Nothing about the scheme is "free market."

Toll-road fever no bargain for consumers

January 20, 2007

Henry Lamb
WorldNetDaily
Copyright 2007

Across the country, state highway officials are almost giddy about the prospects of selling the right to build toll roads to private investors. Financial wizards have learned how to amass gigantic pools of capital to pay the states for the privilege. Prestigious financial institutions are promoting the new method of financing infrastructure as the greatest development since sliced bread.

Left out of the equation is the consumer – the poor working stiff who has paid exorbitant local, state and federal taxes on every gallon of gasoline he ever purchased so that highway officials would have the funds necessary to construct new highways as needed and keep them in good repair. Under this new scheme for financing infrastructure, the poor working stiff gets to continue paying the exorbitant gasoline taxes and pay an additional "toll fee" for the privilege of driving on a highway for which his tax dollars should have already paid.

Abuse of the consumer doesn't stop there. Toll roads are profitable because the operators not only get the toll fees, they get revenue from the concession contracts as well. Concessionaires must raise their prices to cover the contract costs. They can because they have no competition in toll road corridors from other vendors. The toll road user must pay whatever the concessionaire charges for gasoline, food and whatever other services that may be available.

Traveling on a non-toll roadway, a consumer may choose from an incredible array of restaurants, service stations and other vendors, all eagerly competing for his business. On a toll road, the consumer is stuck with whatever food, gasoline and other services the toll operator chooses to make available. The vendors have no competition, and the price for goods and services is always higher on a toll road than on a non-toll road.

Yet, politicians and economists hail this new form of infrastructure financing as a great example of free-market ingenuity. Nothing about the scheme is "free market."

In the first instance, the land on which a road is to be constructed requires the eminent domain power of government. Free market entrepreneurs would have little hope of acquiring sufficient right of way without the power of eminent domain. Very few functions in society can be performed better by government than by a free market; highways is one of those functions.

If gasoline taxes are not sufficient to provide the roadways required, they can be raised. The consumers, who are the taxpayers, can control the quality of their highway system by allowing, or not allowing, an increase in the gasoline tax.

Should a special roadway become necessary, such as the proposed Trans-Texas Corridor project, which requires more funding than current taxes allow and which will benefit a narrow, definable consumer group, government could obtain the funding through bond sales tied to the future toll revenues. This is essentially how the private sector raises the funds, by pledging future revenues. The difference is the profit taken by the private sector; this profit could stay in the pockets of the consumers if the project were constructed and operated by government officials. Moreover, the consumers might have some hope of oversight by elected representatives if the project were operated by the government.

When government turns over the right to operate a toll road to a private operator, the consumer is at the mercy of the contract agreed to by the initiating government and the operator. These agreements tend to be for many years, binding future generations.

The Trans-Texas Corridor agreement with Centra-Zachry lasts for 50 years. Centra, a Spanish company, partnered with an Australian firm in a 99-year contract to operate the Chicago Skyway, and a 75-year contract to operate the Indiana Tollway.

The users of these facilities will be paying handsome tolls, premium prices for food and services, in addition to the exorbitant gasoline tax, for most of the rest of this century.

What makes this form of infrastructure financing so attractive to highway officials is the initial cash payment from the private-sector operator. The city of Chicago was paid $1.83 billion for the right to operate the Chicago Skyway. The Indiana Tollway deal produced $3.85 billion for state officials. And the Texas deal will produce a total of $7.2 billion for state officials.

This is just too much money – all at once – for government officials to resist. No, it will not be used to reduce gasoline taxes, or any other tax, for that matter. Government will simply find ways to watch it evaporate long before the contract expires. Government benefits from the cash windfall; the private operator and its financiers benefit from consumer revenues; and the consumer – the poor working stiff – gets to pay the bill.

© 2007 WorldNetDaily: www.worldnetdaily.com

Ric Williamson: "Pay your 15 cents a mile and get the heck out of my way."

Search 'Ric Williamson' in TTC News Archives HERE

Taking the Bull by the Horns

Ric Williamson addresses Texas's transportation concerns

January/February

AAA Texas
Texas Journey Magazine
Copyright 2007

Since its inception 50 years ago, the Interstate Highway System dramatically changed how Americans live, work, and play. Interstates have linked the East to the West and the North to the South, providing easy access to goods and job locations and contributing to a more prosperous economy. But the Interstate Highway System is at a crossroads: Today's voters, legislators, and transportation planners are faced with unprecedented challenges in traffic congestion, population growth, and road funding. To give TEXAS JOURNEY readers insight into these issues, AAA Texas government affairs representative Anne O'Ryan sat down with Texas Transportation Commission Chairman Ric Williamson to talk about the state's transportation future.

Ann O'Ryan: When we look at transportation in Texas, what have we been doing that you feel needs to be changed?

Ric Williamson: The dilemma Texas faces, and the dilemma that all [states] face, is that the binding scheme to support the transportation infrastructure might have made a lot of sense 50 years ago, [but] it makes very little sense for the next 50 years.

It’s interesting—when you study the history of the Interstate Highway System. It was originally proposed as a toll system, right up until the time that congressional leaders suggested to the president that they would rather raise the federal gasoline tax than stand behind a toll system. They weren't sure people would pay the tolls and use the system enough for it to grow as fast as they felt it needed to grow. That was a perfectly rational decision in 1956. Today, it is a perfectly irrational decision for those of us who live in high growth states and for those of us who have a tremendous infrastructure already in place that has to be maintained. [The current gas tax rate] does not generate enough cash flow to accomplish our goals at all. It’s not even close.

