Saturday, November 18, 2006

HB 154 would replace Perry's appointees on the Texas Transportation Commission with an elected Commissioner

Under the Dome

House bills on road to nowhere?

November 18, 2006

Ben Wear
Austin American-Statesman
Copyright 2006

Early entries in the silly season for the Legislature: a bill that would slam the door on Texas cities' plans to install cameras at red lights and another that would effect a voter overthrow of Gov. Rick Perry's tollifying Texas Transportation Commission.

Forecast for potential passage of both: mostly cloudy.

Rep. Carl Isett, a Republican from Lubbock, has offered House Bill 55, which would ban a "local authority" from operating "photographic traffic signal enforcement" on highways under their jurisdiction. Many of them, including Austin and Hutto, are rushing to do just that after the Legislature, a couple of sessions ago, made it possible to levy civil fines for traffic infractions. Until then, only criminal citations were possible, and you needed a police officer on scene, by and large, to do that.

Then Texas Attorney General Greg Abbott's office ruled this year that the law applied to the state highway system. Because those are the kind of roads, including interstate frontage roads, that have the most red-light runners at the highest speeds, that was what cities and the private purveyors of red-light camera systems were waiting to hear. They're popping up everywhere. Isett wants to stop that trend.

Rep. Joe Pickett, D-El Paso, meanwhile, basically wants to stop the Perry administration's head-long rush into toll roads.

Pickett, with HB 154, proposes to wrest the steering wheel from the Perry appointees that make up the Texas Transportation Commission.

His bill would replace the commission with an elected transportation commissioner.

It will be interesting to see whether this one ever gets a hearing before the House Transportation Committee, which is led by Rep. Mike Krusee, a Republican from Williamson County. Krusee wholeheartedly supports the toll policies that the appointed commission has been pursuing.

© 2006 Austin American-Statesman: www.


Friday, November 17, 2006

"I think future generations will wonder why we did this, why we ruined parkland by putting a tollway down it."

Trinity project faces bump in road

Dallas: Planned parkway may harm levee, must be tweaked, corps says

November 17, 2006

The Dallas Morning News
Copyright 2006

Dallas officials and North Texas Tollway Authority project managers are working to tweak the alignment of the proposed Trinity Parkway, after the U.S. Army Corps of Engineers determined it might compromise the Trinity River's eastern levee.

The corps says it will support the tollway – a key part of the city's landmark Trinity River Project – only if design elements don't put the city at risk for flooding. Corps officials say the city has been quick to address the problem areas.

The parkway project "absolutely cannot happen if the structural integrity of the levee is damaged in any way," said Col. Christopher Martin, commander of the corps' Fort Worth district.

Dallas officials said they've "hit a bump" with the nine-mile, $691 million parkway, intended to relieve downtown traffic and provide easy access to the future park and lakes. But they said they were confident the adjustments would do the trick.

"We're moving it around some," City Manager Mary Suhm said of the parkway. "We're going to have to figure out how to get the tollway and the levees to fit together."

But not everyone on the Dallas City Council wants these puzzle pieces to fit. District 14 council member Angela Hunt is opposing the tollway because of its proximity to the long-awaited parks project.

"It is extraordinarily shortsighted to put a six-lane tollway in the middle of what is supposed to be our Dallas destination park," Ms. Hunt said. "I think we will look back and regret it in the future."

The Trinity River Project is, first and foremost, a flood-control measure, Col. Martin said, and the tollway plan is an added bonus. It's the corps' job to make sure that the project's main intent – protecting Dallas residents from high water – is not compromised, he said.

Col. Martin, who took over the Fort Worth office this summer, said the first parkway sketches he saw "could've potentially violated the structural integrity" of the eastern levee, along which the tollway is designed to run. Dallas and its contractors have worked quickly to make the fixes, which warrant further study, he said, but at first glance appear to do the trick.

The toll road, which would alternate between four and six lanes and be sized to handle traffic projections for 2025, is designed to ease congestion on Interstate 35E and the Interstate 30/35E Mixmaster. It would also provide an alternate route into Oak Cliff, southern Dallas and downtown.

"We have to have a road to relieve 85,000 cars a day from the Mixmaster – the minimum to fulfill our traffic needs," said City Council member Ed Oakley, chairman of the council's Trinity River committee.

Under the City Council's preferred alignment, the tollway would begin at the confluence of I-35E and State Highway 183, and end at U.S. Highway 175 – running right inside and atop the levee that protects much of downtown from an 800-year flood. Construction could begin as early as next year.

Trinity River Project director Rebecca Dugger said the corps' concerns involved "places where they felt the parkway was getting too close to their levee footprint," particularly where it runs under the bridges spanning the river.

"They didn't like that," Ms. Dugger said. "After [Hurricane] Katrina, the corps is obviously looking very carefully at their levees, and making sure nothing is going to impact their ability to fight floods."

She said the city, in conjunction with the tollway authority, is trying to push the parkway "somewhere that would make the corps a little more comfortable" – away from the levee and slightly closer to the proposed waterfront.

For Ms. Hunt, the only acceptable solution is to trash the tollway project altogether. But she acknowledged that "politicians have made their decision" and that the only way to change the tollway's course would be for Dallas constituents to demand it.

"I think future generations will wonder why we did this, why we ruined parkland by putting a tollway down it," she said.

Mr. Oakley said the council has jumped this hurdle before – right after Laura Miller was elected mayor. Even she, originally an ardent opponent of the project, realized there was no getting around a new roadway adjacent to the park, he said.

"Everybody would like the road not to be there," he said. "But we have no better alternatives."

In other Trinity news, Thursday marked the grand opening of the Trinity Center – an Oak Lawn office designed to house the Trinity Trust Foundation and other nonprofits involved in the massive lakes, parks and tollway project.

