TTC News Archives-Trans Texas Corridor: 12/26/2004

Friday, December 31, 2004

Dan Shelley, lobbyist, "Sat quietly in the corner."

Perry aide was in on toll road meetings

Shelley is said to have met with transportation department officials while helping Spain-based Cintra.

12/31/04

W. Gardner Selby, Austin Bureau
San Antonio Express-News
Copyright 2004

A consultant who was later hired as an aide to Gov. Rick Perry attended multiple meetings with the Texas Department of Transportation before the firm he assisted was tapped to launch the ambitious network of toll roads outlined by Perry in 2002, officials said.

Published reports have suggested Dan Shelley, who assisted Spain-based Cintra from December 2003 until he became Perry's legislative liaison in September, had little contact with the department while helping Cintra.

But agency officials said Thursday that Shelley accompanied Cintra delegates to several of a dozen meetings involving Cintra and state employees.

"He was there to introduce them to Texas ," said Ed Pensock, director of corridor development. "He never did any lobbying by any stretch of the imagination. He sat quietly in the corner."

A Cintra spokeswoman referred questions to Perry's office. Shelley, a former Houston state senator who later worked for Gov. George W. Bush, was unavailable for comment.

Shelley's role, initially reported this week by the Dallas Morning News, drew attention after the Texas Transportation Commission voted two weeks ago to choose a consortium led by Cintra over two competing groups to build and operate the first leg of the Trans Texas Corridor , the 50-year vision of toll roads and rail lines throughout Texas advanced by Perry.

Cintra will pay the state $1.2 billion by 2014 for the right to operate the segment paralleling Interstate 35 and will shoulder the risk of bonds to fund construction. A contract is expected to be signed within two months.

Over the next 10 years, Cintra will invest an additional $6 billion to construct a four-lane toll road from San Antonio to Dallas, with work starting in about a year, and relocate some Union Pacific tracks to the east.

Tom "Smitty" Smith, director of Public Citizen's Texas office, called Shelley's work introducing Cintra the "heart and soul" of lobbying.

And Perry's hiring of Shelley demonstrates the need to restrict lobbyists from entering government for at least a year after they have stopped promoting other causes, Smith said.

A Perry spokesman and the commission chairman said neither Perry nor Shelley influenced the selection of the Cintra group over two competitors.

"I don't see monsters where they don't exist," commission chairman Ric Williamson said.

Shelley did not list Cintra as a client on his lobbyist reports, records show.

State law requires individuals who seek to influence government action to register as lobbyists and list their clients. Lobbyists don't have to report compensation or expenditures for communications regarding purchasing decisions.

Williamson said he was unaware of any meetings with Shelley outside of one he had with him more than a year ago in which he agreed to have TxDOT inform Cintra on corridor ideas.

Of the staff meetings including Shelley, Williamson said: "I don't see it as important," noting that Shelley never was paid by Cintra and sacrificed a "seven-figure" lobby practice to work for Perry.

Shelley never was paid because his fee was contingent on Cintra getting the contract and finalizing financing, Perry spokesman Robert Black said.

"Dan never took any money from the company, he never lobbied for the company, there was absolutely no reason to question his integrity or to think there may be a conflict of interest, which there is not," Black said.

wselby@express-news.net

Staff Writer Patrick Driscoll contributed to this report.

© 2004 The San Antonio Express-News: www.mysanantonio.com

Dan Shelley "was there to introduce them to Texas"

Perry aide was at toll road meetings

Firm he was consulting for at the time later won lucrative contract.

December 31, 2004

W. Gardner Selby, Austin Bureau
San Antonio Express-News
Copyright 2004

A consultant who was later hired as an aide to Gov. Rick Perry attended multiple meetings with the Texas Department of Transportation before the firm he assisted was tapped to launch the ambitious network of toll roads outlined by Perry in 2002, officials said.

Published reports have suggested Dan Shelley, who assisted Spain-based Cintra from December 2003 until he became Perry's legislative liaison in September, had little contact with the department while helping Cintra.

But agency officials said Thursday that Shelley accompanied Cintra delegates to several of a dozen meetings involving Cintra and state employees.

"He was there to introduce them to Texas ," said Ed Pensock, director of corridor development. "He never did any lobbying by any stretch of the imagination."

A Cintra spokeswoman referred questions to Perry's office. Shelley, a former Houston state senator who later worked for Gov. George W. Bush, was unavailable for comment.

Shelley's role, first reported this week by the Dallas Morning News, drew attention after a Texas Transportation Commission vote two weeks ago.

The panel chose a consortium led by Cintra over two competing groups to build and operate the first leg of the Trans Texas Corridor , the 50-year vision of toll roads and rail lines throughout Texas advanced by Perry.

Cintra will pay the state $1.2 billion by 2014 for the right to operate the segment paralleling Interstate 35 and will shoulder the risk of bonds to fund construction. A contract is expected to be signed within two months.

Over the next 10 years, Cintra will invest $6 billion more to build a four-lane toll road from San Antonio to Dallas, with work starting in about a year, and to relocate some Union Pacific tracks to the east.