If you said, "What would that rate have to be today to maintain the current system and to build for the number of Texans and the number of road miles and the number of roads that have to be built?" the answer is 91 cents a gallon. And our tax rate is 20 cents a gallon.

If you said, "Tell me what the gas tax rate needs to be from this point forward, to catch up for what we didn't build the last 50 years, and what we know we’re going to have to build the next 25" the answer is $1.40 a gallon. Not 20 cents a gallon.

Ann O'Ryan: Texas today is considered a national model for transportation [with its plans to build more roads than any other state], What is Texas doing differently?

Ric Williamson: The governor and the legislature have said we've got a great tax system. The tax rate we have now on gasoline is sufficient to maintain [roads] and keep [them] in good shape. For capacity from this point forward, we’re going to parallel that [tax-funded road] system with toll roads.

We're going to do it as the private sector is willing to risk their money with us. And we're gonna use the private sector—and, in partnership, public trust—to decide when toll road's built, to assure ourselves that no toll road is built before it’s ready to be built. That’s why you see us planning for the Trans-Texas Corridor but not actively building it yet.

We have a governor and a legislature that understands the problem and are willing to take the heat for the most part for TxDOT to do projects that over the next 25 years will solve most of our transportation problems.

Ann O'Ryan: What do you believe are Texas's transportation problems today?

Ric Williamson: First and foremost is congestion. We have major congestion in our urban areas, which creates three costly problems. First, it contributes to very poor air quality. Second, it make's road travel within that area unsafe— the roads could be getting safer by a lot if we didn't have all this congestion. The third thing that congestion does—and that no one until Rick Perry was elected governor was willing to tackle—is that it taxes people's time. And this is the great indirect tax.

Congestion taxes people in ways that no one has been willing to quantify until now. And we’re realizing what a heavy toll it is. It takes a tremendous amount out of the economy of Texas. And it is beyond question, in our minds that high paying, high-quality jobs follow dependable and open transportation routes.

Ann O’Ryan: You were twice named as one of the 10 best legislators and dubbed “The Revolutionary" [by Texas Monthly magazine]. Do you see that as your rote as chairman of the Transportation Commission?

Ric Williamson: No. My role is whatever Governor Perry defines for me. The reference to revolutionary think is made in the context that every morning I've woken up and gone to my job in public service, I've done so with the notion that however we're doing things today may or may not be the best way so do things. And if it is not the best way to do things, there's no glory in defending that which doesn't work. You should never he afraid to look in the mirror and say, "I'm wrong" or "That’s not working" or "What I did isn't gonna work, and so now we need to change things." And I think it's safe to say that that’s not a normal approach to public service. But that's my approach.

Ann O’Ryan: So how is Texas going to address the congestion problem?

Ric Williamson: If you preferred strategy is to take- the limited amount of gasoline tax dollars that you have and distribute those gasoline tax dollars proportionally to the urban areas of the state, you’re probably not going to reduce congestion. If, on the other hand, your strategic direction is to use every financial tool available to you—to think in terms of how you can create more cash flow and deploy that tactically to reach your goals—then you've probably got a pretty good chance of being successful.

Ann O'Ryan: How will motorists be impacted?

Ric Williamson: For the next 15 years they’re going to see orange cones everywhere because these [toll and private financing projects] are going on and the Trans-Texas Corridor will kick off in four years.

After 15 years, we will almost overnight see congestion start t o disappear in places that we didn’t dream was possible. We'll put the finishing touches on a robust commuter rails system, and we think we'll have in place a series of short-haul taxis that the private sector will develop.

We think that, by the year 2020, air quality will noticeable disappear as congestion decreases. We think that high-paying jobs, such as those Toyota brought [with its new plant in San Antonio], will suddenly start popping up n the most unexpected places.

The most important thing Is that they're gonna see the same 20 cents a gallon gas tax we were paying 15 years earlier because we made a conscious decision to reserve the gas tax for the maintenance and repair of the existing [tax-funded road] system and to use the private sector and consumer-driven tolls to build our capacity expansion. We can honestly look the taxpayer in the eye and say, “You have a choice.”

Ann O'Ryan: Our members have told us that they don't want existing roads or existing lanes tolled. Will Texas be adding toll onto existing roads or lanes?

Ric Williamson: As long as Governor Perry is governor, he has said that will not happen. Both state and federal law require a series of events [to add tolls to existing lanes]. County government has to approve that. City government, in some cases, has to approve it. The Department of Transportation has to approve it.

But let me give you the public policy argument— the whole notion was based on some pretty clear thinking; Does the current gasoline tax pay for all these roads and all this clean air? No, it doesn't. It doesn't even come close.

So let me see if I understand this: I got this road moving through downtown Dallas, the apportioned taxes for this road are paying only part of the cost of the road, but somehow we shouldn’t toll that existing road? Tell me why. Explain to me why we shouldn’t do that. And really, the only valid answer is because, by God, we just don't want to.

Ann O'Ryan: Will there always be a reasonable non-tolled alternative?

Ric Williamson: First of all, you can have the best public policy in the world, but if the people don't accept it, then it never gets implemented.

So when you go down the toll road path, you've gotta do it in a way that people- will accept it, embrace it, take ownership in it- The way you do that is you never make them pay a toll.

But our argument is that the tax road system in Texas is so robust that we can parallel every major tax road with a toll lane or a toll road and I can honestly say, "Look, if you want to pay the 20-cent gas tax and stay on the tax road, then stay on the tax road. Nobody is making you get into this toll lane, nobody's, making you pay 15 cents a mile for this toll road. But if for whatever reason you want to get out of my way and get onto this toll road, please do so; it's right here. Pay your 15 cents a mile and get the heck out of my way." I just like that, I think it works. I think it makes sense.