The Trinity Trust, headed by chief fundraiser Gail Thomas, is raising $150 million in private dollars for the project. The center will eventually display a 20-by-7-foot scale model of the Trinity River corridor.


© 2006 The Dallas Morning News Co


"Asking lawmakers to show greater discipline on highway funding is a job best left to St. Jude."

St. Jude of politics is readying for fight over highway money


Jaime Castillo
San Antonio Express-News
Copyright 2006

If I didn't know better, I would swear state Sen. Jeff Wentworth is trying to become the St. Jude of the Texas Legislature.

Not that he was looking, but politics' budding patron of lost causes may have found a worthy issue that actually has less chance of becoming law than his biennial attempt to depoliticize the redistricting process.

And that's saying something.

Many readers are probably aware that Wentworth files a bill every two years to create an independent redistricting commission that would take the power to redraw political lines away from state lawmakers.

Wentworth has credibility on the issue because, as a Republican, he continues to propose the bill at a time when his own party controls the levers in Austin.

But, while the idea makes sense, asking Democrats and Republicans to give up the right to exact gerrymandered revenge on each other is like asking a hungry dog to stop eating halfway through an opened box of Milk-Bones.

Despite similar long odds, frustrated motorists everywhere will likely honk for hope once they hear about Wentworth's latest cause, a bill that would keep lawmakers from spending state highway funds on anything but highway construction and maintenance.

You might be asking: Do grown-up legislators actually need to be told that highway funds should go for highways?


Since 1986, about $9.3 billion has been diverted from the state highway fund for non-highway things such as tourism packages and state historical and arts commissions.

The Department of Public Safety, which patrols the state's often traffic-choked highways, also is funded through highway dollars.

It's enough to make Bexar County Commissioner Lyle Larson violate Ronald Reagan's commandment of not speaking ill of other Republicans.

Larson, who has criticized the state's GOP leadership for being quick to support toll roads after creating "a self-fulfilling highway funding shortfall," recently fired off letters to Gov. Rick Perry, Lt. Gov. David Dewhurst and House Speaker Tom Craddick.

As of this week, Craddick was the only one who had responded. In a nutshell, the speaker respectfully told Larson not to hold his breath.

"If the Legislature chooses not to utilize (gas tax) revenue for non-transportation infrastructure needs, then the Legislature would be forced to either cut other programs or raise revenue via increased taxes or increased fees," Craddick wrote.

Larson characterized the response as "somewhat disappointing."

"I've been in elected office 15 years, and I wouldn't send a letter like that to one of my constituents," he said.

"What I'm reading into that letter is the speaker saying, 'Yes, you caught us with our hands in the cookie jar, but we're going to continue to eat those cookies.'"

Meanwhile, Wentworth and the bill's House sponsor, Democratic state Rep. Robert Puente, say they are cautiously optimistic that some progress can be made on the legislation.

But as long as there is no political will in Austin to raise the gas tax for the first time since 1991, asking lawmakers to show greater discipline on redistricting and highway funding is a job best left to St. Jude.

© 2006 San Antonio Express-News:


"Lawmakers on a collision course with Gov. Rick Perry?"

Toll roads were a non-starter on election day


The Lone Star Report
Volume 11, Issue 15
Copyright 2006

Mike Krusee (R-Round Rock) gets only 50 percent of the vote in a solidly Republican district? And his Democratic opponent is within five percent? This is but one example of the unpopularity of the state's current transportation policies.

Most successful candidates ran as fast and as far as they could from the governor's policy of making almost all new freeways toll roads. The Trans-Texas Corridor also did not play well on election day for a variety of reasons.

The Legislature will likely revisit this issue, which could put lawmakers on a collision course with Gov. Rick Perry.

It remains to be seen exactly what changes to current policy will gather steam at the Capitol. But transportation will be an issue in the spring.

© 2006 The Lone Star Report:


The 'Highway Twins' : More of the same?

Ogden, Krusee prepare for legislature


By Daniel K. Lai
Taylor Daily Press
Copyright 2006

With the general election behind them and the 80th Texas legislative session just over the horizon, local lawmakers have started formulating their respective battle plans.

“Almost immediately after the election I had meetings in Taylor to continue discussions on the East Williamson County Higher Education Center,” State Rep. Mike Krusee, R-Dist. 52, said. “It's still in the planning stages. There is an awful lot of people to coordinate in that effort - city governments, school districts, county officials and institutions of higher learning. It's not a cut and dry process.”

Although Monday was the first day for legislators to file bills for the next legislative session, Krusee said he has not filed any yet.

“There are several priorities I will be working to address with this legislature including planning and preparing for growth in the county and establishing a stronger, affordable and reliable source of water for residents,” he said. “The main issue is what the legislature is going to do with the budget surplus; some of it needs to go to education but I think it needs to be used to lower property taxes. That is important. Do we spend it (the surplus) or use it to lower property tax? I'm optimistic the Republican legislators will agree we need to lower property taxes.”

One issue that Krusee said his office has been consistently contacted about is the route of the Trans-Texas Corridor.

“I've already said this - the SH 130 corridor has been designated Williamson County's Trans-Texas Corridor,” he said. “It's not going to go through Taylor or Granger or other areas on the eastern side of the county. My office is routinely contacted by people who are concerned and we do our best to inform them on the status of the Trans-Texas Corridor.

“In the coming months, I suspect TxDOT will further narrow the proposed path of the corridor around SH-130; an additional toll-road further east will not be built.”

State Sen. Steve Ogden, R-Dist. 5, said he has also heard several questions raised about the TTC and will plan to focus a lot of attention on the project.

