college graduates
(Chip Somodevilla/Getty Images)
June 05, 2013

Jobs Outlook is Brighter for Class of 2013

For the last five years, graduation day has been as much a time for apprehension as for celebration.

Even now, with the Great Recession over, many recent graduates are still struggling to turn their high school and college diplomas into tickets for a better life. The unemployment rate for Americans under age 25 remains more than double the overall rate of 7.5 percent.

But experts are predicting this year's graduates — whether from high school, community college or a four-year college — should have better career launches than at any time since 2008. Companies expect to hire about 2.1 percent more college graduates from the Class of 2013, and will offer a higher overall starting salary of $44,928 — up 5.3 percent over last year, according to the spring survey by the National Association of Colleges and Employers.

Many college officials are cheering as the job offers come in for their graduates. "At both the graduate and the undergraduate level, we're seeing higher salaries, we're seeing earlier offers, and we're seeing better acceptance rates than we've seen in quite some time," said Jamie Belinne, assistant dean for career services at the University of Houston's Bauer College of Business.

Higher Skills Have Rewards

On Friday, the U.S. Department of Labor will release data about May hiring. The new numbers likely will confirm a trend that already is well entrenched: Job growth is improving in general, but the higher your skill level, the better your chances of landing one of those jobs.

In April, the unemployment rate for people with at least a college bachelor's degree was 3.9 percent. For those with less than a high school diploma, the rate was 11.6 percent. Not only do college graduates have more job offers, they also command salaries that average nearly twice as much as high school graduates.

But even for the roughly 1.7 million Americans who will earn college degrees this year, the job market will remain very uneven, with hot spots and cold. NACE, the nonprofit organization that assesses graduates' employment prospects, says the biggest pay gains this year are going to people entering health-sciences careers. They are being offered 9.4 percent more than last year's recruits.

But graduates in the humanities and social sciences are still facing tough times. Their job offers pay just 1.9 percent more than last year, the survey showed.

For people who have high school diplomas or two-year-degrees, the prospects are improving too, but mostly for those in growing economic sectors, such as health care and energy.

"It helps to have a hard skill that is immediately useful for a company," said John Challenger, who heads the global outplacement firm Challenger, Gray & Christmas.

Opportunities For Those Who Keep Learning

That's exactly what Adan Alanis discovered when he decided to go into automotive repair work. He graduated from high school three years ago when the job market was far weaker. Still, he managed to land a good job at a Ford dealership in Pasadena, Texas, because he was at the top of his class.

"The manager here and a few other managers from different dealerships came by and they interviewed all of us, and they only hired me and one other guy because we were always on top of our studies, and we always had the highest grades in class," Alanis said.

But he could see the repair tasks were getting more complicated all the time as automakers continued increasing the technological sophistication of their vehicles. "Everything's getting more electronic, and I've been into electronics, too," he said. So he went back to school and has just earned his associate's degree from nearby San Jacinto College.

The Bureau of Labor Statistics' Occupational Outlook Handbook shows the best opportunities are turning up for people like Alanis — those willing to keep layering on skills involving electronics, software and computer systems.

And in health care, jobs abound for high-skilled professionals such as physical and occupational therapists, optometrists, dental hygienists and audiologists, the handbook says.

Some Sectors Lag

But not all skilled workers are flourishing. Many people who have challenging jobs — such as flight attendants, mail carriers and newspaper reporters — are in industries that need to reduce employee ranks.

J.C. Gage, an Iraq War veteran and new graduate of the University of Houston, is learning how tough the job market remains for those with degrees outside of technology or a hard science. With his degree in public relations, he has started an internship with a public-relations firm. He also is working for the Houston Chronicle's sports section while continuing his search for a full-time job.

"I'm working 9 to 4, Monday through Thursday [at the PR firm], and then I'm working four nights a week at the Chronicle, from 6 to midnight," he said. "It is exhausting."

Darlene Senger and Elaine Nekritz discuss pensions
(Brian Mackey/IPR)
May 28, 2013

House Pension Plan Supporters Say Bill Saves $187B

Members of the Illinois House continued pushing for their version of a pension overhaul on Tuesday.