Tom "Smitty" Smith, director of Public Citizen's Texas office, called Shelley's work introducing Cintra the "heart and soul" of lobbying. He said Perry's hiring of Shelley shows the need to restrict lobbyists from entering government for at least a year after they stop touting clients.

A Perry spokesman and the commission chairman said neither Perry nor Shelley influenced the selection of the Cintra group over two competitors.

"I don't see monsters where they don't exist," commission Chairman Ric Williamson said.

Shelley did not list Cintra as a client on his lobbyist reports, records show.

State law requires individuals who seek to influence government action to register as lobbyists and list their clients. Lobbyists don't have to report compensation or expenditures related to purchasing decisions.

Williamson said he was unaware of any meetings with Shelley except one more than a year ago in which he agreed to have TxDOT inform Cintra on corridor ideas.

Of the staff meetings including Shelley, Williamson said: "I don't see it as important," noting that Shelley never was paid by Cintra and sacrificed a "seven-figure" lobby practice to work for Perry.

Shelley never was paid because his fee was contingent on Cintra getting the contract and finalizing financing, Perry spokesman Robert Black said.

"Dan never took any money from the company; he never lobbied for the company. There was absolutely no reason to question his integrity or to think there may be a conflict of interest, which there is not," Black said.

wselby@express-news.net

Express-News Staff Writer Patrick Driscoll contributed to this report.

© 2004 San Antonio Express-News: www.mysanantonio.com

"The governor had an agenda. It's all predetermined."

Perry's office downplays ties to corridor firm

12/30/2004

Associated Press
Copyright 2004

AUSTIN — A top aide to Gov. Rick Perry who worked for a company chosen for a $7.2 billion state road project had no contact about the project with the company or transportation officials after joining the governor's staff, Perry's office said.

Dan Shelley was a government affairs consultant for Spain-based Cintra until three months before the company was picked to build the first leg of the Trans-Texas Corridor. He was to be paid if the road deal went through, Perry spokesman Robert Black said.

Shelley gave up that deal when he became Perry's legislative director and had no further contact on the issue with Cintra or the Texas Transportation Commission, the Perry-appointed board that picked the company, Black said.

"The governor's office had no influence at all over who won the contract for the Trans-Texas Corridor," Black said in Wednesday's Dallas Morning News.

The corridor, a network of tollways and rail lines across the state projected to cost $175 billion, is the centerpiece of Perry's transportation policy.

An opponent of the plan said Shelley's previous employment for Cintra added to questions about the project.

"From the very beginning, this was going to be a railroaded project," said David Stall, founder of Corridor Watch. "The governor had an agenda. It's all predetermined."

A Cintra spokeswoman said Shelley worked for the company but declined to comment, referring questions to the governor's office. Shelley's office also referred calls to Perry's office.

Shelley, a lobbyist at the time, began consulting for the company in December 2003, about three months after Cintra was named one of three possible Trans-Texas Corridor contractors, the governor's office said.

When Shelley joined the governor's staff nine months later, his lobbying firm did not take over the Cintra contract or the promised pay, Black said.

State records show Shelley — a lawyer and former state legislator — and his firm were not registered with the state as lobbyists for Cintra, as required for individuals who have contact with state officials intended to influence government decisions.

"Dan Shelley gave advice to Cintra" about doing business in Texas, Black said. "He didn't lobby, nor did he try to influence anyone else's decision's, other than Cintra's."

The Transportation Commission this month voted to begin negotiations with Cintra to start work on the 800-mile route from Oklahoma to Mexico.

Cintra's plan calls for developing $6 billion in new roadways roughly parallel to Interstate 35 by 2010.

© 2004 The Associated Press: www.ap.org

Perry Aide met "at least five times" with Transportation Commission on Cintra's behalf

Account of aide's role at Cintra contradicted

Before joining Perry, lobbyist met TxDOT officials several times

December 30, 2004

by Pete Slover and Tony Hartzel
The Dallas Morning News
Copyright 2004

AUSTIN – A former lobbyist who is now a top adviser to Gov. Rick Perry met at least five times with state transportation officials on behalf of a Spanish construction company months before it won a multibillion dollar road deal, state records show.

Those documents contradict the previous account of state Transportation Commission chairman and Perry appointee Ric Williamson, who said he recalled only one instance in which Dan Shelley had visited the department on behalf of Cintra.

Mr. Shelley, the governor's legislative director, declined to comment on the meetings. A spokesman for Mr. Perry said that Mr. Shelley's activities did not constitute lobbying, and he reiterated that Mr. Shelley and the rest of the governor's staff had no role in the awarding of the $7.2 billion contract.

Mr. Williamson said Thursday that he'd had just one meeting with Mr. Shelley, while the other meetings were with Transportation Department staffers.

The question of whether Mr. Shelley's activities amounted to lobbying is unclear. He has never registered as a lobbyist for Cintra, which state law can require for those seeking specific actions from state officials on someone else's behalf.

Mr. Shelley began consulting for Cintra a year ago, working on a contingency that paid him solely based on how much business Cintra secured in Texas, the governor's office said. Contingency fees are banned for most lobbying contracts, with some exceptions.