© 2007 AAA Texas: www.aaa-texas.com

"Toll roads along this stretch of 281 has the great potential to have a catastrophic impact."

Bexar official makes stand to stop 281 tolls

01/19/2007

Patrick Driscoll
San Antonio Express-News
Copyright 2007

For years now, Lyle Larson has felt like a fly being brushed aside amid the state's rush to toll new highway lanes, but lately he feels like his luck could be changing.

The Bexar County commissioner is lining up powerful allies for a goal-line stand next week against a plan to build toll lanes on U.S. 281 from Loop 1604 to Comal County — smack through his precinct.

First he got letters of support from Ernesto Ancira Jr., president of Ancira Enterprises, and Tom Turner Jr., chairman of TETCO, after telling them their concerns would ring louder if put in writing. Soon, more than a dozen other businesses on the highway wrote letters.

Now Larson is getting help from state Sen. Jeff Wentworth, R-San Antonio, whose district includes U.S. 281, and the commissioner says he now may have enough ammo to derail toll plans.

"That gives me a little bit more hope," he said Friday.

Ancira said he wouldn't have built an auto dealership on U.S. 281, and Turner said his firm wouldn't have put five convenience stores there if they had known toll lanes were coming.

"Toll roads along this stretch of 281 has the great potential to have a catastrophic impact," Turner said in his letter.

Larson said such opposition is old news to him, but nevertheless the letters help crack open claims that San Antonio's business community is solidly behind local toll plans.

"I represent the area, and I get the calls," he said. "Most of the people that are going to be impacted are opposed to this."

But Larson was surprised by Wentworth, who doesn't oppose toll roads and rubbed elbows with advocates at the November ribbon cutting for the Central Texas Turnpike in Austin.

But U.S. 281 is different, and the senator wrote to Larson last week to say he backs efforts to stop tolling of that highway.

"I would like to take this opportunity to express my support for this initiative," Wentworth stated. "Toll roads may be the best mobility solution in some instances, but other options should be considered."

Larson, who says he gets little respect from the Texas Department of Transportation, feels he may have turned a corner.

"They just look at me (as) an annoyance," he said. "If they go against a state senator's wishes, then I think TxDOT's going to have a lot more problems."

But Larson still must sway 17 fellow board members of the local Metropolitan Planning Organization, including two TxDOT officials.

He was the lone wolf in 2004 when the board ditched a plan to widen 21/2 miles of U.S. 281 into a freeway and add overpasses at Stone Oak Parkway, Evans Road and Borgfeld Road. It instead opted for tolls so eight miles of express lanes could be built.

Since then, one other board member — Bexar County Commissioner Tommy Adkisson — has joined the attack. On Monday, Larson and Adkisson will flaunt Wentworth's support and ask the board to pull the U.S. 281 tollway plan and revert back to the freeway version.

"In this case, construction of these three overpasses may be the best choice," Wentworth said in his letter.

TxDOT warns that pulling the plug could have far-reaching effects. U.S. 281 toll revenues also are supposed to help finance toll lanes on Loop 1604, as part of a 47-mile system that two private consortiums are competing to take over.

"While some officials are concerned about one project or one road, the MPO has to look at things from a regional point of view," said David Casteel, TxDOT's lead engineer in San Antonio and a member of the MPO board.

Meanwhile, time is running out for Larson and his allies.

A public hearing on the latest environmental report for the U.S. 281 tollway is less than three weeks away, and construction can start once federal officials approve the report, which could be this summer.

"If we're going to change directions, we need to change direction before construction starts," Larson said.

pdriscoll@express-news.net

© 2007 San Antonio Express-News: www.mysanantonio.com

"When you lose money on every sale, it’s tough to make it up in volume."

Highway to state insolvency

January 18, 2007

Bob Buckel
Azle News
Copyright 2007

Recently I drove on the new tollway – SH 121 – through Frisco, coming back from East Texas.

I must say, it was nice. Less traffic, no stoplights. For anyone who has driven through the Frisco/Plano area in the last few years, it was a huge improvement.

Apparently, as we drove, an unseen camera photographed our license plate and sent the data to a computer, which determined the vehicle’s ownership and generated a tollway bill that arrived last week. It was a bill for 60 cents.

Now, I appreciate the fact that I didn’t have to stop at a toll gate and toss coins into a basket, but I question whether even the State of Texas can afford to make money like this.

It cost Texas 28 cents – bulk rate – to mail this bill. I’m convinced that even my tiny part of the cost of installing and maintaining the cameras and computer system cost more than the remaining 32 cents that didn’t go to the Postal Service.

But add to that the cost of the invoice itself, the paper, the toner, the printer that kicked it out, the cost of folding it and sticking it in an envelope – along with a pre-addressed return envelope – and I’m sure Texas lost money on this transaction.

And as we all know, when you lose money on every sale, it’s tough to make it up in volume.

Shoot, it cost me 39 cents just to mail that 60-cent check, not to mention the time it took to write it and the cost of the check itself. This bill wasn’t worth sending or paying.

I thought about just tossing it, but then I read the warning at the bottom: “As the registered owner of the vehicle(s) on this invoice, you are responsible for the payment of the specified tolls and fees. Failure to pay the invoice within thirty (30) days may result in the issuance of a Notice of Toll Violation that includes administrative fees as authorized under Texas Transportation Code §228.055.”