The Democratic leaders of the House and Senate remain deadlocked over the best approach to fixing Illinois $100 billion pension problem. The latest twist could affect how public school teachers' pensions are funded.

One of the more contentious issues in the debate over government pensions in Springfield has been who should pay for teachers' retirement benefits.

Teachers pay part of their salaries toward their pensions. But for years, state government has paid the employers' share of pension costs ... at least for every school district outside Chicago.

House Speaker Michael Madigan calls that a "free lunch," and says local school districts ought to pay for their own employees.

Legislation to carry out this so-called cost shift has been controversial. Downstate and suburban lawmakers whose districts would be affected say it would result in property tax increases.

The House prefers a plan sponsored by Madigan that unilaterally cuts pension benefits.

Supporters of pension legislation that passed the Illinois House say their plan would save the state $187 billion over 30 years.

Reps. Elaine Nekritz (D-Northbrook) and Darlene Senger (R-Naperville) presented an analysis Tuesday. They say it shows the House's pension measure would save Illinois more than three times as much as a plan approved by the Senate.

Nekritz (D-Northbrook) said under the House's version of a pension overhaul, that's no longer an issue.

"If Senate Bill 1 passes, there would be no shift, because the employer normal cost would be zero," Nekritz said.

Basically, that means so much money would be saved by slashing benefits and increasing employee contributions, it wouldn't cost the schools anything.

Senate President John Cullerton and labor unions believe the House plan is unconstitutional and would save nothing because the courts would throw it out.

Cullerton's union-backed plan was approved by the Senate. It offers workers and retirees a choice of benefits.

The Illinois Supreme Court building in Springfield, Ill.
May 24, 2013

No Pension Cuts for Illinois Judges

Two major pension packages in the Illinois legislature are designed to rein in retirement costs by cutting current and retired government workers’ benefits, but one group being left out of both deals is judges.

There is a lot of angst, uproar and fussing at the capitol over what’s happening with the state’s pension systems.

What legislators do about it will have ramifications for the Illinois budget, as well as for state employees’ and teachers’ pocketbooks – not to mention politicians’ own political and financial futures.

But it won’t affect judges’ wallets. Their retirement benefits would be left untouched.  State Rep. Dan Brady (R-Bloomington) said it is unfair, and he will not go along with it.

“A teachers’ just as important as a judge, and that should be across the board," Brady said. "I cannot believe that we’re aren’t going to make some changes to over 2,039 judges across the state of Illinois, over 1,059 who are retirees, and not ask them to ante up anything?”

That may well be what happens.But even if lawmakers finally come to an agreement and pass a pension overhaul, there is a chance that in a year or two, lawmakers could be sent back to square one. 

The state constitution guarantees public pension benefits “shall not be impaired.” So, it is widely expected that any change to the pension plans would end up in court.

“Judges were excluded as a practical decision,” said Illinois House Speaker Mike Madigan. “The absence of the judicial pension system in the bill, will, let’s say, relieve them of the burden of dealing with a conflict of interest.”

Madigan sounds confident it will work.

“I think that there will be at least four members of the Illinois Supreme Court that will approve the bill,” he said.

Those were remarks he quickly retreated from when pressed by a reporter if he had been in contact with the justices.

"I’ve had no conversations with any member of the court concerning anything,” he said.

After all – it wouldn’t be proper for a key lawmaker to try to exert influence over the judiciary, but critics argue that is something Madigan already has done .

He is not only Speaker of the House, but also also head of the Democratic Party of Illinois. In 2010, the Party was the top contributor in Supreme Court’s Chief Justice Thomas Kilbride’s heated campaign to keep his seat. The Democratic Party gave Kilbride nearly $1.5 million.

“Clearly the Speaker would not be involved in such races unless he felt there were consequences from the court (on matters such as partisan redistricting of the legislature and congressional districts, for example,” said Jim Nowlan, a former legislator, a retired University of Illinois political professor, and a member of Illinois’ executive ethics commission.

“I think that the court has been perceived throughout history as a political court," Nowlan said. "The judges are elected on partisan ballots."

That is a common perception, according to Dennis Rendleman, who is a member of the Illinois Judicial Ethics Committee .