Upon joining the governor's office as staff liaison to the Legislature in September, he gave up any right to that fee – which would have been paid upon the eventual signing of the contract, the governor's staff said. The governor's aides said they did not know the amount of the fee.

Robert Black, the Perry spokesman, said that the meetings – documented in visitor sign-in sheets for the Transportation Department's Austin headquarters – do not alter the governor's support of Mr. Shelley.

"Dan's role in these meetings was to introduce Cintra to TxDOT and to get out of the way and let them talk," said Perry spokesman Robert Black. "These meetings were informational only. ... There was no lobby effort made."

"Cintra had hired Dan not specifically for any project, but to determine if there were business opportunities in the state," Mr. Black said, adding that Mr. Shelley also talked to local officials in Dallas and Houston on behalf of the company.

Corridor project

The Trans-Texas Corridor is the cornerstone of Mr. Perry's transportation policy, overseen by a five-member board he selected.

"I don't think anyone from any of the three bidders had undue influence," said Mr. Williamson, a longtime friend of the governor. "In the end, they were all graded on how much money would have to come from the state and when they could start construction."

Mr. Williamson said his meeting with Mr. Shelley occurred late last year. The visitor logs show that since then, Mr. Shelley met with Transportation Commission staff five times, for a total of six hours between January and June. The logs did not include some meetings described by participants that occurred at outlying buildings.

The logs indicate that for all but 35 minutes of the six hours, no competing bidders were present. Cintra executives accompanied Mr. Shelley on all of his visits but one, a five-minute stop that fit the description the governor's office gave of a time when Mr. Shelley picked up a package for delivery to Cintra officials in Spain.

Records of meetings between Transportation Department officials and bidders for the corridor contract were not available late Thursday, but a department spokeswoman said that each of the three finalists had about a dozen sessions with department staff about their proposals for the Trans-Texas Corridor.

"Mr. Shelley's role was no role," said spokeswoman Gaby Garcia. "He was just another player and another member of the Cintra team."

Sitting quietly in corner

She added that Transportation Department officials at the meetings said Mr. Shelley did nothing more than sit in a corner quietly during the discussions.

Mr. Williamson said the one meeting he had with Mr. Shelley did not appear designed to affect the road pick.

"He didn't have four to five meetings with me," said Mr. Williamson, who distinguished between meetings Mr. Shelley had with department staff – who recommended Cintra – and the final decision-makers on the Texas Transportation Commission. "We erect a wall between the department staff and us. We have no idea who comes and who goes. And to tell you the truth, I don't want to know."

Mr. Shelley's work with Cintra also extended to at least one meeting with North Texas transportation officials. Representatives of the three competitors met Feb. 26 with Michael Morris, transportation director of the North Central Texas Council of Governments, and Mr. Shelley signed in as the sole representative of Cintra.

Mr. Morris said he sought the meeting so that the bidders would understand the region's concerns about the corridor's path. Mr. Shelley handed a copy of a presentation to Mr. Morris, but that was the extent of their direct contact.

"No one was really lobbying us," Mr. Morris said. "He had a presentation, but it's hard for me to conclude that was lobbying."

The general counsel of the Texas Ethics Commission would only discuss the issue hypothetically. But given the circumstances in this case, such activities could fall outside the technical requirements for lobby registration, in part because they cover "a purchasing decision."

Tom "Smitty" Smith of Public Citizen, whose watchdog organization advocates for tougher lobbying regulations, said such legalities can obscure the obvious benefit of contact with state officials.

"Lobbying is not only promoting a particular piece of legislation or contract," Mr. Smith said. "It's opening doors."

E-mail pslover@dallasnews.com and thartzel@dallasnews.com

Thursday, December 30, 2004

Corridor Backs Off Commuter Rail

OPIONION EDITORIALS:

Where's the Rail?

Transportation plan backs off mass transit

December 30, 2004

The Dallas Morning News
Copyright 2004

When Gov. Rick Perry first outlined his vision for the Trans-Texas Corridor nearly three years ago he described it as including high-speed and commuter rail. But the corridor contract awarded this month to a Spanish firm relegates rail to an afterthought.

The plan by Cintra, picked by the state for the $7.2 billion project, calls for miles and miles of blacktop, mainly new toll roads parallel to Interstate 35. Transportation planners, according to the current outline, wouldn't get to the rail part for some 20 years.

That's not good enough.

In two decades, our state is projected to have 5 million more people. Roads are fine, and we support them. But alone they can't get the job done. Texans need a better and broader transportation system. Here are two key reasons:

•Our economy. It will suffer if we don't find better and more efficient ways to move people and goods. Commuter and high-speed rail lines that connect the state's major cities and airports, and align with major national freight corridors will spur needed economic development.

•Public health. We can't keep guzzling fuel and spewing emissions without serious consequence. Pollution doesn't just dirty our air; it harms our lungs. Nearly everybody in North Texas either suffers from or knows somebody who suffers from serious respiratory problems. Want an earful? Ask any physician who specializes in respiratory ailments about North Texas' air quality.

