Schutze: Perry's Trans Texas flip-flop

Link to article here.

Get Off My Lawn

Rick Perry Says He's Mr. Grassroots, But His Trans-Texas Flop Suggests Otherwise

By Jim Schutze Wed., Oct. 5 2011 at 4:34 PM

Tea Party people say they hate Washington and its top-down style of governance. They're the political version of eat-local. Everything should be grassroots.
Here in Texas the Tea Party loves Governor Rick Perry, but if you talk to people who've gone up against Perry on local issues, they will tell you that grassroots is one word the man cannot even find in the dictionary.

I ran into this particular Perry disconnect when I was doing the reporting for a story on Perry in this week's newspaper. One of the little sagas we had to trim back for space had to do with his attempt to build the Trans-Texas Corridor, a proposed but now defunct 4,000-mile-long high-tech transportation right-of-way, four football fields wide, from Mexico to Oklahoma.

Talk about top-down. Perry got beat badly on the TTC because he acted like he didn't even know local communities existed. The local communities that probably had more to do with beating him were our own town, Dallas, and Fort Worth.

For that part of my Perry story, I hardly talked to any progressive anti-highway Democrats at all. The people who fought Perry on it and beat him were mostly conservative-leaning pro-road-building Republicans. They all told me they liked Perry's basic idea but just couldn't reason with the man because of his autocratic style.

The TTC was the brainchild of an oil and gas millionaire pal of Perry's from back in the day, the late Ric Williamson, whom Perry had appointed chair of the state's Transportation Commission. The idea is dead now, shot many times over in the head by the Legislature. In fact, even though it had already been dead four years, the most recent Legislature dragged out the corpse and shot it again just to make sure, passing new legislation to curb the state's use of eminent domain.

One of the first people I interviewed for my piece was Republican State Senator Florence Shapiro of Plano. She said rural dwellers in the proposed path of the TTC learned the details from local newspapers and blogs, not Perry.

"Think if you're living in one of these communities. You've had farm land for three generations, and one day you read in the paper that this mammoth, behemoth, much larger than necessary thing is going to condemn most of your property. They were livid and rightfully so."

But so were the cities. Dallas and Fort Worth at the time were pouring hundreds of millions in infrastructure dollars into our two competing "logistics centers" -- rail and freeway hubs with gargantuan automated warehouses to handle Pacific Rim trade coming up from deep-water ports in Houston, Mexico and Southern California. The TTC would have stepped around both centers, carrying all of that lucrative trade instead out into hinterlands where people didn't want it.

Bill Blaydes, then the Dallas City Council member in charge of our "inland port" project, says he, like Shapiro, thought the TTC idea had merit. He says it could have been married to Dallas' project, as well as to Fort Worth's Alliance Logistics Center, had Perry merely been willing to deal.
"It was a magnificent idea, had he been willing to work with the metropolitan areas and not try to bypass something that we had been working very hard to promote," Blaydes says. "We probably would not have fought it as hard as we did, but we fought it all the way to Washington."

In several years of trying, Blaydes said he was never able to find an inch of common ground with Perry or his friend Williamson. "They were headstrong and hard-headed. They could not and would not revise their vision," he says.

Sandy Greyson was the Dallas City Council member responsible for long-range transportation planning policy. She says when Dallas realized Perry wouldn't negotiate, the city mobilized quickly, hiring David Dean, a transportation lobbyist with strong ties to the Legislature.

Before Dean ever approached the capital, Greyson says, he ventured into the boondocks and did the grassroots work Perry and Williamson had failed to do, knitting together a coalition of every town council, aggrieved rancher and outlet mall he could find along the proposed route. By the time Dean took his "River of Trade" coalition to Austin, the TTC was a dead letter.

Greyson calls Williamson "a brilliant man" and mourns for the better parts of his concept. But, she says, "The fatal flaw in the whole thing was that it seemed to be a very top-down plan that would be imposed on people and cities and counties."

Shapiro says of the plan now, "It's gone." She says Perry could have pulled it off, had he been willing or able to work the grassroots.

"The idea should have been from the bottom up rather than from the top down. You would talk about it," Shapiro says. "You would have discussions about why we need this kind of infrastructure, so it comes from the grass roots, from the community leaders, from the people who own the land, not the government here telling you what to do."

Toss in Perry's decision to order HPV vaccinations for Texas girls and the way he handled the education budget in this recent legislative session: You have a man here who doesn't know a grass root from a railroad tie.

Given his campaign ads and his promises on the stump to put power back in the hands of states and local communities, there is enormous irony in how he really governs. But if something happened to Romney, Perry got the GOP nod and beat Obama ... well, that situation would go way beyond irony.

Revolving door continues: Rodriguez jumps from City Manager post to Zachry

Assistant city manager named to deputy spot after departure
By Josh Baugh
San Antonio Express-News
September 30, 2011

When the City's new fiscal year begins Saturday, it'll bring with it several changes to the City Manager Sheryl Sculley's executive team, including the departure of Deputy City Manager A. J. Rodriguez, and the promotion of Assistant City Manager Erik Walsh.

Sculley gave the City Council a memo Thursday explaining the details of the resignation, several promotions and a rehire.

Rodriguez is leaving the post to return to the private sector as the executive director of public policy and government relations for Zachry Holdings, Inc., where he'll be the primary public policy adviser to ZHI's chief executive and board of directors. His city salary is $194,000.

Read the rest of the story here.

Selling the Capitol: Facilities Commission first to implement new P3 law

Link to article here.

State set to accept proposals for public-private partnerships for an array of government facilities

By Laylan Copelin

Updated: 5:09 a.m. Monday, Oct. 3, 2011

The State of Texas has hung a "Partners Wanted" sign on its vast amount of public property.

It is a message to developers and contractors that the state — land-rich but cash-strapped — will accept unsolicited proposals for public-private partnerships to construct and operate a wide array of facilities from offices to power generation sites to medical buildings.

The new guidelines, which went into effect Sept. 1, could help the state reduce its reliance on leased facilities, particularly office space, and make it easier to develop the Capitol complex by involving the private sector.

Texas government is spending about $150 million a year on leases for 10.6 million square feet of space, including about $48 million for 3 million square feet in Travis County. Almost three-fourths of those leases will come up for renegotiation over the next six years, but the state must act quickly if it wants to move more of its operations into new facilities on state lands.

"Time is the killer of any real estate deal," said Aundre Dukes, a portfolio manager at the Texas Facilities Commission. "This will go a long way to getting shovels into dirt."
The guidelines were written in response to Senate Bill 1048, which passed during this year's legislative session and covers local governments and higher education institutions, as well as state government.

Public-private partnership has its detractors and defenders, but it might be more widely used as governments try to stretch their budgets without increasing taxes.

The facilities commission already had the authority to accept unsolicited proposals, but the state seldom did, Dukes said. Instead, the public sector typically advertised for proposals after it had identified a project.

Local examples of public-private partnerships include the Triangle, a complex of apartments, retail shops and restaurants, and the original Central Market shopping center, both on state lands in Central Austin.

Though state law allowed such projects before Senate Bill 1048, it didn't provide a clear, predictable path.

"The private sector didn't want to reinvent the wheel every time," said Chris Lloyd, a Virginia-based lobbyist who supported the Texas legislation that was patterned on a Virginia law.

Senate Bill 1048 creates a single format to encourage the private sector to approach the public sector with its proposals.

"In essence, they are submitting a business plan," Dukes said.

When it comes to structuring the deal, the guidelines are open-ended. Companies, for example, could build, own and operate a facility with a long-term ground lease from the state. Or they could build it, transfer it to the state and then operate it. There are at least a dozen variations in the guidelines that try to anticipate any construction project or service the state might need.

There is a $5,000 fee to cover the cost of the initial review by the state staff.

If the Texas Facilities Commission accepts the proposal at one of its public meetings, the details are published. The company's financial data and other proprietary information are protected from disclosure, but the rest of the proposal becomes public information.

The Legislature added an 11-member oversight group made up of four senators, four House members and three officials from the executive branch. It has 45 days to review each proposal.

At that time, competitors are allowed to offer their own versions of the initial proposal.

Once the facilities commission chooses a proposal, the winning company must pay for advisers, lawyers or consultants who are hired to do the final evaluation before the state approves the proposal.

Dukes said allowing competition ensures the public gets a good deal.

During debate over Senate Bill 1048, however, critics questioned the public-private partnership approach.

"There isn't really a public-private partnership that is a good deal for taxpayers," said Terri Hall, executive director of Texans Uniting for Reform and Freedom, a group formed in 2005 to oppose toll roads, including instances in which foreign companies designed, built and operated the roads for the state.

"It's all about cronyism," Hall said of public-private partnerships.

She said 99-year ground leases give the private sector virtual ownership of state land.

Even with competing proposals, Hall said the devil is in the details of the final contract. She said the private sector "out-lawyers and out-negotiates" the public sector. And she said she is worried that in some instances taxpayers could end up guaranteeing the debt.

"We are basically subsidizing private profits," she said.

The Legislature disagreed. It overwhelmingly passed Senate Bill 1048, though 28 conservative House members voted against it.

The Texas Facilities Commission could provide the biggest test run of the new law.

Two years ago, the commission began steering away from leasing office space to a vision of public-private partnerships helping fully develop the Capitol complex.

The concept is anchored in three ideas:

• It's cheaper to build on land the state already owns.

• Money now being spent on leased space could be redirected toward construction.

• Developers might be drawn upon to put up the cash for a role in the projects.

A former director of construction at the University of Texas, James Broaddus has seen public-private partnerships from both sides since he founded his project management firm, Broaddus and Associates, 11 years ago.

He supports the concept and said he believes it could provide cash-strapped governments and public institutions with the money to build facilities needed for Texas' exploding population.

"There's a lot of private capital sitting on the sidelines looking for a sound investment," he said.

However, Broaddus warned: "This is not a playing field for amateurs. The government owners need to really evaluate what they are getting."

The seven-member facilities commission has approved the concept for the Capitol complex, but it still must solicit bids for a master plan. Dukes said the guidelines could speed up implementation once that plan is created.

In the meantime, the guidelines can be applied to public-private partnerships anywhere in the state.

"Our task is not just downtown Austin," Dukes said. "It's much bigger than the Capitol complex."

The development community has been inquiring for months, since the commission released its inventory of state properties and first floated the idea of public-private partnerships.

Dukes said he has heard from developers coast-to-coast.

"There hasn't been a parcel in our master plan," he said, "that I haven't gotten a phone call on."

Will Trans Texas Corridor sidetrack Perry candidacy?

Link to article here.

Scuttled highway may sidetrack Perry
By: Kendra Marr, Politico
October 3, 2011 10:30 PM EDT

Rick Perry’s small-government record has yet another blot.

It’s called the Trans-Texas Corridor.

The governor’s 2012 rivals have latched onto his executive order mandating the HPV vaccine and his advocacy for in-state tuition for illegal immigrants, while little has been said about his unrealized 1,200-foot-wide toll road project that would have swallowed more than 500,000 acres of Texas farmland and wildlife habitats. But as the focus of debates increasingly turn toward President Barack Obama’s jobs agenda — a plan calling for a heavy dose of infrastructure investment — that may change.