As judicial campaigns have gotten more intense and attracted more money, Rendleman said people have become skeptical of judges’ ability to stay impartial.

“I don’t think I’m totally naive about the political of Illinois, but the dynamic is different,” Rendleman said.

Supreme Court justices in Illinois only run for election once.  After that they stay on the bench, unless voters take a once in a decade chance to kick them off.  Rendleman said that means judges do not carry the same sense of indebtedness to their donors as do legislators — who are constantly running for re-election.

“It’s not like the General Assembly where you can say that, you owe me on this issue, or you owe me on everything,” Rendleman said.

Rendleman added that it is not as if there’s any way to get around the deeper, intrinsic conflict-of-interest issue that would arise if the Judicial Retirement System were to be included in a pension overhaul that judges, themselves, receive state pensions.

“There is a doctrine in judicial ethics called the Rule of Necessity,” he said.

This rule, Rendleman said, is invoked when there’s no other court that could resolve the issue.

“You can’t take a question of the Illinois law, and then send it to Indiana to be resolved, just because the Illinois justices might have an interest in that law," he explained.

It came into play during a case decided by the Illinois Supreme Court ruled in 2004. That was when Illinois’ budget troubles were beginning. 

In that case, Illinois judges were the plaintiffs, suing the state for trying to strip them of their automatic cost-of-living pay increases.  Justices on the state Supreme Court ruled in their own favor, and they got to keep their pay hikes.

They cited another clause in the state Constitution — a clause that could also come into play if there were an attempt to reduce judicial pensions. 

The constitution specifically said a judge’s compensation cannot be diminished during his or her term. It is meant to keep the third branch of government independent, so lawmakers can’t punish judges for unpopular rulings.

That is what Gov. Pat Quinn seems to be alluding to when he justifies leaving judges out what he has otherwise demanded be “comprehensive pension reform.”

“There are some constitutional principles that are in the Illinois constitution, that, uh, make that, uh more difficult," Quinn said. "The judges have a little different status. There’s been a supreme court case that already addressed that matter.”

Retirement benefits, after all, could be considered compensation.

Bear in mind, there are far fewer judges in Illinois than there are, say, teachers. So Illinois will get far greater savings by cutting teachers’ pensions than by cutting judges’.

Still, critics are quick to point out that Illinois judges are among the highest paid in the nation, and their pension benefits are particularly generous.

The association representing Illinois’ current and retired judges declined comment.

But Judge Ed Petka was willing to offer his perspective. Petka was on the Will County Circuit Court for a few years before he got cancer and suffered heart problems, forcing him to step down. So now, he’s drawing a pension.

“I haven’t calculated to the penny, but it’s somewhere around $190,000,” Petka said.

Petka does not apologize for it.  He said he would love to still be working as a judge. He did not do anything nefarious to get his pension — it is the law. 

Even though he was only on the bench for a relatively short time, Illinois law lets judges combine their years of service with those spent in other government jobs. In Petka’s case, he was a state legislator.

He was in that job when Gov. Rod Blagojevich and the General Assembly voted to – as he puts it – repeatedly raid the state’s pension funds.

“The numbers that were given were way off base, I said so at the time, and many of us who voted ‘no’ on the raids turned out to be correct," Petka said.

Illinois’ pension funds are in trouble for a lot of reasons, but that is a big one.

Petka is no longer in a position to decide what Illinois should do about the pension mess it’s gotten itself into.

"Thank God I no longer have to worry about those types of things," he said. "No matter what they do it is going to be a very, very difficult sell.”

A sell Senate President John Cullerton and House Speaker Mike Madigan – who are both attorneys, by the way – are trying to make easier for the court to buy by leaving judges out of it.

But there is still one more legal argument to consider. 

“From my perspective and very candidly, I haven’t given this an enormous amount of thought," Petka said. "But I would think that having four out of the five pension systems in the state being included and one being excluded, from the operation of a pension bill, may lead to a problem that has not been discussed that I’m aware of and that’s the equal protection of the laws.”

In other words – all people similarly situated – whether they are a retired teacher, state worker, university employee, legislator, or if they’re a retired judge – are to be treated the same way in the eyes of the law.