The whole contract issue was complicated this week by conflict of interest concerns raised by news reports that a top aide to Mr. Perry worked for Cintra until three months before the company was selected for the contract.

When it comes to rail, there is time to correct this situation. The state and the firm have 60 days to work out more details. Then, there will be a 12-month period to hammer out final plans.

The state should insist that rail be a more immediate piece of the picture. It's good for Texas.

Shelley's previous employment for Cintra adds questions about the Trans-Texas Corridor.

Perry says his aide didn't influence highway contract

Consultant cut his ties to Cintra before its selection, the governor says

Associated Press
Copyright 2004

AUSTIN - A top aide to Gov. Rick Perry who had worked for a company that was chosen for a $7.2 billion state road project had no contact about the project with the company or transportation officials once he joined the governor's staff, Perry's office said.

Dan Shelley had been a government affairs consultant for Spain-based Cintra until three months before the company was picked to build the road project. He was to be paid if the road deal went through, Perry spokesman Robert Black said.

But Shelley gave up that deal when he became Perry's legislative director, and he had no further contact on the issue with Cintra or the Texas Transportation Commission, the Perry-appointed board that picked the company, Black said.

"The governor's office had no influence at all over who won the contract for the Trans -Texas Corridor ," Black said in Wednesday's editions of the Dallas Morning News.

The Trans -Texas Corridor , a network of tollways and rail lines across the state projected to cost $175 billion, is the centerpiece of Perry's transportation policy.

An opponent of the plan said Shelley's previous employment for Cintra added to questions about the project.

"From the very beginning, this was going to be a railroaded project," said David Stall, founder of Corridor Watch. "The governor had an agenda. It's all predetermined."

A Cintra spokeswoman referred questions to the governor's office. Shelley's office also referred calls to Perry's office.

Shelley, a lobbyist at the time, began consulting for the company in December 2003, about three months after Cintra was named one of three possible Trans -Texas Corridor contractors, the governor's office said.

When Shelley joined the governor's staff nine months later, his lobbying firm did not take over the Cintra contract or the promised pay, Black said.

State records show Shelley and his firm were not registered with the state as lobbyists for Cintra, as required for individuals who have contact with state officials intended to influence government decisions.

"Dan Shelley gave advice to Cintra" about doing business in Texas , Black said. "He didn't lobby, nor did he try to influence anyone else's decisions, other than Cintra's."

Associated Press: www.ap.org

"House Bill 3588 made tolls a key funding strategy"

Legislature driven to fix road funding

Advocates say tolls won't be enough. Far-reaching bill to be revisited.

December 30, 2004

Patrick Driscoll, Staff Writer
San Antonio Express-News
Copyright 2004

A massive transportation bill passed by the Texas Legislature last year has enlisted toll roads as the main weapon to fight growing traffic congestion, but officials say more legislation is needed to help unclog the state's roadways.

Elected leaders, bureaucrats and road advocates are looking to the 79th Legislative Session, which begins Jan. 11, to tweak and juice up House Bill 3588 - the historic omnibus transportation bill that made tollways a big business in Texas.

Up for consideration are ideas to increase the gasoline tax, free up more taxpayer money to build toll lanes, shuffle the budget to direct more funds to transportation, and allow state officials to spend more on rail facilities.

Expect clear-headed discussions and decisions but not a visit from the road fairy, especially for anything calling for new taxes, said Rep. Mike Krusee, R-Round Rock, chairman of the House Committee on Transportation.

"We've got everybody's attention, that's for sure," Krusee said. "This is one of the best opportunities ever to educate the Legislature and the public in the realities of transportation funding."

But he added, "It's far too early to predict what the outcome's going to be."

The reality is that the 38-cent-a-gallon gas tax, in place for more than a decade, can't keep up with the demand for roads, officials say. Inflation marches on, cars are getting better gas mileage, population is exploding and people drive more than ever.

But political resolve wilts over the prospect of raising it another $1, as some say is needed.

"New sources of revenue are always controversial," Krusee said.

Before HB 3588 made tolls a key funding strategy, Texas could pay for only a third of its desired transportation projects.

With toll roads on the books to speed up construction - including new lanes for Loop 1604 and U.S. 281 on the North Side - metropolitan areas now can take care of 60 percent of transportation needs over the next 25 years.

"It still doesn't bridge the entire gap," said Vic Boyer, director of the San Antonio Mobility Coalition. "There's still a significant amount of funding that's needed."

The coalition, a public-private nonprofit group, and officials in other cities likely will ask the Legislature to increase the gas tax steadily to keep in step with inflation and to let voters raise sales or gas taxes at local levels to help pay for transportation projects.

Another proposal eyed by San Antonio advocates as well as state transportation commissioners is to shift highway user fees from the General Revenue Fund to the Texas Mobility Fund, although it would cut money from other programs.

But all three suggestions could be quashed by fears of new taxes, Krusee said. And the school finance reform issue trumps them all.

"School finance kind of throws everything up in the air," he said.

Facing a better chance is an effort to pour more gas taxes into toll roads to accelerate projects, Krusee said. Lawmakers could do that by removing, or at least raising, a cap of $800 million a year that the Texas Department of Transportation can spend on tollways.

