How toll companies make money even when the toll road loses money

Link to article here.

How Macquarie Makes Money By Losing Money on Toll Roads
by Angie Schmitt and Payton Chung
Streetsblog USA
November 19, 2014

This is the second post in a three-part series about privately financed highways. Part one introduced the Indiana Toll Road privatization as an example of shoddily structured infrastructure deals. Part three looks at how faulty traffic projections lead bad projects to get built, and how the public ends up paying for those mistakes.

Macquarie Group, the gigantic Australian financial services firm with some $400 billion in assets under management, has made a lot of money in the infrastructure privatization game.

The publicly traded company owns the Brussels Airport, the Dulles Greenway, telecommunications towers in Mexico, a wind farm in Kenya, and much more. One of those assets was the Indiana Toll Road, which Macquarie purchased in 2006 with Spanish firm Ferrovial — whose most profitable assets include Heathrow Airport and the 407 toll road ringing Toronto. The Indiana Toll Road was housed in a spinoff company called ITR Concession Co. LLC., which filed for chapter 11 bankruptcy in September after a disastrous eight-year run.

Alamo planning board hastily obligates Prop 1, adopts more toll roads

Link to article here.

Alamo planning board hastily obligates Prop 1 money, adopts more toll roads
By Terri Hall
December 9, 2014

Yesterday, the Alamo Area Metropolitan Planning Organization (or AAMPO) voted to adopt its long-range plan, Mobility 2040, that will add 4 new toll projects and 34 other new projects that will obligate ten years of Proposition One money. The AAMPO has long promised that when new funding became available, they would turn previously planned toll lanes back into free lanes on projects like US 281 in San Antonio. Prop 1 passed with 81% of the vote on November 4, and voters overwhelmingly approved the measure precisely because the funds could not be used for toll projects. Now taxpayers are facing still more toll roads.

The betrayal taxpayers feel kicked into high gear when the AAMPO voted to add yet more toll roads to the plan instead of turn toll lanes on existing major corridors back into free lanes as promised. Voters do not get to select which elected officials are appointed to the AAMPO, so there’s no direct accountability.

Anti-toll hero Kolkhorst wins senate seat

Lois Kolkhorst wins senate seat
Anti-toll leader to take senate by storm

December 6, 2014 marks a pivotal day in Texas history. Lois Kolkhorst won the senate seat, SD 18, in a special election to replace pro-toll Glenn Hegar who was elected Comptroller November 4. Kolkhorst has been the one true anti-toll stalwart in the Texas House during her tenure. She authored the bill to the repeal the Trans Texas Corridor and as well as the bill to protect Texans from privatized toll roads that milk taxpayers and dole out plenty of sweetheart deals for special interests.

Last session, she carried our bill to make the toll come off the road when it's paid for to prevent perpetual taxation. While on the Sunset Committee, she fought for legislation to make the Transportation Commission an elected board rather than the current structure of unaccountable appointees. She's just as strong on property rights carrying key amendments and legislation that would force the government to return land taken with eminent domain to the original owners if it wasn't used for the purpose for which it was taken within 10 years.

Her stellar pro-taxpayer record can be viewed here. In it we contrast her record to the anti-taxpayer and pro-toll record of the current Senate Transportation Committee Chair Robert Nichols. We'd love to see the incoming Lt. Governor Dan Patrick appoint this great conservative, Lois Kolkhorst, to Chair the Transportation Committee and replace the era of Perry-Nichols that lurched the state toward punitive taxation through unaccountable, tax-subsidized toll roads, and took us from pay-as-you-go to now leading the country in road debt.

This email address is being protected from spambots. You need JavaScript enabled to view it. and tell him we can't allow a committee chair that's so anti-taxpayer to continue to lead this important committee. Texans voted for change, not the status quo when they elected Dan Patrick. We need a true conservative to Chair Transportation and the best person for the job is Lois Kolkhorst - bar none!

Raw sewage: Johnson Ranch developer trucking sewage out, dumping silt on neighbor's land

Link to article here.

Graham property
Johnson Ranch developer trucking sewage out, dumping silt on neighbor's land

By Terri Hall
October 21, 2014

It’s hard to believe there’s a colonia in the Texas Hill Country, but apparently there is at the Johnson Ranch housing development in Bulverde. Since its amended permit for sewage treatment has not been approved, rather than wait until it was, DHJB Development went ahead and started building homes and is currently pumping raw sewage from the homes and hauling it off-site. The Johnson Ranch public elementary school is just 840 feet away. Parents of the children attending the school should know that. It’s highly likely the upscale residents of Johnson Ranch don’t know how their sewage is being handled either.