May 13, 2013

Report: Pension Payments to Make Up Quarter of State Spending

A new report shows nearly a quarter of Illinois’ state spending plan for next year will go toward pension payments.

The Illinois State House and the State Senate have so far disagreed on the best way to address the worst-funded pension system in the country.

Laurence Msall is with the Civic Federation - a budget watchdog group. He said the state used to spend about 7 percent of its budget on retirement benefits. Now it’s closer to 25 percent.

It effectively means that all new revenue, in order to keep up with that growth, has to go into the pension system," Msall said.

Msall said the state’s financial outlook is so bad - it also owes nearly 7 billion dollars in a backlog of bills to its vendors - including social service agencies.

May 09, 2013

Vet Techs at University of Illinois Demand Higher Wages

Veterinary technicians at the University of Illinois are in contract negotiations for the first time with the U of I over wages.

The AFSCME Council 31 union is trying to negotiate a new deal for roughly 60 vet techs on the Urbana campus, and after four months of contract talks, the union said there has not been much progress.

AFSCME’s Tara McCauley said veterinary technicians make as much as $6.00 an hour less than animal caretakers on campus, but require more training and responsibilities.

“Our problem is that the veterinary technicians do have a higher level of skill and training and they’re held accountable to a different level of care for the animals and our professionals,” McCauley said. “We feel that they deserve to be paid at least at minimum the rate that the caretakers make.”

McColley said veterinary technicians assist with animal surgeries, check X-rays, and administer medicine. She said they have to be certified by the state to do their job. Meanwhile, McColley noted that animal caretakers primarily feed the animals and clean cages, and do not need any special certification.

Kristina Donze has worked as a vet tech at the U of I for about a decade, and she said because of the responsibilities and training that go into the job, higher wages are only fair.

“We got into this profession because of love of animals, and nobody got into it to get paid a ton and ton of money," Donze said. "And we’re not asking for what we feel is a ton of money, just fair. We want to be paid fairly for the job that we’re doing.”

In a statement, the U of I said it believes what it is offering veterinary technicians is fair.

“We believe the rates and benefits we’re offering this group of employees is fair and exceeds the average offered in the local market,” said University Spokeswoman Robin Kaler.

computer online commerce
May 07, 2013

Some Net Retailers Aren't Buying Online Sales Tax Proposal

Congress is considering a bill that would allow states to collect sales taxes from online retailers. Proponents say a law is necessary to level the playing field with brick-and-mortar stores and to raise revenue for states.

Simply put, the Marketplace Fairness Act would require any online retailer with more than $1 million in annual sales to collect and remit sales tax. But Joseph Henchman, a vice president at the nonpartisan Tax Foundation, says it's not that simple. He says the bill, at about five pages of text, is unusually brief. And, he says, it doesn't come close to matching how complex collecting sales tax can get.

"It also doesn't include a lot of detail about implementation," Henchman notes. For example, the bill says the states will have to provide automated tax software to businesses free of charge. But what if a business' existing systems don't work with available tax software? Who pays? What if a state doesn't provide adequate software? To whom should the business take its complaint?

Fearing A Logistical 'Nightmare'

These are the types of questions that dog Stacey Strawn, president of the gift shop Silver Gallery. The business has a small storefront in Waynesboro, Va., but the lion's share of its $3 million in annual sales are made online and over the phone. Strawn, like some other online retailers, is crying foul on the bill. Trying to comply with the law, she says, would "be a nightmare."

If the law passes, Strawn would have to collect taxes for every purchase, then remit them to every state and local government where her customers live. She says software that automates tax collection is not a plug-and-play solution that meets all needs.

"Something gets exchanged and it's sent to another state. Then we have to figure out how to refund the taxes from the first state, collect our refund from that state, then charge the customer the new tax," she explains.

Strawn estimates it would cost $15,000 to set up the logistics, plus ongoing tech support. She says she cannot pass those costs along to her customers without losing business. And another fear: getting audited out-of-state. "What then?" she asks.

Accountants are not only expensive for small businesses like hers, Strawn says, but it's also "hard to find people who are in tune with your business to begin with."