The House Transportation Committee last summer recommended such a move, and the Texas Transportation Commission two weeks ago asked for a repeal of the cap. San Antonio officials support changing it.

"We're not toll happy, we're transportation-asset happy," commission Chairman Ric Williamson said.

"Somebody else has a good idea of how to relieve traffic? The door's open."

San Antonio officials, stung by a rash of major train accidents this year, also welcome proposals by the commission to eliminate state spending caps on rail lines and to create a fund to relocate tracks around cities.

The fund could be stretched by using it to leverage bonds, state officials say. About $100 million a year could generate an estimated $1 billion in bonds.

Relocating freight rail would make downtowns safer and open doors for commuter rail to run on old tracks, which is what San Antonio and Austin officials hope to do along Interstate 35.

"That's an important one, I think, for us," said County Judge Nelson Wolff, who will be chairman of the Mobility Coalition next year. "All this exclusivity of asphalt is just leading to an era of congestion."

Other matters up for debate include deciding when a conversion of a free road to a toll road occurs - whether it's during planning phases, construction or after it opens - and what approvals are needed.

Rep. Terry Keel, R-Austin, who has listened to an uproar in the capital over toll road plans and has voiced concerns himself, suspects legislators might even rescind the provisions that allow conversions.

"I can tell you, I think the conversion issue will be revisited for sure," he said.

pdriscoll@express-news.net

© 2004 San Antonio Express-News: www.mysanantonio.com

Wednesday, December 29, 2004

Top Aide to Perry Worked for Cintra

Perry Aide Worked for Firm

Ex-consultant wasn't paid, didn't sway decision, governor's office says

By PETE SLOVER and TONY HARTZEL
The Dallas Morning News
Copyright 2004

AUSTIN – A top aide to Gov. Rick Perry worked for a Spanish company until three months before the company was picked for a $7.2 billion state road project.

As a government affairs consultant for Cintra, Dan Shelley was to be paid if the road deal went through, a spokesman for the governor said. But Mr. Shelley agreed to give up all rights to that money – an amount the governor's office could not detail – when he joined Mr. Perry's staff as legislative director.

The spokesman, Robert Black, said Mr. Shelley was never paid any money by Cintra. After joining the governor's office, he said, Mr. Shelley had no contact about the project with Cintra or the Texas Transportation Commission, the Perry-appointed board that picked the company.

"The governor's office had no influence at all over who won the contract for the Trans-Texas Corridor," Mr. Black said.

Mr. Perry has made the Trans-Texas Corridor, a network of tollways and rail lines across the state projected to cost $175 billion, the centerpiece of his transportation policy. An opponent of the plan said Mr. Shelley's previous employment for Cintra added to questions about the project.

"From the very beginning, this was going to be a railroaded project," said Corridor Watch founder David Stall. His group opposes the governor's proposal and wants to ensure that the development process is open to public input. "The governor had an agenda. It's all predetermined."

A spokeswoman for Cintra, which is based in Madrid, Spain, confirmed Mr. Shelley had worked for the company but declined to comment, referring further questions to the governor's office. Mr. Shelley's office also referred calls to Mr. Perry's press office.

Mr. Shelley, a lobbyist at the time, began consulting for the company in December 2003, roughly three months after Cintra was named to a list of three possible Trans-Texas Corridor contractors, the governor's office said. When Mr. Shelley joined the governor's staff nine months later, his lobbying firm – which includes his daughter and son-in-law – did not take over the Cintra contract or the promised pay, Mr. Black said.

Influence denied

State records show Mr. Shelley – a lawyer and former state legislator who serves as Mr. Perry's liaison to lawmakers – and his firm were not registered with the state as lobbyists for Cintra, as required for individuals who have contact with state officials that's intended to influence government decisions.

"Dan Shelley gave advice to Cintra" about doing business in Texas, Mr. Black said. "He didn't lobby, nor did he try to influence anyone else's decisions, other than Cintra's."

Texas Transportation Commission Chairman Ric Williamson said Mr. Shelley approached Texas Department of Transportation officials about a year ago, seeking a meeting about his work for Cintra and possibly other Spanish companies. The visit was brief, and it was the only known business contact between Mr. Shelley and the transportation department, Mr. Williamson said.

"The visit he made to TxDOT was not in the nature of a specific project," Mr. Williamson said. "It was along the lines of, 'These guys may want to do business in Texas. Can you spend some time with them?' "

Several months later, the state hosted a tour in Dallas and other Texas cities, explaining potential projects to about 20 representatives of Spanish companies. They included several from Cintra's then-parent company, Ferrovial Agroman.

"There should be an appearance question from your point of view. But from my point of view, there is none," Mr. Williamson said. "I can guarantee you Dan Shelley didn't lobby me for anything to do with Cintra."

State transporation officials said Mr. Shelley's association with Cintra could not have played a role in the company's selection for the most expensive privately funded public works project in history.

The bidding process

The identities of each bidder were kept separate from the details of their proposals, with the companies generally known as bidders A, B and C as their plans were evaluated and scored.

