Friday, May 01, 2009

Perry on closed door meeting: "We were all lovin' on each other in there."

Perry talks transportation with legislative leaders, including Pickett


Brandi Grissom
El Paso Times
Copyright 2009

As I walked from one side of the chamber to the other today trying to track down an El Paso lawmaker, I recognized Gov. Rick Perry's security detail sitting in the hallway behind the House chamber.

Wondering what warranted Perry's trip across the Capitol, some other reporters and I hung out to see what we could see and hear what we could hear.

When a door opened and Perry emerged, we could see some of the folks in the room: Lt. Gov. Dewhurst, House Speaker Joe Straus, Transportation Commission Chairwoman Deirdre Delisi and House Transportation Committee Chairman state Rep. Joe Pickett.

Clearly, this meeting was about transportation, but Perry wouldn't stop long enough to chat with us (His staff indicated he would not, asking us not to ask the Perry any questions. Sure, that's going to happen.). We lobbed questions at Perry's back as he high-tailed it for the elevator, but his only reply was, "We were all lovin' on each other in there."

Pickett was a little more forthcoming. The meeting, he said, was about a bill by state Sen. John Carona, R-Dallas, that would allow local areas to vote on fees and taxes to generate money for transportation projects in their regions.

Pickett said the group was discussing a plan he developed to allow municipal planning organizations, or MPOs, to decide about those transportation plans instead of individual municipalities and counties.

MPOs were designed to represent transportation needs for an entire region and could better decide on priorities, Pickett said.

The group in the meeting, he said, seemed to be on board with the plan.

"Gov. Perry had very minimal objections to the proposals," Pickett said.

He didn't mention anything about anybody lovin' on anybody.

© 2009 El Paso Tims:

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“We need to shut down this loophole because it gives the government a way to avoid eminent domain proceedings.”

House passes Kolkhorst eminent domain protection legislation


The Sealy News
Copyright 2009

Texas representatives have added additional protection to landowners against eminent domain abuse by repealing the “jury of view” process from the transportation code.

The legislation, authored by Rep. Lois Kolkhorst, R-Brenham, repeals the powerful, but rarely used process known as “jury of view”, which local governments can invoke to remove important constitutional protections usually afforded to landowners. The process gives county commissioners the opportunity to appoint five individuals to determine the path of a road and assess any damages incurred by property owners with no appeals process.

“This is a great example of how getting rid of a law will protect our rights and give more power to the property owners,” Kolkhorst said. “We need to shut down this loophole because it gives the government a way to avoid eminent domain proceedings.”

Landowners who oppose the process say that jury of view allows local governments to be the final arbiters of a land condemnation proceeding and denies affected parties a new trial to review or challenge a condemnation decision.

Critics say the process has sometimes been abused, and has been selectively used by local governments hoping to avoid the scrutiny that traditional eminent domain hearings may bring to controversial projects.

“This law denies the public their constitutional due process to landowner protections. It’s time to get rid of it, and I’m glad my fellow lawmakers agreed,” Kolkhorst said.

The bill passed unanimously and had the support of the Texas Farm Bureau.

© 2009 The Sealy News:

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"We have to drive a wooden stake into the heart of the Trans-Texas Corridor, just like we would to permanently kill a vampire."

Abolish the plans for the Trans-Texas Corridor


By David McQuade Leibowitz - Guest Commentary
Southside Reporter
San Antonio Express-News
Copyright 2009

State Rep. David McQuade Leibowitz presented legislation that would abolish the Trans-Texas Corridor and prevent the conversion of existing roads to toll roads in the House Transportation Committee on April 21.

“Today is San Jacinto Day, when Texas celebrates their final victory over Mexico in 1836. I hope that today is also the beginning of the end of the Trans-Texas Corridor.

“While state leaders have said the Trans-Texas Corridor is dead, the statue that allows its construction is still on the books. We need to get rid of the language so that the tolling advocates and foreign corporations will not be able to take the property of Texans and turn them into toll roads.”

Leibowitz presented two bills to the committee, House Bill 11 and House Bill 13.

House Bill 11 repeals the authority of Texas Department of Transportation (TxDOT) to contract and build the Trans-Texas Corridor (TTC).

