid construction contracts (6,000 people carried out the $550 million Tri-State widening) and no-bid contracts for law firms, bond houses, banks, insurance brokers, engineering consultants and a host of others. Though the governor has the upper hand, both parties get to enjoy the largess, wishing only that there was more.

"Reinventing quasi-government" isn't anyone's buzzword, but it may be a way to look at this agency. Created long ago when today's crowded suburban landscape would have seemed unimaginable, this agency has effectively served as a state land-use planner. Real estate development proliferated in toll-way corridors. Built to augment interstate travel, the tollway system counts 70 percent of its daily customers as commuters. Its own promotional video for bond-industry audiences touts tollways as "the single most important factor in the economic development of Chicago's collar counties."

By triggering further expansion on the region's outer edges, this latest round of tollway expansion is certain to fuel the downward spiral of Chicago and its aging suburbs.

Moreover, critics who regard highways as just one piece of the region's transportation puzzle, say more tollways will encourage low-density growth patterns and, thus, greater reliance on automobiles. Policy makers are having a hard enough time deciding how to reduce exhaust fumes that foul the northeastern Illinois air so badly that the feds threaten to withhold $710 million - 90 percent of state transportation monies.

Huge road investments have helped tilt the General Assembly's power structure toward the tollway-rich and tollway-hun-

gry. "Tollways are high on the list for people who they impact, but not so high on the list for other legislators," explained Mark Gordon, spokesman for state Senate President James "Pate" Philip (R-23, Wood Dale). When the state Senate approved a $1.2 billion tollway expansion last May, passage by the House seemed doubtful because House Speaker Michael J. Madigan's (D-22, Chicago) support reportedly hinged on the authority taking over the Chicago Calumet-Skyway. Built by the city of Chicago, this tollway hasn't generated enough revenue to pay off the bonds since 1963. Contending "we'd have bondholder lawsuits up the wazoo," Hickman said the authority can't buy this 7.8-mile link between the industrial ghost towns in southeast Chicago and northwest Indiana. The Skyway's $90.2 million in bonds mature next January, when the city of Chicago's indebtedness will soar. But Chicago Democrats faced a more urgent crisis last July — financing city schools. Before agreeing to add $80 million to the state budget for the Chicago Board of Education, suburban Republicans wanted tollways. Obviously, other factors figured in the closed-door session. One end result was suburban lawmakers walking away with a tollway authorization package worth twice their original proposal. Not everyone equates this horse trading with progress. The authority is "a relatively unaccountable bureaucracy and rate-setting body that's allowed to raise taxes, namely tolls, with virtually no public review and hardly any meaningful judicial review," said Howard Learner, the lead attorney for consumer and governmental parties that recently negotiated a $1.68 billion rebate from Commonwealth Edison. Executive director of the Chicago-based Environmental Law and Policy Center of the Midwest, Learner said the authority is "institutionally part of the problem rather than the state's transportation and environmental solution. Its mission to build, build, build has demonstrably produced more congestion and pollution." "Our job is to move people as fast and as safely as we can," Hickman countered, noting the authority hasn't raised tolls in over a decade and that its environmental record is also commendable. He cited the authority's work of achieving IDOT's dream to build a limited-access road through DuPage County. "An hour drive now takes 25 minutes, which means cars use less gas and that they create less pollution than they would sitting at stop lights," he said. 1-355 is the site for a pilot program of electronic scanners and debit cards that may help reduce the

Northeastern Illinois Planning Commission. Now village president of Oak Park, Christmas suspects the Peotone road plan is another Edgar posture intended to make the airport "seem real."

The McHenry extension reached lawmakers' desks only minutes before the legislature authorized toll officials to plan the slam dunk. Hickman didn't ask for this one, and won't build it until projected use would make its bond payments "self-sufficient." He conceded the road may face too many environmental complications to ever happen. Madigan spokesman Steve Brown said the route was added near the end of negotiations because Philip felt the 1-355 extensions will stimulate growth in southern suburban areas where Democratic voters are moving and, thus, help the Democratic party. The GOP leader apparently demanded a "Republican road."

The most needed tollway addition wasn't included in the package. "O'Hare is a disaster because of all the traffic having to come in and out to the east," Hickman said, adding gridlock could be reduced by building a second entrance — a Tri-State by-pass that loops around the airport's western perimeter. Political considerations add to the bottleneck: Many suburban officials would like to see that tollway built right where Chicago Mayor Richard M. Daley wants a new O'Hare runway.