Proponents of the legislation say automated tax software has been around for years and that it works — despite the huge variability in tax rates across the country. Charles Collins, director of government affairs for Taxware, a tax software maker, says a lot of Strawn's concerns are misplaced.

For one thing, companies like his would provide tech support to businesses, Collins says. Also, he argues, technology simplifies most processes, including returns and exchanges, as well as handling audits.

Under the bill, Collins says, the state and the software company would largely handle the burden if a business gets audited. "We or the state would be responsible for resolving those issues," he says. "It wouldn't be any issue that the seller would have to pay."

A New Tax, Raising New Tax Questions

Scott McFarlane, CEO of Avalara, another automated tax software firm, agrees that the law's details need to be fleshed out. But he says the complexities are overstated. "There's certainly questions, but I think they're probably not as difficult an issue as people are making them," he says.

But Henchman, of the Tax Foundation, says he has another, bigger beef with the bill. He argues it's forging an entirely new frontier for taxes. Historically, taxes have always been tied to a physical location; people pay income tax where they live because that's where they use social services. And stores have paid taxes where they operate because they use local roads and so forth.

But this bill is a proposal to collect taxes beyond geographic location. "And that creates a lot of implications for where are we going with everything else," Henchmen says. "Do we apply that to income tax, too, if you're a business traveling coming into the state? Or if you participate in conference calls with the state — is that enough to bring you within the scope?"

The bill now faces more opposition in the Republican-controlled House.


Treasury Department
(Florian Hirzinger/Wikimedia)
May 01, 2013

The Federal Deficit is Actually Shrinking

During the housing bust, taxpayers were forced to bail out mortgage giants Fannie Mae and Freddie Mac. But thanks to the real estate recovery, Fannie Mae could end up paying tens of billions of dollars back to the Treasury this summer.

That's just one of the factors behind a better bottom line for the federal government. This week, the Treasury Department announced it will pay down some of its debt for the first time in six years.

Washington has been so preoccupied with warnings of exploding deficits in recent years that John Makin of the conservative American Enterprise Institute was caught off guard when he checked out the numbers.

"I'm surprised that more people who talk a lot about it haven't looked carefully at where we find ourselves," he says.

The federal deficit is shrinking rather quickly — both in absolute dollars and as a share of the overall economy. The Congressional Budget Office projects the deficit will drop below 4 percent of GDP next year and below 2.5 percent in 2015.

Greg Valliere of Potomac Research says the improvement could come even faster, thanks to rising government tax receipts and shrinking government payouts.

"There are two really big spending stories that are changing the fiscal outlook in Washington," he says. "The first is that there's no new spending. Anything the president proposes will get rejected by the House. Secondly, through sequester and other cuts, domestic discretionary spending is actually falling."

In a way, policymakers backed into this shrinking deficit. Both the spending cuts and the tax increases are more the product of government stalemate than any deliberate action.

The economy is paying a price in slower growth. Even some conservatives like Makin are now warning that austerity has gone far enough.

"Deficit reduction means slowing the growth of spending and raising taxes. And nobody likes that. So you have to be telling the story of ... we're doing some short-run pain for long-run gain, but we're not doing too much of it," he says. "And that's why I think we've done enough austerity for now."

Liberal economists argue that government has gone too far in its belt-tightening. Jared Bernstein of the Center on Budget and Policy Priorities hopes the rapidly improving budget picture will help to silence deficit alarmists.

"If that diminishes the urgency to recklessly cut spending in the short term, that's actually a good thing," Bernstein says. "Because we've actually overcut in the near term and that's hurting the weak economy and people who depend on some of these benefits."

Bernstein notes that government spending on unemployment, for example, fell by 25 percent in the first quarter from a year ago. That's good news for those who went off the rolls because they found jobs. But not for those whose benefits simply ran out or were cut back indiscriminately.

"There are millions of people across the country who are seeing their unemployment benefits reduced because of sequestration," he says. "They don't have a job. In fact, they're still legitimately on unemployment insurance. But the sequestration is taking a chunk out of their benefit check at a very bad time for them."

That's also less money circulating in the economy.

One byproduct of the falling deficit is that the government won't bump up against the debt ceiling so quickly. Steve Bell of the Bipartisan Policy Center says forecasters initially thought Congress would have to raise the debt ceiling this summer. Now that's been pushed back a bit.