“The TTC is not clearly defined in the public's mind,” he said. “There was a lot of discussion about it when I was campaigning and I will look at the issues.”

Of the various issues raised, Ogden said he will focus his attention directly to the three main concerns - tolls, the TxDOT comprehensive development plan for the TTC and the completion of other state roads.

“Once a road has been built and the money from tolls have paid for that road, the tolls should go away,” he said. “I also want to review the TxDOT comprehensive development agreement for the Trans-Texas Corridor to understand if employing a foreign-based company for the job is the best thing in order to make sure we're not making a huge mistake. There will be a lot of attention to the Trans-Texas Corridor.”

However, Ogden said as chairman of the Senate Finance Committee his primary responsibility will be writing the state budget.

“Ninety percent of my time and money will be dedicated on that,” he said. “My responsibility will be to write a balanced, conservative and fair budget for the state.”

In addition, Ogden said he will also focus on “cleaning up” the property tax legislation passed during last summer's special session.

“We have a responsibility to clean it up and eliminate as many of the glitches that we can find,” he said. “We still have a lot of work ahead of us but I am confident we will be successful.”

The 80th Texas State Legislature will convene Jan. 9.

© 2006 Taylor Daily Press:


A 'Public Service' message from the friendly folks who own TxDOT

Billboards Promoting Trans-Texas Corridor Pop Up After Election

Billboard from 'astroturf' group appears on FM 1960 Between Jones and Perry Road in Houston, Texas


"A public service message by the Outdoor Advertising Association of Texas"

Location of Billboard:

For more on "astroturfing" CLICK HERE

Additional links:


Transportation Committee Chairman Mike Krusee wins a squeaker via 'black box' voting

System counts too many votes

County confident glitch did not affect results


By Daniel K. Lai
Taylor Daily Press
Copyright 2006

After finalizing all the results from election day, the Williamson County Elections Department found an error in the total votes calculated by computer software.

According to Williamson County Elections Administrator Debra Stacy, the error did not affect the results of the Nov. 7 election.

“Voter sign-in sheets at each voting precinct showed that approximately 84,500 people voted in Williamson County out of 208,521 registered voters for a 40 percent voter turn-out,” she said in a written statement. “However, the elections computer software program that tallies all votes, both scanned ballots and electronic votes, recorded more than 91,000 votes.”

Stacy said the problem occurred within the Election Systems & Software (ES&S) software program.

“While tallying the final results, the software took the number of electronic votes and multiplied that number by three,” she said. “Although there were more votes recorded, it was at the same percentage for both Republican and Democratic candidates. This means that the software problem did not affect the outcome of any election.”

Amanda Brown, a spokeswoman for ES&S, said the company is working closely with the county elections division to understand the origin of the problem.

“It hasn't been determined it was a software problem,” she said. “It could've been, but it also could've been machine or human error as well. We're working diligently to address what exactly caused the problem.”

Brown said ES&S provides election-related services to 43 out of the 50 states throughout the country and cannot specifically say if this is an isolated incident.

“We literally support thousands of customers so there has certainly been some issues in the past, but each one is unique,” she said. “There has been an historical change in the way elections are carried out today and overall voting across the country went very well from what we understand.”

Stacy said the county Elections Administration office is currently reviewing the election process in order to make recommendations to the commissioners court for changes that would prevent the problem from occurring in the future.

Final election results including provisional ballots will be available on the county's Web site at

Copyright © 2006 Taylor Daily Press:


Thursday, November 16, 2006

"Once the land is lost, there's no way of getting it back."

Disappearing Frontier

Roadway may lead to loss of open space, runoff


By Andrew Egan
The Daily Texan
Copyright 2006

With the election season past, proponents of the controversial Trans-Texas Corridor proposal weathered their reelection campaigns well, including the corridors original proponent, Gov. Rick Perry.

The largest proposed public works project in Texas history, the corridor will be a series of toll roads, railways and utility lines extending across the state. Many state officials tout the project as the only answer to alleviate trade and traffic concerns resulting from population growth while various citizen groups have criticized the Perry administration and Spanish-based contractor, Cintra-Zachary, for their vague plans for the corridor.

Environmentalists and farmers also worry about the loss of open space and potential ecological consequences, such as runoff.

These fears aren't important in the project's current phase, because they are considered later in construction planning, said Gabby Garcia, Texas Department of Transportation spokeswoman.

"Basically, what we're trying to do now is narrow down our [proposed] area, and that's it," she said.

The Texas Department of Transportation submitted a Draft Environmental Impact Statement addressing environmental concerns for the specific 10-mile-wide study area the department is considering for the corridor to the Federal Highway Administration. The department is hoping for federal approval by next summer, Garcia said.

The project is so early in its development the department does not know exactly how much land the project will need, she added.

The text of the impact statement shows that no matter how much land is used, it will include a good deal of prime farmland. Prime farmland soils consist of between 37 percent to 47 percent of each the proposed narrowed study areas, according to the statement.

Much of that farmland is in the belt running from the Red River to San Antonio known as the Blackland Prairie. The prairie is valuable for cattle and cash crops such as corn, said James Greenwade, Natural Conservation and Resource Service spokesman with the U.S. Department of Agriculture.

"It's some of the best crop land we have in Texas for dry-land agriculture," Greenwade said.

Once the land is lost, there's no way of getting it back, and the consequence could be a reduction in valuable cash crops the area produces, said Warren Mayberry, Texas Farm Bureau spokesman.

"No matter how many acres it finally winds up taking, it's very safe to say the corridor will have an impact on agricultural output," Mayberry said.

The decrease could also hurt some farmers, he added.

Pat Henson has had his hands in Texas' soil for over 50 years. He owns and operates a 600-acre farm north of Temple and said he worked as a conservationist with the USDA's Natural Resource and Conservation Service for 35 years.

