November 19, 2021
Illinois enacted a $48.7 billion multi-year FY2022 capital budget in June 2021. Unlike the State’s annual General Funds budget, which is intended to cover only the cost of operations for the current fiscal year, capital appropriations are reauthorized over multiple years as planning, engineering and construction of capital investments commence. The current capital budget was initially approved in 2019 as the Rebuild Illinois capital plan. The Civic Federation reviewed the FY2022 enacted capital budget in a recent blog here.
The FY2022 capital budget appropriated nearly $28.5 billion for transportation projects, or 58.5% of the entire capital budget. These projects include the state’s road program for ongoing surface transportation improvements such as roads, bridges and mass transit. They are managed by the Illinois Department of Transportation. Funding is provided primarily from bonds, motor fuel taxes, a portion of motor vehicle registration fees and federal funds. 
Historically, the State’s capital plan has not included a comprehensive statewide capital improvement plan (CIP) that establishes priorities to balance capital needs with available resources, pairs capital projects with funding sources, helps ensure orderly repair and maintenance of capital assets and provides an estimate of the size and timing of future debt issuance. Rather, it primarily provides a list of projects. This will change in 2022 in part when a new state law takes effect requiring the implementation of a new capital improvement planning process for the state’s transportation program that will include a transparent and objective project selection process.
Best Practices in Capital Project Planning and Selection
The Government Finance Officers Association (GFOA) recommends that governments develop a multi-year CIP that identifies needs; determines financial impacts, including a consideration of life cycle costs; and prioritizes capital requests. Developing a CIP is an important financial accountability measure because capital projects are costly and must be paid for over a number of years that funds are borrowed. A capital prioritization process should:
- Incorporate input from major stakeholders as well as the general public;
- Evaluate the impact of capital projects on operating budget;
- Use analytical techniques such as cost-benefit analysis, net present value or life-cycle costing to evaluate projects; and
- Use a formal rating or scaling system to help facilitate decision-making.
When considering which projects to implement, governments should prioritize:
- Health and safety issues requiring a capital project to correct;
- Renewing or replacing important assets based on the capital asset life cycle; and
- Infrastructure improvements that are necessary to support a government’s policies, plans, and studies.
The Civic Federation agrees with GFOA, issuing a statement in 2019 that Illinois’ capital plan should include a detailed, transparent blueprint of project prioritization, with a clear explanation of how each project fits into the whole plan. This would ensure that funds were being spent efficiently and with maximum impact on Illinois’ economy.
One prominent example of a best practice state CIP that utilizes a well-defined prioritization system is the Virginia Department of Transportation’s SMART SCALE. Virginia statute requires the use of an objective, weighted prioritization scoring system for each proposed transportation project that takes into account the project’s impact on congestion, safety, accessibility, economic development, the environment and transportation-efficient land use. The resulting scores guide lawmakers’ allocation of funding resources.
New State Law Requires Transportation Improvement Plan
Public Act 102-0573 approved in August 2021 requires the Illinois Department of Transportation to develop a multi-modal transportation improvement program for the state’s transportation system. The stated purpose of the law is to use objective and quantifiable technical analyses to guide transportation investment decisions. To do that, IDOT is directed to develop:
- A risk-based, statewide highway system asset management plan;
- A needs-based transit asset management plan; and
- A performance-based project selection process for state-owned transportation assets that add capacity.
The project selection or prioritization process must include public input from stakeholders as well as both a quantitative analysis of the evaluation factors to be used and a qualitative review by IDOT. Beginning in April 2022 no new capacity projects may be included in IDOT’s multi-year transportation plan without being evaluated under the prioritization process. The law also requires the Regional Transportation Authority to develop a transparent prioritization process for Northeastern Illinois transit projects managed by the CTA, Meta and Pace that receive State capital funding.
IDOT’s Data Driven Decision Tool
IDOT is developing a data driven decision tool to implement the provisions of Public Act 102-0573. The tool is based on the Department’s Long Range Transportation Plan (LRTP). IDOT is required by state law to compete a new LRTP every five years. The Plan provides the overarching strategic direction for the state’s transportation system. The LRTP identifies the five goals listed below as the goals for the development of the data drive decision tool.
Each of the five goals in the LRTP will be evaluated using the thirteen selection criteria listed below. Full descriptions of each of the criteria can be found here.
The data driven decision tool is being developed by IDOT with assistance from federal guidance on project selection in the Moving Ahead for Progress in the 21st Century Act (MAP-21), advice from national and state transportation experts, input from political leaders and advocacy groups and industry best practices. The Department is seeking additional input on the data driven decision tool from stakeholders through its website and an interactive survey that closed on October 27, 2021. IDOT says it is in the process of collating and respond to the input and will provide documentation on its website when it is available.
 Governor’s Office of Management and Budget: Enacted Appropriations by Line Item, FY21 and FY22 at https://www2.illinois.gov/sites/budget/Pages/default.aspx.
 Illinois FY2022 State Capital Budget, p. 32.
 Public Act 102-0572. ILCS 2705/2705-203 and 70 ILCS 3615/2.39.