Not wishing to be a scofflaw or to cost Texas any more than it had already spent, I put it with the others and paid it on time. They should get it this week.

That means someone in Austin has to open it, receipt it, credit it to my account and deposit it in the state’s account – which according to what I read is running a surplus of $14.3 billion for the upcoming biennium.

I know the governor is all fired up about using toll roads to pay for highway construction without having to wait on the feds to free up funds. I know traffic is bad and there’s a real need for innovative ways to get more, bigger, better roads built more quickly.

I’m for all that. I really am.

I applaud the technology, too, that helps drivers get on and off tollways without a thought, must less a visit with a surly toll-booth attendant.

It just seems like we could find a better way to collect it. How about putting it on our state income tax? Oh, that’s right – we don’t have one. How about the sales tax? No – who wants to stand in line at Wal-Mart while they find out who you are and how much you owe in highway tolls?

I guess they could just run you a tab until it gets to at least $5 or so – then it would be worth collecting. I’m sure folks who drive that road every day get a much larger bill, when they get one.

I’m just worried that if they send out enough invoices like mine, the state’s $14.3 billion suplus could be gone even before the Legislature has a chance to spend it. What a tragedy that would be.

Bob Buckel is publisher of the Azle News.

© 2007 Azle News: www.azle-news.com

France wants a piece of the TTC pie

France seeks bigger role in S.A.'s growth

1/18/2007

Meena Thiruvengadam
San Antonio Express-News
Copyright 2007

San Antonio is in the midst of an "economic miracle," and French businesses want to be part of it, the country's U.S. ambassador said here Thursday.

There are three areas in particular — mass transit, medicine and tourism — in which French companies can help San Antonio develop more quickly, Jean-David Levitte said during a luncheon at the Westin Riverwalk.

"These are three areas that are very important for the economy of San Antonio as well as three areas of our economy where we have really a technological edge," he said.

The country's companies could be instrumental in the implementation of the proposed Trans Texas Corridor, said J. Tullos Wells, a San Antonio lawyer, honorary consul of Canada and chairman of the Free Trade Alliance San Antonio, the group hosting the luncheon.

"They understand commuter rail and mass transit as well as anyone else on the planet," Wells said.

With 150 companies responsible for 50,000 jobs here, Levitte said France already is Texas' second-largest foreign direct investor.

meenat@express-news.net

© 2007 San Antonio Express-News: www.mysanantonio.com

Note to Governor Perry: Dump 'Ric' Williamson

Senator says Perry should replace transportation chief

Carona says Ric Williamson has 'worn out his welcome'

January 18, 2007

By Ben Wear
Austin American-Statesman
copyright 2007

Gov. Rick Perry should find someone other than his long-time friend Ric Williamson to lead the Texas Transportation Commission, the incoming chairman of the Senate's transportation committee said today.

Sen. John Carona, R-Dallas, said Williamson's "abrasiveness" and single-minded commitment to toll roads and privatization as the only solution to traffic congestion "has worn out his welcome in many communities across the state. I think it would be in the best interest of the state that he step aside in favor of new leadership on the commission."

Williamson, whose six-year appointed term ends Feb. 1, declined to comment, citing a standing policy of not responding publicly to comments by elected officials. Perry's office did not immediately respond to a call for comment.

Williamson, if reappointed during the current legislative session, would not be able to serve beyond the end of the session in May unless he was confirmed by the Senate. However, Perry could choose simply to appoint no one until the Legislature goes home. Under that scenario, Williamson could serve in holdover status indefinitely.

Commissioner John Johnson, for instance, has continued to serve even though his term expired during the 2005 legislative session. Perry recently named a replacement.

Williamson, an oil business executive from Weatherford, served in the Legislature from 1985-98, a period that overlapped with some of Perry's time in the House. He was appointed to the commission by Perry in March 2001 and was named the group's chairman effective Jan. 29, 2004.

Williamson, particularly since becoming chairman, has been a dogged advocate for Perry's toll road policies, which includes having the Texas Department of Transportation analyze all new highway construction for the possibility of charging tolls.

In addition, Williamson and the commission have aggressively moved the department toward reaching agreements with private companies to build and operate tollways as private concessions on state-owned highway right-of-way. The centerpiece of that policy is the proposed Trans-Texas Corridor, which would be a network of intrastate tollways, railroads and utility corridors paralleling the existing interstate highways in the state.

Carona, chairman of the Senate Transportation and Homeland Security Committee since February 2006, has made it clear he diverges from Perry and Williamson on much of that agenda. While Carona supports toll roads in certain circumstances, he said today that the Trans-Texas Corridor plan was a mistake and that turning highway construction over to private operators is wrong.

He supports allowing the state's 20-cents-a-gallon gas tax to float upward with the growth in highway construction costs and has filed a bill this session to make that happen.

"There ought to be other options that ought to be part of the mix," Carona said. "What we're saying is put the system back in balance again."

Williamson, he said, has not been open to those other options.

"Ric Williamson and his group take any discussion that seems to move away from their core position as a threat," Carona said. Williamson is bright and committed to transportation, Carona said, and always polite in appearing before legislators to discuss the subject.

"He is quick to speak, but not necessarily quick to listen," Carona said. "I think with the new session and the governor's new term, it would be a good time to begin a new relationship."

bwear@statesman.com; 445-3698

© 2007 Austin American-Statesman: www. statesman.com

"We are going to raise the question whether foreign ownership of highways is in fact the best approach for American security."