It repeals Chapter 227 of the Transportation Code which establishes the Trans-Texas Corridor. It also repeals sections providing for:
  • Regional Mobility Authorities to work on the TTC
  • An 85-mph speed limit on the TTC
  • A property tax exemption for the TTC
  • Reporting requirements x for the TTC
  • Hydrogen refueling stations on the TTC

“The Trans-Texas Corridor is sucking the very lifeblood out of the heart and soul of our beloved Texas. If we have to drive a wooden stake into the heart of the Trans-Texas Corridor, just like we would to permanently kill a vampire, then that is what we will do.

“House Bill 11 drives a wooden stake into the heart (assuming it has one to begin with) of the Trans-Texas Corridor and kills it permanently.”

House Bill 13 prohibits turning a planned state highway into a toll project unless one of the two following conditions are met:

  • The highway or lane was open to traffic as a turnpike project on or before Sept. 1, 2005.
  • Or, the highway is reconstructed so that the number of non-tolled lanes is greater than or equal to the previously existing number of non-tolled lanes; or the highway or lane was open to traffic as an HOV lane on May 1, 2005.

The goal of this bill is to limit the conversion of freeways into toll roads and I think we will accomplish that.

David McQuade Leibowitz is the state representative for District 117. His district office is located at 9107 Marbach Road, Suite 111.

He can be contacted by phone at his district office by calling 372-0759 or his Austin office at (512) 463-0269.

© 2009 San Antonio Express-News:

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To view the Trans-Texas Corridor Blog click HERE


Thursday, April 30, 2009

Texas Senate to Public: "We know that ya'll are right, but you don't have anything to offer."

TxDOT = Republican Socialists [Fascists] of Texas


Hank Gilbert
The Burnt Orange Report
Copyright 2009

On Tuesday, the Texas House passed its version of the TxDOT Sunset bill. Not only did it not mirror hardly anything that the Sunset Commission suggested from their almost year-long review of the agency, it was also loaded down with a laundry list of other transportation bills, thus making it an omnibus transportation bill. We, at Texas TURF, had predicted as much midway through the session. Everone should know, that if this thing passes, the tax-paying, traveling public in Texas will never come out of this recession that we find ourselves in today.

Most of you know that I vowed to continue fighting the TTC and TxDOT back in the '06 campaign. I only wish that the people who won those elections in '06 and '08 would also fight like they vowed to do. Instead, most are bowing to inside pressures of special interest groups instead of listening to constituents. If this huge bill is signed into law, as written, every Democrat in the state can flip the "socialist" label upon Texas Republicans!

Texas TURF is a bi-partisian organization that has over 100,000 members statewide. Terri Hall, a republican mother of 7, and myself, formed this organization immediately after the '06 elections. We have worked very hard to convince legislators to listen to the people and reform this rogue agency, TxDOT. However, as a senator's aide put it a couple of weeks ago,"we know that ya'll are right, but you don't have anything to offer." In other words, without stock options, paid luxury vacations, etc., you and your group are no use to us.

Over the past 3 years, we have testified, on behalf of the people of Texas, at a varity of hearings. Texas Transportation Committee, House and Senate Transportation Committee hearings, and town-hall meetings throughout Texas and the United States, are just a few of the events that have heard our passionate testimonies. In a lot of the legislative hearings, we are treated as "second-class" citizens. Most of you know that I don't take very kindly to that type of behavior.

For almost every day of this legislative session, either Terri or I have been in Austin meeting with legislators and/or testifying to committees. We have testified for some good legislation (eminent domain and some transportation bills) and against many transportation bills. Most of the bills that we support are stuck in committee, and probably won't see the light of day. Most, if not all of the bills that we oppose, are well on their way to becoming law unless people start speaking up.

Perry is controlling all of this with his new transportation aide, that he recently received, on loan, from Ag. Commissioner Todd Staples. His aide is commonly seen in the house and senate transportation committee offices delivering messages from 39%. Consequently, the committees have been bowing to his pressure. Perry's main allies in the leg. are Sen. John Corona (R-Dallas)(chair of the Senate Transportation Committee), Sen. Robert Nichols (R-Jacksonville), Sen. Steve Ogden (R-College Station), Sen. Jeff Wentworth (R-San Antonio), Rep. Joe Pickett (D-El Paso)(chair of the House Transportation Committee) and Rep. Wayne Smith (R-Houston).