Forging a debate to assure the authority's future as an instrument for the public good won't be easy. "Legislative leaders cut their deal and nobody else knows anything about it," a lawmaker observed. "There are no checks and balances. The only real debate involves 'the golden goose,' which it took me some time to leam means where to put interchanges."

There was once considerable debate over the tollway business. Unfortunately, it began with legislators deciding who got what.

In 1955, Republican Gov. William G. Stratton's two-year-old Illinois State Toll Highway Commission encountered political problems. Lacking their own seat at the patronage table, Democrats made an issue of constituent complaints over tollway routes and land condemnations. Several months before money flowed on the first tollway bonds, the commission chairman resigned following a House investigation that exposed the shakedown of public officials, bankers and contractors. Before adjourning, lawmakers approved a Cook County expressway revenue bond that — thanks to the 1956 Interstate Highway Act — became upfront money for the Edens, Kennedy, Elsenhower and Dan Ryan expressways.

"Democrats in the General Assembly felt that if a Republican administration was to have nearly one-half billion dollars for building toll roads, with all that that construction meant in patronage and in public benefit, then a Cook County Democratic highway department should also have funds for major road building," David Kenney wrote in A Political Passage, the biography of Gov. Stratton. While signing the bill, Stratton told Cook County officials, "I assume ... that you will be too busy building expressways to be troublesome to my toll road."

After learning these particulars of the deal that shaped the course of development in northern Illinois, Hickman laughed. "I wonder why in the world they created that 88 extension. We can't close it down, as much as I'd like to." Completed in 1974, the 69-mile toll road goes from Aurora to Rock Falls/Sterling where it switches into the 1-88 freeway, continuing westward toward the Quad Cities where it links up with 1-80 — an east/west freeway that handles the brunt of traffic crossing the state of Illinois.

Through the years, the 1-88 tollway promoted development by its interchanges — thanks to the contributions of users of other tollways. So much for "self-sufficiency." 1-88 is little-traveled — evidence of the General Assembly's work to breathe new life into its cash cow, contended John Matejevich, who is 1963 was a state representative from North Chicago. He saw his colleagues turn the toll commission into a toll authority and assure its future by authorizing a boondoggle whose construction bonds wouldn't be paid off until 2010.

In 1989, Auditor General Robert G. Cronson issued a report charging the authority with an improper use of toll revenues from other roads to finance 1-355. The Cook County Circuit Court dismissed a class-action lawsuit after lawmakers granted the authority power to use toll revenues for system wide expansion. Matejevich had alarmed the bond industry with frequent bills to prohibit the use of surplus toll revenues to fund new construction in 1992. He was then gerrymandered out of a 14th term in the House, leaving the General Assembly without a well-informed tollway critic.

Insulation from the public boosts a stellar bond rating. In 1992, an official boasted to the Bond Buyer, the industry newspaper, that one key credit factor is that the authority doesn't need approval from the General Assembly or governor to increase tolls.

"Nobody holds a gun to anybody's head, forcing them to use the tollway system," Hickman said. It's hard to resist using the finest roads that the public's money could buy. Of course, by putting all those resources into tollways and encouraging the development of nearly every square foot of surrounding land, the state has effectively given many people no other sensible alternative.

Some reformers want the General Assembly to assume some oversight control. Hickman is skeptical: The inherently parochial interests of lawmakers hinder their ability to make sound region-wide transportation policy. "If you live in Will County, you don't really care what happens in Lake or Winnebago counties because you're not running for reelection there," he explained. Development-hungry Will officials badly want toll roads and to get them were eager to vote for the 53 extension, which also enjoys broad support — thanks in no small part to IDOT's intergovernmental planning process.

The hardest part of his job, Hickman said, is environmental problems which, like the Skyway that may be foisted on the authority or the 1-88 extension that already was, "can't be wished away." Yet, upon replacing the last of Thompson's appointees, he was most interested in learning the bond business. Help came from investment banker Gayle Franzen, the authority's executive director in the early 1980s who was then profiting from tollway bond fees.

The Tribune reported that Franzen's firm got $2 million in fees from Hickman's first bond deal, which financed the widening of the Tri-State. That Franzen, who was the Regional Transportation Authority chairman and is now a candidate to chair the DuPage County Board, enjoyed a fat slice of patronage doesn't bother Hickman. You work with people you know, he said as confidently as he described the authority's accountability to the public. During a three-hour interview, Hickman answered every question but one: Is it fair to call the Illinois State Toll Highway Authority an unregulated monopoly? Gazing out the window, he was silent for several seconds and then flashed a big grin.

      Robert Heuer is a free-lance writer in Chicago.