"It looks very suspicious...and the fact you have state officials involved ... it just becomes this very incestuous set of transactions."

Perry donor's daughter got $70,000 to promote governor's technology fund

10/30/10

By JAMES DREW, RYAN McNEILL and STEVE McGONIGLE
The Dallas Morning News
Copyright 2010

A company run by the daughter of a big-money donor and former adviser to Gov. Rick Perry was paid nearly $70,000 to promote the governor's Emerging Technology Fund, The Dallas Morning News has learned.

Perry spokeswoman Katherine Cesinger confirmed that Verve Public Relations Inc. of California was paid to do promotional work for TexasOne. The nonprofit program, affiliated with the governor's economic development office, was created to entice companies to move to Texas.

Verve is operated by Christiane "CJ" Nance, the 33-year-old daughter of David G. Nance, an entrepreneur and Perry donor whose company received a $4.5 million tech fund award in August. David Nance is a former member of the Perry-appointed advisory committee that recommends awards from the tech fund.

Verve's work included producing videos that promoted tech fund recipients. It was covered by a $100,000 donation from a company run by David Nance, the governor's office said. "No tax dollars were used for the project," Cesinger said.

It is not clear who directed the hiring of Verve. CJ Nance – described in an online résumé as an advertising graduate of SMU – did not respond to several requests for additional information. No one from TexasOne would respond to questions from The News.

It does not appear that any laws were violated. But a nonprofit tax expert told The News that such directed transactions can have serious consequences with the IRS.

"It's highly unusual, and it looks very suspicious," said James P. Joseph, an adviser to the IRS who heads the tax-exempt practice at Arnold & Porter LLP in Washington D.C.

If a donor contributes money to be used as an "earmarked grant to pay your child, that's the definition of an insider transaction," Joseph said. Nance could also face questions from the IRS if he claimed the donation on his tax return, he said.

"It's a real minefield," Joseph said. "And the fact you have state officials involved ... it just becomes this very incestuous set of transactions."

Perry, a Republican, is seeking a record third full term in next week's gubernatorial election against Democrat Bill White.

The governor's spokeswoman said the donation that covered CJ Nance's work came from Developtech Resources Corp. of Austin. David Nance is Developtech's president and chief executive officer, according to U.S. Securities and Exchange Commission filings.

"David Nance made this contribution for the sole purpose of covering costs associated with Verve's promotional materials for the Texas Emerging Technology Fund," Cesinger wrote in an e-mail to the paper.

Since 2000, Nance has contributed $80,000 to the Perry campaign. Developtech also donated $50,000 to the Republican Governors Association while Perry was the group's chairman in 2008. The company contributed another $50,000 to the association in the year before Perry was elected chairman.

The News reported on Oct. 13 that Convergen Lifesciences Inc., a biotech company owned by David Nance, received its $4.5 million tech fund award despite failing to obtain the necessary recommendation from a regional screening board. Perry recently said he's had a close personal relationship with David Nance for 15 years.

But the governor has denied that the award to Convergen violated procedural rules or was the result of favoritism. Convergen was approved for a tech fund award, he said, because it showed promise toward finding a cure for cancer.

In all, more than $16 million in tech fund awards have gone to startup companies whose officers or investors were large Perry donors, The News found. Perry's office administers the tech fund, but awards must also be approved by the speaker of the House and the lieutenant governor.

The revelation that Nance's daughter was paid for work related to the tech fund underscores the need for reform, said a lawmaker who heads the fund's legislative oversight committee.

"This just reinforces my comment that the ETF needs to be put under different management with more transparency, more accountability and better monitoring," said Rep. Mark Strama, D-Austin, chairman of the House technology committee.

According to business records filed with the Texas secretary of state, Verve began doing business in Texas in February 2007. The company incorporated in California in 2009 and no longer has a charter in Texas.

Verve's website lists a business address in Santa Monica that is the same as an apartment listed to CJ Nance, who describes herself in online postings as a public relations professional, fashion blogger and event planner.

The company's portfolio, listed on its website, includes six recipients of tech fund awards made in 2006 while David Nance was on its advisory committee. He was appointed in August 2005 and replaced in February 2007.

Cesinger declined to answer questions from The News about who paid CJ Nance. She did not respond to a request for records associated with the $68,917 payment to Verve.

TexasOne was started by Perry in 2003, under the auspices of the nonprofit Texas Economic Development Corp., to lure out-of-state businesses. Staff members from the governor's office do work for, and have received pay from, TexasOne.