“Pay to play, cronyism — all those charges can be found right here in the Trans-Texas Corridor,” said Terri Hall, founder and director of Texans United for Reform and Freedom, a group that fought the project. “We had a Texas-sized uprising.”

In 2002, Perry unveiled his $175 billion blueprint for Texas transportation, calling for 4,000 miles of new toll roads, high-speed rail lines and pipelines “as big as Texas and as ambitious as our people.” Not unlike Obama, Perry envisioned a government role in cultivating private-sector investment in infrastructure.

But awarding new toll development to a Spanish company stoked nativist fears — and questions about a revolving door to the governor’s office. His massive land grab through eminent domain, the practice of government seizing private property for public use, incurred the wrath of farmers, environmentalists and members of his own party.
Nearly 10 years later, Perry signed the death certificate for his brainchild, scrubbing all references of the corridor project from state statutes during the most recent Texas legislative session.

“I supported the ban of ever making a taxpayer-paid road a toll road. You cannot do that in the state of Texas,” he said in an August interview with Des Moines-based WHO Radio, stressing that tolling alternatives are raising taxes, asking Washington for money or waiting for the “asphalt fairy.”

Perry spokesman Ray Sullivan said the failed initiative ultimately fostered conversations about how to fund road projects without increased taxes or relying on the Federal Highway Trust Fund.

“We would describe it as one starting a very important, robust public debate and discussion of financing and developing transportation infrastructure,” he said. “While the corridor concept is dead, the debate has resulted in more transportation funding options and high-priority projects going forward with some private financing and strong state and local cooperation.”

Tolling and public-private partnerships have helped the state’s infrastructure keep up with the big influx of people moving to the state, Sullivan said, adding that the debate had evolved in such a “positive way,” the governor “could agree with the legislature that the corridor was no longer the right approach for the state.”

It’s clear that Texas needs to do something about its crumbling and aging transportation network. The state added 4 million people over the past decade, and its population explosion isn’t expected to slow down. Nearly half of the state’s major highways are congested, and one-third of its major roads are in poor or mediocre condition, according to the American Society of Civil Engineers.

At the same time, the state has borrowed heavily to fund its road projects since 2003 and will owe $17.3 billion by the end of next year.

Perry’s Trans-Texas Corridor proposal — launched during his first gubernatorial campaign — would have run from the Mexico border to Oklahoma. It was the answer to the challenges of a growing state that was expecting increased international traffic under the North American Free Trade Agreement. Perry envisioned separate lanes for cars and trucks, as well as a rail system. The project was also slated to carry water pipes and utility lines. It was the “largest engineering project ever proposed for Texas,” according to one transportation department report, promising to reduce congestion, cut pollution, improve safety and speed up trade routes.

Given the state’s budget difficulties, Perry’s financing schemes included public and private money, including some toll roads.

Republicans took control of the state Legislature in 2003, pushing the Trans-Texas Corridor project through both chambers as part of an omnibus transportation bill. But evidently, few lawmakers knew what the bill contained.

When the state Transportation Department began holding public meetings about the project in early 2004, voters were fuming at the possibility that private corporations — particularly foreign ones — might exercise eminent domain to build massive amounts of infrastructure for profit.

“His plan was meant to be bold, get one’s imagination working, and it turned out to look scary to people,” said Matt Dellinger, author of “Interstate 69,” which details the fight over the Trans-Texas Corridor.

County toll authorities in Dallas and Houston complained the state was forcing them into contracts with private companies, while voters began calling their legislators to repeal the law. David and Linda Stall, a Republican couple from Fayetteville, Texas, formed a group called, which held meetings across the state about the details of the plan and whipped up outrage.

Environmental groups objected to the wildlife being lost, and farmers turned on the former state agriculture commissioner, calling it an abuse of eminent domain.

“It would have claimed a lot of farm and ranch ground — some of the best in farm and ranch country in the entire state,” said Jim Sartwelle, director of public policy for the Texas Farm Bureau.

Perry’s decision to award development rights to a Spanish company, Cintra, only tapped into anxieties about immigration, free trade and border security. Conspiracy theorists dubbed it the “NAFTA Superhighway” and protested the alleged plot to dissolve the nation’s borders.

And voters cried foul when it came out that one of Perry’s top aides, Dan Shelley, worked for Cintra until three months before the company was selected for the state road project. When Shelley left the governor’s office, he signed a lucrative lobbying contract with Cintra.

But the Perry administration held its ground. Texas Transportation Commissioner Ric Williamson, one of Perry’s closest advisers and friends, frequently intoned, “There is no road fairy.”

“We either build toll roads, slow roads or no roads,” Perry said in 2007.

Ultimately, the uproar forced state officials to scale back the proposal. In 2007, the Legislature dealt a blow to the main tenant of the corridor by placing a moratorium on public-private toll partnerships. In 2009, Perry’s Transportation Department officially killed it off with a “no build” recommendation on the corridor’s first segment, which was being handled by Cintra.

It was one of the most controversial issues of Perry’s gubernatorial career — yet he emerged from the fight relatively unscathed.

During his 2006 reelection, there wasn’t a strong Republican challenger to bring up the Trans-Texas Corridor. Perry, who continued to support the corridor, won the four-way general election with 39 percent of the vote.

During his 2010 gubernatorial fight, Republican Sen. Kay Bailey Hutchison aired a biting attack ad accusing Perry of tolling roads for the benefit of foreign companies. Hutchison lost, and while the Democratic nominee, then-Houston Mayor Bill White, also ran an attack ad on the project, Perry won easily.

By the recent midterm election, the issue was too old to cause much damage. Yet tea party activists were still vocally hesitant at what they viewed as the government’s big private-land grab.

Will it damage Perry’s national ambitions?

“Rick Perry talks a good game about getting government out of your life, but if there’s any utility at all for him to put government in your life, you’ve got government in your life,” said Leland Beatty, who worked for Perry’s agriculture predecessor Jim Hightower.

Hall fumes that some public-private partnerships are still alive and well in Texas — even if the corridor project is dead. “There are all these sweetheart deals for all his corporate cronies,” she said.

Meanwhile, others have forgiven.

“Were there disagreements in the middle of the process? Certainly,” said Sartwelle. “But it never happened. The bottom line is it never happened.”

Kirby Brown of the Texas Wildlife Association insisted that “the governor got bad advice.” But he admitted, “There’s no question, we have members who are still mad about it, and they didn’t like the way it played out.”

Dellinger offered this defense: “I could see Perry’s eventual answer being like his HPV response: ‘My heart was in right place, but I went about it all wrong.’”

Perry pushes toll agency to sell, privatize I-35 in Denton

Link to article here.

It's significant to note that Deirdre Delisi is Chairwoman of Perry's Texas Transportation Commission and running his presidential campaign at a time when she has the power to direct billions in state contracts to potential campaign donors, like the corporations who will benefit from privatization. The NTTA already knows this project isn't toll viable, so why is Perry's Commission pushing to have it privatized? How will they make money? The same way they all do -- taxpayer subsidies, or public money for private profits.

Gas taxes would build it, but can't use it without paying again through toll taxes:
"With half-a-billon dollars in public money (note: total project cost $3 billion), TxDOT could attract private firms to build the tolled portion of the project -- ie, the two managed lanes in each direction -- and perhaps a small portion of the improvements to the main lanes first. The revenue from those toll lanes would then, supporters hope, be sufficient to help finance the subsequent improvements."

This also shows how diabolical Perry's highway department remains, even after two scathing and a 628 page management audit sunset reviews that could have abolished the agency altogether. So now that the sunset review is over, they're up to their usual bullying that got them into trouble in the first place. Commissioner Ted Houghton even promised TxDOT was no longer in the business of toll roads and that it would defer to the LOCAL toll entities to do it, if they chose. Now that the sunset review is over, TxDOT is NOT deferring to the LOCALS and is foisting its agenda upon them with the MOST expensive way to fund roads that result in toll rates as high as 75 cents PER MILE!

The most shocking statement in this article:
"NTTA executives said this morning that there is no way NTTA could borrow enough to pay for the road because it would take decades before its projected toll revenues would be enough to pay both the debt service on the necessary loans and the operations and maintenance of the road -- even if it is built in stages."

With pressure from state, NTTA board poised to clear way for privatization of I-35E toll project to Denton
By Michael Lindenberger/Reporter
Dallas Morning News
9:50 AM on Wed., Sep. 21, 2011

Free lanes would be expanded; new tolled managed lanes added to I-35E

Update: The board voted 9-0 to waive its rights to develop the project, with the controversial caveat deleted.

Should the NTTA waive its right to develop the Interstate 35E project between Dallas and Denton?

It's a $3.2 billon construction project, and would stretch 29 miles and cover two tolled lanes in each direction, two to three frontage roads lanes in each direction, and between three and four lanes of rebuilt interstate lanes -- big enough, in other words, to make it the largest and most expensive project in NTTA history.

Support for the project is near unanimous from Dallas to Denton to Arlington to Austin. And expectations are high that work on at least part of the project could get underway in the next couple of years, despite its high costs.

But those costs and a strong preference for privatization on behalf of the Governor and his appointees who run the Texas Transportation Commission have likely sidelined NTTA for this project.

Here's why: NTTA executives said this morning that there is no way NTTA could borrow enough to pay for the road because it would take decades before its projected toll revenues would be enough to pay both the debt service on the necessary loans and the operations and maintenance of the road -- even if it is built in stages.

So the staff has recommended to the board that it formally waive its rights to develop the road and by doing so let TxDOT work with local officials to attract a private investor who would finance the road in return for the right to collect tolls. That's an approach that was outlawed by the Legislature in 2009, but given new life again in 2011.

TxDOT wants that project badly enough that Gov. Rick Perry's chief transportation advisor, chairman Deirdre Delisi of the Texas Transportation Commission, called NTTA chairman Victor Vandergriff last night urging him to support the waiver and get his agency out of the way of the project.

The board hasn't voted yet -- though it appears certain they will support the waiver -- because the proposal made by the staff includes a caveat that the waiver would be rescinded if TxDOT kicks in significant tax dollars to make the project more attractive to the private sector. The thinking at NTTA has been if TxDOT is willing to heavily subsidize the project with tax dollars, then why should such funds only be available to the private sector.

The amounts are huge. CFO Janice Davis told board members that a private firm eager to build the project would likely need government assistance to back its debt -- giving it a lower borrowing costs -- as well as upfront payments of hundreds of millions of dollars, and annual payments to assist it in paying its loans.

Of course, TxDOT and other backers of the project are smart enough to see that a caveat that rescinds NTTA's waiver in the event of such assistance is tantamount to no waiver at all, since the assistance is necessary.

That's likely the message Delisi delivered to Vandergriff last night.

So where's that leave the project? NTTA is going to consultant with its lawyers in a few minutes and will likely delete the caveat. If it does, it will give the project to TxDOT.

That will be a mixed blessing for the state, which wants to showcase the power of private investment in highway infrastructure. But as Michael Morris, the transportation chief at the NCTCOG said this morning, with only about $500 million to $600 million in public money available for the more than $3 billion project, the challenges in funding the project through any means will be significant.

