Giving Private Investments Firms Control Over Infrastructure CTA Group Says Mayor's Plans Will Destroy Public Transit

From Members of Citizens Taking Action:

Members of Citizens Taking Action, an organization of comprised of transit dependent riders, voted unanimously at their monthly meeting on Monday to come out against Mayor Rahm Emmanuel's announcement of having private investment firms either own or operate public transit in Chicago. This approach calls for a "public-private partnership" for financing improvements to the infrastructure instead of the traditional methods.

Charles Paidock Secretary of the organization, said: “Public transit is a central municipal service, and we don't put money into a fare box to make some guy rich. I foresee three things happening: loss of control by the city, increased or added fares, and diminished service. You might want to add corruption on a scale never seen before. And once it's done, there's no going back. Sometimes these deals are for contracts lasting 99 years. People such as myself depend on CTA every day. It isn't something you experiment with. I fear the long term consequences. We're going to end up stranded. Remember, it's he who pays the piper who names the tune. Also, I don't think the federal, state or local governments can finanacially support a private enterprise. The system is going to end up entirely fare box dependent, with the money going for highways."

Mr Paidock added: "We were told that about $5 million dollars, or one-third (1/3) of the mayor's campaign was financed by investment firms. This looks more like it might be more of a payback than good government, or a genuine concern for providing public transit."

Another member, Kevin Peterson, said: "What is to stop the powers-to-be from cutting bus and train services to only during the rush hour, since this is when the system is most profitable? They would get rid of any routes that don't have, to use their term, a "revenue stream."

The group points out that this approach was tried not long ago by the famous London Underground, setting up a firm called Metronet, which had disastrous results. Contracts that were supposed to deliver upgrades to 35 stations over three years in fact only delivered 14, or just 40%. Stations that were supposed to cost Metronet £2 million in fact cost £7.5 million, 375% of the original stated price. After five years only 65% of scheduled track renewal had been achieved.

Metronet’s demise only cost its five parent companies £70 million each. It cost the tax payer £1.7 billion. This means each parent company has lost just 4.1% in comparison to the city. A review committee determined that the model of public-private partnerships (PPP) itself "is flawed and probably inferior to traditional public-sector management." (More Information)

The transit group has affiliated itself with another termed "Illinois Coalition to Protect the Public Commons" (ICPPC). The organization maintains that: "As we saw with the Chicago parking meters, when public assets are privatized the public pays and the private companies profit. Private companies invest for fast profits and fat bonuses. To do this, they quickly raise prices, reduce services and/or quality, replace public workers with fewer, less-skilled workers, cut back on long-term maintenance, and exploit public grants and tax exemptions."

Additional information about it is available at: http://www.ctariders.org/Brochure.html