Perry's chief of staff, Ray Sullivan, and the director of his economic development division, Aaron Demerson, are ex-officio directors of TexasOne. Other directors, all appointed by Perry, include some of his largest campaign donors.

David Nance's now-bankrupt pharmaceutical company, Introgen Therapeutics Inc., pledged to donate $150,000 to TexasOne. Bankruptcy court filings list a $50,000 claim owed to the governor's economic development corporation.

David Spencer, a former chairman of the Emerging Technology Fund advisory committee, is quoted on the Verve website as saying, "CJ is a sharp cookie," and praising the company for "showcasing the ETF's diverse portfolio of high-tech companies to our legislators and international investors."

T.J. Wainerdi, an executive of one tech fund recipient, told The News that the young woman who interviewed him for a video went by "CJ." He said he remembered her because of the similarity to his own name.

"She was out of California. She was a blond girl," said Wainerdi. His Houston firm, Carbon Nanotechnologies Inc., received $975,000 for research on fuel cell technology that could power the next generation of portable and wireless electronic devices.

Other tech fund recipients featured in TexasOne videos said the interviews were arranged by the governor's office.

"Obviously, somebody had found her in the governor's office, and they contracted with her to use her," said Ruben G. Zamorano, president of Diabetica Solutions Inc., a San Antonio-based biotech company

Diabetica Solutions, formerly known as Xilas Medical, was awarded $1 million from the tech fund in 2006 to help commercialize a device designed to detect conditions in diabetics that can lead to amputation.

jdrew@dallasnews.com;

rmcneill@dallasnews.com;

smcgonigle@dallasnews.com


© 2010 Dallas Morning News: www.dallasnews.com

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"The pressure will once again be put on state lawmakers to rein in the scheme."

Texas gubernatorial candidates on transportation

10/29/10

Land Line Media Blog
Land Line Magazine
Copyright 2010

For months the candidates for governor in Texas have been taking their message about critical issues, including transportation, to the people in hopes of winning their support. Only a handful of days remain until voters give the candidates the answers to whether they were successful.

The candidates are Gov. Rick Perry, a Republican, and Bill White, a Democrat.

Perry’s policies on transportation are well known. The most noteworthy endeavor of his 10-year administration has been his push to create the Trans-Texas Corridor. Approved in 2003, the corridor was touted as a toll road that would cut across Texas from the Mexican border to Oklahoma.

In 2009, after years of debate, the multibillion-dollar TTC was declared dead. But his goal of increasing toll options in the state is very much still alive.

Perry’s election website touts his track record of pursuing “innovative infrastructure solutions for a rapidly growing state by promoting private investment.” Although many Texans cringe at the thought of paying extra to travel around the state, Perry is committed to pushing forward and partnering with private groups to build roads.

Perry’s opponent, former Houston Mayor Bill White, is not opposed to tolls. However, he is not interested in the grand tolling plan pushed by Perry. White wants to leave toll talk up to local officials and says it is important to “respect the will of the voters.”

White’s plan for involving locals in the decision process is much more palatable than Perry’s approach of shoving the toll option down their throats. If re-elected, there is no doubt that as long as Perry continues to push anything resembling the TTC plan his constituents are not going to stay mum. The pressure will once again be put on state lawmakers to rein in the scheme.

While the candidates differ on how to approach toll plans, they are both campaigning about the importance of stopping diversions from the transportation budget.

Perry says billions of dollars are diverted from the state’s transportation fund for other purposes. His website touts the governor’s 2010-2011 budget that ended more than $300 million in diversions, and using the money for road construction and maintenance.

On White’s website, he calls for phasing out the diversion of fuel taxes for purposes that are not related to highway construction.

The candidates’ commitment to making sure transportation funds are used for their intended purpose is laudable. Whoever is in the governor’s chair during the next four years, it will be worth tracking whether Perry’s election year budget decision or White’s campaign promise are carried forward.

Addressing other options to boost transportation funding, White says he will call on the Legislature to allow local voters to decide whether to increase their fuel tax. Perry says he is opposed to higher taxes of any kind.

© 2010 Land Line Media Blog: landlinemedia.blogspot.com

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"Our business partners understand today that patience is key."

I-35W to be widened by 2017 -- with toll lanes

10/28/10

Gordon Dickson
Fort Worth Star-Telegram
Copyright 2010

The Texas Transportation Commission has just approved a deal that speeds up the widening of I-35W from downtown Fort Worth to near Alliance Airport. The new lanes are scheduled to open by 2017. The project, which will become part of the adjacent Loop 820 expansion known as North Tarrant Express, will be paid for partly with a $135 million infusion of state funds known as Proposition 14, which pledges future gas tax revenue to pay off debt. That portion of the funding was approved Thursday during a commission meeting in Austin.Ntemapnew

Improvements include a complete redo of the dangerous I-35W/Loop 820 interchange -- and removal of all those bothersome left-lane exits -- and two new I-35W toll lanes in each direction from I-30 in downtown Fort Worth to just north of the I-35W/U.S. 287 split in far north Fort Worth. Existing freeway lanes also would be rebuilt and would remain free.