Henson said he opposes the corridor because of the loss of prime farmland while economic conditions facing farmers become increasingly strained.

"The price of the product we're selling hasn't gone up, but the price of everything we buy has," he said.

In the end, the size of the corridor will have too much impact on the land while not doing much to help the community, Henson said.

"Their thinking is if a little bit does a little good, then a whole lot will do a lot of good," he said. "We don't do that in the farming community."

© 2006 The Daily Texan:


"It really adds up."

Tollway, turnpike fees on the rise

Some drivers to pay $1; increase steeper for cash customers

November 15, 2006

The Dallas Morning News
Copyright 2006

FORT WORTH – Driving on the Dallas North Tollway and the Bush Turnpike is going to cost more – enough to make some motorists fork over a dollar at each main toll plaza.

On Wednesday, the North Texas Tollway Authority formally approved raising the tolls on both roads, effective next September. Rates for TollTag users will increase a dime to 70 cents, and tolls for cash customers will go up a quarter to reach $1.

The board also approved a second, smaller rate increase that will take effect in 2010.

The tollway authority last raised its rates on the Dallas North Tollway in 1999 and on the Bush Turnpike in 2002. The agency's board of directors, faced with rising costs for planned projects and demand to build even more projects, had discussed toll increases for more than a year. In April, the board approved a policy calling for regular toll increases every five years, and that led to the toll increase approved Wednesday.

"We have to increase rates to not only maintain what we've got, but also to build for the future," said board vice chairman Jack Miller.

Revenue from the increases could raise $2 billion for road projects in the next 35 years. Projects could include the Trinity Parkway near downtown Dallas and a State Highway 360 extension in southern Tarrant County.

"We've been asked to do more to address the congestion issue," said Allan Rutter, executive director of the tollway authority. "This will do so in a way that addresses the concerns of a lot of people in our own region."

The agency offered some good news for motorists who slog through the tollway construction zone near downtown Dallas. Higher rates at the main toll plaza there will not take effect until construction in the area ends in mid-2008.

In 2010, tolls at main plazas will rise again slightly, going to 75 cents for TollTag users at each main lane plaza on the Tollway and Bush Turnpike. Cash customers will continue to pay $1.

The new rates apply at the tollway's three main toll booths, which are at Wycliff Avenue near downtown Dallas; Keller Springs Road in Far North Dallas; and Parker Road in Plano. The increases also apply at the Bush Turnpike's five main toll plazas – in Irving, Carrollton, Far North Dallas, Plano and Richardson.

Rates also will rise on all ramp tollbooths next year and again in 2010. Those rates vary, but most will rise by a nickel. The increases do not affect tolls on the Addison Airport Toll Tunnel or the Mountain Creek Lake Toll Bridge, which will remain at 50 cents.

"It really adds up," said motorist Michael Lovelace, who uses a mixture of freeways and city streets to get to his job near the tollway-Bush Turnpike interchange. "They don't pay me enough already."

The premium for using cash on tollway authority roads also is rising.

Cash users now pay a 25 percent premium at main tollbooths. That premium will rise to 43 percent next year, and the tollway authority hopes the higher cost will entice more people to get TollTags. During peak commute times, about 80 percent of all transactions recorded are with TollTags.

The board also has pledged to raise tolls on a more consistent basis after 2010. Under the guidelines for increasing toll rates, tolls would rise about 10 percent every five years.

"This allows us to plan regionally and for our customers to know what to expect," said Paul Wageman, chairman of the tollway authority board.

The new toll rates will not affect the new State Highway 121 toll road in Collin and Denton counties, which is owned by the Texas Department of Transportation. Portions of the all-electronic toll road have opened in Denton County, and tolls will be collected on those sections starting Dec. 1. State and regional leaders have set toll rates slightly higher on that and other state-operated roads.

Some motorists said Wednesday that they were not happy to have to pay more on roads that already have a lot of traffic.

"Do we really benefit from all that?" asked Brandon Finnigan, who said he used to commute on the tollway from the Frisco area to his old job at a car dealership in Dallas. He now works in real estate, which also requires a lot of driving. "The roads are nice, but there is always going to be traffic on them."


© 2006 The Dallas Morning News Co


Infrastructure, debt, and the Islamic Bond

Islamic-Bond Market Becomes Global By Attracting Non-Muslim Borrowers


by Karen Lane
The Wall Street Journal
Copyright 2006

WHEN TEXAS-BASED energy firm East Cameron Partners wanted to raise cash this year, it turned not to banks or the domestic bond market, but to the Middle East. The result was the first bond backed by U.S. assets that adheres to Islamic laws against paying or charging interest. “I had never heard of sukuk before,” says Campbell Evans, the Houston company’s general manager, using the Arabic name for Islamic bonds. “I got a book [about it] and it seemed Byzantine. But at the end of the day, it worked for us.”

Islamic financing differs from conventional financing in its strict adherence to Shariah, or Islamic law, which calls for ethical and equitable financing, and bans speculation. Conventional bonds issued by companies or governments pay a fixed annual interest rate for the life of the bond, which can be as many as 10 or even 30 years, after which the principal is repaid. Some bonds are backed by assets such as mortgages or creditcard receivables. If the issuer defaults, the assets are sold to recoup some bondholder losses.

Sukuk are similar to asset-backed bonds, but instead of a fixed annual interest rate, payouts to investors over the life of the bond are derived from leases, profits or sales of tangible assets such as property, equipment or a joint-venture business. These leases, profits or sales can be structured to deliver the equivalent of a fixed annual interest rate, yet they technically aren’t the forbidden “interest” payment.

