Thursday, June 23, 2005

Costello: "These people must be high."

Austin's got a tricky toll road windfall

Pending agreements with state would save city $51.7 million but could create political nightmare for council

By Ben Wear
Austin American-Statesman
Copyright 2005

The Austin City Council suddenly has 51.7 million reasons to love toll roads.

The council, at its first meeting since new members Jennifer Kim and Lee Leffingwell were sworn in, on Thursday will consider giving after-the-fact approval to three contracts with the Texas Department of Transportation. Under those contracts, signed June 13 by City Manager Toby Futrell and state officials, the state would pick up an estimated $51.7 million of costs associated with three Austin toll roads that otherwise would have been the city's responsibility.

However, the agreements state that if at some point in the future the roads — new lanes on most of Ed Bluestein Boulevard (U.S. 183), Texas 71 near its confluence with U.S. 183, and U.S. 290 and Texas 71 in Oak Hill — were to be built instead as free roads, the city would have to pay the money back.

By signing the agreement one day ahead of Gov. Rick Perry's signature on a new transportation law, the city secured more than $23 million of the total. The money consists of $5.7 million for right-of-way purchases and $46 million for utility relocation costs. For now, the city plans to put the smaller amount into the general fund, which pays for basic services like police and parks, and move the $46 million to the Austin Water Utility and Austin Energy.

That windfall thus represents at once a powerful argument for charging tolls on those local highways and a significant disincentive from ever backing off from tolls. And the decision on the contracts could be a painful political baptism for Kim and Leffingwell, who said during their campaigns that they were against putting tolls on "existing roads."

The 23-member Capital Area Metropolitan Planning Organization board, which includes Mayor Will Wynn and three Austin City Council members, last July approved levying tolls on those three roads and others.

"If those are toll roads, then signing these contracts is smart because it saves the city $52 million," said political consultant Mike Blizzard, who didn't work for a candidate this spring but supported Leffingwell and Kim opponent Margot Clarke. "If they are taken out of the toll plan, then the city's just back to status quo. On the other hand, by signing those contracts, it may make council members on CAMPO less likely to oppose tolling those roads because then the city would lose $52 million."

Leffingwell, reached Tuesday just minutes into his first day on the job, said he is against conversion of free roads to toll roads. But as for the contracts on these three projects, which are not conversions per se but rather greatly expanded roads with both free lanes and toll lanes, Leffingwell said ratifying them is the best course.

"I just don't see any practical downside," Leffingwell said. "Now, if someone misunderstands what you're saying, there may be a political downside."

Council Member Betty Dunkerley, who during her just-completed re-election campaign took a stance comparable to Kim's and Leffingwell's, agreed with Leffingwell, as did Wynn. Kim said that her inclination is to oppose the contracts and that she will ask for a postponement.

"I'd rather not rush to judgment on approving this until we get more answers," she said. "And if there is a compelling case for approving this, a damned-if-you-do, damned-if-you-don't situation, we need a chance to explain it to our constituents."

Council Member Brewster McCracken, a CAMPO board member, said he will probably support the agreements to protect the city's interest should the roads remain tollways. But he said that, given the burden of toll road operations and maintenance to be borne locally, which he said runs in the hundreds of millions over the next generation, he would still support returning them to free status.

Council Members Raul Alvarez and Danny Thomas could not be reached for comment.

Sal Costello, who founded the Austin Toll Party group in reaction to CAMPO approval of the toll plan, was incredulous that the city would consider the contract weeks after approving spending $144,000 to study the toll road plan and possible alternatives.

"These people must be high," Costello said. "I would like to know who in their right mind would take a moment to work on these contracts."

City staff and the state have been working on them since the council told its staff to do so in August. Under an almost two-decade-old agreement with the Department of Transportation, the city has been liable for 10 percent of right-of-way prices on these highways and for the entire cost of moving utility facilities when the roads are expanded.

When city employees brought one of those payments to the council for approval last summer, just weeks after the controversial CAMPO toll road vote, the council suggested a renegotiation.

While those talks continued, the Legislature this spring approved a measure that would have obligated the city to pay 50 percent of the utility relocation costs — $23 million. With Perry on the verge of signing that bill into law — he did so June 14 — the city and state inked the three contracts the day before.

If the council were to vote against ratification, city real estate manager Lauraine Rizer said, those signatures would become meaningless and the agreements would not go into effect.

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