State Sen. Wendy Davis, D-Fort Worth, says the approval of $135 million in Proposition 14 bonds for the I-35W project is highway justice for North Texas, which got shortchanged by the state earlier this year when voter-approved Proposition 12 bonds were issued for areas along the I-35 corridor in Texas that have far fewer traffic problems.

"I'm pleased to see Proposition 14 bond money being used to solve real congestion problems in the state, and especially in North Texas, which has seen tremendous growth and has been designated a serious non-attainment area for air quality," said Davis, a Senate transportation committee member.

A year ago, the Texas Department of Transportation abandoned its attempt to develop a new toll road parallel to the I-35 corridor known as the Trans Texas Corridor. That project was widely criticized as a land grab, and intrusion on Texans' property. Since then, about $1.9 billion in various forms of federal, state and local funding has been committed to widening the I-35 corridor and keeping it a nontoll road, mostly between Hillsboro and San Antonio. But very little of that money was awarded to the Metroplex, which is the state's most congested metro area.

Thursday's action brings the total amount of road work underway in the I-35W/Loop 820/Airport Freeway corridor in Tarrant County to $3.3 billion, including expansion of Northeast Loop 820 in Fort Worth and Haltom City and Texas 121/183 in Bedford, Euless and Hurst.

Most of the money is coming from NTE Mobility Partners, a group of private-sector firms led by Spain-based Cintra that is arranging much of the financing in return for the right to collect tolls on the toll lanes for 52 years. Existing freeway lanes would remain free.

The project does include a total of about $773 million in public funds.

NTE Mobility Partners has pledged to rebuild Loop 820 and Airport Freeway by 2015, and I-35W by 2017.

Construction on the Loop 820/Airport Freeway portion is beginning in the next few weeks. Motorists can expand full-fledged construction on Airport Freeway, particularly in Hurst, by early next year.

The I-35W portion must still clear a couple of bureaucratic hurdles, including a federal environmental review. But Thursday's approval of the $135 million in state Proposition 14 funds removes the biggest obstacle to getting the work done.

"Our business partners understand today that patience is key," said Russell Laughlin, senior vice president of Hillwood Properties at AllianceTexas. About 200 businesses have pushed elected leaders to fix congestion on I-35W for the past decade, said Laughlin, who also is president of the 35W Coalition.

© Fort Worth Star-Telegram: www.star-telegram.com

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"Perry says he’ll keep fighting for privatized toll roads if re-elected."

Texas Gov Rick Perry Could Get Four More Years to Build Mega-Highways

10/27/10

Streetsblog (Capitol Hill)
Tanya Snyder
Copyright 2010

Perry is running against Democrat and former Houston Mayor Bill White. White has challenged some of Perry’s more ill-conceived road-building projects and has some nice things to say about high speed rail, but he’s no banner-waving reformer.

“Throughout his administration, it was apparent that he was fine with people wanting trains, but he himself does not see them as an important priority,” said Andrew Burleson, who writes the transportation and planning blog neoHOUSTON. “To him, the purpose of democracy is to let people vote for frivolities if they wish, but his job as mayor was to keep cars moving.”

For example, Burleson said, White talked a good game about promoting transit, but he effectively blocked a metrorail extension bill that would have added 40 new miles of light rail to the seven miles already in the system. White’s administration insisted on 12-foot-wide traffic lanes on every street. Aside from the huge additional expense, Burleson said, “You don’t want that on a pedestrian-heavy street. Cars will drive too fast.”

White told Grist that he’s in favor of “removing barriers” to people who want to walk to work, but that he wouldn’t push walkable urbanism from the state level. He wants to reform TxDOT by decentralizing power to give local jurisdictions more of a say in where the money goes. He criticizes Perry’s road-building binge, mostly because the state had to take on billions of dollars in debt to do it. Texas, under Perry, has built more roads in the last 10 years than any other state – a fact Perry touts every chance he gets.

White also criticizes Perry’s controversial attempt to privatize of toll roads, which would have paid billions to design, build and finance State Highway 121. The legislature blocked the deal. Perry says he’ll keep fighting for it if reelected. White says he would have applied for federal high speed rail funds, “rather than losing those dollars by default to Florida and California.” He says the congested I-35 corridor, which goes north from Mexico, is a prime candidate for rail. Perry has pushed to widen the highway.