What's also clear, however, is that once NTTA moves out of the picture, the state will be free to pump as much money as it can find into the project to secure the interest of a private sector partner. What that means for folks like Denton Judge Mary Horn, who has been pushing for a rebuilt link between Denton and Dallas for years, will likely look like this:

With half-a-billon dollars in public money, TxDOT could attract private firms to build the tolled portion of the project -- ie, the two managed lanes in each direction -- and perhaps a small portion of the improvements to the main lanes first. The revenue from those toll lanes would then, supporters hope, be sufficient to help finance the subsequent improvements.

NTTA has attempted to keep its finger in the pot long enough to get back into the game if the project turns into a primarily toll project. That's the kind of prospect TxDOT wants to avoid, and it is likely what it is going to get once the board meets with its attorneys this morning.

When it meets with its attorneys, the overriding reality will be financial, not legal: With so little money to bring to the table, NTTA is likely to find that it simply can't afford to stay in the driver's seat for the Interstate 35E project.

Perry's cronies: The Shelley-Cintra-Giuliani connection

Link to article here.

Perry & his cronies: The Shelley-Cintra-Giuliani connection

By Terri Hall,, September 21, 2011

With the pay-to-play Solyndra scandal rocking the White House, presidential hopeful Rick Perry is embroiled in a mountain of crony capitalism controversy all his own. During the September 12 GOP presidential debate, Michelle Bachmann exposed the money trail behind Perry’s Executive Order mandating all 6th grade girls in Texas receive the Gardasil HPV vaccine made by the drug company, Merck, the employer of Perry’s former Chief of Staff, Mike Toomey, at the time. Merck funneled money to Perry, initially $5,000, but eventually adding up to the tidy sum of closer to $400,000, sparking outrage across Texas and now the nation.

Toomey’s just the tip of the ice berg.

A recent bill pushed through the Texas Legislature benefited the company Waste Control Specialists, owned by #2 donor to Gov. Rick Perry, Harold Simmons.  Just days after the bill was signed into law, Mr. Simmons wrote a $100,000 check to Americans for Rick Perry, the super PAC supporting Gov. Perry's candidacy for president notes Debra Medina of We Texans.

Janet Ahmad, President of Homeowners for Better Building, pointed to similar problems in the construction industry.  Top Rick Perry donor, Bob Perry, paid nearly $8 million in campaign contributions and sought and received his own regulatory agency called the Texas Residential Construction Commission in 2003.  Gov. Perry appointed industry-connected people to that agency, including Perry Homes VP, corporate counsel John Krugh. “The resulting agency was so anti-consumer and so counter-productive that the Texas Legislature later decided to abolish it,” Ahmad concludes.

Texas for Sale

Then there’s Perry's penchant for selling off Texas infrastructure to the highest bidder, particularly to the employer of his former staffer Dan Shelley, a Spanish company, Cintra. Shelley worked as a ‘consultant’ for Cintra (in 2004), became Perry’s liaison to the legislature during the time that Cintra was awarded the development rights to the $7 billion dollar Trans Texas Corridor (in 2005), then went back to work as a lobbyist for Cintra (in 2006). He and has daughter reportedly earned between $50,000-$100,000 on lobbying for Cintra that year.

Two key bills that just passed the Texas Legislature and signed into law by Perry further illustrate the crony capitalism and pattern of governance in the Perry Administration, both of which will benefit Cintra, in particular.

SB 1420 makes 15 Texas roads eligible for public private partnerships (P3s) that sell- off Texas sovereign land/public roads to private entities in 50 year monopolies. P3s involve public money for private profits (including gas taxes and other public subsidies), contain non-compete clauses that penalize or prohibit the expansion of surrounding free routes, and put the power to tax in the hands of private corporations that result in toll rates as high as 75 cents per mile ($13/day or like adding $15 to every gallon of gas you buy). It’s selling off Texas to the highest bidder, which is the MOST expensive, anti-taxpayer method of funding infrastructure.

Four road projects under SB 1420 have already been awarded to Cintra. In fact, every single P3 for roads in Texas has gone to Cintra: SH 130 (segments 5 & 6) and I-635 and the North Tarrant Express (comprised of multiple projects, primarily on I-820) in Dallas/Ft.Worth. All have been heavily subsidized with gas taxes and other public money (see pages 2 & 3), yet Cintra walks away with a sweetheart deal and guaranteed profits. Despite Cintra’s shaky financial situation (its debt rating just got lowered due to fears of the Cintra-controlled Indiana Toll Road going into default), Perry’s highway department continues to press ahead with these extremely controversial and unpopular privatization projects.

Perry’s connection to Cintra explains why he endorsed Rudy Giuliani in the last presidential election. At the time, Giuliani’s law firm, Bracewell & Giuliani, was the legal firm representing Cintra in its bid to takeover SH 121 (which eventually unraveled) in the Dallas area. Giuliani’s investment firm was purchased by an Australian firm, Macquarie, another global player in P3s at the same time his law firm was advising Cintra on the SH 121 deal. While many social conservatives were baffled by Perry’s backing of Giuliani, it was no surprise to those following the Trans Texas Corridor and Perry’s push to privatize Texas freeways.

Balfour Beatty enters the scene

Perry likes to brag ‘Texas is Open for Business’ and here’s what that means to property rights and taxpayers. The second key public private partnership bill, SB 1048, Perry signed into law will mean Katie-Bar-the-Door on selling off virtually everything not nailed down. The bill was written by lobbyist Brett Findley on behalf of another infrastructure firm, British company Balfour Beatty, and it will allow all public buildings, nursing homes, hospitals, schools, ports, mass transit projects, ports, telecommunications, etc. to be sold-off to corporations using P3s. Unlike the 50 year cap on road P3s, SB 1048 gives no limit on the length of time a P3s can last or whether such broad authority expires.

Two particularly anti-taxpayer provisions in SB 1048 are the fact taxpayers secure the private entity’s debt (2267.061 (f)) and that it authorizes public subsidies for private profits by raiding taxpayers’ money through loans from the State Infrastructure Bank.

Michelle Malkin called P3s corporate welfare. Fannie Mae and Freddie Mac are P3s and required massive taxpayer bailouts. P3s socialize the losses and privatize the profits. These contracts also eliminate competitive bidding and grant government-sanctioned monopolies (with guaranteed profits) to the well-connected.

Public interest not protected, kept secret

These contracts can be negotiated in SECRET, without financial disclosures (like financing, the structure of the ‘user fees’ or lease payments, viability studies, public subsidies, or whether or not it contains non-compete clauses or other gotcha provisions). There is no meaningful public access to P3s before they’re signed, and the few guidelines created simply exist to advise governmental entities outside the public purview.

Eminent domain for private gain

P3s represent eminent domain for private gain -- the source of much of the backlash to the Trans Texas Corridor, where P3s were the financing mechanism that granted these private entities the control of not just the facility, but the right of way/surrounding property where private companies make a killing on concessions. A plurality of Texans don’t like the idea of foreign ownership of our public infrastructure and they dislike eminent domain for private gain even more.

Of course, it started with the Trans Texas Corridor, known at the federal level as high priority corridors, corridors of the future, or the NAFTA superhighways. Just in Texas, it was to be a 4,000 mile multi-modal network of toll roads, rail lines, power transmission lines, pipelines, telecommunications lines and more. It was going to be financed, operated, and controlled by a foreign company, Cintra, granted massive swaths of land 1,200 feet (4 football fields) wide taken forcibly through eminent domain.

Called the biggest land grab in Texas history, it was going to gobble up 580,000 acres of private Texas land (the first corridor alone was to displace 1 million Texans) and hand it over to well-connected global players using PPPs, who would gain exclusive rights to determine the route and what hotels, restaurants, and gas stations were along the corridor in a government-sanctioned monopoly for a half century. It was the worst case of eminent domain for private gain ever conceived.

Property rights shredded
The Trans Texas Corridor, and P3s in general, represent an imminent threat to private property rights. While lawmakers repealed the Trans Texas Corridor from state statute only months ago due to the public backlash, the corridor lives on through these P3s.

So Perry basically granted government a blank check to trample on property rights and the power to pick the winners and losers — who will lose their land to benefit another, rather than restricting the power of eminent domain to matters of public necessity. If the government can steal your land, it’s tantamount to stealing your wealth. Who said Republicans aren’t socialists? P3s are just the sort of wealth redistribution they like — giveaways to their cronies and special interest friends. They’re also a BIG step in enacting the U.N.’s Agenda 21 policies where the stated goals are to abolish private property and restrict mobility.

Rick Perry’s crony capitalism wasn’t just a fleeting lapse of judgment pertaining to the HPV scandal, it’s a consistent pattern of revolving door, pay-to-play crony capitalism that Americans detest and can ill afford.

Terri Hall, San Antonio Transportation Policy Examiner
September 21, 2011 - Like this? Subscribe to get instant updates.

America's most expensive highways - toll roads

Where Are America's Most Expensive Highways and Byways?

By Jo  Piazza

Published September 20, 2011 |

With air travel becoming prohibitively expensive, more travelers are taking to the roads. But even our nation's highways and byways are no longer the cheap alternative, as tolls continue to climb for states seeking additional revenue streams.

The most recent pain in the wallet is the preliminary approval for the state of Virginia to levy tolls on Interstate 95, extending the pay-to-ride corridor on the highly traveled North-South route even deeper into the Southern states, starting south of Fredericksburg.

So where are the nation's most expensive highways and byways?

It's a common belief among the road warriors who say that the Delaware Turnpike -- the 11.2 mile stretch of road that connects from New York and Philadelphia take to Baltimore and Washington D.C. -- is the most expensive toll road in the U.S.

But according to the Federal Highway Administration, the most costly interstate toll road for passenger vehicles, broken down by average cost per mile, is the Chicago Skyway -- a 7.8-mile toll road connecting the Dan Ryan Expressway to the Indiana Tollway, costing drivers a whopping $.46 per mile. The tolled express lanes in downtown Denver, Colo. come in second, costing $.29 cents a mile. The Delaware John F. Kennedy Memorial Highway comes in third, costing approximately $.23 cents per mile.

The priciest non-interstate toll roads include New York's Whiteface Mountain Veterans Memorial Highway at stunning $3.11 per mile, the Prospect Mountain Veterans Memorial Highway in New York at $1.01, the Fort Bend Parkway Extension in Texas at $.59 and Colorado's scenic Pike's Peak toll road where the average cost is $.53 per mile for a passenger vehicle.

Tolls are revenue generators for states, which means that in tough economic times they are only going to go up.

According to the Federal Highway Administration the number of interstate and non-interstate toll roads and bridges has increased from 4,601 miles to 5,079 miles since 2001.

Virginia estimates that with the new tolls, they will collect $250 million in the first five years of implementation, if they win final approval. Under mandate from the Federal Highway Authority the funds must be put back into the state's highway system.

The American Automobile Association (AAA) does not keep track of how tolls affect the number of drivers on the road, nor does the Federal Highway Administration, but AAA is strong in its stance against tolling existing capacity.

“As a general principle, AAA believe that all roads should be toll free. Tolls should not be imposed on existing capacity, especially on the Interstate Highway System.. We recognize that all levels of government are facing transportation funding shortfalls. And at the same time, states face tremendous transportation system maintenance and construction backlogs that need addressing,” said AAA spokesman Troy Green.

Toll increases always seem to come with it grumbling from frequent commuters, and then followed by a spark of creative ingenuity as drivers attempt to save a few bucks each day.