All of these, along with others, have offered legislation that would continue to allow TxDOT to operate unrestrained. Continuation of CDA's and PPP's without regulation and oversite (Nichols/Carona), the creation of a "Transportation Bank" (Corona/Ogden), tolling of existing free roadways (Nichols), local-option taxation (Corona/Wentworth/Truitt), continuation of payments to losing bidders (Corona, Nichols), and leaving the Texas Transportation Commission to remain a 5-member board appointed by the Governor(3), Lt. Governor(1) and the Speaker(1), even though 76% of the people polled by the Sunset Committee preferred a single, ELECTED commissioner!

Good bills have been filed, by our own David Leibowitz of San Antonio, that would end the TTC and all enabling legislation and programs, along with a bill that would end tolling of existing highways. In committee, NO ONE testified against either bill, yet Chairman Pickett will not allow either bill to be voted out of committee and get to the floor for a vote.

We need your help! We need people from all over the state emailing, calling and faxing the leg. demanding that they stop the expanding of TxDOT, and that they vote to rein in this agency. We demand an end to the Republican-led socialization of Texas! We also need help in developing a legislative "score card or fact sheet" on each of these members that can be used against them in their districts for the 2010 election cycle. Without this, be prepared to re-write your own personal budgets allowing for a "transportation allowance" that will be needed to travel anywhere in our great state. Unfortunately, a large portion of Texans don't have those funds available.

© 2009 Burnt Orange Report:

To search TTC News Archives click HERE

To view the Trans-Texas Corridor Blog click HERE


Wednesday, April 29, 2009

"Specific communities are being forced to bear the weight of this burden and won't reap its benefits."

Complaint alleges U.S. 290 East toll road violates civil rights act


The Elgin Courier
Copyright 2009

The proposed toll road along US 290 East discriminates against low-income and minority populations in Austin, according to a complaint filed with the Federal Highway Administration.

Texas RioGrande Legal Aid (TRLA), the leading provider of legal aid in Texas, in conjunction with the SOS Alliance and the Center on Race, Poverty and the Environment, filed the complaint on behalf of three Travis County residents and the Bluebonnet Neighborhood Association.

Filed against the Texas Department of Transportation (TxDOT), Central Texas Regional Mobility Authority (CTRMA), and the Capital Area Metropolitan Planning Organization (CAMPO), the complaint argues that the toll road project violates Title VI of the Civil Rights Act by having a disproportionate impact on the low-income and minority communities that surround and use the highway.

"The toll road will create a class distinction between those who are and are not able to use it," said TRLA attorney D'Ann Johnson. "Low-income residents will be forced to either use congested frontage roads or spend an unreasonable amount of their income on tolls."

According to the complaint, the project would impose economic hardships, increase health and safety risks and increase traffic in the neighboring communities. The complaint also argues that previous reviews of the toll road project have underestimated the impact it will have on neighboring communities and low-income residents who currently use U.S. 290 East for their commute.

Added Johnson, "The impacts of this toll road will not be felt equally among Austin residents. Specific communities are being forced to bear the weight of this burden and won't reap its benefits."

A copy of the complaint can be found at

© 2009 Blacklands Publications, Inc.:

For the fiscal note click: [HERE]

To search TTC News Archives click HERE

To view the Trans-Texas Corridor Blog click HERE


Tuesday, April 28, 2009

"No significant fiscal implication to the State is anticipated."

Transportation revolving fund approved

innovative financing


By Mike Ward
Austin American Statesman
Copyright 2009

The Texas Senate today approved the creation of a new Texas Transportation Revolving Fund to help expedite funding for much-needed highway projects across a state that is strapped for cash for such projects.

“Additional road-building capacity, upwards of $20 billion. That’s what this means,” said Senate Transportation and Homeland Security Committee Chairman John Carona, R-Dallas, the author of Senate Bill 1350.

Senate budget-writers have included $1 billion in funding of the new fund.

“This is a big deal,” said Senate Finance Committee Chairman Steve Ogden, R-Bryan. “This is one of the most creative bills to come of the Finance Committee.”

Corona said that for every dollar that is put into the new fund, “it will increase by a factor of three or four. Fifteen to twenty billion (dollars) will be the total impact.”