Jackson Lee to chair panel on transportation security

House Democrat says she'll study safety of private leases for tollways

Jan. 18, 2007

By: MICHELLE MITTELSTADT
Houston Chronicle Washington Bureau
Copyright 2007

WASHINGTON — Rep. Sheila Jackson Lee was tapped Thursday as chairwoman of a powerful House subcommittee responsible for overseeing the security of the nation's transportation and critical infrastructure sectors.

As head of the House Homeland Security Committee's Transportation Security and Infrastructure Protection subcommittee, the Houston Democrat will have authority to assess and oversee government efforts to protect the nation's airports, seaports, rail lines and highways.

Jackson Lee will also have oversight over the Transportation Security Administration and the security of critical infrastructure such as hospitals, and chemical and power plants.

"I am extremely excited," she said.

Noting the Houston area's convergence of airports, rail, petrochemical plants, the Port of Houston, mass transit, the Texas Medical Center and highways, she added, "This committee is one that fits not only for Houston but also the nation."

Jackson Lee served notice that her subcommittee will wade into the controversy over financing new highway construction through tolls and leases to private companies, including foreign ones. "We are going to raise the question whether foreign ownership of highways is in fact the best approach for American security," she said.

On whether she has reached a conclusion on the issue, which could place her at odds with ardent toll-road backer Gov. Rick Perry, Jackson Lee said: "Sometimes revenue has to take a back seat to security."

Jackson Lee's elevation on the Homeland Security Committee, by Democratic leaders, means she definitely will not chair the House Judiciary Committee's immigration subcommittee, which is sure to be a hub of activity this year.

She has been the top Democrat on that subcommittee for years, but was faced with the fact that a more senior Democrat, California Rep. Zoe Lofgren, a former immigration attorney, will assert her claim to that chairmanship when the committee formally organizes next week.

Jackson Lee said she will remain a member of the immigration subcommittee and noted she can also influence the immigration policy debate from her other Homeland Security assignment, the Border, Maritime and Global Counterterrorism Subcommittee.

Another Houston-area lawmaker, Rep. Nick Lampson, D-Stafford, also gained assignment to key subcommittees, joining the Transportation and Infrastructure Committee's aviation subcommittee and its railroads, pipelines and hazardous materials subcommittee.

"Those are going to be areas of critical importance to Congressional District 22, particularly the railroad thing," Lampson said, citing concerns in Fort Bend County over the number of freight trains that cross through communities.

Lampson, who also serves on the Science and Agriculture committees, has gained assignment to an agriculture subcommittee that could help the seafood and cattle industries in his district.

Lampson noted he is a former crawfish farmer. michelle.mittelstadt@chron.com


© 2007 Houston Chronicle: www.chron.com

Former Texas Transportation Commissioner Nichols is appointed to Texas Senate Committees on Transportation and Homeland Security

Nichols selected to serve on four Senate committees

January 16, 2007

From Staff Reports
Athens Review
Copyright 2007


AUSTIN — Freshman State Sen. Robert Nichols, R-Jacksonville, has been appointed to serve on four committees and one subcommittee during the current legislative session.

Nichols was elected in November to represent Senate District 3, replacing former Sen. Todd Staples, R-Palestine, who successfully ran for state agriculture commissioner after serving since 2001 as state senator.

Nichols will serve on the committees on Transportation and Homeland Security, Health and Human Services, Nominations and on Intergovernmental Affairs, where he was named vice-chairman. He also will serve on the subcommittee on Evacuations and Flooding.

“This announcement is great news,” Nichols said. “These committees will allow me to capitalize on my knowledge and experience while giving me a greater opportunity to advocate for specific needs of Senate District 3.”

Prior to his election to state office, Nichols served two terms on the Texas Transportation Commission. He also holds 30 medical patents and has served on the board of directors at East Texas Medical Center and the Nan Travis Hospital Foundation for over 24 years.

“As a member of the Transportation and Homeland Security Committee, my goals are simple but vitally important, keep Texans safe and keep Texans moving,” Nichols said. “An efficient transportation system is essential to a strong economy, and nothing is more important than protecting Texas from threats to our security.”

He asked to be put on the Health and Human Services Committee in order to help develop practical answers to problems facing the state’s healthcare system.

“I requested a seat on Health and Human Services because it is important to help Texans in need without creating disincentives for independence,” Nichols said. “Texans have a reputation for hard work and independence, but we also have great compassion. My philosophy for working on Health and Human Services is to combine the best of those traits.”

His background in community medicine gives him practical insight into the state’s healthcare needs, he said.

“Reliable and accessible healthcare is important to everyone,” Nichols said.

He also looks forward to bringing his years of service as a Jacksonville mayor, city councilman and member of the Jacksonville Economic Development Corporation to his appointment as vice-chair of the Intergovernmental Affairs Committee and its newly-created Subcommittee on Evacuations and Flooding.

“Hurricanes Katrina and Rita greatly affected District 3, and we will likely face similar stress and strain from storms and evacuations in the future,” Nichols said. “That disaster reminded the Legislature of the importance of communication on all levels of government, and I plan to use my experience as a mayor and commissioner to help develop the best solutions for our region.”

© 2007 CNHI: www.athensreview.com

"There needs to be a national dialogue – and not just among the nation’s investment bankers."

Roadblock needed on privatizing highways

Jan. 16, 2007

By Daniel Schulman
Fort Wayne News Sentinal
Copyright 2007

If you’ve ever traveled cross-country on I-90, you’ve driven the Indiana Toll Road, a major trucking artery that stretches 157 miles across the length of northern Indiana. Last June, the “Main Street of the Midwest,” as it’s locally known, was turned over to a foreign consortium – made up of the Spanish construction firm Cintra and Macquarie Infrastructure Group (MIG) of Australia – in exchange for $3.8 billion.