“It's is usually an issue if there's a big toll increase. People start to think about avoiding the toll. They research it, try out alternates,and make a judgment whether the toll is worth it to them,” explains Peter Samuel, the editor of the independent website Toll Road News that collects data on toll increases nationwide.

“On the long turnpikes - like N.J. Turnpike, Ohio Turnpike, I-95 in Delaware and Maryland etc. - there's usually a parallel free road, however (with) lots of stoplights, much slower. But if the toll is high enough some people do switch to that slower but free road, no doubt about it,” Samuel said.

This will likely be the case if the toll increase is approved in Virginia, particularly in our digital times when there is no shortage of information online about how to ditch tolls and the costs of doing so.

“People start to research it with Google Maps and such like. I'm sure someone will come up with an iPhone app 'Avoid the Toll' which will map the toll points and show a motorist how to get around the toll, maybe estimate the time it will cost you and the toll charge you'll avoid,” Samuel said.

But the real question is how the rising prices of tolls impact drivers?

Read more:

Fitch warns of toll troubles

Article from:

Credit Ratings Agency Warns of Tolling Troubles
Fitch Ratings reports toll roads imperiled by lack of sustained growth in the economy.

Fitch reportToll roads at one point appeared to be unstoppable. Steady growth in traffic yielded rapidly rising profits, especially for pioneers in the field such as Australia's Macquarie Bank where executives became so rich from deals that included the leasing of US roads that it was dubbed the "millionaires' factory." That all changed when the recession took hold and motorists scaled back on the mileage driven each year. Losses began to mount, and as a report released last week by Fitch Ratings argues, the dynamics for tolling may not improve in the near future.

"Fitch tracks data on toll roads, bridges, and tunnels across its ratings portfolio," Fitch analysts wrote in the report, Downshifting: US Transportation Reacts as GDP Growth Flattens. "Traffic declined year over year as much as 10 percent during the Great Recession. Sustained positive growth in traffic commenced in February 2010. The most recent Fitch data indicates that growth in traffic volumes began slowly declining on tolled facilities, heading to zero growth in second-quarter 2011."

The US Bureau of Transportation Statistics reported a similar decline in commercial transportation services for both goods and passengers. Despite some recovery, the index remains below pre-recession levels. These transportation statistics mirror figures for consumer spending which began recovering early last year only to falter this March. Growth in consumer spending for the second quarter of 2011 was under 0.1 percent.

The credit ratings agency argues activity in the economy at large and the in the transportation sector are directly linked. When someone gets a job, he generally gets in his car to drive to work. When stores sell goods, the supplies, raw materials and final product are usually transported by truck. When unemployment is high and sales are low, such transportation activity drops.

"Higher oil and other commodity prices account for some of the change in consumer spending," the analysts explained. "Unlike past downturns, these prices are increasingly influenced by external factors as well as US demand. Consumers are reacting to increased prices and a weak labor market with belt tightening."

Fitch will not downgrade any existing credit ratings for toll roads because these operations have a monopoly position that enables them to recover from downturns by hiking tolls that many motorists have no choice but to pay.

"Tolled facilities have experienced low and even negative traffic growth since 2007," the analysts stated. "Revenues have grown at a much higher rate as facility operators reacted to the downturn by raising rates to preserve financial and operational flexibility."

The ratings agency warned that sustained periods of low economic growth imperils the financing of deals built with healthier traffic and economic forecasts in mind.

"Most public infrastructure facilities should be able to weather little to no growth scenarios over the next three to five years," Fitch wrote. "However, there are a number of issuers whose escalating debt profiles could pose a problem in the medium term. Newer toll facilities generally have such debt service profiles... Stand-alone, concession-based facilities, originally financed in 2006 - 2008 when expectations for future economic growth were very high, will be more vulnerable."


Link to article here.

2010 recovery in toll traffic stopped in Q2, unprecedented stall-out - Fitch Ratings

Posted on Sun, 2011-09-11 23:30
Fitch Ratings say in a recent report that traffic on toll facilities ceased to grow in the second quarter of this year, suggesting the weak recovery from the 2008-2009 recession in 2010 and first quarter 2011 has stalled. An accompanying graph shows 4/11 traffic and revenue as still growing but at 2 to 3% versus a healthy revenue growth 5% year-on-year -  rather constant for a year through the first quarter.

Fitch says this "second dip" is unprecedented. No recovery in the past 40 years has seen such marked stoppage before pre-recession levels are reached.

Traffic has been growing through to the second quarter but less strongly than toll revenue,  the difference reflecting an increase in average toll rates. But growth in traffic along with revenue has plunged towards zero since, the Fitch report says.

They see approximate "zero growth" now.

Untolled roads too

They say untolled roads are experiencing a pattern of stagnant year-on-year traffic numbers in recent months similar to that of toll facilities.

They write: "It is important to note that this second dip in the trajectory is very different from any seen over the past 40 years."

Reflection of consumer spending

Fitch analysts say the stall-out of traffic recovery is a reflection of the deterioration of the US and world economy over the summer.

"The direction of the economy and the general economic climate has become uncertain over the summer months. The housing market shows rising delinquencies; firms are holding back on expansion plans; and consumers are husbanding their financial resources. The recent dramatic decline in the U.S. stock markets and the overhang of the debt crisis may keep consumers in a conservative posture. Consequently, the prospects for near-term growth in traffic volumes in transportation infrastructure facilities as seen in late 2010 now seem low."

Higher toll rates have boosted revenues

The only good news from Fitch is many tollers have found they can increase revenue with higher toll rates. Those motorists who are traveling apparently find the benefits of tolled travel greater than the cost, so total revenues are up compared to pre-recession levels, though traffic volume has not recovered.

Growth prospects now "low"

Whereas by late 2010 it looked as though there was a recovery under way that would continue through this year and next, the prospects for growth are now  "low."

How does the a no-growth scenario affect the viability of tollers whose capital was raised in a more optimistic atmosphere?

Most will weather the no-growth period for 3 to 5 years

Fitch Ratings say most "should be able to weather little or no-growth scenarios over the next three to five years." But a number of bond issuers could find escalating debt a problem "medium term."

This includes several "newer toll facilities" and airports.

No agencies are named, but they say:

"For such facilities, an extended period of limited or flat growth in volume will require they make more dramatic increases in tolls/airline rates and charges coupled with continued expense reductions to maintain their credit profile. Stand-alone, concession-based facilities, originally financed in 2006−2008 when expectations for future economic growth were very high, will be more vulnerable."

SIDENOTE: Metropolitan Washington Airports Authority (MWAA) had its bonds recently downrated in a quite separate Fitch analysis. MWAA has been borrowing heavily to expand capacity at Washington Dulles International Airport and the poor air traffic has depressed landing fee revenues, making the debt for expansion tougher to support.

But MWAA also has plans to issue $3.2b in toll revenue bonds as part of its underwriting of the extension of the DC metrorail system to Dulles airport and beyond. Huge revenue increases will be needed on the Dulles Toll Road to support this. Studies on the future likely traffic and revenue on the Toll Road by consultants Wilbur Smith Associates won't be done until year's end.

Strangely the Fitch rationale for the MWAA downrating focuses exclusively on the airport portion of MWAA business, making no references to the extraordinary rail debt planned to be borne by the Toll Road.

The major report cited here is titled "Downshifting: US transportation reacts as GDP growth flattens."

Named analysts are Thomas McCormick, Michael McDermott, Cherian George and Jeffrey Lack.

TOLLROADSnews 2011-09-11

Perry denies support of NAFTA superhighway

Link to article here.

Okay, Perry must be having a total break from reality is he thinks he can tell such a bald-faced lie and get away with it while he's under the media microscope of a presidential campaign. Perry is truly trying to re-make himself as he runs for he for real? After shoving the Trans Texas Corridor (TTC) down Texans throats for the last 8 years in stubborn defiance against the tens of thousands of Texas who rose-up to oppose the the TTC, he honestly thinks he can get away with this denial of his support for it? Had it not been for a Texas-sized uprising, the Trans Texas Corridor would have NEVER been repealed from the transportation code in June of this year! To add insult to injury, Perry also signed into law another bill that still allows 15 Texas roads to be sold off to these foreign companies using public private partnerships. So the pie in the sky TTC is over, but a smaller version built in segments will commence.

Rick Perry Says He Opposes Globalist Super Highway

Kurt Nimmo
September 15, 2011

During a call-in radio show in Des Moines, Iowa, declared GOP presidential candidate Rick Perry told a whopper. He said the idea of a NAFTA Super Highway (or Trans-Texas Highway) does not appeal to him.

“I’m looking for a candidate that is actually going to walk their talk, so I want to know how Gov. Perry justifies being in a Bilderberg meeting and also in my research and reading, I’ve read that he is interested in joining Canada, United States and Mexico and developing our currency as an ‘Amero.’ That doesn’t appeal to me at all, I think our sovereignty is at threat,” the caller said.

“I agree with you there. It doesn’t appeal to me at all either,” Perry responded.

In fact, the idea of linking Mexico, the United States and Canada via a transnational highway appeals to Perry so much that his campaign website lists it as one of his accomplishments.

Perry was a well-paid pimp for the globalist “corridor” that would take a big bite out of the sovereignty of the United States.

Rachel Alexander writes:

Construction of the Trans-Texas Corridor began in 2007. Perry received substantial campaign contributions from the companies expected to benefit from the construction, Cintra Concesiones de Infraestructuras de Transport and Zachry Construction Company. Cintra is a Spanish-owned company that would own the toll roads. This arrangement has been accused of being a hidden tax payable to a foreign corporation. Zachry was selected by the Texas Department of Transportation to construct the Trans-Texas Corridor.

Perry and the elite tried to sell the highway concept as nothing more than a “free trade” arrangement between neighbors, but in fact, as Jerome Corsi and others have documented, it “goes well beyond simple free trade agreements and purposely disguises efforts to subvert U.S. sovereignty to an entity that would operate much like the European Union,” as Alexander puts it.

Corsi and Judicial Watch made repeated Freedom of Information Act requests and received over a thousand pages of material affirming the globalist plan.

Perry’s disavowal, however, of the Amero appellation stands up. I can’t find any evidence that he ever supported the concept, although he brags about being a minion of the globalists on his campaign website.

On the subject of the 2007 Bilderberg meeting, Perry attempts to defuse and minimize it by stating that he only attended once and talked about energy.

Fact of the matter is Rick Perry violated the Logan Act when he trekked to Istanbul, Turkey, to attend the secretive meeting.

The Logan Act states:

Any citizen of the United States, wherever he may be, who, without authority of the United States, directly or indirectly commences or carries on any correspondence or intercourse with any foreign government or any officer or agent thereof, with intent to influence the measures or conduct of any foreign government or of any officer or agent thereof, in relation to any disputes or controversies with the United States, or to defeat the measures of the United States, shall be fined under this title or imprisoned not more than three years, or both.

“Rick Perry seems to have attempted to get ahead of accusations that he was violating the act in making the visit by claiming the trip was paid for out of campaign contributions and not by taxpayers, but this is inconsequential,” Paul Joseph Watson wrote on May 31, 2007.

It is inconsequential because he violated U.S. law and should be held responsible for doing so.