But Mr. Williamson said one company's bid stood out because of its unique method of having the contractor pay billions up front for the project, which are then repaid out of future toll and rail proceeds. That funding mechanism matched Cintra's well-known, innovative efforts elsewhere, possibly leading informed guessers to conclude that Cintra wrote that bid, Mr. Williamson said.

Cintra plans to fund the project with a combination of its own revenue and some from investors who will be paid back over time with toll money. The company, which has been in business since 1968, expects to pay for about 20 percent to 30 percent from its own funds, and to get a return on that investment starting in about a decade, company officials said.

Phillip Russell, director of TxDOT'S Texas Turnpike Authority division, has said that none of the companies knew how much weight the state would place on different parts of the bid, including the financing and road-planning aspects.

Initially, the state told bidders that the details on how to build the road would count more than the financing details, but it never released the exact ratio for the decision. The state awarded the contract this month and revealed a ratio with almost equal weight on the two – 41 percent for road planning and 40 percent for financial – a formula that favored Cintra's approach.

"The weighting being kept secret is a problem," said Mr. Stall of Corridor Watch. "If you shift the weight [of one criterion], you can also shift who the winner is."

Mr. Russell, who was in charge of the weighting process, could not be reached for comment Tuesday. A transportation department spokeswoman said that the exact grading formula was set before Cintra and other bidders submitted detailed proposals in August, but nearly a year after the companies submitted their first general plans.

Monday, December 27, 2004

"Toll road rage."

Tolls, rails, repairs topped news in 2004

Ben Wear, AMERICAN-STATESMAN STAFF
Austin American-Statesman
Copyright 2004

Toll road rage, and rail peace.

Oh, and the pleasantly shocking construction blitzkrieg on Lamar Boulevard.

This past year in transportation, both in Central Texas and statewide, was at once a year of milestone events and a year of a still-unresolved policy war about how to pay for highways.

At the end of 2004, it looks like both Central Texas and the state as a whole are heading toward having many more toll roads than could have been predicted in January. But that situation, with Austin's mayor under attack because of his support of tolls and the governor's GOP opponents pondering how much hay to make of the issue, remains fluid.

Passenger rail in Austin and its environs, on the other hand, became a reality in 2004 after almost two decades of false starts and sometimes nasty debate. The big news, of course, is that Capital Metro as of Nov. 2 has permission -- with 62 percent of the vote -- to build a 32-mile passenger rail line from Leander to downtown Austin.

If all goes as expected, that $60 million line, with nine stations and sleek diesel-powered cars, should open by 2008.

The City of Austin had performed with particular lack of distinction on an overhaul of Barton Springs Road a couple of years ago. So when the time came in March for a 16-month rehabilitation of Lamar Boulevard downtown, everyone predicted traffic hysteria and ruin for the businesses along the road.

The city turned all that on its head, finishing the project a mind-bending 10 months early. Austin completed troublesome projects on South First Street and Enfield Road this year as well, and wrapped up work on Cesar Chavez Street in East Austin about five months early. Not bad, not bad at all.

But the big story, worth recounting, was "The Great Turnpike War of 2004."

It all started gently enough in January.

State officials had backed off a plan to open as a toll road the expansion of U.S. 183 in Northwest Austin. Local officials were preparing a toll road plan for Austin, but it seemed likely to be incremental.

The Texas Transportation Commission was talking tough on tolls, but it seemed mostly just that: talk. And Gov. Rick Perry's Trans Texas Corridor plan for 4,000 miles of toll roads, rail and utility lines still could be regarded merely as a 2002 campaign splash slowly evaporating under the heat of fiscal reality.

And nobody had heard of Sal Costello.

Then, in April, the Central Texas Regional Mobility Authority and Bob Daigh, the Austin district engineer for the Texas Department of Transportation, unveiled a toll road plan of eye-popping scope: $2.2 billion of spending on nine roads, six of them existing roads with periodic stoplights, that would be turned into expressways.

Actually, two of those roads, with more than $400 million of the total cost, were already scheduled to be toll roads, so it was actually a $1.8 billion, seven-road plan. But it was still a lot to take in.

The plan, Daigh and others said, pretty much had to go forward as introduced, or those toll-happy state transportation commissioners would punish Austin by sending much of that money to Dallas or Houston. The reaction locally was subdued at first, and even a well-attended public hearing in May was relatively low-key.

But then state Rep. Terry Keel of Austin and Travis County Commissioner Gerald Daugherty, Republicans with a history of supporting roads, unexpectedly came out against parts of the plan, especially levying tolls on a short stretch of MoPac Boulevard (Loop 1) at William Cannon Drive.

"Double taxation," they called it, because the project, already under construction, was being built with gasoline tax dollars (just like that stretch of U.S. 183 where toll plans had been dropped) and would have no debt to be paid back with tolls.

Then Costello, a marketing consultant who lives at Circle C, got involved. He created Web sites, ran anti-toll ads and facilitated an avalanche of e-mails to the decision-makers on the Capital Area Metropolitan Planning Organization board.