The privatization of the nation’s highways, a trend touched off in 2005 when the City of Chicago sold a 99-year-lease on the Chicago Skyway to the same consortium, has so far received little attention. It is, however, big news in the investment banking world and major firms such as Goldman Sachs and the Carlyle Group have already set up infrastructure funds to invest in what they expect to be a very lucrative market.

Goldman, the primary dealmaker in the toll road market thus far, is pushing privatization aggressively around the country, advising Indiana and other states considering privatization even as it has created a fund whose sole purpose is to maximize returns by picking up infrastructures for the best price possible.

The idea seems to be catching on. States including New York, Pennsylvania and New Jersey have recently raised the possibility of leasing major turnpikes, while other states, from Florida to Alaska, are now considering inviting the private sector to build and operate highways and bridges. In all, more than 20 states have passed legislation allowing so-called public-private partnerships to lease and operate toll roads.

The Indiana deal inked by Gov. Mitch Daniels will yield hundreds of millions of dollars in tax breaks for the consortium, which also receives immunity from most local and state taxes.

Under the deal, the consortium collects all the tolls, which it’s allowed to raise to levels far beyond what Hoosiers have been used to. In fact, one analysis found that if the toll regimen in place in Indiana and Chicago had been applied to New York’s Holland Tunnel for the past 70 years, the toll could stand at $185 rather than the current $6.

Another analysis found that the value of the road over the 75-year term could be as much as $11.38 billion — a nice return on MIG-Cintra’s investment, but a potential net loss of more than $7 billion to Indiana taxpayers.

For companies seeking to buy up American infrastructure, the financial stakes in privatizing the nation’s transportation arteries are potentially huge. In 1956, a Republican president, Dwight Eisenhower, convinced Congress that an integrated, public highway system was vital to economic development, commerce, and even national security.

Today, Ike’s legacy is at a crossroads. The federal highway trust fund, financed by the proceeds of the federal gas tax, is running out of money, in part because lawmakers have not dared to raise the tax since the mid-’90s. At this rate, the fund will be in the red by 2009.

Meanwhile, states and cities desperate for repairs to decaying roads and bridges, not to mention new highways, are struggling to find ways to pay for transportation projects.

Enter privatization, which promises a quick fix – and a means to outsource difficult political decisions, such as raising tolls or taxes, to entities that don’t have to worry about getting re-elected. The notion has the enthusiastic backing of the Bush administration, but some politicians are worried that, as Congressman Peter DeFazio, D-Ore., put it during a congressional hearing on highway privatization last May, we are “outsourcing political will to a private entity.”

“It’s a scam, basically,” DeFazio, the incoming chair of the House Subcommittee on Highways, Transit, and Pipelines, later said in an interview. “It just does not make sense for an integrated national transportation system.”

With the highway trust fund headed toward running on empty, it’s clear that new transportation funding options are needed. But before the nation heads farther down the privatization road, there needs to be a national dialogue – and not just among the nation’s investment bankers.

Daniel Schulman is Mother Jones’ Washington-based Lannan Investigative Fellow. This column was adapted for newspapers from a longer version in the magazine.

© 2007 Fort Wayne News Sentinal: www.fortwayne.com

MoPac will take mo' money from commuters

Looking at 'managed' tolls on new MoPac lanes

January 15, 2007

Ben Wear
Austin American-Statesman
Copyright 2007

Amid all the roiling about whether several Austin highways should be expanded as tollways, plans to add toll lanes to MoPac Boulevard (Loop 1) have been churning away quietly below the radar.

That's about to change.

In mid-March, the Texas Department of Transportation will release a detailed proposal to add "managed lanes" to MoPac between Town Lake and Parmer Lane. And if all goes smoothly — a huge "if" in the world of public policy and highway construction — MoPac north of the river could have eight lanes by the end of 2010. That's one more on each side.

But you 'd have to pay to use those two new lanes.

Which brings us back to managed lanes, an approach that would be a Central Texas first if it happens on MoPac. But not necessarily a last.

Austin City Council Member Brewster McCracken has been pushing managed lanes as an alternative to creating full-fledged toll roads on U.S. 183, Texas 71 and other highways in a proposed second wave of tollways dubbed Phase 2.

The MoPac project is considered Phase 3, though it might occur before Phase 2.

So what's a managed lane?

That can vary, both in design and toll scheme, from place to place. But it's a lane that might be free for some vehicles such as buses or carpools and charge tolls for other vehicles. In some cases, there is "congestion pricing" in which the toll rate rises and falls to assure that the managed lane remains free-flowing. If traffic congests, the price would go up to temporarily cull users.

John Kelly, the Transportation Department's lead consultant on the MoPac project, provided general details of the $102 million plan.

•No added right of way: Central Austin neighborhoods made it clear years ago that MoPac shouldn't expand outward. And the Union Pacific railroad, at least for now, is loathe to give up some of its 60 feet of right of way. But, Kelly says, he and his team, on paper, have contrived to wedge a fourth lane into the skinniest section of MoPac from Town Lake to RM 2222. Which means . . .

•Narrower lanes: MoPac lanes, 12 feet wide in most places, would go to 11 feet. However, the two added lanes would be 12 feet wide, with a 4-foot buffer from the three free lanes, allowing people to drive around stalled or wrecked cars in the managed lane. Aside from scattered 11-foot sections on MoPac, officials say there are 11-foot lanes across Central Texas.

•No concrete barriers: The managed lanes would be separated from existing lanes with stripes and flexible pylons. There would be entry and exits points at each end and two places in between.