It’s too bad the caller didn’t point this out. It would have probably put an entirely different spin on the conversation.

NYT: Trans Texas Corridor thorn in Perry's side

Link to article here.

September 9, 2011

Gov. Perry's Proposed Road in Texas Had Few Friends and Could Still Take a Political Toll

By AMANDA PETERKA of Greenwire

New York Times

The less the Trans-Texas Corridor is brought up during the Republican presidential primaries, the better for Rick Perry.

Although it was officially killed in the most recent Texas legislative session, the proposed massive transportation and infrastructure project and ensuing debacle could still end up being a thorn in the governor's side as he preaches his anti-big government mantra on the campaign trail.

As originally proposed and backed by Perry, the state of Texas would have taken more than 500,000 acres of private land to build the 1,200-foot-wide toll road. The majority of those acres were agricultural lands and wildlife habitats, and many are part of the state's Blackland Prairies, some of the richest farmland in the country.

"It was so expansive and so wide, unlike any highway ever built. It was an enormous size," said Terri Hall, founder and director of Texans United for Reform and Freedom, a group that has opposed the project. "A fully built-out interstate is only about 400 feet wide. It was a huge land grab."

There is no argument that Texas needs to do something about its roads. In the past decade, Texas has added more than 4 million people to its population, stressing the transportation infrastructure well beyond state coffers.

The state's population is projected to grow further, and most of the growth is expected to occur in the north-south corridor from San Antonio to the Oklahoma border.

To fund road projects, Texas has borrowed heavily, and its debt will be $17.3 billion by the end of 2012 for road repairs made since 2003 (Greenwire, Aug. 17).

In 2002, Perry proposed the $175 billion, 4,000-mile Trans-Texas Corridor, which would have carried Texans from the Mexico border to Oklahoma. Perry envisioned separate lanes for cars and trucks, and a rail system to be built in the middle. The project would also have potentially carried water pipes and utility lines.

With the state's budget difficulties, "the tolling aspect was one of the selling points from Rick Perry's perspective," said Ken Kramer, director of the Lone Star Chapter of the Sierra Club.

Once Republicans took control of the state Legislature after redistricting in 2003, the TTC was pushed through the House and the Senate as part of an omnibus transportation bill that allowed for the private funding of public highways, the tolling of such a road and the use of eminent domain to acquire land for the project.

"It was not until lawmakers got back home that they discovered what they had done and there was going to be pushback," said Harvey Kronberg, editor of The Quorum Report, an online Texas political tip sheet.

And there quickly was plenty of pushback. Environmental groups objected to the wildlife habitat that would be lost and advocated for expanded public transportation rather than allowing more cars. Others objected to tolling as a means to raise money to build highways.

And when Perry awarded the development rights to a Spanish company, Cintra, there were complaints that foreign interests were taking over American roads and that Perry was rewarding his cronies. A former legislative director of Perry's, Dan Shelley, went to work for Cintra after leaving the governor's office.

Jim Sartwelle, public policy director at the Texas Farm Bureau, said that his organization is not necessarily anti-toll road. For farmers and ranchers, the problem with the project was the taking of so much agricultural and ranch land -- and the fact that Perry himself is a former farmer heightened their outrage. Some of that land had been in families for hundreds of years.

"Agriculture's biggest concerns were property rights concerns," Sartwelle said. "What happens if the state takes a large piece of property and cuts it into two pieces? It leaves a landlocked piece with no access. Now the land's not worth as much. ... It was an extremely emotional issue to many of our members."

Perry spent two terms as agriculture commissioner in the 1990s, his first statewide post. He was elected lieutenant governor in 1998 and became governor after George W. Bush was elected president in 2000.

Leland Beatty, who worked for Perry's agriculture predecessor Jim Hightower, looked at the TTC as Perry betraying the state's agricultural interests.

"Once he became lieutenant governor, agriculture never mattered in any way, shape or form," Beatty said, who also is the retired communications director for the Environmental Defense Fund. "He had always been a big property rights fan, he was always talking about farmers' right to defend against condemnation. Once he became governor and had a big chance to do the toll road deal, he didn't care."

The project became one of the most controversial issues of Perry's tenure as governor. But while it generated a lot of acrimony and played a huge role in state legislative elections, Perry emerged relatively unscathed.

"There was a lot of screaming and yelling and complaining, and legislators just wanted to eviscerate the TTC. But there was no penalty against Perry," Kronberg said.

When he was up for re-election in 2006, Perry had no effective Republican primary challenger to bring up the issue. He won the four-way general election that year with 39 percent of the vote.

By that time, the pushback against the project forced state officials to scale back their proposal. One part of it, Texas Highway 130, was begun as a tolled bypass around Austin. The scale was nowhere near that of the original plan.

The TTC concept was shelved in 2009 when legislators decided not to pass a public-private toll bill that would have made it possible. In the 2010 gubernatorial election, Houston Mayor Bill White, the Democratic nominee, did run an ad attacking Perry over the project, but bigger issues dominated the dialogue, and Perry won easily.

"Talk has died down because it was so thoroughly trashed by so many people," Kramer of the Sierra Club said.

This past legislative session, lawmakers passed a bill repealing the TTC, ending years of dispute.

The mood of the Legislature was, "If it ain't dead already, we're just going to formally say we're putting a nail in this coffin," said David Weinberg, president of the Texas League of Conservation Voters.

Farmers and ranchers won another victory this legislative session with the passage of long-awaited eminent domain reform. Sartwelle of the Farm Bureau said that there is not much acrimony left toward Perry within the agriculture community.

"It was a mistake that was never made," he said of the TTC.

But those watching the Republican presidential primaries say it is likely Perry has not heard the last of the Trans-Texas Corridor. Because the nature of the TTC was essentially government taking over private land, there is the possibility that it could turn away tea party members who would otherwise support Perry.

"It could be brought up," Sartwelle said. "Anything would be fair game. I don't know if it would get a lot of traction. It's not easily explained off, but it's easily accounted for. We had a problem, this was a way to deal with it, it was met with widespread disapproval, and the governor stayed with it all the way to the end until it was completely removed."

Copyright 2011 E&E Publishing. All Rights Reserved.

Perry's cronyism on display with privatization push

Link to article here.

Murphy's article states: "A flurry of privatization bills were introduced by Republican lawmakers during the regular, biannual legislative session, but all of them fizzled out."

One key bill, SB 1048, authored by British Infrastructure firm Balfour Beatty and carried by Rep. John Davis and Sen. Mike Jackson DID pass, despite our (and plenty of other grassroots) opposition.

(10)  "Qualifying project" means:
(A)  any ferry, mass transit facility, vehicle parking facility, port facility, power generation facility, fuel  supply facility, oil or gas pipeline, water supply facility, public work, waste treatment facility, hospital, school, medical or nursing care facility, recreational facility, public building, or other similar facility currently available or to be made available to a governmental entity for public use, including any structure, parking area, appurtenance, and other property required to operate the structure or facility and any technology infrastructure installed in the structure or facility that is essential to the project's purpose; or
(B)  any improvements necessary or desirable to unimproved real estate owned by a governmental entity.

TURF put every lawmaker on notice about these public private partnerships and specifically what was in this bill (with multiple bulletins, one hand delivered) BEFORE they voted on it, and it sailed through. We also hand delivered an Open Letter to Governor Rick Perry, Lt. Gov. David Dewhurst, Speaker Joe Straus, and every legislator signed by over 100 grassroots groups, most of them tea parties (Perry's claimed base of support) in opposition to public private partnerships (the contracts used to privatize), and they voted for all of it anyway. It may even allow prisons to be privatized based on the broad language pertaining to virtually every type of public infrastructure.

Also, 14 Texas roads were put up on the auction block for road privatization, again, despite the opposition, in the TxDOT sunset bill, SB 1420 (amendment #90 by Phillips). So the privatization advocates got their every wish as far as I can tell.

Flush With Prison Industry Dollars, Rick Perry Pushed Privatized Prisoner Care

By Tim Murphy
Mother Jones
September 1, 2011

Corrections industry lobbyists and execs donated generously to the Texas governor's reelection campaign. He advanced policies that would benefit the prison industry. Coincidence?

Under the banner of closing the state's $27 billion deficit last winter, Texas Gov. Rick Perry floated a proposal to privatize the state's prison health care network. Whether the plan would actually save the state any money was a matter of debate, but one thing was clear: The move would have been a boon for private-prison executives and lobbyists, including Perry's former chief of staff, who had donated generously to his 2010 reelection campaign.

The plan met bipartisan resistance in the state Legislature, but it was just one of a handful of recent proposals by Perry's office that would have benefited the industry—all in the name of deficit reduction.

Private prisons are a big business in Texas, where the combination of federal immigration policies and one of the nation's largest inmate populations has led to a boom in construction over the last two decades. As governor, Perry, the front-runner for the GOP presidential nomination, has supported privatizing everything from public lands to highways, but according to Scott Henson, a criminal-justice watchdog who runs the blog Grits for Breakfast, the governor had remained largely quiet on the prisons issue—until this year.

That coincided with an influx of campaign contributions from private-prison executives and lobbyists, among them his former top aide, Michael Toomey, a political powerbroker who represents the nation's largest private corrections contractor, Corrections Corporation of America. CCA, per its website, "provides health care services to male and female inmates and youthful offenders who are housed in local jails, detention facilities, and correctional institutions around the country." (Toomey told Mother Jones he had not lobbied Perry's office or the state Legislature on the prison health care plan; Perry's campaign did not respond to a request for comment.)
Toomey, who had not contributed directly to any of the governor's previous gubernatorial campaigns, opened up his wallet for two separate $10,000 donations to Perry two months before Election Day in 2010. Thomas Beasley, the founder of CCA, has given $17,000 to Perry’s campaigns over the last decade. Another private prison firm, the GEO Group, poured $15,000 into Perry’s 2010 reelection effort in 2010 through its eponymous political action committee. Luis Gonzalez, a GEO Group lobbyist, meanwhile, gave $50,000 to Perry’s reelection bid.

Perry first floated the health care privatization proposal in his 2011 budget, which noted: "The Governor’s budget recommends canceling necessary contracts early to explore private sector delivery options, or instructing the state-supported institution to provide correctional care according to the constitutional minimum level." Mike Ward of the Austin American-Statesman reported that Perry adviser Mike Morrissey held a closed-door meeting in March to discuss the privatization proposal with potential vendors—but not, pointedly, the state-university-operated facilities that currently run things.

A flurry of privatization bills were introduced by Republican lawmakers during the regular, biannual legislative session, but all of them fizzled out. And then in June, as the Legislature scrambled to put together a budget during a special session, the plan resurfaced in two different pieces of legislation. First, an amendment was attached by a GOP lawmaker to an unrelated bill that would have transferred the authority for the state’s prison health care board to Perry by giving him the power to appoint the majority of the committee members. That proposal, which was jettisoned after it came to light, would have effectively given the governor's office the power to unilaterally make sweeping changes to the system.

"There was no evidence that it could be done cheaper," says state Rep. Jerry Madden, a Republican, who chairs the House corrections subcommittee and worked to have the language removed. A second proposal, a few days later, would have explicitly granted the corrections agency the power to solicit bids for prison health care services but not mandated it.