Under the legislation, the fund allows transportation funding to be “continually recycled by using repayments of financial assistance to provide assistance for other projects,” according to a bill analysis compiled by the Senate Research Center.

“On projects that are difficult to finance, we can use this fund as a temporary guarantor fund,” Corona said. “This will be one tool of many that we can use.”

After other senators applauded the measure, it was approved unanimously.

It now goes to the House for consideration.

© 2009 Austin American-Statesman:

Transportation “bank” gets Senate approval

Patricia Kilday Hart
Texas Monthly
Copyright 2009

The Texas Senate just gave unanimous approval to Sen. John Carona’s SB 1350, which sets up the Texas Transportation Revolving Fund — a transportation “bank,” really — that will leverage $1 billion in transportation bonds authorized by Prop 12.

According to the bill’s analysis, the revolving fund will allow funds to be continuously recycle: the sale of loans will provide additional capital to the fund.

Carona was held up in passage only by a string of laudatory speeches, started by Finance chair Steve Ogden who complimented Carona’s “creativity” in setting up the fund, which could provide up to $20 billion in financing. The revolving fund could provide a vehicle for the Texas Retirement System and Employee Retirement System to invest in state infrastructure, a policy Ogden supports.

However, Ogden noted after passage of the bill that the Senate budget bill provides for debt service to fund the Prop. 12 transportation bonds, while the House’s budget bill does not. He hopes to persuade the House conferees to support the concept — which allows the state to use sales tax revenue, and not just the gas tax, to build highways.

Carona’s bill was headed to speedy passage with no comment when Ogden remarked on the lack of fanfare for such an important measure. “It’s all part of my humble nature,” Carona replied.

© 2009 Texas Monthly:

For the fiscal note click: [HERE]

To search TTC News Archives click HERE

To view the Trans-Texas Corridor Blog click HERE


Monday, April 27, 2009


TxDOT, transportation controversies revving up


by Andy Hogue
Copyright 2009

Plans to reform transportation funding in the Lone Star State seem to be moving along like an average morning commute on a busy highway — slowly, but with delays entirely possible.

"There’s still a very long road to go," according to the author of the transportation Sunset bill, Sen. Glenn Hegar (R-Katy) at the Senate Transportation and Homeland Security Committee April 22.

Hegar’s Sunset bill, SB 1019, was left pending in the Senate Transportation and Homeland Security committee April 22, as members are now working to weave in amendments to the bill into a committee substitute bill to be addressed later.

Despite a few tense moments between legislators and witnesses, the tone of the hearings seemed amicable. It appeared for the moment there might be enough consensuses among committee members to send some bills to the floor. But, then, again, a traffic snarl could be just around the next corner.

Sun stands still for TxDOT

In its current incarnation, SB 1019 would continue the Texas Transportation Commission but without the five-member commission and the job of the executive director of TxDOT — replacing both with a single commissioner to be appointed by the Governor.

In addition, the Sunset bill calls for a legislative committee to oversee the workings of the transportation agency. Hegar said the bill provides for more accountability, responsiveness "and, simply, building projects."

Forty-six amendments were read during committee, before being withdrawn so a committee substitute bill could be drafted this week.

Amendments cover a wide range of options, including: replacing the five member commission with one commissioner or three commissioners; prohibiting the legislative oversight committee from directing TxDOT to build projects; and giving TxDOT greater authority to establish rail projects.

"The Devil’s going to be in the amendments," said Lauren Kennedy, of Texans For Safe and Reliable Transportation, a group that supports increased public-private partnerships in building roads and continuing a multiple-member transportation commission.

"If certain people had their way, they would put in an amendment that no one knows about … making into a staff-driven agency, or allowing the (legislative) oversight committee to take away the commission’s power to make decisions."

Amadeo Saenz, TxDOT executive director, said many of the changes suggested by the Sunset Commission earlier this year could be made without legislation, and many of them have been put into an action plan.

Sen. Florence Shapiro (R-Plano) asked Saenz about progress on hiring a management firm to review TxDOT. Saenz said at Carona’s request the department has sent out proposals for a management structure evaluation.

Transportation Commissioner Ted Houghton said that "a lot of this is going to have to do with funding," drawing attention to what commissioners say is the greater issue.