•Who pays? That will be subject to debate. But Kelly recommends that no tolls be charged only for buses and van pools.

Want to know more about managed lanes?

The Transportation Department has scheduled a forum on them at 6 p.m. Tuesday at the Thompson Conference Center on the University of Texas campus.

Getting There appears Mondays. For questions, tips or story ideas, contact Getting There at 445-3698 or bwear@statesman.com.

© 2006 Austin American-Statesman: www. statesman.com

"A small cabal of wealthy businessmen and business lobbyists dominated the Perry agenda to their own benefit and the detriment of the state."

Perry due credit for more than surviving, many [lobbyists] say

January 14, 2007

By CHRISTY HOPPE
The Dallas Morning News
Copyright 2007

AUSTIN – Sometimes history remembers you for just staying alive: Apollo 13, the Unsinkable Molly Brown and maybe, just maybe, political survivor Rick Perry.

When pressed, Rick Perry listed his work in transportation, the civil justice system and school finance as accomplishments. 'Every issue could probably be a legacy issue. I look at what we need to be doing; what are the issues facing Texas,' he said.

As Mr. Perry stands poised Tuesday to take his third oath of office, on his way to becoming the state's longest-serving governor, it might be the thing for which he is most remembered. In fact, his longevity is no small feat.

"He's the Bobby Knight of Texas governors," said Chuck McDonald, an Austin lobbyist who served in the administration of Democratic Gov. Ann Richards. "He'll be the all-time winningest career leader here. Surviving that long – good, bad or indifferent – is not an insignificant accomplishment."

But beyond that, many who have served in the Capitol think the man from Paint Creek has received short shrift for his long career. Compare him, for instance, to predecessor George W. Bush, who was a widely popular state executive.

By any objective standard, he has tackled the issues left by Mr. Bush and accomplished much more:

Under Mr. Perry, it's much harder to sue for medical malpractice and lawsuit limits have axed the big-dollar jury awards; school property taxes are dropping and thousands of businesses that had escaped taxes before are paying the tab; and the choked state highways are finding relief with a network of new tollways.

But then, Mr. Bush went on to be president.

"I mean, your immediate predecessor ascended to the White House. That's a big shadow," Mr. McDonald said.

Experts and observers believe that Mr. Perry can still write his own legacy, but his stamp thus far has been that he is politically deft and believes that what's good for business is good for the state. And time could show that his idea that private business has a better answer to managing foster care or road construction, or building coal plants, or teaching schoolchildren, could be visionary – or disastrous.

But most agree his longevity is allowing him to push it forward.

"He will be known as a survivor," said Jerry Polinard, a political science professor at the University of Texas-Pan American. "And he will be known for presiding over a period of Republican dominance."

It takes credit away from Mr. Perry, Dr. Polinard said, that the GOP Legislature has pushed for these initiatives. Plus, it's not unusual for Texas governors to have a pro-business bent – Mr. Perry has simply taken it farther than most.

Following personalities

He said that as one of the constitutionally weakest executives in the nation, a Texas governor has needed a forceful personality or a sweeping vision to reach the top tier. Think Allan Shivers and John Connally.

And, as many experts point out, Mr. Perry and his accomplishments are following two of the strongest personalities the state has seen in some time: Ms. Richards and Mr. Bush.

"It will be hard for him to escape the 'average' label unless something happens in the next term," Dr. Polinard said.

The governor himself doesn't really like to join in all this speculation of what he might be thought of down the road.

"I don't wake up every morning and go, 'Oh boy, I wonder what they're going to write about me 10 years from now,' " Mr. Perry said. "This is about leadership and facing the issues that face you at the moment."

But Texas Association of Business director Bill Hammond said Mr. Perry is frequently denied the credit he is due by pundits and the media.

"His actions speak louder than charisma," Mr. Hammond said. "To date, he will be remembered for helping to create the best business climate on the planet."

That environment has created jobs, prosperity and a strong economy that will continue past this administration, Mr. Hammond said. He pointed out that the multibillion-dollar Trans-Texas Corridor could, in a few years, be a toll road that runs from south of San Antonio to north of Dallas, built largely with private dollars, and will be a boon to the economy for decades.

"He's head and shoulders above all those – [Bill] Clements, [Mark] White, Richards, Bush – in terms of his accomplishments. He's done the deal," Mr. Hammond said.

Reggie Bashur, a top lobbyist who worked in the administrations of Mr. Clements and Mr. Bush, said Mr. Perry has faced tough political races and entrenched issues but managed to succeed.

"He's always done best when the odds are toughest against him. Travis could have used Perry at the Alamo," Mr. Bashur said.

He agreed with Mr. Hammond that Mr. Perry has been underrated.

"He's not a favorite of a lot of the so-called observers and pundits around the state," probably because of his strong conservative philosophy, Mr. Bashur said. "But his success is reflected in the fact that people vote for him."

Just 39 percent of Texas voters, though, did so last year. That was enough to easily beat a divided field, but Mr. Perry was never able to convince most voters that he deserved credit for the state's economy or recent legislative achievements. Indeed, in a Dallas Morning News poll last year, more than half of respondents could cite no Perry accomplishment.

Glenn Smith, a former aide to Democratic Lt. Gov. Bill Hobby, said he believes that Mr. Perry will be remembered for really one thing: "His hair."

Special interests

Mr. Smith, now the director of the Texas Progress Council, a largely Democratic think tank, said that history will reflect that a small cabal of wealthy businessmen and business lobbyists dominated the Perry agenda to their own benefit and the detriment of the state.

