Monday, February 04, 2008

"TxDOT continues to spend tax money to support toll projects but says it is running out of money for other roads."

Texas lawmakers aren't sure transportation department's numbers add up

February 4, 2008

The Dallas Morning News
Copyright 2008

Just how broke is TxDOT really?

Lawmakers will be asking that Tuesday during a special joint session of the Senate finance and transportation committees.

For most of last summer and fall, the Texas Department of Transportation issued warnings that it was running out of money for adding lanes and building new highways. In December, it announced it would cut back spending on new highways and instead focus on repairing and, when needed, rebuilding existing roads.

On Monday, TxDOT executive director Amadeo Saenz reiterated the department’s cash-strapped position, arguing that the pavement on scores of Texas highways continues to get worse, and the cost of maintaining them is continually on the rise.

So far, though, that hasn’t set well with lawmakers, some of whom fear the move is designed at least in part to pressure them to support the agency’s push for private toll roads.

Lt. Gov. David Dewhurst, for instance, has demanded TxDOT explain at the committee meeting Tuesday why its fiscal forecasts have not included all the bonding capacity the Legislature has given the agency in recent years, including authority to borrow $5 billion that was granted by voters in a referendum last year.

TxDOT officials, however, said that while voters have approved the extra borrowing, the department can’t do so until the Legislature passes enabling legislation and provides TxDOT enough general revenue appropriations for the agency to make payments on the debt.

The additional borrowing is a welcome tool, but one that can’t address the agency’s long-term needs, TxDOT officials have argued. In an interview Monday, Texas Transportation Commission Ted Houghton of El Paso likened the loans, when offered in lieu of additional revenue, to “taking out a payday loan.”

In North Texas, the cutbacks will be felt less severely than elsewhere in the state. North Texas officials will have the option of using some of the $3.2 billion paid by the North Texas Tollway Authority, which is developing the Highway 121 toll road, to offset some of those shortages.

But other regions, including Austin, have been severely affected, and lawmakers want answers. On Tuesday, they’ll get to ask for them.

“One of the big questions will be, ‘Are you really in a financial crisis? And if so, is it because the money is not there or because you spent the money badly?’ ” said Steven Polunsky, a key transportation aide to committee chairman John Carona, R-Dallas.

For instance, he said his boss will want to know why TxDOT continues to spend tax money to support toll projects but says it is running out of money for other roads.

The committee’s vice chairman, Sen. Kirk Watson, D-Austin, said the agency’s aggressive stance has become too political.

“I am concerned the department has attempted to create a new political force of its own, one that exerts its own pressure on the Legislature,” Mr. Watson said. Instead, the department should leave policy making to the Legislature and stick to planning and building roads, Mr. Watson said.

TxDOT’s sustained push for private toll roads has drawn fire from legislators, who last session slammed on the brakes for so-called public-private partnerships. One result: NTTA got a second chance at bidding for the Highway 121 project, which had initially been awarded to a private construction company headquartered in Spain.

But TxDOT has hardly slowed its push for more such private deals. More than 80 projects have been identified as toll-eligible, and the agency has continued to champion many of them as right for private developers.

A North Texas example is a massive expansion of LBJ Freeway, on which private companies are expected to bid later this year. Six new lanes, all tolled HOV lanes, will be part of that project, which will also rebuild existing free lanes.

TxDOT argues those kinds of projects are the only way to produce the kind of money it needs for new roads. Mr. Houghton said costs for those roads keep going up. He blames a range of factors, including aging infrastructure, Texas’ huge population growth, and the habit of the Legislature of diverting gas tax money to non-road purposes. “And inflation is just eating us alive,” he said.

One former TxDOT commissioner, now a senator often critical of the agency’s toll-road push, said the agency focuses too exclusively on private toll roads.

“There seems to have been in the past two years an overwhelming push for setting up partnerships with private equity concerns, up to the point that all other options have been ignored,” said Sen., Robert Nichols, R-Jacksonsville. “I do not think that is the proper approach.”

The issue of public-private partnerships will get a second look Tuesday, as a study panel created last session to examine their potential meets following the committee meeting.

© 2008 The Dallas Morning News:

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