James Bass, TxDOT’s chief financial officer, said SB 1 could determine everything for 2010. "If we look at the different versions of the House and Senate … (in the House) there is federal dollars for new highway construction but no state dollars."

Sen. Elliot Shapleigh (D-El Paso) asked Bass to predict how much would be available for new construction. Bass said he could not say definitively, but he estimated $2 billion in new projects for 2010 and $1.7 million in 2011 — a number confirmed next day by a TxDOT memo that Shapleigh and other senators requested.

Carona called the funding situation "absolutely a near-term catastrophe in the making."

Houghton, after saying the transportation system will soon be "unable to continue," compared the current level of spending to a maxed-out credit card: "Do we want to keep swiping that credit card and hope someone is on the other end to pay for the bill?"

"We’re restricted," Houghton continued. "… Hamstrung."

How ‘hamstrung’ is TxDOT?

The requested memo, signed by Transportation Commission Chair Deirdre Delisi and sent April 23 to Carona and committee members, paints a grim picture for the agency. Whether enough legislators are buying it is a question yet to be answered.

In the memo, Delisi cited a variety of reasons that funds have fallen into short supply for state transportation projects: falling gas tax revenues, fluctuating federal funding, and decisions by budget writers. Delisi said "severe cuts" to maintenance projects may be the only short-term solution. Maintenance costs the state about $1.1 billion per year, TxDOT officials have stated in previous meetings.

"The Texas Mobility Fund, Proposition 14 Bonds, Comprehensive Development Agreements, and Pass-Through Financing helped get projects to construction more quickly than what would have otherwise been possible," Delisi wrote. "But we have reached the end of what we all knew would be a temporary spike in our contracting levels."

She referenced a speech to the Senate Transportation and Homeland Security Committee on April 8 which predicted that by 2012 expenditures will surpass revenue ($2 billion in 2010 versus $1.7 billion in 2011).

Public trust deficit

There’s another deficit addressed during the Senate Transportation Committee meeting that wasn’t covered in Delisi’s memo: that of the public’s trust in TxDOT.

Carona, while commending the current commissioners, said much progress has been made in restoring the trust of the Legislature.

"There was an unfortunate period in the history of the commission," he said, "under leadership that is no longer leadership … things became entangled and relations with the Legislature became quite hostile. It didn’t have to be that way, it shouldn’t have been that way. But that was that individual’s personality. … but moving forward now, I think the commissioners, as well as chairman Delisi, are very accessible, and responsive to the Legislature …"

Carona said "that individual" is "no longer with us" – a pointed reference to former Transportation Commission Chairman the late Ric Williamson. (Williamson, a former state representative, was an advocate of going from the state’s pay-as-you-go system of transportation infrastructure funding to a private-sector approach reliant on toll roads and other public-private partnerships. He died December 30, 2007.)

Delisi’s tone in the memo was very similar to Williamson’s tactic of constant messages that TxDOT was low on funds and that toll roads are the only hope.

Hegar commended Delisi and other commissioners and hailed their responsiveness. But not everyone present felt that way.

"I have to say that the citizens of Texas don’t believe that anything has changed at TxDOT," said Terri Hall, of Texas TURF, testified before the Senate committee.

Hall took a shot at Carona, saying he did not see "the big picture." Before Hall could finish a list of grievances against TxDOT — "billion-dollar revenue mistakes … illegal ad campaigns, being called ‘bigots’ by a transportation commissioner …" — Carona interjected.

"I think it’s just as likely I see the picture as you standing here representing that yours are the views of all Texans. They’re not. They’re your views, and they’re views, I’m sure, of the small organization you represent …" he said.

"You think 100,000 Texans is small?" Hall replied, before Carona reminded her she had two minutes to testify.

In an interview with LSR, Hall said in 2007 Carona asked her group to bring TxDOT reformers to the Capitol. Carona’s hearing on March 1, 2007, filled a Capitol auditorium and two overflow rooms.

CDAs seem safe … for now

It’s been debated whether or not there is enough legislative will to continue the current limitations on Comprehensive Development Agreements (CDAs) for transportation projects. By the looks of several pending pieces of legislation, CDAs might be around for at least another couple of years.