Perry was also the architect of the Trans-Texas Corridor plan, a mega-construction mission currently underway (albeit in slightly downsized form). The plan is to create a corridor up to a quarter of a mile wide with separate rights-of-way for trucks, passenger cars, freight rail, oil and gas pipelines, and high speed rail.

While Burleson of neoHOUSTON acknowledged the need to deal with the high volume of trucks from Mexico and that the rail additions would be welcome, “The vision for execution was asinine,” he said. “With a quarter-mile right of way, it can’t be remotely close to any city, so they planned these major corridors 50 to 60 miles outside of major cities. For passenger rail? Are you kidding me? If you need to drive 50 miles to the station and then another 50 miles once you get there, you’ve already driven half the distance. You might as well just drive the whole way and have your car when you arrive. Any passenger rail should be directly city to city.”

White ran a political ad blasting the Trans-Texas Corridor project. “Rick Perry said he loves private property rights until he wanted to take people’s homes and family farms,” the ad states. “Perry would bulldoze half a million acres of private land and give it to a Spanish company to build toll roads and let the company set the tolls.”

Rick Perry also earned the wrath of reformers by vetoing a wildly popular bill to protect vulnerable road users. “The bill passed both houses by veto-proof majorities—25-5 in the Senate and 140-5 in the House with one absence—but with the legislative session over, the veto most likely will not be overridden,” lamented Houston Tomorrow, a nonprofit that works on urban issues in the region.

The bill, similar to recently enacted laws in Delaware and New York, requires drivers to maintain a safe passing distance near pedestrians, highway construction and maintenance workers, stranded motorists, and bicyclists, and increases penalties for motorists who cause injuries to vulnerable road users.

In his veto statement, Perry showed his complete disregard for the safety of these people and for the concept of complete streets. He said vulnerable users “already have operation regulations and restrictions in statute” and pointed out several responsibilities that they have, but none of the rights. He rejected the idea of requiring “specific actions by operators of motor vehicles.” And he resisted the implication that motorists should be assumed to be at fault in collisions with pedestrians.

Bill White is known for a “my way or the highway” style of governing — but at least he’d rein in some of Perry’s highway spending. Not that he’s likely to get the chance — Perry has maintained a solid eight point lead, and many Texans have tuned out of a race not expected to bear any surprises.

© 2010 Streetsblog: www.dc.streetsblog.org

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"If we let Perry win this historic battle simply by reelecting him, we will pay infinite and ongoing increases in toll taxes for generations to come."

“Toll Road to Riches” - A biography of Rick Perry

10/25/10

Your Turn
The Tribune (Atoscocita, Humble, Kingwood, Lake Houston)
Copyright 2010

Dear Editor,

I was raised on a farm and ranch in Central Texas, where I learned to shoot a rifle before I learned to ride a bike. The rifle was for protection from rattlesnakes, as we freely roamed the land that we loved. There is a now a two-legged snake stalking our Texas lands. Rick Perry proposed the sweeping toll road and high-speed rail corridor in 2002. The name “Trans-Texas Corridor” is now gone, but two key roads in the project — one parallel to Interstate 35 is now under construction, and another that is to be Interstate 69 running from northeast Texas to the Rio Grande Valley — remains in the planning stages.

This multi-billion dollar toll road is the biggest taxing, spending and tolling fiasco in the history of Texas.

Perry’s Toll Road to Riches cheats Texas taxpayers, consumers, drivers and landowners. It is a prime example of the big government, pro-tax, pro-toll agenda of Rick Perry that favors his already rich cronies. Perry does not care at all about the property rights of Texans. Although he constantly espouses “no new taxes,” these outrageous tolls are in fact new and extreme taxation without equitable representation. If we let Perry win this historic battle simply by reelecting him, we will pay infinite and ongoing increases in toll taxes for generations to come. Is that the legacy we want to leave our children’s children?

Despite opposition from farmers and ranchers, who were threatened with loss of land and a way of life, the work from a secret contract with a Spanish company, with multiple ties to political appointees of Rick Perry, has ravaged the beautiful land all along Central Texas. Where four generations of families thrived on land with over hundred-year old oaks, now nothing stands but the dirt that is being turned to Rick Perry’s Toll Road to Riches for himself and for his political cronies, foreign and domestic. I have seen it with my own eyes and weep for the people and the land that I love.

Josie Salmon Robinson

© 2010 The Tribune: www.ourtribune.com

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