"I think we will be able to see them get into fall before we have the confrontation between the Congress and the president over the debt ceiling," Bell says.

What's not clear is whether fall's cooler temperatures will lead to cooler heads at the bargaining table. Despite the improvement in the short run, the federal government still faces long-term deficits, mostly tied to health care costs.

AEI's Makin says policymakers now have more time to address that challenge. But that could be a blessing or a curse.

"The fact that Congress is not operating under the gun, the White House is not operating under the gun here, gives them some time to sit down and be thoughtful about restructuring entitlements and [the] tax system," he says. "I think many people fear that if you take the pressure off, Congress moves on to other things."

That lack of long-term thinking is a different kind of deficit that Washington has yet to overcome.


April 30, 2013

Sequester Puts Some Needing Housing Aid 'Back To Square One'

Congress decided last week to ease the effects of the across-the-board federal spending cuts on travelers upset over airport delays. But low-income Americans who rely on government housing aid are still feeling the pain.

Housing authorities across the country have all but stopped issuing rent vouchers as they try to deal with the cuts known as sequestration. Many newly issued vouchers have been rescinded, leaving some people homeless or doubled up with family and friends.

And the cuts come at a time when there's a severe shortage of affordable housing across the country.

'Homeless Again'

Melissa Rothkugel, 28, had waited seven years for a housing voucher to help cover her rent in Connecticut. Last year, she lost her job, became homeless and got pregnant. So you can imagine how happy she was in February when she got a letter telling her she had finally been approved for aid.

"I actually broke down and cried," she recalls. "Because, I mean, when they issued me the voucher, I thought everything was going to start getting better and looking up."

She filled out the paperwork, attended orientation in Hartford and started to look for an apartment. But within days she was rushed to the hospital to give birth to a baby daughter. A week later, she got another letter that made her cry.

"It said, due to the budget cuts, that they were revoking my voucher," she says. "So I was back to square one in being homeless again."

Now, she, her baby and her boyfriend are living in her brother's basement.

Rothkugel's voucher was one of 88 rescinded by the city of Hartford in response to federal spending cuts.

'No Recourse'

Hartford isn't alone. In Fort Worth, Texas, 99 vouchers were canceled for families that hadn't yet signed leases. In Minnesota, more than 160 vouchers have been put on hold.

In Fairfax, Va., Roger Bottomley thought a voucher was within reach after 10 years of homelessness, when he was scheduled for an interview this month with the local housing authority. Then it was canceled.

"They didn't have the money for it, the way I understand it," he says.

So he's still living on the street.

"I stayed at the bus stop last night," he says. "It wasn't too cold out."

Across the country, housing authorities say their hands are tied. They have to cut about $2 billion this year in public housing and voucher programs that subsidize rents for the poorest Americans. It's part of the larger stalemate in Washington over how to deal with the budget.

"There is no recourse," says Alex Sanchez, executive director of the housing authority in Santa Clara County, Calif. "We're simply passing on what the Congress decided."

The Santa Clara County housing authority has 25,000 people on its waiting list. But there will be no new vouchers this year. The agency has also asked the U.S. Department of Housing and Urban Development for permission to raise the amount that tenants already in the program will have to pay. Sanchez says it's a hardship on his clients — who are mostly elderly and disabled — but he hopes it will do the trick.

"The very last step we want to take is to actually take people off the program," he says. "But if the cuts continue, I don't believe there will be any other alternative."

'Inflicting Pain'

Sanchez says he thinks Congress should reverse the sequester. But it doesn't look promising.

President Obama has called the sequester "dumb." But he said at a news conference Tuesday that the kind of action lawmakers took last week — to prevent the furloughing of air-traffic controllers — is too shortsighted.

"They should be thinking about what's going to happen five years from now, 10 years from now or 15 years from now," he said. "The only way to do that is for them to engage with me on coming up with a broader deal."

But the president's broader deal would include more tax revenue, something Republicans vehemently oppose. They want deeper spending cuts instead. In the GOP radio address this past weekend, Pennsylvania Rep. Bill Shuster blamed the sequester mess squarely on the president.

