Wednesday, June 27, 2007

"Nobody expects a rubber stamp."

State may defy local leaders on 121 toll plan

Money, politics could push panel to override choice of NTTA

June 27, 2007

The Dallas Morning News
Copyright 2007

The Texas Transportation Commission has made a habit of honoring local leaders' decisions.

But when commissioners meet Thursday to consider North Texas leaders' plans for the politically charged State Highway 121 toll road, nobody expects a rubber stamp.

The Regional Transportation Council voted 27-10 last week to endorse the North Texas Tollway Authority for the multibillion-dollar project. If ratified by the commission, the local vote would torpedo an earlier deal the state reached with the Spanish company Cintra.

Commissioners have never overruled a decision by the regional council, but with so much money and politics at stake, Highway 121 could set a precedent.

"As far as saying, 'Thank you all very much for your comments, and now we're going to vote the other way,' they haven't done that in the past," said RTC chairman Oscar Trevino. "But all we are is a recommending body. I can see them not agreeing with us."

Gov. Rick Perry has appointed all five commission members. They have the ultimate say on state road contracts. Transportation officials in Austin, El Paso, Houston and San Antonio say the panel has yet to contradict a local recommendation on a specific road project.

"This commission, more than any prior one, has acted to strengthen decision making at the regional and local level," said Alan Clark, director of transportation planning for the Houston-Galveston Area Council.

Still, Highway 121 is a special case. The state originally picked Cintra for the project four months ago. When that deal prompted a backlash from state lawmakers, regional leaders invited the NTTA to re-enter the bidding process.

Members of the RTC – mostly local elected officials – spent more than eight hours combing through the dueling bids before siding with the tollway authority.

Members said they chose the NTTA for several reasons, including the idea of keeping profits in North Texas rather than sending money to Spain.

The tollway authority's cash offer of $3.3 billion was higher than Cintra's. And RTC members said they believe better-than-expected traffic on Highway 121 could generate more revenue for the NTTA to build other roads in North Texas.

The Texas Department of Transportation, which is governed by the state transportation commission, has consistently favored Cintra's proposal.

Since Mr. Perry appoints the five commissioners, the department is under pressure to carry out his initiative to privatize highways. A winning bid for Cintra would signal that Texas' roads are open for business.

Local power

Reversing the RTC's endorsement of the NTTA for Highway 121 would be a hairpin turn from the commission's philosophy of local control, a mantra it has repeated over the past four years.

Regional planning councils used to present the state with a wish list of road projects, then wait for commissioners to pick which ones to fund. Now, the state gives each council a pot of money and asks regional leaders to select projects and prioritize them.

Inflation is chipping away at the state gas tax, the chief funding source to build and maintain roads. Commissioners have encouraged regional councils to generate more public money by seeking toll-road contracts with upfront payments. Highway 121 is Texas' richest such deal yet, with the NTTA and Cintra both offering around $3 billion in cash in return for the right to collect tolls for the next 50 years.

The commission's chairman, Ric Williamson, declined to comment last week on the upcoming vote on Highway 121. But in late March, days after the RTC invited the tollway authority back into the bidding process for Highway 121, Mr. Williamson all but guaranteed that commissioners would defer to regional leaders.

"We want to administer the award of that construction contract according to the regional leadership," he said. "We just believe that if you have a strategy that says empower local and regional government, that's what that means and you stay out of it, other than making sure the law is followed and making sure good engineering practices are used. If you're going to let go and let people assume a regional perspective, that's what you have to do."

Other commissioners, however, have raised concerns that the volatile and unorthodox bidding process for Highway 121 may prompt Cintra to sue the state.

And Transportation Department officials have circulated letters suggesting that yanking the project from Cintra could cost the state federal funds. A state engineer even wrote a memo suggesting that the NTTA could go bankrupt if it's awarded the project. James Bass, the department's chief financial officer, has since called the memo "moot."

The department's two representatives on the regional council voted for Cintra's proposal. And Mr. Bass said earlier this month that if commissioners ask for a staff recommendation on Thursday, the department's review team will recommend Cintra.

How much weight the commission would give a staff assessment is unclear. While commissioners emphasize local control, they also have embraced private companies – Cintra, for example – as a key solution to the state's transportation problems.

"You had a monopoly called TxDOT. We're trying desperately to dismantle that monopoly," Mr. Williamson said during a meeting with reporters last month.

"We try to move wherever we can to insert competition and competitive pressure into the decision-making process, in the broader context of letting regional leaders judge who has the best proposal in that competitive process," he said.

New territory

Should commissioners reject the NTTA proposal, local officials say, it will be the first time the panel has reversed an RTC decision.

Mr. Trevino, the mayor of North Richland Hills and the RTC's new chairman, said members of the regional council tangled with commissioners last year about a proposed Trans-Texas Corridor route that local leaders felt ran too far east of Dallas to benefit the region economically.

Commissioners ultimately agreed to study another route that would include the future Loop 9 project near the Ellis-Dallas county line, bringing the corridor closer to North Texas' urban areas.

Still, Mr. Trevino said, it's possible the commission will overturn the RTC vote on Highway 121.

"I don't think it'd be the best thing for them to do," he said. "But then again, they march to a different drummer than we do."

State lawmakers warn that rejecting the RTC vote would snub the Legislature, which passed a law requiring that NTTA be awarded Highway 121 if its proposal were financially superior.

Transportation officials across Texas will be watching Thursday's meeting for clues on how the commission will handle local recommendations on future toll deals.

"It'll set the tone," said Sid Martinez, director of San Antonio's transportation planning agency. "If they go with the RTC's recommendation, then we know in the future that more than likely they will honor the vote of the local and regional players. If they don't, then we know that it might be a tougher landscape."

The commission overruled El Paso's regional council last year during a debate over whether the city could establish its own transportation authority. But none of the state's five largest planning organizations could recall being reversed on a specific road project.

Michael Aulick, executive director of the Capital Area Metropolitan Planning Organization in Austin, said he couldn't think of any similar battles between his group and the commission.

But Mr. Aulick said the Highway 121 debate is different because of the billions at stake and the unprecedented choice between hefty public and private toll bids.

"We're not in y'all's league," he said. "Dallas-Fort Worth plays a much bigger game. They play the NFL compared to what we do down here."

© 2007 The Dallas Morning News Co

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