Carona’s SB 404 attempts to extend the authority of TxDOT to enter CDAs, though Sen. Wendy Davis (D-Forth Worth) offered a similar-in-scope amendment during April 22’s Sunset bill discussion in case SB 404 gets hung up (keeping in mind that amendments read at the committee meeting are eligible for discussion on the Senate floor later).

Hall said that’s a way of "sneaking" CDA extensions in. Bill Noble, executive director of Texans For Safe and Reliable Transportation said CDAs are important funding options to defend.

© 2009 Dallas Blog:

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“What we have is the tax tail wagging the dog, with dangerous consequences for America’s transportation policy."

Bills filed to stop ‘double dipping’ on private toll roads


David Tanner, staff writer
Land Line Magazine
Copyright 2009

U.S. senators have filed a pair of bills to stop private-sector toll operators from double dipping into the pockets of taxpayers.

The Owner-Operator Independent Drivers Association applauded the move, saying the bills filed by Sen. Jeff Bingaman, D-NM, and Sen. Charles Grassley, R-IA, benefit highway users by eliminating subsidies for private toll roads.

“Taxpayers should never have been paying to provide these sweetheart benefits to the private sector to begin with,” OOIDA Director of Legislative Affairs Mike Joyce told Land Line.

“These two bills are a step in the right direction in protecting highway users from double – and even triple – taxation in deals that have gone down with the private sector.”

Bingaman and Grassley, both members of the Senate Finance Committee, introduced S884 and S885 to eliminate subsidies for privatized highways.

  • The first bill, S884, would stop states from receiving federal tax funding and private-sector money for the same toll road.
  • The other bill, S885, would put a limit on the toll operator’s current ability to write off the cost of the asset over the long term.

S885 would make it more difficult in the future for private investors to profit from subsidies, as happened with the privatization of the Chicago Skyway in Illinois. Private toll operator Cintra-Macquarie, a Spanish-Australian bank partnership, was allowed a 99-year tax write-off as part of the Skyway lease.

The Bingaman-Grassley legislation urges Congress to tighten up the tax write-off criteria.

“The tax code’s exceedingly generous cost-recovery provisions create a perverse incentive to tie up critical American infrastructure in private hands for generations to come,” Bingaman stated in a press release issued by both lawmakers.

“What we have is the tax tail wagging the dog, with dangerous consequences for America’s transportation policy. We must eliminate this perverse incentive and stop subsidizing these private highway operators – who are primarily Spanish and Australian banks – with American tax dollars.”

Grassley, the Senate Finance Committee’s top Republican, believes the bills will keep more taxpayer dollars in the Treasury for other projects.

“Our bills would protect taxpayers from the triple whammy of funding highway construction, giving generous tax breaks to private industry to maintain the infrastructure, and then paying tolls to use that infrastructure,” Grassley stated.

Both bills were sent to the Senate Finance Committee for review.

Joyce said a number of highway user groups are turning up in support of the bills.

“These are two extremely well-respected members of the Senate with a great knowledge in tax and financing issues. We applaud their actions on behalf of all truckers and all highway users,” Joyce said.

“We will fight side by side with them to see if we can get this language passed on its own or in the highway bill if need be.”

© 2009 Land Line Magazine:

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"Both bills would help remove the unfair, hidden public subsidies for what really amounts to a fire sale of public infrastructure assets."

Ending Accounting Gimmicks


Transport Topics
Copyright 2009

Legislation introduced by two prominent members of the Senate Finance Committee could go a long way toward taking the air out of some politicians’ stampede to raise short-term revenue by leasing out or selling public highways and other public assets.

The bill, sponsored by Chairman Jeff Bingaman (D-N.M.) and ranking member Chuck Grassley (R-Iowa), would both remove an unfair accounting gimmick from such deals and help raise revenue for the Treasury (click here to see p. 1 story).

One of the attractions of these so-called public-private partnerships has been the ability of the acquiring companies to depreciate the cost of the deal over 15 years and not the 45 years that roads and highways usually last.

The bill would require companies to spread the depreciation over the actual anticipated life of the project.

“We’re subsidizing these transactions in a way that’s just not fair,” said Bingaman’s spokeswoman, Jude McCartin.

We couldn’t agree more.