"It's a different scene than special interests holding power in Austin – that's always been the case," Mr. Smith said. "This is a very reduced number of people who hold the power – and that has been the key to his successes, which ultimately, I think, will be seen as failures."

Mr. Smith said that while Mr. Perry trims public programs and aids private businesses, schools are left starving for funding, children can't get health care, state college tuitions are skyrocketing and pollution spews unabated.

"Texas is so far behind in so many areas that no one governor can ever get it done. But we're digging ourselves into a much deeper hole," he said.

And many of the private partnerships that Mr. Perry is promoting will be undone by scandal and failures and rejected by future voters and legislatures, Mr. Smith predicted.

He also said that while he might begrudge Mr. Perry's policies, he can only admire his ability to win at politics. He's disciplined and looks good on TV, Mr. Smith said.

"Everyone was mistaken if they thought they might win against him because he was going to make mistakes," he said.

Pushed to discuss his achievements, the governor said last week that he tackled a woefully neglected transportation network, a broken civil justice system and a school finance scheme thrown out by the courts.

"Every issue could probably be a legacy issue. I look at what we need to be doing; what are the issues facing Texas," he said.

Also, Mr. Perry said, history doesn't wait for someone to make it up. Too often, it happens suddenly, such as a Hurricane Katrina or Rita.

"Those are all things that are out there, and they will be what they will be," he said. "A legacy is something the historians can write about."

E-mail choppe@dallasnews.com

© 2007 The Dallas Morning News: www.dallasnews.com

"These nutty experiments in privatization are predestined to fail."

Privatizing toll roads won't pay off for drivers

1/14/07

BY JOHN BENDEL
Asbury Park Press
Copyright 2007

Sell New Jersey's toll roads? Toll road privatization is all the rage in state capitals around here.

Pennsylvania speculates it could net from $3 billion to $10 billion from a Pennsylvania Turnpike lease to a private operator. Delaware is considering a lease of the Delaware Turnpike for as much as $4 billion. Indiana actually did it, recently leasing the Indiana Toll Road — its Turnpike — to an Australian/Spanish consortium for 75 years for $3.8 billion.

Here in New Jersey, Gov. Corzine expects to net up to $10 billion for New Jersey's toll roads. It's part of his plan to reduce property taxes, he says.

Privatization advocates claim toll road sales or leases raise cash for new infrastructure and that private ownership will be more efficient. Private owners will run roads like businesses, they say.

Well, private owners might try, but these nutty experiments in privatization are predestined to fail. The reason is simple: Politics always trumps economics.

A privately owned New Jersey Turnpike or Garden State Parkway will lead first to higher tolls, then to lower maintenance and perhaps public subsidy. Ultimately, the state will be compelled to buy back what it should never have sold in the first place. The cost in the end will be enormous.

The future should be clear to anyone willing to look beyond the numbers on the table today.

First, it will be impossible for any privately run toll road to gain and maintain public support. Proponents of private toll roads acknowledge that operators will raise tolls — something politicians haven't the nerve to do. That's the point, they admit with a grin.

But tolls will always have political consequences, no matter who imposes them. In this age of regular E-ZPass statements, the cost of tolls is very visible to all. No public relations strategy, no brilliant marketing plan, no free coffee, no toll-plaza lottery will ease resentment of higher tolls and the company that exacts them.

As tolls rise, we will see more traffic on alternate roads. Look at the record here: after steep Turnpike toll hikes pushed truck traffic onto alternate roads in the early 1990s, New Jersey towns urged the state to impose truck restrictions. Trenton obliged in 1999.

Those rules were overturned by a federal court last February, but the state is now vetting new truck-restriction regulations designed to pass constitutional muster.

That ongoing effort reflects serious political might. Those same local governments will fight overload on "their" roads — even if the traffic is not primarily big trucks. They will push for lower tolls, or at least for tighter control over increases.

On their side of the equation, toll operators will trim expenses. That's what private businesses do. That's how private owners are expected to generate a profit.

But we're talking about fewer employees and less maintenance. Even if maintenance stays the same qualitatively — a questionable proposition — toll payers will perceive cutbacks in every overflowing trash can, tire-busting pothole and snow-covered traffic lane.

How long will it be before accidents are blamed on cutbacks — real or perceived? The bereaved will demand maintenance standards. Editorial writers and commentators will be right behind them. Toll road operators, no matter what they do, will become public villains.

Of course, if tolls and maintenance standards are imposed by law, the private toll road operator will demand subsidies. Talk about a politically distasteful turn of events.

But even if subsidies are not provided, state government will find itself over time pressed to buy the roads back — at a substantial profit for the owners, of course.

What makes politicians, of all people, believe that privately owned public toll roads will function beyond the reach of politics? Nothing is beyond the reach of government — certainly not highways that people perceive to be public property. No contract, no lease, no deed will change that central, altogether reasonable assumption.

Despite what the governor or the lawyers say now, legal agreements cannot protect private toll road operators from future political interference — not even the most ironclad franchises and absolute guarantees.

When a toll road deal goes bad politically — as it has to — politicians in power then will change the law. And if they can't do that, they will find ways to harass toll road owners to achieve the same ends. You'd be amazed how creative politicians can be when it comes to the exercise of power.

No private toll road operator will be able to blow off the Legislature and/or a determined future governor. In the real political world, it will be very popular for an elected official to move against an unpopular toll road operator.

Could there possibly be any other kind?

John Bendel is a former newspaper reporter who covered transportation issues. He is a former member of the Island Heights Borough Council.

© 2007 Asbury Park Press: www.app.com