In order to have the authority to do this pumping and hauling of raw sewage, a lift station must be in operation. According to one environmental services company, “wastewater lift stations are facilities designed to move wastewater from lower to higher elevation, particularly where the elevation of the source is not sufficient for gravity flow.”

Conflict of interest: 281 consultant writes city's transportation plan

Link to article here.

Bulverde Transportation Plan written by 281 toll consultant
By Terri Hall
October 20, 2014

A Transportation Forum sponsored by the City of Bulverde, the Economic Development Foundation, and the Chamber of Commerce was held at GVTC on October 16. It was a 4-hour marathon brought to you by the same consultants, HNTB, hired by the Bexar County toll authority known as the Alamo Regional Mobility Authority (or RMA).

The HNTB moderator, Tom Wendorf, used to head the Bexar County Public Works Department and actually VOTED to toll US 281 during his entire tenure on the local Metropolitan Planning Organization (MPO). The fact that the City of Bulverde hired this company to write its Major Thoroughfare Plan (MTP) for our area is breathtaking. Whom you hire determines the outcome. Bulverde residents have loudly declared they do not want to pay $8/day in tolls to get into San Antonio (as the current proposal would require), nor do we want 12 stop lights added to US 281, as the Texas Department of Transportation (TxDOT) is planning to do as presented to an overflow crowd at the public meeting in July at the library.

Landowners revolt: Push cities to oppose private Blacklands tollway

Link to article here.

Citizens blitz local governments to stop private Blacklands tollway
By Terri Hall
October 16, 2014

Opposition to the controversial private Blacklands-Northeast Gateway Toll Road from Garland to Greenville east of Dallas kicked into high gear this week when concerned citizens did a full court press to pressure remaining cities and counties to pass resolutions opposing the toll road. Seven cities had already passed resolutions prior to Tuesday. Those cities include Fate, Josephine, Lavon, Nevada, Rockwall, Sasche, and Wylie. The Rockwall County Democratic Party also passed a resolution opposing the tollway.

On ‘Super Tuesday,’ residents blitzed four city council meetings and one county commissioners meetings in one day. The City of Rowlett agreed to pass a resolution and Caddo Mills plans to pass one prior to the next crucial meeting of the Regional Transportation Council (RTC) on November 13, where the board may decide whether or not to adopt the tollway into its short and long-range plans.

Prop 1 on the skids with voters

UPDATE: After this article stirred up trouble, TxDOT put a promise in writing that no portion of Prop 1 will be used to support toll roads.

Link to article here.

Prop 1 on collision course with taxpayers
By Terri Hall
October 15, 2014

Though a supermajority of Texas legislators with the help of virtually every Chamber of Commerce are out stumping for Prop 1 in all earnestness, their efforts are starting to fall on deaf ears as more Texans tune in to the persistent problems with the Texas Department of Transportation (TxDOT). Prop 1, on the ballot November 4, would take half of the oil and gas severance tax currently collected on oil and gas production (that normally goes to the state’s Rainy Day Fund) and send it to the state highway fund for the next 10 years.

A more in-depth look at the structural road funding shortfall and the pros and cons of Prop 1’s role in it can be found here. Today, the concern isn’t about whether or not Prop 1 is the right approach to address the shortfall, but rather about something that popped up in the Dallas Morning News which said, “A caveat in Proposition 1 forbids the extra funds, which could equal about $1.7 billion a year, from being used on toll projects. But Bill Hale, TxDOT’s engineer operations director for metro districts, said a connection to the Trinity Parkway (toll road) wouldn’t be barred from using the funds because the project itself isn’t tolled.”

TxDOT spokesman Tony Hartzel then quipped: “That’s his take on it.”

What's involved with Prop 1?

Link to article here.

Issues to consider when voting on Prop 1
By Terri Hall
October 12, 2014

Many Texans are struggling to decide whether or not to support the upcoming constitutional amendment  known as Proposition 1 on the ballot November 4. Prop 1 would take half of the oil and gas severance tax currently collected on oil and gas production (that goes to capitalize the state’s Rainy Day Fund), and allocate those funds to the state highway fund for the next 10 years.

There are many issues to consider when deciding how to vote. Many Texans wonder why there needs to be an amendment to the constitution to address highway funding. They think the federal and state taxes, or user fees, we pay on every gallon of gasoline pay for highways. Few Texans are aware of the structural road funding shortfall facing Texas and the nation.

Abbott, Davis both claim anti-toll positions

Link to article here.

