Tuesday, March 30, 2010

"Leaders must stop pretending that there is a something-for-nothing solution to our traffic problems."

State Senators' View

Texas must face transportation issue


State Senators John Carona & Kirk Watson
Oak Hill Gazette
Copyright 2010

You know Texas traffic is bad. You've heard it will get worse. But what about the state's efforts to get you out of traffic?

Unfortunately, transportation policy in Texas is moving just as slowly as that 18-wheeler sitting in front of you at rush hour. But the trucker is in less denial about the state's road situation than its elected leaders are.

Right now, traffic – and the state's inability to deal with it – is merely maddening. But a decade from now, with tens of millions more people pouring onto little more than the current road network, it will become an economic disaster for individuals as well as businesses.

In February, the Senate Transportation and Homeland Security Committee heard testimony from mayors, county judges, business leaders, transportation experts, finance experts, and the public. The message was clear:

When it comes to transportation, Texas is broke. The state can't afford the infrastructure it needs to keep goods flowing and our economy thriving, let alone accommodate future generations. Stop doing nothing.

Today, the state's transportation revenue almost equals current maintenance costs – meaning Texas can barely maintain existing roads, let alone build new ones. The state can't even borrow its way out of the problem, since so much transportation money is already paying interest on billions of dollars previously loaned to us.

Yes, voters in 2007 approved $5 billion in bonds – debt that will be repaid primarily through sales taxes. But that's a tiny fraction of the tens of billions required for essential projects that are well into the planning stages.

As grim as the funding situation is, however, it's not nearly as depressing as the failure of elected leaders to begin grappling with the problem.

More than a year ago, we outlined steps needed to move Texans through their communities and across the state. Those included ending transportation funding diversions, allowing voter-approved regional funding options, rewriting the nearly 20-year-old gas tax system and reforming the Texas Department of Transportation through comprehensive audit and policy changes.

Since then, there's been a legislative session, a special session, and most of a political primary season. Yet there's been virtually no movement in any of these areas. Even a serious discussion of them – acknowledging the difficult choices Texas faces – has been hard to come by.

Instead, politicians of every stripe rely on simplistic solutions and expectations removed from reality. Some pretend the state can find billions of dollars through some sort of bureaucratic reorganization. Others embrace privately owned toll roads – which are not only more expensive than traditional highways, but also are viewed skeptically, and rightfully so, by Texans who worry about their cost and losing control of our infrastructure.

Incorrectly, some assume that ending diversions alone will provide the necessary funds – it won't. And anti-government demagogues, masquerading as conservatives, have embarked on frantic e-mail campaigns filled with misinformation and lacking any practical solutions.

Texas needs leaders who will honestly present the tough choices that Texans face. At the very least, the Legislature should continue looking for efficiencies while revisiting Texas' motor fuels tax – which hasn't changed since 1991 and no longer keeps pace with the state's growing needs. This represents the most fiscally responsible approach.

And the Legislature must follow through on commitments to end funding diversions away from transportation infrastructure.

These steps would begin to get Texas moving again, while restoring confidence in the Department of Transportation.

But first, leaders must stop pretending that there is a something-for-nothing solution to our traffic problems. The people of Texas know better.

Nothing creates congestion faster than ignoring the obvious ... in this case, rush-hour traffic.

State Sens. John Carona, R-Dallas, and Kirk Watson, D-Austin, are chair and vice chair of the Senate Transportation and Homeland Security Committee.

© 2010 Oak Hill Gazette: www.oakhillgazette.com

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Monday, March 29, 2010

"Bureaucrats and politicians turn to public-private partnerships because they, in effect, outsource unpleasant revenue-raising duties..."

The trouble with tolls

Toll-road financial collapse is a failure of government, not capitalism


Copyright 2010

A toll-road project in San Diego, once held up as a model of the "innovative" public-private partnerships, collapsed last week.

The South Bay Expressway filed for Chapter 11 bankruptcy protection after being open for business less than three years. Proponents of the tolling fad insist that allowing private companies to charge motorists to drive on roads represents the free-market solution to all of our transportation funding woes. The South Bay Expressway failure shows that plan is a road to nowhere.

Thanks to gasoline prices around $3 a gallon and the ongoing recession, hard-pressed consumers weren't interested in shelling out an additional $4.50 to drive 10 miles. Macquarie Infrastructure Group, the Australian firm that owns the expressway, assured federal highway officials that 60,000 paying customers would use the road daily. In fact, only 22,600 did so, leaving the project without enough revenue to sustain its debt obligations.

It turns out that estimates based on rosy scenarios are the norm in the world of tolling schemes. A Texas Department of Transportation study completed last year found that a majority of toll-road projects overestimated traffic levels in the first five years by at least 20 percent to 30 percent. Because public transportation agencies generally cut deals with private tolling companies behind closed doors, such detailed forecasts are not available for public review until long after the contract is signed.

Plunging traffic is also the norm nationwide. The Pocahontas Parkway in Richmond reported a 12 percent drop in traffic last year. Transurban, the Australian company that owns the road, responded by raising prices every year since 2008 and is scheduled to continue doing so until 2016. Dulles Greenway traffic is similarly down 7.2 percent, and Macquarie has put in motion a series of regular price hikes.

In a true free-market environment, the projects would follow the law of supply and demand, dropping rates to attract new customers. Instead, the foreign companies operating these roads are hiking tolls as fast as they possibly can - the opposite of what one would expect in a truly competitive marketplace.

Toll roads get away with this conduct because they are state-sanctioned monopolies, not free-market operations. Bureaucrats and politicians turn to public-private partnerships because they, in effect, outsource unpleasant revenue-raising duties to private companies. As we see from the South Bay Expressway, the deals governments strike with companies to perform this task frequently are based on faulty, unsustainable assumptions.

We hope Virginia Gov. Robert F. McDonnell heeds this lesson and drops his support for the foolhardy plan to impose tolls on the Interstate 95/395 high-occupancy vehicle lanes.

© 2010 The Washington Times: www.washingtontimes.com

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To view the Trans-Texas Corridor Blog click HERE