Western and Asian companies and governments are increasingly using Islamic bonds to tap a well of petrodollars in the Middle East. A rising queue of Persian Gulf-based borrowers are doing the same to raise cash overseas, particularly for large infrastructure projects needed to diversify their sources of economic growth.

As a result, the Islamic finance market is swiftly expanding globally. With both Islamic and conventional banks seeking a piece of the action, it is building bridges between Muslim and non-Muslim nations. According to London’s Islamic Finance Information Service, $16.9 billion in sukuk was issued between January and October this year, 43% more than the total in 2005. Analysts say there is easily $10 billion in the pipeline for the next few months. The market is relatively tiny. In the first half of 2006,new sales of international bonds and short-term notes totaled $1.2 trillion, according to the Bank for International Settlements.

New rating and hedging tools are expected to help the Islamic bond market expand faster. East Cameron Partners, Mr. Evans’s Houston energy firm, raised $166 million in its July issue to consolidate assets and fund development of gas fields. “The sukuk represented over and above what might be available in America in terms of being able to raise the cash at relatively lower coupons,” or payouts to investors, Mr. Evans said. “An Islamic bond would be easily placed with conventional investors, which can widen the investor base, whereas the opposite isn’t true,” said Roula Sleiman, senior associate at Lebanon’s Bemo Securitization SAL, which arranged the deal with Merrill Lynch & Co.

Malaysian borrowers, including state-owned investment company Khazanah Nasional, have marketed Islamic bond deals in the Middle East. So has the Pakistani government, selling $600 million in bonds in 2005. In Japan, Bank of Tokyo-itsubishi UFJ Ltd., the core banking unit of Mitsubishi UFJ Financial Group Inc., is allying with Malaysian bank CIMB Group Bhd. to sell financial services, including potential Japanese corporate sukuk. Islamic communities in the Gulf for centuries have looked close to home to raise capital. Now they are looking farther afield for Shariah-compliant funds to finance projects aimed at transforming the region into a tourism and business hub.

Dubai Ports, Customs and Free Zone in January sold 11% of its $3.5 billion sukuk—the largest ever—to European investors. Around half went into the hands of non-Islamic investors. “In the next two to three years, Bahrain, Kuwait, Qatar, Saudi Arabia, the United Arab Emirates and Oman are looking at more than $50 billion in [infrastructure] financing. I would say 30% of the $50 billion is likely to emerge as sukuk,” said Rafe Haneef, head of Islamic banking at Citigroup Inc. in Kuala Lumpur.

Banks, particularly in the Gulf, are loath to overexpose themselves to the property sector, while developers find that aping the stock markets is more expensive than raising debt. “Infrastructure is a perfect use of sukuk because you are raising funds that
are to be used for a specific project. Assets that you create can generate a return” to pay bondholders, says Neale Downes, a partner in Bahrain with law firm Trowers & Hamlins.

Borrowers outside the Middle East have made this discovery, too. Next year, China is expected to issue its first sukuk when Kuwait Finance House targets the Persian Gulf with a $200 million deal for a Chinese government-linked power company. Indonesia is in the midst of revising tax and other regulations to support both sovereign and corporate Islamic-bond issuance. One of the first sukuk to come to market could be a $650 million deal from Jakarta Monorail, aimed at easing the Indonesian capital’s gridlocked transport network.

Some Islamic borrowers are opting to list their deals outside their home jurisdictions. “Listing on a European exchange like the Irish Stock Exchange makes secondary trade easier from a regulatory point of view for European institutions,” says Gerard Scully, head of debt listing at the Dublin exchange, which last month got its first sukuk listing and is pitching for more. The London and Luxembourg exchanges also list sukuk.

There is geopolitical upside to the proliferation, observers say. It “gives people the chance to learn something positive about Islam, and it counters negative issues in other areas,” says Rodney Wilson, professor in the Institute for Middle Eastern and Islamic Studies at the United Kingdom’s Durham University. Cross-border sales of sukuk are prompting greater harmonization in the way the bonds are structured. Malaysia in the past has favored bond structures that don’t comply with the Middle East’s interpretation of Shariah, notably the deferred payment sale principle of bai’ bithaman ajil—whereby a bank buys an asset on behalf of a customer and sells it later at cost plus a profit margin.

In recent years, however, the Malaysian government has offered tax breaks to encourage the use of more globally accepted structures in a bid to become an Islamic financing hub. One is called the lease-based, or ijarah, structure. Say a petrochemical company wants to raise $350 million. It would sell a plant to a special-purpose company set up for the deal and then lease it back for five years. Investors or banks would lend the company the $350 million. Instead of interest payments, the investors would get proceeds from the lease payments. After five years, the special-purpose company returns the plant to the parent company, and the principal $350 million is returned to the investors.

Another globally accepted structure is called musharakah, a joint venture. The venture’s partners buy Islamic bonds and receive payments over the loan period based on the plant’s profit. In September, Malaysian toll-road operator Plus Expressways set a precedent by swapping outstanding 4.7 billion ringgit ($1.3 billion) in bai’ bithaman ajil debt for Persian Gulf-compliant funding to make the company eligible for inclusion in global Shariah stock indexes. “If you can commoditize products, your cost of issuance comes down,” said Mr. Downes of Trowers & Hamlins.

Cross-border investment should get a further lift from the use of credit ratings. The year-old Islamic International Rating Agency has developed Shariah Quality Ratings, designed to help Islamic investors better judge the standard of Shariah endorsements of an instrument or issuer.

Another catalyst for growth should be global standards for Shariah-compliant derivatives— financial products designed by investment banks to hedge the risk of Islamic debt. New York’s International Swaps and Derivatives Association and Bahrain’s International Islamic Financial Market are engaged in talks aimed at agreeing on such basic standards.

