Sunday, April 01, 2007

'Liberating Dead Capital?' Robbing the Public Treasury is a more accurate description.


Macquarie's D.J. Gribbin moves closer to assuming DOT general counsel role


Alice S. McGuffie
Citizens for a Better Waller County
Copyright 2007

The Senate Committee on Commerce, Science, and Transportation Nomination hearing of David J. Gribbin, IV on Thursday, March 29, 2007 for the position of General Counsel of the Department of Transportation has totally gone without notice by any news organizations. This quiet event, though not particularly individually significant, is one more step in the United States' giant leap toward privatizing our national infrastructure.

Gribbin was nominated by President George W. Bush in January of this year and his credentials demonstrate rapid job bounces between the public and private sectors.

D.J. Gribbin has served a little more than a year as a Division Director of Macquarie Holdings, Inc. While in this role he testified at the U.S. HOUSE TRANSPORTATION AND INFRASTRUCTURE COMMITTEE “UNDERSTANDING CONTEMPORARY PUBLIC-PRIVATE HIGHWAY TRANSACTIONS: THE FUTURE OF INFRASTRUCTURE FINANCE” MAY 24, 2006 and encouraged Congress to "liberate" the "dead capital" of the U.S. Highway Infrastructure by facilitating more public private partnerships. Macquarie Holdings is the U.S. based "child" of Australia's Macquarie Bank.

In an October 2005 article, The Sydney Morning Herald Newspaper called Macquarie Bank the Millionaire's factory, an insatiable innovator, mesmerising the market with financial origami and generating apparently endless streams of money, and likened Macquarie Bank to "the greatest corporate catastrophe in history … Enron, the energy monster that invented new markets in everything from electricity to bandwidth to weather futures and then imploded."

Before joining Macquarie, Mr. Gribbin served as Chief Counsel for the Federal Highway Administration. Mr. Gribbin's tenure at FHWA was characterized by his strong agenda of advancing public-private partnerships (PPP). His efforts included creating a PPP task force, writing a report to Congress highlighting the benefits of PPPs, and creation of FHW's SEP-15 program.

While FHWA chief counsel, D J Gribbin wrote a formal Advice Memorandum for state DOTs and metro planning organizations saying that if grant funds were not available toll projects alone could be considered in alternatives analyses done under the NEPA permitting process, thus giving state or local toll agencies the opportunity to eliminate non-toll alternatives and simplifying and speeding up the permitting of new toll projects, and focusing on making new highway projects toll projects from the beginning.

TollRoad News reported, this was of huge importance in moving new highway projects away from the hand-out mechanisms of federal aid and state matching grants and toward tolling, because it reversed the order in which financing is considered.

Previously most highway projects were considered from the viewpoint of need based on free-road demand modeling and environmental acceptability. Financeability was only considered after a project was shaped and permitted, and often only after it was included in the area longrange plans.

Under Gribbin's doctrine governmental authorities, pushing toll projects, could bypass free road projects in the lengthy selection and approval process laid down in federal law. Projects were allowed to be advanced as toll projects from the beginning. An MPO could, under Gribbin's ruling, advance tolling as part of the initial purpose and need for a project, eliminating non-toll alternatives.

Prior to joining the FHWA, Mr. Gribbin served as the Director of Public Sector Business Development at Koch Industries. In that role, he worked with the governors, legislators and leaders of State highway authorities to develop public-private transportation ventures. In addition, he worked on a policy level with Congress and the Administration to make it easier for states to use innovative financing and contracting techniques when building highways. As Koch's Director of Government Affairs, he helped manage Koch's Federal legislative and political efforts.

If his appointment is confirmed by the Senate (which has recessed until April 10, 2007), Mr. Gribbin would serve as the principal legal officer and advisor to Secretary of Transportation Mary Peters, his former boss when he was at the FHWA.

Senator Daniel K. Inouye commented at the Nomination Hearing on Thursday, "The General Counsel of the Department will play a key role in guiding the agency through the many challenges ahead. Our nation’s transportation system is slowly collapsing under the tremendous stress of increased congestion caused by growing passenger and freight demand and years of under-investment. All modes of transportation are plagued by stubborn safety problems. On our highways alone, we lose 43,000 lives a year. Tackling these problems will force us to face complex fiscal, environmental, safety, and security issues, requiring leadership that, so far, has been lacking from this Administration."

So, where would Mr. Gribbin's guidance take the Department of Transportation if he becomes the DOT's General Counsel?

With his decided preference for public private partnerships we can see his legal interpretations will open more doors for private boardrooms' secret deals and close more doors to public ownership and oversight.

Liberating Dead Capital, indeed. Robbing the Public Treasury is a more accurate description.

© 2007 Citizens for a Better Waller County:

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