The July 12 hearing where the CAMPO board voted 16-7 to approve the plan (with Keel leading the opposition) was a memorable one, with spectators overflowing into four other rooms at the University of Texas meeting site. One of those rooms was directly above the main meeting room, and the folks sequestered there watching on closed-circuit television unleashed a foot-stomping rumble each time someone on the dais spoke in favor of tolls. But the plan passed. End of story, right?

No, more like the end of the beginning. Costello began a recall petition campaign against Austin Mayor Will Wynn and two other council members who voted for the plan and expanded his e-mail blitz to Perry, the Transportation Commission and every member of the Legislature. The governor's chief of staff got involved, and, behind the scenes, talks continued about how to change the plan and quell the uproar.

Meanwhile, plans to put tolls on roads near Dallas and Houston, true conversions where no improvements were planned on the roads in question, generated their own firestorms. And El Paso was in open revolt about the pressure from the commission to create toll roads.

When CAMPO next met, in September, a new set of particularly ugly memories was created. The losing side from the July vote suggested changes, and the board and audience traded charges of illegal conflict of interest and racism.

Eventually, in November, Wynn and others announced plans to take the MoPac stretch out of the plan (a vote is likely in January); tolls on two other roads will be delayed by about two years, and Capital of Texas Highway (Loop 360) is unlikely to become a turnpike for a very long time.

But what remained in the plan was enough for state officials, who rewarded Central Texas with a healthy share of state transportation dollars for other projects and promised more. Toll opponents, deep into the recall campaign, promised to keep fighting, and the issue may play a big role in this coming May's council election.

Oh, and that pie-in-the-sky corridor plan of Perry's? In mid-December, the governor and the commission unveiled tentative agreement with a private consortium led by a Spanish company to build a 300-plus-mile toll road parallel to Interstate 35. The consortium, if it all works out, would build $6 billion worth of road with its own money and give the state an additional $1.2 billion.

The Legislature, facilitator of this toll road push via a 2003 law, will take a second look in the new year. If Democrats align with anti-Perry Republicans on the toll issue, then some significant changes might occur. But don't bet the House, or the Senate, on it.

In war, generally the folks with the most guns and bigger bombs win. And Perry and his pro-toll troops enter 2005 with all the weapons.

Getting There appears Mondays. For questions, tips or story ideas, contact Getting There at (512) 445-3698 or bwear@statesman.com.

Copyright (c) 2004 Austin American-Statesman: www.statesman.com

"Father Time may need to exchange his scythe for a Toll Tag. "

Out with the old roads, in with the tolls

GORDON DICKSON Staff Writer
Fort Worth Star-Telegram
Copyright 2004

Father Time may need to exchange his scythe for a Toll Tag.

During the next 12 months, major decisions will be made about the construction of toll roads locally and statewide. Many of the roads will collect tolls electronically, meaning that motorists will need to install Toll Tag transponders on their windshields.

For several years, transportation officials have talked about expanding the use of toll roads to make up for perpetual shortfalls in highway funding.

Now the time is drawing near to break ground on some toll projects.

Here are highlights of projects Metroplex residents may hear about in 2005:

* Interstate 30: Special toll lanes are planned from Arlington to Dallas by 2007. The lanes would help football fans get to and from the planned Dallas Cowboys stadium in Arlington. Toll prices would vary according to traffic conditions. The project would extend as far west as Fielder Road.

*Trans Texas Corridor : Cintra Concesiones de Infraestructuras de Transporte of Madrid, Spain, has agreed to pay for a $6 billion toll road bypassing Interstate 35 from north of the Dallas-Fort Worth area to San Antonio in exchange for the right to collect tolls for 50 years.

The speed limit would be 85 mph, and trucks could carry 50 percent more cargo. It is expected to be under construction by 2007 and completed by 2015.

* Northeast Loop 820, Airport Freeway and Interstate 35W: Four consortia are competing to build toll express lanes in the median of these three roads, which make up the most congested corridor in Tarrant County.

The first phase would connect I-35W to Dallas/Fort Worth Airport.

Eventually, the lanes would stretch into north Dallas, creating a 27-mile corridor connecting I-35W to I-35E. Existing lanes would remain free.

The Texas Transportation Commission is expected to select a winning proposal in early 2005, possibly between February and April. Construction could begin in 2007.

* New laws: The Legislature convenes next month, and some lawmakers want to clamp down on the Texas Department of Transportation's ability to convert freeways into toll roads.

Copyright 2004 Star-Telegram, Inc. www.dfw.com

Sunday, December 26, 2004

No high speed rail in the near future for Trans-Texas Corridor

Corridor project scales back rail hopes

Red River-San Antonio toll road may add trains after 2025

December 26, 2004

By TONY HARTZEL
The Dallas Morning News
Copyright 2004

At first glance, the $6 billion Trans-Texas Corridor proposal unveiled this month appears to be little more than a Texas-size toll road.

Aside from a small rail relocation project around Austin, the plan for a privately operated toll road from the Red River to San Antonio made virtually no mention of potential rail and utility lines that have been prominent in discussions about the corridor.