Adherence to Shariah prevents Islamic investors from using conventional hedging tools—interest-rate swaps, forwards or options—to offset fluctuations in interest rates and currencies. The few tailor-made hedging tools now in use have concentrated such risk into the hands of a small number of investors. Global standards would help spread it more evenly, bankers say. “For the Islamic market to exist in the proper manner, it must have all the relevant products that befits the financial market.

For every single conventional product, you want to have the equivalent Islamic product,” says Badlisyah Abdul Ghani, head of CIMB’s Islamic division. Bid Lifts Delta Air Lines Bonds US Airways Group’s announced intention to buy Delta Air Lines when it exits bankruptcy court drove up the price of its bonds Wednesday, a sign some creditors gave the plan an enthusiastic thumbs-up. After being rebuffed by Delta executives this summer, US Airways has brought its proposed purchase of the air carrier to the company’s many creditors by offering them $4 billion in cash and 78.5 million US Airways shares, for a total $8 billion based on Tuesday’s closing price of US Airways’ stock.

Those holding the company’s distressed bonds rejoiced in the idea. Delta’s 7.9% bonds due 2009 rose 21 points, or cents on the dollar, to trade at 61.5 cents on the dollar, according to MarketAxess, an online trading platform. The 8.3% notes due 2029 rose 21.56 cents to 61.75 cents on the dollar, MarketAxess showed. Those notes were the most actively traded Wednesday. Shareholders also cheered. US Airways shares rose $8.57, or 17%, to $59.50 as of 4 p.m. in New York Stock Exchange composite trading. “The prospect for everybody would be better because you’d have these companies combining and forming a much stronger entity which would eliminate redundancies,” said Margaret Patel, a portfolio manager at Pioneer High Yield Fund. “The prospect for recovery for bondholders would be improved.”

The elimination of overlaps from the merger, in flights and gates at both airlines for example, would allow for cost cuts that could strengthen both carriers’ operations, market participants said. US Airways said it believes the combination would generate at least $1.65 billion in annual synergies. A potential US Airways and Delta tie-up also lifted the bonds of Northwest Airlines, which like Delta is in bankruptcy protection. Its 10% bonds due 2009 were up 11.5 points to 78.28 cents on the dollar, according to MarketAxess. Treasurys Slip on Factory Data Robust New York-area manufacturing data knocked Treasurys lower Wednesday, and meeting minutes from the Federal Reserve’s latest policy-setting gathering ensured that the market ended in negative territory.

Most of the damage done to the market was done early, and it struck most hard at the short-dated issues on the yield curve. The Fed minutes exacerbated the slide. The lost ground helped push further into negative territory the spread between short- and long-dated Treasury yields, with the difference, -0.20 percentage point, at its widest point in nearly six years. At 4 p.m., the benchmark 10-year note was down 11/32 point, or $3.4375 per $1,000 face value, at 100 2/32. Its yield rose to 4.619% from 4.576% Tuesday, as yields move inversely to prices. The 30-year bond was down 16/32 point at 96 28/32 to yield 4.697%, up from 4.666%.

—Cynthia Koons and Michael S. Derby contributed to this article.

© 2006 The Wall Street Journal:


Wednesday, November 15, 2006

"In the beginning, all we heard was a major highway would be built; we've found out that this is not quite true."

December 4 meeting in Brenham will discuss Trans Texas Corridor


Navasota Examiner
Copyright 2006

When we first started hearing about plans for the Trans Texas Corridor, no one in our area seemed to know or care much about it. Now, this project seems to be all people are talking about.

In the beginning, all we heard was a major highway would be built; we've found out that this is not quite true. It will be a toll road system with pipe lines and a rail system, and if you live in the north end of the county, it will not be "somewhere" else, it will either be at your front fence or back fence.

"They say" it won't be in our lifetime; however, last week in the Brenham Banner Press, there was an announcement from TxDOT stating that there would be a public meeting on Dec. 4 in Brenham to discuss "US 290 Corridor improvements."

The TTC is not going through Washington County, but will cross US 290. They are already letting residents there know what changes will be in store for their area.

If this isn't going to be in our lifetime, why are they already doing this? Why aren't they passing out proposed highway changes for Grimes County?

This should be a matter of public record and available to all residents that it is going to displace. There will be more than one TxDot offical at this meeting and it states that they will answer questions.

The main man that will be there is Robert A. Apppleton, P. E. Bryan Director of Transportation, Planning and Development. He can be mailed comments at 1300 N. Texas Ave, Bryan, Tx. 77803 or e-mail him at

One lady I know when asked what she thought of the whole thing and the fact that if they wanted your land, they can take it, said, "Looks to me like the thing they should do is to run it down the main street in Navasota. It would be a lot easier to move a lawyer or a doctor's office than a couple hundred head of cattle."

"A lot of history is going to be destroyed."

Corridor Would Destroy one of Texas' Oldest Homes

Bexar County family works to protect a piece of history from the bulldozer

November 14, 2006

By Jim Forsyth
WOAI (San Antonio)
Copyright 2006

Analiese Kunert's home in southeast Bexar County was built in 1798 by the de la Garza family, shortly after receiving a grant of land from the king of Spain. With rustic rock construction and gleaming original pine floors, it is one of the oldest continuously occupied private homes in Texas.

And if Governor Rick Perry has his way, that wood floored living room, so lovingly crafted by Spanish artisans, will be right in the middle of the fast lane of the Trans Texas Corridor, the $181 billion complex of toll roads, rail lines, and gas and oil transmission pipes that Perry has planned to criss cross the entire state.

"Everything is hand laid stone, the walls are about eighteen inches thick," Kunert says, proudly ticking off the 18th Century attributes which make her home a true Texas treasure. "It's all original flooring, lots of exposed beams, two huge fireplaces."