Earlier, Perry’s office had floated another proposal that seemed designed to please the private-prison industry. It sought to eliminate the independence of the Texas Commission on Jail Standards and fold it, along with two other public-safety commissions, into a single agency. The governor’s office justified the move, which ultimately fell short, as a spending measure, a chance to eliminate bureaucratic redundancies. But critics saw a pattern.

"One of the things that the commission has always wanted is to have control over the private prisons," says Ana Yanez-Correa, executive director of the Texas Criminal Justice Coalition, which monitors prison reform in the Lone Star State. "Obviously [the governor’s office] didn’t like that, so this session they tried to dilute the power of the commission by merging it with two other entities."

Perry has drawn scrutiny for his cozy relationships with top donors. According to the group Texans for Public Justice (PDF), nearly 20 percent of the governor’s fundraising totals since 2001 have come from people whom he has appointed, while programs like the $200 million Texas Enterprise Fund, designed to help the state lure new businesses with tax incentives, have been criticized as a "slush fund" for Perry donors. Toomey, the aide-turned-lobbyist who Texas Monthly ranked as one of the 25 most influential politicos in the state, was the key player in Perry’s decision, overturned by the Legislature, to require all adolescent girls to receive an HPV vaccination. At the time, Toomey was a lobbyist for Merck, the pharmaceutical company that manufactured the vaccine.

Toomey, known in Austin as "Mike the Knife," served as Perry’s chief of staff for almost two years, from November 2002 through September 2004. The two have remained close—in August, Toomey formed a Super PAC, Make Us Great Again, specifically to support Perry’s presidential campaign. He added CCA to his client roster in 2007.

In 2003, Perry signed a line-item veto eliminating the funding for the Texas Criminal Justice Policy Council, a state agency tasked with providing "objective analysis and assessment of state criminal justice programs and initiatives." According to the Austin Chronicle, the decision to pull the plug on the agency came from Toomey, who had lobbied for prison contractors before he worked for Perry. (Toomey has denied any involvement in the program’s elimination.)

Perry's rush to privatize prison health care is consistent with the approach he's taken throughout most of his 10 years as governor: slashing public services under the guise of austerity, and then contracting those services out to the well-connected businesses that have made his rise possible. As he put it during his reelection campaign in 2010, as the private-prison industry filled his war chest with donations, "Texas is open for business." To his critics, those words have never rang truer.

HuffPo: Perry steers money to road for Exxon

Link to article here.

Grand Parkway has become the poster child of all that's wrong with transportation policy in Texas. The claim is we're out of money for roads so Texans have to choke down toll taxes, even on existing roads. Yet Rick Perry's Transportation Commission can come up with $350 million in gas taxes, plus another $40 million more allocated at its August meeting, for a road in the middle of the Katy prairie where there's NO traffic congestion, to benefit ExxonMobil!

Exxon Headquarters Near Houston To Get New Road Despite State Budget Shortfalls

Texas faces a transportation funding gap of $315 billion over the next 20 years, according to the state's transportation commission. Ten of its top 20 congested roads are in or around Houston.

Yet while the mitigation plans for congestion around several of those existing roads remain unfunded, the state is moving ahead with the construction of more than 180 miles of beltway called the Grand Parkway, segments of which will run right past the new North American headquarters of ExxonMobil. The total price tag for the project, which will require the use of eminent domain, is estimated at $5.2 billion.

Since the 1960s, planners in Houston have dreamed of building the Parkway, a massive third beltway in the suburbs and exurbs beyond the Sam Houston Tollway, which itself rings the 610 Loop near the city's core. Coming up with the money for the road, however, has never been easy. For decades the grand plan has languished; so far only two out of its 11 segments have been built.

But in January the Texas Transportation Commission, appointed by Governor Rick Perry, decided to assume authority for several segments of the project.

One commissioner said the project was particularly important for the Texas Department of Transportation, commonly called TxDOT, because ExxonMobil was considering moving its North American headquarters to a brand new, 385-acre corporate campus north of the city near where the road will some day go. Suburban Harris County, which surrounds Houston and where the campus is located, had struggled to find a way to pay for its parts of the Parkway.

In January, ExxonMobil's final decision about that campus had yet to be publicly revealed. Civic boosters seemed to suggest that without progress on the Grand Parkway, the company might leave the region.

"Exxon representatives have stated very clearly to me that TxDOT moving forward on the Grand Parkway is essential, and that if that did not happen, they would not select this site," transportation commissioner and Houston real estate developer Ned Holmes said. He added that it was "kind of a deal-breaker" for the company.

The commission's vote in support of the project was unanimous, and if all goes as planned, the segments of the road adjoining ExxonMobil will go online just as the company's new campus, which sits about 10 miles up the road from its old campus, is completed in 2015.

David Crossley, the president of Houston Tomorrow, which studies urban issues in the region, said that "six months ago the Parkway project was essentially dead. But when Exxon began to close in on their decision, everything started going really fast. It's breathtaking how they got this going again."

Critics say that the Transportation Commission's decision to move the project along raises questions as to whether the state's road policy is too influenced by the concerns of developers, private toll-road operators and politically connected companies like ExxonMobil.

A spokesman for the oil and gas company, noting that "ExxonMobil speaks for itself," declined to comment on Holmes' remarks. "We don't comment on meetings with government officials," he said.

Raquelle Lewis, a public information officer for TxDOT's Houston District, said that while "it certainly does not hurt to have a corporation like Exxon that is in support of us moving forward," the Grand Parkway "is an initiative that's been on the priority list for the Greater Houston region for a very long time."

Lewis said ExxonMobil had been in contact with the Grand Parkway Association, a state-authorized non-profit that facilitates the development of the beltway.

"I have no doubt that those communications were a part of the discussions and the decision-making that happened within state government," she said. "They're a huge corporate entity with a huge impact on anywhere they decide to headquarter."

TxDOT says that building the northern segments of the Grand Parkway now is necessary to prepare the city for the congestion that will inevitably come later as the region continues to grow, whether or not ExxonMobil moves to the area.

Transportation advocates, however, suggest that the road is more important to developers than to the city's often-frustrated motorists. Some believe real estate developers may have been more influential than ExxonMobil in securing the project's approval.

Finishing the Parkway would generate boundless real estate opportunities on the outskirts of the sprawling, smoggy city, which famously has few zoning laws and many developers. A developer is already clearing ground on one project, an 1,800-acre mixed-use village that claims it will be built on "sustainable development principles," immediately adjacent to where ExxonMobil's campus will go.

If the state has free money to spend on a project, Robin Holzer of the Citizen's Transportation Coalition argued, it should spend it "to benefit existing taxpayers, instead of blowing it on a speculative toll road out in the boonies for the benefit of one of the world's most profitable oil and gas companies."

Critics of the project are further upset that parts of the Grand Parkway, including those near the future headquarters of ExxonMobil, may very well be built as toll roads under the auspices of public-private partnerships.

Next Tuesday the state will break ground for Segment E of the Grand Parkway, a publicly funded stretch of road to the west of the city that will cost $350 million. The state may sell ownership stakes in Segment E to help finance parts of the road that are slated to be turned over to public-private partnerships.

Such public-private partnerships were hugely controversial earlier in Governor Rick Perry's tenure, when he proposed a system of "supercorridors" to be called the Trans-Texas Corridor. After a massive grassroots outcry, Perry abandoned that idea.

Despite that misstep, however, Texas is turning back to public-private toll roads. In June, Perry signed a transportation bill authorizing TxDOT to build the Grand Parkway and a bevy of other projects as public-private partnerships. The state has yet to make a decision on whether to do that for the northern segments of the Grand Parkway.

Terri Hall, a conservative critic of Perry's road-building policies who serves as the executive director of Texans Uniting for Reform and Freedom, said, "What is so insidious about this is that we are now putting in the hands of private companies the power to tax."

She worries ordinary Texans would not be able to access the road if it is run by a private company.

"Maybe they pay their employees well enough that they can take the toll road to work," Hall said of ExxonMobil, but "we're basically creating a two-tiered highway system: one for the haves, one for the have-nots."

Cintra's debt rating lowered for DFW project

Link to article here.

Incredibly, despite the risky nature of the North Tarrant Express project, which privatizes portions of I-820 and SH 121, note in the last paragraph that even if the private developer Spanish company, Cintra, is off in its projections by 50%, it can still cover its debt: "On North Tarrant Express, Moody's noted in its rating report that the traffic and revenue projections are aggressive but that even if the revenue is off by 50 percent, the developer could still pay its debt service." That means your toll rates are jacked up sky high if they can be off by as much as 50% and still cover their expenses!

North Tarrant Express gets lower rating than other bond projects

Posted Tuesday, Sep. 06, 2011

By Gordon Dickson - Star Telegram

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Bonds sold for North Tarrant Express earned a middle-of-the-road rating, partly because analysts can't be certain that enough people will use the toll lanes to raise the money to pay off the debt.

The project, which includes rebuilding Northeast Loop 820 and Texas 121/183 with both toll and nontoll lanes in Northeast Tarrant County, is considered financially solid, according to a report published last week by Moody's Investors Service. Even so, North Tarrant Express got a lower rating than other bond projects in Dallas-Fort Worth, including toll road projects financed by the North Texas Tollway Authority.

The rating of Baa2 for senior debt and Baa3 for subordinate debt shows that the North Tarrant Express project isn't a terribly risky investment, but it's not fail-safe, either.
"You have to predict people's appetite and tolerance for paying a toll in a toll lane, when there's a freeway lane right next to you," said Laura Barrientos, a Moody's analyst who helped prepare the North Tarrant Express report. "The Baa2, for a project that's in construction, is actually a very good rating."

NTE Mobility Partners is the developer responsible for widening Loop 820 and 121/183, adding toll lanes and rebuilding the free lanes. The developer is using private activity bonds and a federally backed transportation infrastructure loan to pay for some of the $2.1 billion construction. The money is to be repaid by tolls collected on managed lanes in what is now the median.

Solid, with risks

Those who follow bond markets say the Moody's ratings for North Tarrant Express are the lowest that bonds can earn while still being considered investment-worthy -- not junk. According to Moody's definition, the ratings carry a moderate credit risk with "certain speculative characteristics."

NTE Mobility Partners is lead by Cintra, a Spanish company that is also building the LBJ Express project on Interstate 635 between Grapevine and Dallas. Bonds for LBJ Express have earned similar ratings.

Such ratings are normal for toll projects being built in an area where motorists have free options and where the popularity of the toll lanes won't truly be known until they open, several officials with experience in toll finance said.

The report describes North Tarrant Express as financially solid but highlights a few potential risks. First, as with any road project funded by bonds, there is a risk that construction will be slowed, which could delay repayment of the debt. But specific to the North Tarrant Express project, there is also uncertainly about how much motorists will embrace paying tolls in a corridor they're accustomed to using for free.

North Tarrant Express will be among the first projects with so-called variable pricing, meaning the price can change by the minute, depending on traffic. To limit traffic on the toll lanes -- two in each direction -- tolls can range from $2 to $10 to travel the entire 13-mile corridor, NTE Mobility Partners spokesman Robert Hinkle said. The idea is to ensure that traffic flow stays at least 50 mph on the toll lanes, whereas traffic on the free lanes will likely remain congested during peak travel times.