"There are some in the Obama administration who thought inflicting pain on the public would give the president more leverage to avoid making necessary spending cuts and to impose more tax hikes on the American people," he said.

But to people like Rothkugel in Connecticut and Bottomley in Virginia, this is all business as usual. They don't expect to get help anytime soon.


Amtrak train
(Seth Perlman/AP)
April 24, 2013

End of the Line for Amtrak’s Indiana Train?

Amtrak’s Hoosier State line has long been a popular way for college students at places like Purdue University in Lafayette, Indiana to travel to Chicago for concerts, sporting events and to shop, especially on weekends.

“The Friday train can be pretty packed,” Marc Magliari, Amtrak’s Chicago-based spokesman, told WBEZ on Tuesday.

But that service between Chicago and Indianapolis could be disrupted if Indiana lawmakers don’t act soon to provide funding. The Hoosier State line runs four days a week between the two cities, carrying on average about 120 passengers per trip on trains that can accommodate up to 270 people, depending on demand. In 2012, some 37,000 riders boarded the Hoosier State line, according to Amtrak.

By October, the Hoosier State line could make its last run if $3 million in funding doesn’t come through from Indiana lawmakers. That’s because in 2008, Congress decided to eliminate funding for Amtrak routes that are less than 750-miles. Chicago to Indianapolis is less than 200.

Tim Maloney hopes that does not happen.

“We’re very interested in seeing more (Indiana) investment and involvement with transportation alternatives to motor vehicles on highways because of the environmental and energy-savings benefits that those alternatives provide,” said Maloney, senior policy director the Indianapolis-based Hoosier Environmental Council.

Maloney’s been keeping a watchful eye during this last week for legislative action in the Indiana House and Senate. Hoosier lawmakers are busying putting the final touches on a new two-year budget. Maloney said the Senate’s version of the budget includes funding to keep the Hoosier State line going.

Maloney believes there is a demand for alternatives to driving between Chicago and Indy, even though Amtrak can take up to five hours compared to approximately three hours in a car from downtown Chicago.

“We believe there will be a growing demand for those alternative based on high gas prices and demographic changes. So, we think it’s a good idea for the state to diversify its transportation investment, including passenger rail and urban public transit,” Maloney said.

Indiana isn’t the only state who has to decide whether to keep an Amtrak train route to Chicago up and running. A route from Chicago to St. Louis and Detroit to Chicago are also at risk of losing funding.

If the Hoosier State route is eliminated, passengers can still utilize the Cardinal line that runs three days a week from Chicago to Indy. Because the Cardinal line connects to the East Coast, funding continues. Maloney says Amtrak has seen an 80 percent growth in the last five years and thinks it could get more.

“It’s close to 40,000 passengers a year and that’s based on having just one train a day going each day,” Maloney said.

Maloney said work is being done to improve travel times, primarily because Amtrak often has to stop for freight trains in its path during its four-stop trip which includes one stop outside Chicago in Dyer, Indiana.

“But there’s no question travel times need to improve. That’s a key for attracting more riders,” Maloney said.

But besides travel convenience, Maloney says there’s also an issue of jobs. Amtrak operates a maintenance center in Beech Grove, a suburb of Indianapolis that provides about 550 jobs.

“Amtrak spends over $21 million dollars a year buying goods and services from Indiana companies,” Maloney said. “There are 99 companies in Indiana that benefit and can benefit from passenger rail service, that’s second only to Ohio.”

Meanwhile, the Indiana Department of Transportation has hired an engineering consultant to evaluate what types of schedule changes might make Amtrak service in Indiana self-supporting. If Hoosier lawmakers don’t make a decision this week on whether to fund the route, it could write the money into the budget and decide at a later time whether to use it on the route.

But Maloney questions some media reports suggesting Indiana can wait until October to decide.

"If the legislature doesn't allocate the funding this week, it may not have the money to fund it later. This is a very important time," Maloney said.

On Wednesday morning, the Hoosier State pulled into the depot in Dyer, Indiana with no one boarding or getting off. When asked if she thinks Indiana will continue funding for the route, a female Amtrak conductor speaking from a window said, "I think they will."

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