Category: Public Private Partnerships
See a map of the Trans Texas Corridor & all the NAFTA trade corridors here.
Trans Texas Corridor commences despite opposition
By Terri Hall
January 6, 2013
When Jerry Corsi talks, people listen. Corsi’s recent column on the revival of the Trans Texas Corridor (TTC) gave national attention to what Texans have been warning for a decade -- that despite Texas-sized opposition and claims of its demise by Texas Governor Rick Perry and his Texas Department of Transportation (TxDOT), the Trans Texas Corridor is quietly being built piece by piece. The Texas Transportation Commission just awarded a public private partnership (P3), known in Texas as a Comprehensive Development Agreement (CDA), for a segment of Interstate 35E between Dallas and Denton County at its last meeting.
The award for I-35E followed on the heels of the Commission’s award of a CDA for I-35W to Spain-based Cintra as part of the Master Development Plan for the North Tarrant Express in October. Both projects relate to Perry’s original Trans Texas Corridor vision of building a 4,000-mile network of international trade corridors four football fields wide using P3s, to include toll roads, toll commuter and freight rail, utilities, telecommunication lines, and pipelines of all sorts, developed and operated by private, even foreign, corporations free of competition for a half century.
The private developers would have had the ability to lease out the land condemned using eminent domain for private profit for gas stations, hotels, restaurants, and any commercial enterprise of its choosing within the corridor’s right-of-way, granting it a virtual government-sanctioned monopoly for generations. It’s the same eminent domain for private gain and erosion of property rights that caused a backlash to the U.S. Supreme Court’s Kelo decision.
Naturally, Texans immediately and vehemently opposed the TTC, and a grassroots revolt ensued for seven years before Texas lawmakers finally repealed it from state statute in 2011. While the TTC may not have its own chapter in the Transportation Code any longer, elsewhere in statute it retains the ability to lease out the public’s right-of-way for commercial ventures, and the Texas legislature continues to approve P3s (the financing mechanism of the TTC) on a limited basis for key projects around the state -- which just so happen to coincide with many of the original TTC projects.
It’s surely no coincidence that two of the projects the North Texas Council of Governments (NTCOG) is currently lobbying to get approval from the legislature to develop as P3s are also part of the TTC-35 corridor, I-35E in southern Dallas and Loop 9 through southern Dallas and Rockwall County. The Texas legislature convenes Tuesday, January 8. If history is any indicator, NTCOG will get its way and the people of Texas and property rights will get thrown under the bus and the TTC will proceed under different road names.
Texans achieved a major victory from the repeal of the TTC from state law by curbing the over-sized land grab of 580,000 acres of private Texas farm and ranch land. Instead, the TTC proceeds primarily as ‘managed lane’ projects that add toll lanes to existing corridors, like I-35, with much smaller footprints.
‘Managed lanes’ aren’t without their own controversy, particularly congestion tolling that puts the taxation in the hands of private toll operators for generations. Congestion tolling or ‘pricing’ allows the toll operator to increase the toll rates in real time (as often as every 5 minutes) if it deems too many people are using the lanes and the speed dips below 50 MPH. It’s designed to knock drivers off their own public roads in order to ‘manage’ congestion rather than solve it by offering sufficient free capacity for all drivers.
But the controversy doesn’t stop there.
P3s also contain non-compete provisions that limit or prohibit the construction or expansion of free roads surrounding the toll facility, thereby guaranteeing congestion on the free alternatives. Taxpayers have to foot the bill for any losses in toll revenue from those ‘competing’ facilities, so future transportation decisions are hampered and controlled by private interests. These contracts include profit guarantees and force taxpayers to pay for ‘uncollectable tolls,’ like those from out-of-state and foreign drivers, of which there are many in Texas.
In addition to all of that, taxpayers subsidize the construction of the privately-operated tollways with gas taxes and others public funds, so everyone is paying for the road, but very few will be able to access them since toll rates in peak hours will be 75 cents a mile. That’s like adding $15 to every gallon of gas you buy! Those that do take the private tollways, will be paying a double tax to use a road their public money built. Texans will also pay in the higher cost of goods, regardless of whether they ever take one of these foreign-owned toll roads.
P3s get lots of help from the federal taxpayer as well through low-interest, taxpayer-backed federal TIFIA loans and Private Activity Bonds (PABs). MAP-21, the latest federal highway bill passed in June 2011, expanded the TIFIA program nearly tenfold to one billion a year, despite the first project to receive one having gone bankrupt in San Diego, and virtually guarantees anyone who applies for one will get one.
TIFIA loans have almost exclusively gone to subsidize P3s. MAP-21 also continues PABs and gives these corporations other tax breaks. So despite the talk that P3s transfer the financial risk from the taxpayers to the private sector, it simply isn’t true. Conservative columnist Michelle Malkin dubs P3s corporate welfare. There’s no sugar-coating this stuff -- it’s legalized theft and piracy of public assets, as well as a multi-generational transfer of wealth due to the debt involved with these toll projects.
So, Corsi is right. The Trans Texas Corridor is alive and well, and Texans have the ability to capitalize on this information with the start of the next legislative session just around the corner. Stalwart, anti-TTC lawmakers like Rep. Lois Kolkhorst, R - Brenham, who authored the TTC repeal bill until it passed, are likely to stand in TxDOT’s way -- and Texans will have her back. The billion-dollar question is, will the rent-seeking special interests get their way, or will the new grassroots, conservative wave of legislators help Kolkhorst turn back the tide and kill any vestige of the TTC once and for all? To that I say -- Come and Take it!
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