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Traffic on the Chicago area`s clogged highways has grown so dramatically that it is impossible to meet the demand by building more roads, according to a new report.

The document, to be released Thursday by the Illinois Public Action Council, says that construction of more than 700 new lane miles of freeway and tollway would be needed just to reduce congestion here to 1980 levels.

But ”to relieve congestion and carry out planned highway improvements over the next five years would cost over $12 billion,” according to the report. Compared with prior expenditures on superhighways, that is more than five times the amount spent statewide in the five-year period that ended in 1980, it says.

In 1980, volumes on local expressways and tollways were approaching 13,000 vehicles per lane per day, researchers found. By 1986, traffic exceeded the 15,000-vehicle level and by 1990, it hit more than 16,000.

Meanwhile, on principal arterial streets in the six-county region, congestion increased by 20 percent during the 1980s as vehicle miles traveled climbed 83 percent faster than construction of new lane miles, according to the report.

Previous studies have concluded that congestion in the metropolitan area cost drivers here $2.5 billion in wasted time, fuel and insurance premiums in 1987, and that another $12.7 billion will be wasted between 1990 and 2005.

State officials plan a few new highways in the Chicago area over the next decade or so, but they acknowledge that eliminating congestion through new construction is financially unfeasible.

”It is simply not possible any longer to build enough lanes to handle all the traffic,” Richard Adorjan, a spokesman for the Illinois Department of Transportation, said Wednesday.

IDOT is seeking to gain more capacity out of existing highways and arterials under a program called Operation Green Light. It features improvements at highway choke points to ease congestion, synchronization of traffic signals to promote smoother traffic flows and construction of parking lots at train stations to promote use of public transportation.

But Illinois Public Action Council officials said they believe it is time to devote more money to buses and trains.

”Business as usual, building roads to meet higher traffic levels, is just not working,” said David Stahr, the council`s director of research. ”We really have to think in terms of putting a public commitment into public transit.”

Robert Creamer, the group`s executive director, asserted that the ”death spiral” of fare increases, service reductions and declining ridership must be reversed at the Chicago Transit Authority.

He said his group plans to seek legislation that would provide financial incentives for the CTA to increase service, rather than impose service cuts.