If these “partnerships” are such good deals, surely they need to stand on their own, without a hidden subsidy from the Treasury.

As American Trucking Associations’ Tim Lynch said after it was introduced, the legislation would take “the thumb off the scales so that these deals will either go or not go on their own merits.”

The timing is crucial, because the Obama administration has made it clear that it supports more of these kinds of deals to fund infrastructure development rather than increasing fuel taxes, which we believe would be a much better idea.

In addition, Sen. Bingaman introduced a companion bill that would require states to eliminate privatized roads from the calculations that determine how much federal money the states receive to maintain their public road systems.

Sen. Bingaman said it was a matter of fairness, and again we definitely agree.

Because the affected states already have received payments from their “partners” for the private roadways, and because the private companies are charged with paying for maintenance of the improvements, it “doesn’t make sense and it isn’t fair to other states” to include them in the federal funding program, Sen. Bingaman’s aide said.

We heartily endorse this legislation and believe that both bills would help remove the unfair, hidden public subsidies for what really amounts to a fire sale of public infrastructure assets.

© 2009 American Trucking Associations, Inc.:

To search TTC News Archives click HERE

To view the Trans-Texas Corridor Blog click HERE


CTRMA tolling schemes may lead to bond default pileup down the road

Area's latest tollway is no cash cow

'Profit' from Texas 45 Southeast will be used to make up red ink on other three TxDOT toll roads here.


Ben Wear
Austin American-Statesman
Copyright 2009

How times have changed: There's a 7.4-mile-long toll road opening in greater Austin in three days, weather permitting, and you don't know about it. Well, now you do. After a ribbon-cutting Thursday afternoon, Texas 45 Southeast will run from a point on Interstate 35 a few miles north of Buda to U.S. 183 near Mustang Ridge, flowing seamlessly into the south end of the Texas 130 toll road. After a promotional period of one to two months (depending on whether you have an electronic toll tag or not), passenger vehicles with tags will pay $1 to drive it, and everyone else will be billed $1.33 by mail. Truckers will pay about four times that.

The new road will make it easier for cross-country travelers to evade Austin traffic by taking Texas 45 Southeast and Texas 130 around the east fringe of the metro edge.

It might save Lockhart commuters a few minutes. And getting from San Marcos to Bastrop or Elgin will take less time.

But what Texas 45 Southeast won't do, based on figures from the Texas Department of Transportation, is make extra money for other Central Texas transportation projects, at least not in the lifetime of most people who currently hold a driver's license.

The oddity of this is that no money was borrowed to build Texas 45 Southeast. The cost of about $180 million came purely from gas taxes and vehicle fees, unlike most toll roads, which use a combination of debt and taxes. So it would seem that the tolls would be almost pure profit that could give the area badly needed road and rail cash.

Not so, for a number of reasons.

First of all, the road won't bring in outrageous amounts of money, at least not at first. The first-year estimate, according to TxDOT Chief Financial Officer James Bass, is about $1.6 million, or about $4,300 a day. At about a dollar a ride, you can see they're not expecting much traffic initially on the four-lane expressway. Even in year 10 TxDOT is expecting only about $5.1 million of toll revenue.

About a third of that initially will go to operations, principally processing the tolls.
What's left over after operations and maintenance, now and decades in the future, won't be available, however. Instead, it will go to help pay for the expected operating deficit on TxDOT's other three toll roads in Central Texas: Texas 130, Texas 45 North and Loop 1.

Those roads do have debt, about $2.2 billion of it. The annual debt payments start out large — about $36 million this year — and then grow to elephantine size. The projected debt payment in 2042 is almost a half billion dollars. TxDOT does not expect them to make a profit until that year, though one has to wonder how.

Until then, Texas 45 Southeast, along with many millions annually from TxDOT's statewide kitty, will help make up the red ink.

A transportation source of mine years ago used a colorful, unprintable metaphor to describe how much money Texas 45 Southeast would generate when it opens.

Maybe so. But don't expect it to generate more roads.

For questions, tips or story ideas, contact Getting There at 445-3698 or

© 2009 Austin American-Statesman:

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"If you are skewing these [privatized] deals because of tax benefits then maybe they’re not such great deals after all."

