Thursday, March 01, 2007

"Making a policy piñata of the Texas Department of Transportation."

Senate panel takes another look at toll roads in all-day public hearing

Carona says many lawmakers want a "do-over."

March 01, 2007

By Ben Wear
Austin American-Statesman
Copyright 2007

An auditorium-full of Texas elected officials and average Joes gathered at the Capitol today to talk about the state's toll road policy and spent the morning making a policy piñata of the Texas Department of Transportation.

To some degree, the testimony has been a replay of more than 50 hearings held around the state last summer on the proposed Trans-Texas Corridor, when large crowds of mostly rural Texans decried Gov. Rick Perry and the Transportation Department's plan to build a wide corridor of roads and rail through the countryside.

But the difference today, one that seems to have energized opposition in the Legislature, is the agency's increasing turn to contracting with private companies to build, operate and profit from such roads for 50 years. Legislators worry that building roads that way will lead to higher tolls and leave what are currently unknowable tollway profits in corporate rather than public hands.

State Sen. John Carona, a Dallas Republican who chairs the Senate Transportation and Homeland Security Committee, has been an increasingly strident critic of the state's turn to toll roads and such private agreements. He called today's rare all-day public hearing as the Legislature considers his and other bills to roll back authority they gave to the Transportation Department in recent sessions.

"There are many legislators that would like a do-over," Carona said, eliciting laughter and applause from the packed auditorium.

As of this morning, about 100 people had signed up to speak and more than 500 people had submitted written comments or testimony.

Carona interrupted the public testimony at midmorning for an invited guest, Dennis Enright with NW Financial Group, billed as an expert in so-called public-private partnerships.

Enright said that the state, whenever possible, should attempt to borrow money and build toll roads rather than turning projects over to the private sector. The cost of borrowing money is generally lower for the public sector, he said, as much as 50 percent lower. And the large up-front payments to the state, such as the $2.1 billion that Spanish company Cintra has offered to pay the state to build a Dallas-area tollway, only increase the amount such companies must borrow and the tolls they will charge.

Enright said that for risky roads, such as the rural tollways in the Trans-Texas Corridor plan, it might be appropriate to put such projects in private hands. But urban tollways likely to have heavy traffic, such as the Texas 121 road Cintra would build, are best done by the government, he said.

"You should find out whether it can be done by the public sector more efficiently," Enright said. "It's a vital public asset."

Transportation Department officials have argued in the past that the private sector has infinitely higher capacity to borrow and thus build needed roads faster. The agency says the state has more than $80 billion in transportation needs over the next 25 years that there is currently no money set aside to do.

But transportation officials say that using long-term leases with private companies, most of them foreign firms with experience in running toll roads, could close that $80 billion gap in just a few years.

Sen. Eliot Shapleigh, D-El Paso, highlighted the underlying core issue: gasoline taxes. The Legislature has not increased the state's 20 cents-a-gallon gas tax since 1991, and the federal 18.4-cents-a-gallon gas tax has been frozen since 1993.

Carona has filed a bill that would automatically increase the gas tax by tying it to increases in highway construction costs.

Tax bills cannot originate in the Senate, however, so Carona will have to depend on a comparable bill emerging from the House and amend it with his tax provisions.

The hearing is expected to last throughout the day, and will include testimony at midafternoon from state Transportation Department officials.

© 2007 Austin American-Statesman:

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