Both gubernatorial candidates stake out anti-toll positions
By Terri Hall
October 2, 2014

Texas gubernatorial candidates Greg Abbott and Wendy Davis claimed to be against more toll roads at last night’s debate. Perhaps the recent research conducted by Texas Transportation Institute (TTI) that shows Texans do not want anymore tolls made the decision to be anti-toll a little easier. What’s shocking however, is that Wendy Davis thinks she can get away with it.

Since Davis entered the Texas senate in 2009, she’s done nothing but vote in favor of toll roads, even for the controversial private, corporate toll roads known as public private partnerships (P3s). Prior to her stint in the senate, she served as a Ft. Worth council member where she was appointed to serve on the Regional Transportation Council. Davis cried crocodile tears when the legislature yanked a P3 contract from Spanish toll giant, Cintra, for Hwy 121 in 2007. The contract would have locked down the expansion of free roads in Collin and Denton counties for the next 52 years. The toll rates Cintra could have charged in those final years would have been more than the cost of an airplane ticket from San Antonio to Dallas.

Research: Texans do NOT want more toll roads

Link to article here.

Texans know what they like: free, open, bike-free roads
By Dug Begley
Houston Chronicle blog
September 25, 2014

There may be no such thing as a free ride, but that doesn’t mean Texas drivers can’t dream. According to a new study from Texas A&M Transportation Institute researchers, the state’s drivers would like more investment in everything from sequenced traffic lights to public transit — even if they do not want to ride the bus themselves.

What they currently don’t want, according to a survey that researchers conduct every two years, is more toll roads, or giving bicyclists a major say in how transportation is planned.

Private Northeast Gateway tollway near Dallas draws angry crowd

Link to article here.

Private tollway near east Dallas draws ire from record crowd
By Terri Hall
September 23, 2014

The people have spoken and their will is clear - they do not want the proposed private Blacklands Tollway-Northeast Gateway corridor through Rockwall to Greenville in east Dallas. Last night, a record capacity crowd of nearly 1,500 showed up to get their opposition to the controversial toll project on the record. Landowners and concerned citizens voiced their opinions to the Texas Turnpike Corporation (TTC) and the North Central Texas Council of Governments (NCTCOG) at a public meeting held in Rockwall that lasted until after midnight.

The initial public meeting took place on September 4 in Lavon, but the fire marshal shut it down due an overcapacity crowd. They planned on 250 and 500 showed up. The meeting was rescheduled for last night. So tripling the number of attendees in just a few weeks demonstrates that the public opposition to this private toll project is only gaining steam and showing no signs of petering out.

The overwhelming majority spoke in opposition, primarily because this private corporation can wield the power of eminent domain for its private toll road that company documents show is projected to net $78 million in annual profits by 2035. Yet the company claimed last night that it didn’t know how much profit the toll road was anticipated to make.

Cintra files bankruptcy on Indiana Toll Road, is SH 130 next?

Link to article here.

Cintra, Macquarie file bankruptcy on Indiana Toll Road
By Terri Hall
September 23, 2014

Yesterday, the two private, foreign corporations that tookover the Indiana Toll Road in 2006 filed for Chapter 11 bankruptcy. Former Indiana Governor Mitch Daniels sold it to Spanish infrastructure company Cintra and Australia-based Macquarie in a $3.8 billion, 75-year lease that raised eyebrows around the world.

Few thought a road could fetch so much money. It set off a chain reaction of state governments clamoring for quick cash to shore-up shrinking highway funding. Indiana used the money to build other highway projects, forcing Indiana Toll Road users to pay for other road expansion they don’t use. The state has long since spent the money in the short-term, but now the tollway is in long-term trouble.

When Cintra and Macquarie acquired the tollway, they immediately doubled the toll rates. The troubled road has failed to attract enough traffic to repay its $5.8 billion in debt still owed on the project. It shouldn’t surprise anyone that the road is in bankruptcy when they’ve doubled the cost to use it. In a true market approach, if not enough customers are buying your product, you lower the price, not increase it. The hedge fund and distressed debt investors that now own about 80% of the debt have agreed to allow Cintra and Macquarie to restructure their debt or dupe another company into buying it.

Munoz' ties to 281 toll road create trail of corruption

Link to article here. Update: Munoz & team did snag the contract.

Munoz' ties to 281 toll road create trail of corruption
By Terri Hall
September 17, 2014

The Express-News reported yesterday that Henry Munoz is angling to get a piece of the US 281 toll project in San Antonio by seeking a 5-year engineering contract with the Alamo Regional Mobility Authority (RMA). The trouble stems from his sordid history of buying and manipulating local politicians, and he’s particularly adept at it when it comes to transportation. He's set-up his own company to now profit from the project he helped fashion while a public official.