Plans for high-speed or intercity rail, which set off furious opposition from Texas landowners and some business heavyweights a decade ago, will not be part of the winning bidder's plans anytime soon.

"We don't see at this time any high-speed trains happening," said José M. López, director of U.S. and Latin American operations for Cintra, the Spanish company hired to build the first leg of the corridor plan by 2013.

Rail lines may be part of a long-term master plan, which mentions rail projects after 2025. "Highways are much easier to plan and can come to fruition faster than railroads," Mr. López said.

Still, Gov. Rick Perry's ambitious Trans-Texas Corridor plan features echoes of the high-speed rail battle from the 1990s.

In both cases, a foreign consortium promised to build a major public works project with no public financing. The high-speed rail proposal faced fierce opposition from rural landowners, who are now worried about the corridor plans. Concerns about property rights led the state Republican Party and the Texas Farm Bureau to oppose the corridor.

"Taking private land for lease to a company that will use our land to generate a profit by charging us tolls and rent is offensive. It should be illegal," said David Stall, founder of Corridor Watch, based in Fayetteville, east of Austin.

One previous opponent to high-speed rail has no plans to enter the corridor discussions.

"We don't have a role in the current policy talks," said Linda Rutherford, a spokeswoman for Dallas-based Southwest Airlines, which opposed the rail plans in the 1990s. "It was not an issue of competing with high-speed rail as a mode of transportation, it was competing with it on the amount of subsidy it would have received."

This time around, some of the same players may eventually end up on different sides of the debate. Texas Transportation Commission Chairman Ric Williamson said he "fully expects" Southwest Airlines to eventually work with the state on building a rail network.

"Rick Perry is focused on commuter rail that the market will support," Mr. Williamson said. "I expect it [Southwest Airlines' participation] because I understand the economics of the oil and gas business. I don't think the price of fuel is going to go down. It's only going to go up."

Toll-rate debate

With no plans for high-speed rail and only marginal discussion of commuter rail, the debate over such a large public works project will focus on other issues this time, including the setting of toll rates and the use of private capital to build major roads.

Cintra's proposal calls for building several hundred miles of a four-lane toll road from North Texas to San Antonio, but other projects could follow, Mr. Williamson said last week.

The key to building connecting or related projects may lie in the state's plans for a proposed $1.2 billion payment from Cintra.

"It would be entirely logical and not surprising to take that $1.2 billion and leverage it into $3 billion or $4 billion to use for several purposes," Mr. Williamson said. "We will turn that $1.2 billion into a lot more and take care of a lot of problems up and down the corridor."

The state and Cintra have until mid-February to negotiate important details of the proposed $7.2 billion initial agreement or cancel the deal. The two sides then would have another year to iron out more specifics on what construction officials are calling the largest privately funded public works project in history.

Precise routes for the corridor are far from being chosen. The state could narrow down the possibilities to a single, 10-mile-wide swath by early spring. In North Texas, the study area includes the southeast corner of Dallas County and extends as far east as Wood County about 75 miles away. Area residents will be able to give their input on possible routes at public hearings in the spring. The toll road could open to San Antonio by 2014.

While no firm construction plans have been announced, Mr. Williamson said the state might be interested in extending the corridor to the Texas Valley, dredging the port of Corpus Christi to allow for bigger ships, and moving freight rail off a congested Austin-to-San Antonio line to make room for commuter trains.

Private-public model

Although relatively new to the United States, the private-public partnership model has been used successfully elsewhere. Cintra, which has been in business since 1968, recently went public on the Spanish stock exchange. It also has been around long enough to have a mixture of older and newer toll projects, including one road in the Basque area of Spain that it returned to the Spanish government after a 35-year lease.

"This is a business that is well-developed and mature in parts of the world," Mr. López said. "In the United States, for a number of reasons, it is not."

Still, officials in other parts of the world have raised questions about Cintra's practices. Toronto-area officials waged an unsuccessful legal battle to prevent Cintra from raising tolls on Highway 407. And in the Chicago area, the company has drawn attention for its plans to raise tolls on the Chicago Skyway, which it is in the process of acquiring.

In both cases, Mr. López said, the company negotiated a deal with local governments that included toll limits. The company would not have bid the same amount if it did not have the right to set tolls under established parameters.

"We expect to set tolls based on market demand," Mr. López said. "If not, we won't have cars. And if we don't have customers, we won't have cash."

With toll roads not generating much revenue for investors for at least eight to 10 years, Cintra will be in the toll road business for the long haul, Mr. López added. Cintra probably will have the rights to the corridor and its tolls for 50 years.

"This is a very specialized business," he said. "People who try to see this business as a quick way to make money will fail."

The state probably will retain the right to set tolls, and it may even attempt to enter into a toll revenue-sharing agreement with Cintra, Mr. Williamson said. The company's current Texas business proposal, if left unchanged, would keep tolls between 10 and 20 cents per mile.

So will Texans pay $30 or more to travel up to 85 mph on an unclogged traffic artery between North Texas and San Antonio?

"We believe it will work, as it has in many places worldwide," Mr. López said.

E-mail thartzel@dallasnews.com