"The Moody's investment grade rating of NTE shows confidence in the project," Hinkle said.

State is satisfied

The Texas Department of Transportation, which has entered into contracts with outside developers for North Tarrant Express and LBJ Express, was mainly concerned that both projects be considered investment-grade, not junk, said James Bass, the agency's chief financial officer. Officials at the agency are satisfied that the ratings are unchanged since the project agreements were signed nearly two years ago.

"Right now, people are making investments in large part based on revenue forecasts," Bass said. "What you'll see oftentimes is as a roadway gets past the construction risk and starts dealing with actual revenue, then there might be an opportunity for that rating to be adjusted upward."

But the tollway authority, which builds more-traditional toll projects in the Metroplex, typically gets higher ratings.

In July, the authority issued $100 million in revenue bonds, which were rated AA1 and A-plus by Standard & Poor's, and P1 and A1 by Moody's -- all ratings that indicate a low credit risk.

Those bonds were backed by the entire Dallas-area tollway system, meaning that even if revenue from tolls collected on one road fell below projections, revenue from another road could pay the debt.

But even the tollway authority sometimes struggles with bond ratings. Last month, a different series of tollway bonds issued in 2008 was dropped from an A-minus rating from S&P to "nonrated," which is considered noninvestment grade. The move came shortly after the U.S. government's rating was dropped. Tollway officials said they don't expect S&P's action to affect the agency's ongoing projects.

On North Tarrant Express, Moody's noted in its rating report that the traffic and revenue projections are aggressive but that even if the revenue is off by 50 percent, the developer could still pay its debt service.

Perry's NAFTA Superhighway problem

Link to article here.

Rick Perry's NAFTA Superhighway Problem

By Rachel Alexander

Move over Mitt Romney. Rick Perry has a bigger problem to defend from his tenure as governor. Remember the NAFTA Superhighway project? It was to consist of a two-mile wide $184 billion transit system of toll roads, rail lines and utilities from the Texas-Mexico border all the way up to the Minnesota-Canadian border, to make it easier to ship foreign goods from China and other countries into North America. It became so unpopular in Texas that the Texas portion of it, called the Trans-Texas Corridor, was renamed and mostly disbanded a couple of years ago. Perry was the only gubernatorial candidate in 2006 of four major candidates who supported it. Even the Democratic candidate opposed it.

Perry’s campaign website lists the Trans-Texas Corridor as one of his accomplishments, “Rather than taking decades to expand these important corridors a little bit at a time, Governor Perry developed the Trans-Texas Corridor plan.”But is it something Perry really wants broadcast as an achievement? The Texas Republican Party’s 2010 platform includes a plank specifically opposing the Trans-Texas Corridor. Some of the opposition to the NAFTA Superhighway has been dismissed as conspiratorial, but loud objections also came from people concerned with border security and one million rural interests and farmers that stood to lose their land to eminent domain.

Construction of the Trans-Texas Corridor began in 2007. Perry received substantial campaign contributions from the companies expected to benefit from the construction, Cintra Concesiones de Infraestructuras de Transport and Zachry Construction Company. Cintra is a Spanish-owned company that would own the toll roads. This arrangement has been accused of being a hidden tax payable to a foreign corporation. Zachry was selected by the Texas Department of Transportation to construct the Trans-Texas Corridor. Perry initially opposed efforts by the Texas legislature to impede the construction, vetoing several bills. As opposition increased, the legislature was finally able to repeal the section of the Transportation code dealing with the Trans-Texas Corridor and pass an eminent domain bill protecting property. The TTC-35 project, a privately built multi-lane toll road, railway and utility line network that was to run parallel to Interstate Highway 35, was canceled. Perry finally backed down in the 2010 Republican primary for governor running against Kay Bailey Hutchinson, and opposed construction of the TTC-35.

NAFTA and expanding free trade sounds good superficially. Unfortunately, it has turned out to be considerably less than free. New York Times best-selling author Jerome Corsi, known for orchestrating the Swift Boat ads targeting John Kerry, wrote a book exposing the NAFTA Superhighway in 2009 called “The Late Great USA: The Coming Merger with Mexico and Canada.” Corsi’s efforts, as well as exposure by Rep. Ron Paul (R-TX) and the website Corsi writes for, WorldNetDaily, may have contributed more to getting the Trans-Texas Corridor shut down than anything else.

Corsi explains in his book that the U.S. is at a disadvantage with “free trade” because unlike most of the world’s international trading countries, we do not charge a value added tax (VAT) to imported goods. This makes our products much more difficult to sell overseas, and other countries’ products much cheaper than ours. The price of union labor drives the costs up even more, making our own products less competitive here as well. This results in a trade imbalance leaving us heavily in debt to other countries, and part of the reason we have a debt ceiling crisis today.

With the economy currently in the tank and nine percent unemployment holding steady, the last thing Americans want is enabling China to sell us more products using cheap exploited labor. Corsi writes that the average age of a worker in a Chinese toy factor is between 12 and 15. The CANAMEX Corridor Coalition, a trade association that supports a transportation super corridor, reports that the average hourly manufacturing wage in the U.S. is $17.20. In Mexico it is $2.10, and in China and India it is $.25.

Furthermore, Corsi has put forth a compelling amount of information in his book showing how the plan to create a North American Union goes well beyond simple free trade agreements and purposely disguises efforts to subvert U.S. sovereignty to an entity that would operate much like the European Union.

Perry is hoping the NAFTA Superhighway quietly fades away. But has it really gone away? The controversial financing mechanism behind it that leases right-of-way to a private company – often Cintra – is still being used for freeways. That funding, known as Comprehensive Development Agreements, was recently used to build a toll road bypass to the Austin area, SH 130, considered part of the Trans-Texas Corridor. Trucks on Interstate 35 are still a big problem during rush hour in Dallas, Austin and San Antonio, so eventually a separate road will need to be built for them similar to what the Trans-Texas Corridor called for. On July 6, the Obama administration struck a deal with Mexico to re-open access to the U.S. for certified Mexican truckers.

Perry already has a record that hurts him with voters concerned about illegal immigration. In April, he stated that he would not support a version of Arizona’s SB 1070 for Texas. In 2001, he signed a bill allowing the children of illegal immigrants to receive in-state tuition at Texas universities. He opposes using E-Verify, the federal electronic system for verifying prospective workers’ immigration status.

Unlike Romney, Perry has not completely disavowed his controversial history as governor. Romney distanced himself from Mass-Care by promising that the first Executive Order he would sign upon becoming president would be a waiver to all 50 states from Obamacare. Perry, on the other hand, proudly lists Trans-Texas Corridor as one of his accomplishments on his website. The state of Texas, multiple factions within the Republican Party, and significant numbers of Democrats oppose the Trans-Texas Corridor. They are not going to sit back and risk repeating an “accomplishment” like this on a national scale. Former president George W. Bush, who was also a Texas governor, was one of the biggest proponents of the NAFTA Superhighway. Voters have the hindsight now to realize that the NAFTA Superhighway is the wrong direction for our country.

Rachel Alexander

Rachel Alexander is the editor of the Intellectual Conservative.

Law professor blasts privatization of roads, parking meters

Link to article here.

Law Review Blasts Toll Road, Parking Meter Privatization
Minnesota Law Review examines the limitations on toll road and parking meter privatization deals.

Julie A. RoinA University of Chicago Law School professor is challenging the prevailing wisdom regarding the sorts of transportation privatization deals that have grown increasingly popular. The Minnesota Law Review last month published a critique by Julie A. Roin that argued such deals have more in common with the medieval practice of tax farming than true privatization. She cited as a primary example Chicago, Illinois Mayor Richard M. Daley's 2008, lease of the city's parking meters to Morgan Stanley for 75 years in return for an up-front payment of $1.2 billion.

"The agreement exchanges future public revenues for present public funds, just like debt," Roin explained. "And just like many debt arrangements, the parking meter deal will leave future ratepayers decidedly worse off... Future ratepayers will be doubly disfavored relative to current residents: they will have to pay higher taxes to maintain the same level of services, even as their disposable income is reduced by the extra parking fees mandated by the agreement."

By the time Daley left office, nearly all of the funds from the one-time payment had been spent, mostly to meet the city's requirement to have a balanced budget. Roin argued that such deals are frequently used to avoid state constitutional restrictions that require voter approval of any substantial new governmental debt obligation.

"Many recent privatization deals have been motivated less by the possibility of achieving efficiency advantages than by politicians' desire to surreptitiously borrow money," Roin wrote. "The upfront payments received by jurisdictions entering into privatization agreements... are, at best, the present value of what would have been future tax (fee) revenue. Rather than true privatization transactions, it is more accurate to describe these deals as loans repayable out of future governmental revenues."

The problem with the debt created by such deals is that they are less flexible and more expensive than conventional forms of debt, such as bonds. They are also significantly less transparent. Traditional debt in the form of publicly traded bonds harnesses market forces to ensure both sides get the best deal possible. Privatization arrangements inherently favor the corporate interest.

"Because of the scale of these transactions, relatively few potential buyers exist for any particular deal," Roin wrote. "This leaves opportunities for collusion or simple underpricing at the expense of the selling entity. In Chicago's parking meter deal, for example, only two bidders vied for the project. Although one can certainly claim that there was a fair public auction of the Chicago parking meter system in that anyone could have entered the auction, the paucity of bidders can also be regarded as a symptom of a defective market, one susceptible to control by insiders or other elites and simply too thin to be trustworthy."

Cities and states also get the worse end of the deal from non-monetary arrangements such a "non-compete" clauses in privatization contracts. These protect private profit at the expense of flexibility in future public policy. Chicago's deal, for example, guarantees the number of parking spaces and hours of operation that apply 75 years in the future. Roin suggested such deals might be discouraged by limiting the length of contract terms to, for example, no more than five years.

"Robbing Peter to pay Paul accomplishes very little when Peter and Paul are the same individual," Roin observed.

Such a simplistic limitation, however, would likely lead to governments not getting the best deals for certain long-term transactions. Roin suggested better legislation would protect future taxpayers by forcing any such deals to escrow funds equal to the amount of taxes or fees that would have been generated by the leased asset. These funds would be released year-by-year so that the present generation would not be borrowing from a future generation. Roin argued that without some limitation, such deals would grow more intrusive.

"In the not-so-eventual future, jurisdictions may even 'sell' the rights to collect property and income taxes to investors alleging better collection techniques and expressing a willingness to accept the risk that future revenues will fall," Roin wrote.

Source: Privatization and the Sale of Tax Revenues (Minnesota Law Review, 7/7/2011)

Rick Perry tied to Agenda 21, globalist policies

Rick Perry tied to Agenda 21, globalist policies
Selling Texas to foreign creditors while jabbing Obama for same
By Terri Hall
Texans Uniting for Reform and Freedom
August 15, 2011

Rick Perry may be good at invoking states rights and property rights, while disavowing ‘foreign creditors,’ but his actions as Texas’ longest serving governor tell a different story. Public private partnerships (or P3s) are part and parcel of the United Nations’ Agenda 21. Two of the purposes of Agenda 21 are to abolish private property and restrict mobility and P3s act as the vehicle to do it. Perry made P3s a centerpiece of his transportation policy since he stepped in as governor.