Analiese and her husband have worked for years to restore this amazing property, which stands just southeast of Loop 1604 in Elmendorf Lavernia Road. And she says it came to a complete shock to her to learn that it was standing right smack in the middle of progress.

"Amazingly, I have never gotten any official notification. It's all word of mouth. I couldn't believe that the people who its affecting the most didn't even know. There's a lot of landowners out here, and a lot of history that's going to be destroyed."

Like many toll road opponents, Kunert is perhaps most concerned with the fact that all the words spoken at all the public hearings about the Corridor and other toll roads don't seem to be heard.

"That's one of the major concerns, that they're not hearing us. The other concern is that the public in general does not even know that this is happening. You can go to the north side (of San Antonio, where the Trans Texas Corridor would not destroy any homes) I would ask 25 people at random, and nobody would even know what the Trans Texas Corridor is. I think that's really sad.

As Kunert walks around the historic thirty acres of land she and her husband own, land once grazed by the cattle which fed the missions, tamed by the vaqueros and which provided milk for the armies of Bustamante and Santa Anna, she reflects on the fact that its future may be to provide a right of way, an on ramp, or a service station turn around.

She says she will fight to get the route changed, but realizes that if her home is spared, that will just mean that somebody else's home, which is just as valuable to them as her home is to her, will fall victim to the controversial project.

"I would like to see this project eliminated entirely," she sighs.

"That may be something that cannot happen at this point. Maybe they can find a route that doesn't effect so many homeowners and property owners. I think that would be a good idea."

The Texas Department of Transportation says the Corridor is the best way to deal with growing highway congestion which threatens to crimp Texas' strong economic growth. And it says no final route for the corridor has been determined.

Kunert and her neighbors find it ironic, to say the least, that the head of the company which would lead the consortium that would build the Corridor, Grupo Ferrovial and its subsidiary Cintra, are Spanish companies, possibly staffed by the descendants of the same Spanish pioneers who built her home and settled her ranch.

"Texas worked so hard, and so many lives were lost so many years ago to make this a part of Texas and not Spain. It looks like Spain had alternate plans. It looks like they're getting back in."

© 2006 Clear Channel Broadcasting, Inc.:


Tuesday, November 14, 2006

Poll: 85% want to stop Texas Highway Fund diversions

Texas should stop spending highway funds for non-highway purposes, poll shows


San Antonio Business Journal
Copyright 2006

The Texas Legislature should end its practice of diverting a portion of its state highway funds toward non-highway programs, such as promoting tourism and providing medical transportation for the needy.

That's at least according to the results of an online poll conducted by the San Antonio Business Journal.

Eighty-five percent of online readers who participated in the poll said that this practice is siphoning off available dollars toward building and maintaining Texas highways.

(This poll is not a scientific sampling, but offers a quick view of what readers are thinking on given topics.)

Bexar County Commissioner Lyle Larson and State Sen. Jeff Wentworth, R-San Antonio, plan to push lawmakers to cease diverting highway dollars for non-highway purposes in the next legislative session.

Some poll takers said that the state is long overdue for a plan that would keep more highway trust fund dollars committed to Texas highways. Several said Texas highways are in poor shape, while residents are continually told there is never enough money to fix road problems.

Others responding to the poll said putting more money into transportation could alleviate the need for toll roads.

Only 7 percent of online voters said the state should continue to divert funds. Another 7 percent were undecided.

© 2006 American City Business Journals, Inc.:


“The TTC’s eminent domain legislation eliminated the due process that protected us from what could only be called a ‘land grab.’”

Taking a stand

November 14, 2006

Waxahatchie Daily Light
Copyright 2006

The final approved version was whittled down from its original form, but the Ellis County Commissioners Court passed a resolution Monday morning asking the Texas Legislature to reconsider legislation regarding the Trans-Texas Corridor.

At the request of Heath Sims, Pct. 3, the commissioners had discussed a possible resolution during their last two meetings that would have opposed the TTC project.

During Monday morning’s meeting and the meeting of Oct. 23, a number of Ellis County residents spoke out against the TTC and encouraged the court to pass a resolution showing the county’s opposition to the planned toll road.

Jimmie Simmons encouraged the court to speak out loudly against the TTC.

“When you all speak out powerfully against something, Austin will hear you,” Simmons said. “Strongly tell the Texas government that we don’t want this in our county.”

Waxahachie Council member and Judge Chad Adams’ recent opponent for county judge Chuck Beatty said he was at the meeting to continue fighting for the people of Ellis County.

“First of all I would like to congratulate Adams on his reelection,” Beatty said. “The voters of Ellis County have spoken and have entrusted you to protect their interests. I promised my supporters that win or lose, I would continue to fight for them. It’s true that Texas needs infrastructure to compete but I don’t believe it should be at the expense of destroying some of the most fertile land in the world. Our main objection however is the way the legislation was written with regard to eminent domain, eliminating the due process that protects us from what could only be called a ‘land grab’ and eroding our liberties.”

Beatty said that counties up and down the proposed corridor are fighting the project and he encouraged the Ellis County commissioners to stand up as well.

After public comments Sims made a motion to accept the resolution.

“I went to an event Saturday honoring our veterans,” Sims said. “As I sat there I thought about our founding fathers coming here to create a government for the people and by the people. Our veterans went to fight and take a stand for the freedom in our country and in other countries. This project will take between 450 to 500 acres per mile. This is a wall through the middle of Texas. It’s very important that we as a court take a stand.”

Sims made a motion to accept the resolution, and Commissioner Larry Jones, Pct. 2, seconded the motion.

But before taking a vote, Commissioner Dennis Robinson, Pct. 1, said he would like to amend the motion, cutting the resolution to the first two paragraphs.