Two Bills Target Road Lease Deals


By Sean McNally, Senior Reporter
Transport Topics
Copyright 2009

Prominent members of the Senate’s tax-writing finance committee introduced legislation April 23 that would pare back the tax benefits private companies gain from leasing public highways, making those privatization deals less attractive to investors.

Sen. Jeff Bingaman (D-N.M.), chairman of the Senate Finance Committee’s panel that oversees infrastructure issues, and Sen. Chuck Grassley (R-Iowa), the finance committee’s top-ranking Republican, co-sponsored the bill.

The Bingaman-Grassley measure would stretch out the depreciation and amortization periods for highway investments. Bingaman introduced a second bill that also would deduct privatized highway miles from a state’s mileage total used to calculate federal aid for roads and bridges, a move that would cut into a state’s share of federal highway funds.

In introducing the bills, Bingaman said states “should have some latitude to determine how to operate their own highways, [but] that doesn’t mean that the federal taxpayer should subsidize selling off these highways.”

Bingaman said that his subcommittee “uncovered . . . [that] the federal government — and taxpayers in all states — now subsidizes these deals through exceedingly generous tax provisions.”

“The goal is to make sure that taxpayers are treated fairly in regard to the privatization of highways,” said Jude McCartin, a spokeswoman for Bingaman.

Federal tax law now allows companies that lease highways to depreciate the value of the lease over 15 years, while the actual length of highway leases and proposals tend to be much longer. Indiana, for example, has leased its toll road for 75 years.

Also, concessionaires can amortize, or recover the costs, for the intangible benefit of the right to collect tolls over 15 years, while receiving that benefit over the full length of the lease.

“We’re subsidizing these transactions in a way that’s just not fair,” McCartin said.

The tax bill would change the tax code to allow companies leasing a highway or a bridge or other piece of infrastructure to depreciate the cost over 45 years, the estimated useful life of highways and streets.

The bill also would push out the amortization period to either 15 years or the length of the lease, whichever is longer.

The bill “takes the thumb off the scales so that these deals will either go or not go on their own merits but not because of tax advantages,” said Tim Lynch, a senior vice president of American Trucking Associations.

ATA has been a vocal opponent of privatizing highways, a trend that began in 2004 with Chicago’s 99-year lease of its Skyway for $1.8 billion to a Spanish-Australian conglomerate headed by the Macquarie Infrastructure Group.

The same conglomerate, which includes Spanish bank Cintra, paid $3.8 billion for its 75-year lease of the Indiana Toll Road.

Lynch argued that those deals — and others proposed or discussed in Pennsylvania, New Jersey and Massachusetts — are helped greatly by the tax provisions allowing quick repayment of costs.

“These are supposed to be privatized deals where the private sector can do something better than the public sector, but if you are skewing the deals because of tax benefits then maybe they’re not such great deals after all,” he said.

McCartin said she thought the fact that the bill would collect additional revenue aided its chances of passing, either on its own or as part of a larger bill later this year.

“We’re in the rare position of actually making money for the government,” she said. “I think in a time when we are looking for revenue, we will look for any opportunity to enact this legislation; we’re trying to save taxpayer dollars anywhere we can.”

Lynch said that since the bill aimed to address the public-private partnership issue “from the tax side, you will have several opportunities” to move the bill. He specifically cited the “tax title to highway reauthorization.”

The Obama administration has touted public-private partnerships as a way to help fund infrastructure improvements — without increasing fuel taxes, which Transportation Secretary Ray LaHood opposes.

Lynch said changing the tax code to dim enthusiasm for privatization projects, rather than banning or restricting them, fits with LaHood’s position that “everything has to be on the table.”

“The fact is that this doesn’t necessarily prohibit the transactions. Again, the beauty of this proposal is that the deals will stand on their own merits, so they’re still on the table,” Lynch said.

McCartin said preventing states from counting privatized highway miles when calculating federal aid formulas, is also aimed at maintaining fairness in infrastructure funding.

“What happens is states provide the amount of highways that they have,” she said, “and right now they are able to count privatized or leased roads, but they are not using that funding to maintain those roads.”

Collecting federal money for roads that are being maintained privately after a state has received lease payments for it “doesn’t make sense and it isn’t fair to other states,” McCartin said.

© 2009 American Trucking Associations, Inc.:

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