Munoz is a former member of the Texas Turnpike Authority and a former Texas Transportation Commissioner, who resigned from the agency under a cloud of scandal for his staff abusing the state travel program and for providing inside information to a Mexican construction company in exchange for lavish accommodations, travel, and other personal pay-offs. Nearly a decade later, Munoz was appointed to the Alamo RMA and served as its Finance Committee Chair. He bolted when Texans Uniting for Reform and Freedom (TURF) successfully sued to halt the US 281 project in 2008. It was just no fun for him to be there anymore. No money to snag for the foreseeable future.

RMA targets toll opposition in taxpayer-funded PR campaign

Link to article here.

RMA targets toll opposition in taxpayer-funded PR campaign
By Terri Hall
September 18, 2014

You’ve probably heard the radio ads with Alamo Regional Mobility Authority (RMA) Chairman John Clamp touting the benefits of the US 281 toll project. If you’re like me, you got steaming mad that a toll authority is using our tax money to convince the public that tolling our existing freeways is a great idea.

I wanted to find out just how much money they’re sinking into this public relations campaign. An open records request revealed that they’ll spend up to $371,294 for radio and television ads, extensive newspaper ads, billboards, and a massive public ‘outreach’ campaign selling their toll road to your homeowners associations, civic groups, churches, chambers of commerce, and anyone that will let them in the door.

The primary contractor, HNTB, hired Trish DeBerry for the task, whose firm previously bid on the 281 toll project as part of a design-build team before her run for Mayor. Ultimately, the RMA has retained her PR services at a cost of $25,000 a month.

Think tank rips 'anti-toll housewife'

Link to article here.

Reason Foundation comes unhinged at populist revolt against tolls
By Terri Hall
August 27, 2014

Bob Poole
of the Reason Foundation has decided to pick a fight he can’t win.

He just published an article personally attacking anti-toll group leaders across the nation, and he had a extra special below-the-belt attack saved just for yours truly. He’s responding to the populist anti-toll revolt taking place in America, and he can’t help but go on the attack because these grassroots efforts are finally making progress. He’s lashing out in response to a 5-page cover story in the Weekly Standard that slammed the new rage among transportation think tanks like Reason, called HOT lanes. It stands for High Occupancy Toll (HOT) lanes. Sometimes they convert existing HOV lanes into toll lanes, other times they’re new lanes but only open to carpoolers and those who pay tolls.

The author, Jonathan Last, used many of the same terms to describe this wrong-headed policy as the anti-toll groups do - government picking winners and losers, crony capitalism, privatized profits, socialized losses, Lexus lanes, etc. If the shoes fits, and it does, it’s not hard for liberty-minded people to come to the same conclusions all by themselves. They can spot a scam when they see one. But Poole asks, ‘Where do these ideas come from?’ Or more to his point, who is promoting ideas in opposition to his libertarian ivory tower theory-world of road pricing?

Cintra's private meetings backfire in N.C.

Link to article and watch the tv report here.

Leaders, community question private meetings on toll lanes
By Jim Bradley
Wed., August 20, 2014

CHARLOTTE, N.C. — Elected officials from towns north of Charlotte will have the chance to talk with the company that wants to build tolls lanes on Interstate 77 but the public won't be allowed in.

A series of private meetings have been set up for Thursday between the North Carolina Department of Transportation, Cintra and leaders in Huntersville, Davidson and Mooresville.  
Cintra was awarded a contract to build additional lanes along I-77 between Charlotte and Mooresville in exchange for collecting the toll revenue paid by drivers. 
The proposal has been controversial and so have the Thursday meetings.

"To me, it sounds like a secret meeting. When the DOT said they're going to have meetings with Cintra, they're going to be made available. I expected meetings that would involve everybody. Not just elected officials," said Huntersville Town Commissioner Rob Kidwell.  

Other critics of the toll lanes jumped into the fray too. 
Vince Winegardner, with the group WidenI77, said the closed-door meetings raise even more questions about the project. 

"If this is a done deal and the decision has been made, why do we have to have private meetings? Why can't they discuss this in public?” he said.

The DOT said the meetings with Cintra are to provide one-on-one time for local leaders to get information from Cintra.  
DOT said public meetings are scheduled in September. 

As for Thursday's meetings for elected officials only, Kidwell said he won't attend. 