“I’m not in support of this road coming through Ellis County,” Robinson said. “But I believe that by simply opposing the legislation it gives us a chance to have a seat at the table.”

Robinson made a motion for the amendment and Commissioner Ron Brown, Pct. 4, seconded the amendment.

“I don’t understand the fear and trying to soften this up,” Sims said. “It’s like putting sugar on a piece of bread. I don’t understand why we need to shorten it other than we might not get something in Austin we want. We’re at the table already. I think we need to stand strong and support what our citizens are asking us to do. We’re still Ellis County, not the North Central Texas Council of Governments (subsection) A - Ellis County. We need to stand up for Ellis County.”

Robinson said there might be consequences down the road for standing up against the TTC.

“I’m concerned that we need to be sure we have a place at the table for regional talks about transportation,” Adams said. “There are a number of electric plants being built south of here. And those plants will require coal which will likely run right through our county. I’m concerned about not having a say as to where trains a mile or two long, carrying coal, come through our county. We have a say as long as we’re still at the table. One of the reasons I’ve worked so hard to be at the table is so we can be involved in the decision making process for regional issues. I think we were successful in getting a letter from the governor supporting the idea of a new route for the TTC along the Highway 360 corridor and we have to remain at the table to have a say in the future of rail and road in Ellis County or else we’ll get pushed out.”

Adams also said the first two paragraphs were what were originally presented to the court by members of the public and the rest of the resolution was additional text added by Sims.

“What you’ve added to the resolution hurts our position,” Adams said. “I don’t think it adequately reflects the people of this county.”

With a 3-2 vote, the commissioners voted to approve Robinson’s amendment. Sims and Jones voted against the amendment.

The vote to approve the first two paragraphs of the resolution passed unanimously.

“I’m pleased we got a resolution passed,” Sims said after the meeting. “I wish it would have passed with more teeth, but I’m pleased we got something passed.”

Adams said he was pleased with the final resolution as well.

“We’re not opposed to the TTC but we are concerned about parts of the legislation creating the TTC,” Adams said. “We want to continue to address transportation issues in Ellis County and the region and we want to be a part of the process.”

E-mail Jonathan at

© 2006 The Daily Light:


CATC: "If you toll more lanes, you get more money."

Study no boon for toll opponents

Analysis of Phase 2 toll plan offers mixed review.

November 14, 2006

By Ben Wear
Austin American-Statesman
Copyright 2006

A long-awaited analysis of proposed Austin toll roads offers little comfort to turnpike opponents — or to politicians looking for a justification to oppose an unpopular second wave of pay-to-drive highways in Central Texas.

The final draft of the report, unveiled Monday to the Capital Area Metropolitan Planning Organization board, says that because of the revenue that tolls provide, making full-fledged toll roads of five Austin roads would ensure that construction could start five to 10 years earlier than the alternatives.

And given those delays, the report by Boston-based CRA International says, the financial value to the community would be greatest with the toll roads.

But Austin City Council Brewster McCracken, a CAMPO board member who requested the study after developing doubts about the tollway plan, saw an opening in the study's findings for his preferred alternative to the Phase 2 toll roads: managed lanes.

Managed lanes, roughly speaking, are lanes built alongside regular expressway lanes that might charge tolls for those driving alone but be free for carpoolers. On the other hand, the $1.9 billion Phase 2 toll road plan (distinct from the first wave of roads now opening) contemplates having tolls on all highway lanes, with free frontage roads alongside.

The five- to 10-year construction difference noted in the study, McCracken said, is irrelevant for at least two of the roads in the plan that are either already completed or nearly complete: sections of U.S. 183 (Ed Bluestein Boulevard) and Texas 71 east of Interstate 35.

The plan also includes a section of U.S. 290 East, short stretches in Oak Hill of Texas 71 and U.S. 290 West, and Texas 45 Southwest, a proposed road.

"All other things being equal, the roads move faster with less congestion under the managed approach," McCracken said, referring to the study's findings that drivers would spend just over 1 percent less time in their cars with managed lanes than toll lanes.

U.S. 183, Texas 71 and any other road with funding already secured, he said, "would be better with managed lanes."

However, the study also says that under the Phase 2 plan, by 2030 the roads would be producing about $46.5 million in excess toll revenue each year that could be used for other transportation projects. With managed lanes, the annual surplus would be at most $8.1 million, the study says.

"I think the study is a roundabout way of stating the obvious, which is that if you toll more lanes, you get more money," said Bruce Byron, executive director of the Capital Area Transportation Coalition. With managed lanes, he said, "you soften the blow on the initial roads, but you make it harder" to pay for additional projects.

McCracken voted for the Phase 2 toll road plan in July 2004, when it came before the 23-member CAMPO board, which is made up primarily of local elected officials and must approve highway projects using federal funds. But McCracken later developed doubts about the information provided to the board by Texas Department of Transportation officials and called for an independent study.

After the Austin City Council was unwilling to provide enough money for the full $300,000 study, other governments (and the toll-road-building Central Texas Regional Mobility Authority) kicked in the balance, and the study commenced about a year ago.

After briefly reviewing the bleak funding situation statewide and nationally, the CRA study attempts to compare the Phase 2 plan to other options, principally that of adding managed lanes.

After a public comment period in December and January and a public hearing at its Jan. 17 meeting, the CAMPO board plans to take up the Phase 2 question at its Feb. 12 meeting.

McCracken predicted Monday that the board will support having tolls on the five roads. But he said the board should seek further information from the state Transportation Department about just how much money is already set aside for specific projects, and when, before deciding whether to go with managed toll lanes or full-fledged toll roads.

© 2006 Austin American-Statesman: www.