"We should be able to ask those questions in the open, get the direct answers into the open because the people who put us in office deserve to know that," Kidwell said.

Toll billing scam in New York

Link to article here.

E-ZPass ‘Unpaid Toll’ Service Center Collection Agency Email is a Scam
By Jack Phillips, Epoch Times | July 11, 2014

A circulating e-mail that purports to be from E-ZPass and said the customer drove on a toll road is fake and a scam that contains malware.

The e-mail is designed to get recipients to download malware onto their computer via links and attachments contained within it.

The e-mail reads:
“From: Collection Agency
Subject: Pay for driving on toll road

E-ZPass Service Center

Dear customer,
You have not paid for driving on a toll road. This invoice is sent repeatedly, please service your debt in the shortest possible time. The invoice can be downloaded here.”

It’s recommended to not download the invoice, as it’s malware.

The e-mail also has the E-ZPass logo in an attempt to make the scam look more official.

This isn’t the first time scammers have tried to use E-ZPass for their own gain.

The New York State Thruway has a post on its website, warning people to watch out for the scam.

“We have recently learned of an email phishing scam which appears to be an attempt to collect 
unpaid tolls. An example of this email is shown below. Please be advised that this is not an  authorized communication from E-ZPass, the New York State Thruway Authority or any other  toll agency associated with E-ZPass. We advise you not to open or respond to such a message  should you receive one,” it said a few days ago.

“If you have any questions about the validity of any message received, please contact the E-ZPass New York Customer Service Center at 800-333-8655.”

Editorial: Beware of P3s

Link to article here.

A caution on P3s: Let elected officials and the public beware
August 17, 2014 12:00 AM
By the Editorial Board
Pittsburg-Post Gazette

When it comes to public-private partnerships, so-called “P3s,” the old adage — let the buyer beware — needs to be updated for governments planning to join with private companies to do public work or assume a public function.

Let the public deal-maker beware. Let the public beware, too.

White House action to expand P3 toll roads

Link to article here.

The key here is Obama took Executive action in lieu of the legislative branch. Ever since George H.W. Bush’s presidency, the US Department of Transportation has been promoting and facilitating P3s, so why President Obama even took this action is puzzling. If he cared about the voters who elected him, he’d shut down P3s and their high cost to drivers, not expand them.

White House Initiative to Expand Public-Private Partnerships
Posted on: Friday, August 15, 2014
National Law Review Online

On July 17, 2014, President Obama announced a new infrastructure investment initiative, the “Build America Investment Initiative.” Among other things, this program is designed to foster increased use of federal credit programs and public-private partnerships (P3s) by state and local governments. This Alert provides an overview of the Build America Investment initiative and its implications for P3s going forward.

Status of Transportation Funding Bill
With an Aug. 1, 2014 deadline quickly approaching for the projected shortfall in the Highway Trust Fund, the House of Representatives enacted a short-term, $11 billion transportation bill on July 15. The Senate is also anticipated to consider this temporary solution in the near future, which would provide funding for surface transportation projects through May 2015. In the face of diminished prospects for a multi-year transportation program being enacted this summer and no expectation of Congressional action on other programmatic changes, the Obama administration has launched this initiative to promote P3s and to attempt to stimulate the growth of these projects through executive branch actions.

Read the rest of the review here.

ELECTION 2014: Texas gubernatorial candidates give insight on transportation

Link to article here.

It’s worth noting, while Attorney General, Greg Abbott was required by law to review public private partnership (P3s) contracts for legal sufficiency, he could not negotiate the terms. The Texas Department of Transportation (TxDOT) was given full authority by the legislature to do that. They’re the ones selling out Texans with favorable terms for private corporations at taxpayer expense. Abbott is campaigning on funding roads with existing taxes, not turning to more tolls and P3s.

Wendy Davis, however, not only voted to give this authority to TxDOT, she voted in favor of tolling every chance she got, for local option gas tax hikes (as noted below), and had conflicts of interest since her law firm worked for the North Texas Tollway Authority (NTTA) and she sat on the Senate Transportation Committee that votes on all NTTA bills. She never recused herself from any vote.

ELECTION 2014: Texas gubernatorial candidates give insight on transportation
By Keith Goble
Land Line state legislative editor

A new governor will be seated in Texas following the Nov. 4 election. The candidates competing for outgoing Gov. Rick Perry’s position have track records and have weighed in on transportation issues.

 The two major party candidates vying to replace him are Republican Greg Abbott and Democrat Wendy Davis. One issue that will confront the winner is a transportation system in need of $4 billion more per year in revenue.