It started with the Trans Texas Corridor, known at the federal level as high priority corridors, corridors of the future, or the NAFTA superhighways. Just in Texas, it was to be a 4,000 mile multi-modal network of toll roads, rail lines, power transmission lines, pipelines, telecommunications lines and more. It was going to be financed, operated, and controlled by a foreign company granted massive swaths of land 1,200 feet (4 football fields) wide taken forcibly through eminent domain.

Called the biggest land grab in Texas history, it was going to gobble up 580,000 acres of private Texas land (the first corridor alone was to displace 1 million Texans) and hand it over to well-connected global players using P3s, who would gain exclusive rights to determine the route and what hotels, restaurants, and gas stations were along the corridor in a government-sanctioned monopoly for a half century. It was the worst case of eminent domain for private gain ever conceived.

Property rights shredded
The Trans Texas Corridor, and P3s in general, represent an imminent threat to private property rights. While lawmakers repealed the Trans Texas Corridor from state statute only months ago due to the public backlash, the re-named corridor (‘Innovative Connectivity Plan’) and its threat to property rights lives on through P3s. Two such projects underway by a Spanish developer, Cintra, will charge Texans 75 cents per mile in tolls (nearly $13 a day while Perry claims he hasn’t raised taxes or indebted Texans to foreign creditors) to access lanes on two public interstates -- I-635 and I-820. A third project being developed by the same company for two segments on SH 130 is, perhaps, the only leg of the Trans Texas Corridor TTC-35 project that will ever be built.

While Perry distracted Texans and tea partiers with ‘emergency’ resolutions on state sovereignty during the 82nd legislature, P3s spread from transportation projects to virtually every other type of public infrastructure in a bill, SB 1048, passed by the Texas legislature which he signed into law June 17. Now all public infrastructure, including public buildings, schools, nursing homes, ports, mass transit, etc. can be auctioned-off to private interests in long-term sweetheart deals with taxpayer subsidies and profit guarantees using P3s.

P3s give a private corporation the power to tax the public, whether through charging tolls or other so-called ‘user fees,’ to access their own public infrastructure, and, perhaps more insidious,  allowing well-connected private entities to profit from concessions on land taken through eminent domain.

Why shouldn’t the original landowner be able to profit from developing his/her land instead of having the government take it in the name of a “public use” and give it to another developer, one with government connections? Perry’s administration of P3s is like his administration of his Emerging Technology Fund that’s been highly criticized for steering taxpayer money to Perry’s campaign donors -- a case in point, Dan Shelley.

Shelley worked for Cintra, who had its sites set on developing the Trans Texas Corridor. Shelley lands a job as Perry’s aide, steers the $7 billion corridor P3 to his former employer Cintra, then goes back to work for Cintra. That’s how Perry does business -- pay to play.

Texas “Open for Business”
While Perry is staking his campaign on Texas being the top net jobs creator, Perry’s version of Texas being “Open for Business” isn’t about low taxes and less regulation as much as it is about doing business with foreign companies, including selling off Texas’ sovereign land and public assets to foreign creditors, an issue which Perry’s first television ad uses to take aim at President Obama.

Aside from the P3s, Texas has 20 active deals going with the Chinese and has 32 foreign trade zones (FTZs), a vehicle to ease the flow of foreign goods into the United States that are chalk full of tax breaks for importers. Perry’s office promoted these FTZs in a document entitled Foreign Trade Zones: Texas Wide Open for Business and even dedicates a web site for Texas FTZs,

A recent Washington Post article documents Perry’s work to get Chinese government-owned telecommunications company Huawei, to base its U.S. operations in Texas, a company that the U.S. government has deemed a threat to national security noting that “three times since 2008, a U.S. government security panel has blocked Huawei from acquiring or partnering with U.S. companies because of concerns that secrets could be leaked to China’s government or military.”

Perry’s coziness with the Chinese and foreign investors exposes a huge weakness in his right flank -- illegal immigration and open borders. The Trans Texas Corridor has been linked to the global plan to economically integrate North America, with the eventual goal of a common security perimeter modeled after the European Union. Perry ushered in in-state tuition for illegals and has long been an obstacle to immigration reform or any Arizona-style immigration law.

Perry’s record paints a much different picture than what candidate Perry would have us believe -- that he’s a states rights, Constitutionally limited government conservative that’s responsible for the “Texas miracle.” In reality, he’s more like an Agenda 21 globalist willing to sell America to the highest bidder.

Continue reading on Rick Perry tied to Agenda 21, globalist policies - San Antonio Transportation Policy |

Credit downgrade may effect toll projects

Credit downgrade may effect toll projects
By Terri Hall
August 9, 2011

Well, if it’s one thing we’ve learned in the bailout era, it’s that all things financial are interconnected. Following Standard and Poor’s credit downgrade of the U.S., it also downgraded Fannie Mae and Freddie Mac. Fannie Mae and Freddie Mac are quasi-governmental entities set-up using controversial public private partnerships (or P3s), which have a reputation for lending money to people who don’t have the ability to pay them back.

The same is true of toll projects, especially those done using P3s. For a many years, politicians have been heavily lobbied to turn to P3s to solve their road funding shortfalls, under the auspices that government can fill the gap with some private money. In return, the private entity gets the right to collect tolls in long-term leases, in some cases for up to 99 years as was the case on the Chicago Skyway deal with Cintra-Macquarie.

The bond markets surely see the trend that toll roads are faltering and going bankrupt all over the globe. So the likelihood that they’ll ignore this trend and continue to loan money to either public or private toll entities given the downgrade in the credit-worthiness of the U.S., is slim to nil. Add to that, a recent report by the Office of Inspector General warns that P3s cannot fill the road funding gap, as Congressman John Mica proposes, and it spells trouble for advocates who plan to rely on more toll roads.

From whence will the debt come? Perhaps more importantly, from whence will the money come from to pay it all back, even if government does find a way to borrow more money it doesn’t have?

Clearly we’ve entered into new territory. The days of playing fast and loose with credit and borrowing, and traffic and revenue projections are over. Toll projects, if they’re ever to get off the ground in this climate, had better have traffic projections paved with gold (which is getting harder and harder to do).

In Texas, former Chairman of the House Transportation Committee, Rep. Joe Pickett, testified last year that there are no more toll viable roads in Texas. They’ve all been done. All the remaining toll projects cannot pay for themselves with the projected traffic alone and will involve massive public subsidies to make them solvent. Should taxpayers risk what the private bond investors won’t?

Road debt spirals out of control
At least one former State Representative in Texas is saying ‘no’ to more road debt.  In a recent editorial in the Houston Chronicle, Jim Dunnam notes that with all the talk of the debt ceiling and debt crisis on the federal level, many states, with Texas as a case in point, have a debt crisis of their own.

For the first time in Texas history, taxpayers will be spending more on debt service than it will for new roads. This is Texas Governor Rick Perry’s legacy -- borrowing and spending beyond its means. Texas used to be pay-as-you-go, but under Perry’s leadership, Texas started borrowing money for roads in 2001. The state has gone from zero debt for roads to now owing $31 billion. Most of that borrowing has gone to subsidize toll roads, making taxpayers pay twice to use the same stretch of road.

Dunnam states: “...nearly all of our future infrastructure needs are to be funded by borrowing from the future generation of Texans. In fact, bond rating agencies are already looking negatively upon toll road debt in the states, so even that favored option of (Rick) Perry's will be gone.”

As yet another indication that toll roads and the debt they incur are neither fiscally sound investments nor a means of generating revenue to make-up for road funding shortfalls, the Central Texas Turnpike System has had to subsidize that system to the tune of $100 million. These subsidies are paid with gas taxes, again, double-taxing taxpayers to bailout a toll system that isn’t covering its debt. When subsidies are necessary, tolls become a new hidden tax for roads.

Then there’s the federal borrowing to prop-up toll roads that can’t pay for themselves using a loan program known as Transportation Infrastructure Finance and Innovation Act (TIFIA).  The first federal TIFIA loan went to a P3 venture in San Diego known as the South Bay Expressway. Less than three years later, the road went bankrupt (traffic projections were off by 40,000 cars a day) -- resulting in a loss of nearly $80 million to taxpayers. Now, the local government is going buy back that failing toll road with yet more taxpayer money, which is, in effect, another bailout.

But the tax man still cometh
All of this comes at a time when Americans’ paychecks are shrinking and when energy and food costs are skyrocketing beyond their ability to keep up. Federal Highway Administration statistics consistently show, as the cost of transportation goes up, driving goes down. So add tolls on top of already rising gas prices, and it puts these toll roads on a collision course with economic reality. Of course, the tax man still cometh, too.  So it begs the question, what is the rationale to keep borrowing and spending money for roads beyond what this generation can pay?

Thomas Jefferson warned against such multi-generational debt when he said: “I say, the earth belongs to each of these generations during its course, fully and in its own right. The second generation receives it clear of the debts and incumbrances of the first, the third of the second, and so on. For if the first could charge it with a debt, then the earth would belong to the dead and not to the living generation. Then, no generation can contract debts greater than may be paid during the course of its own existence.”

Politicians aren’t known for reining themselves in, voters try, but usually end up in the same place only a few years later. So if Europe’s debt crisis is any indicator, the United States’ borrowing habit is likely to be tamed by the financial market itself, as the weight of this crushing debt sinks under its own weight and investors finally say ‘no’ to ill-conceived government borrowing that has no fiscally sound means of repayment.

Perry sold out to China

This YouTube video is instructive of why Rick Perry is a threat to our freedom, property rights, and national sovereignty. All the while Perry derides Obama for the rise in foreign creditors on his watch. It's a must-see for all American voters should Perry seek the presidency.

Report: Public-private toll roads won't fill road funding gap

Link to article here.

Report: Public-private toll roads will not fill the funding gap

By David Tanner, Land Line associate editor

August 3, 2011

Policymakers that promote new toll roads and the leasing of existing toll roads as public-private partnerships might be quick to champion this approach as a way to fill the infrastructure funding gap in the U.S. But the DOT’s own Office of Inspector General says the PPP method does very little to fill that funding gap.

For starters, public-private partnerships don’t really bring in “new” money, they merely call for healthy sum to be paid up front. The OIG points to Indiana, where the governor leased the Indiana Toll Road to private investors from Spain and Australia in exchange for $3.85 billion in up-front cash. Sure, the state got $3.85 billion up front, but the public is on the hook to pay ever-increasing tolls for 75 years to reimburse the private consortium.

That’s just one example given in the OIG’s latest report titled Financial Analysis of Transportation-Related Public-Private Partnerships.

The report generated models based on the Indiana Toll Road and nearby Chicago Skyway under a section detailing public-private partnerships involving existing roadway infrastructure. The OIG also studied so-called “greenfield” projects involving new infrastructure capacity and generated models based on tollway projects being built as PPPs in Texas and in other areas.

The authors of the report set out with three objectives: to identify financial disadvantages of PPPs over traditional public methods; identify factors that help PPPs derive value; and assess whether PPPs close the infrastructure funding gap.

For its first objective, the OIG highlighted several disadvantages to public-private partnerships.

Notably, PPPs cost more than traditional public financing. This is because private entities pay more in taxes than public entities do, and private entities seek higher rates of return than public forms of financing do. In addition, the longer the term of the agreement – 75 years in the case of Indiana and 99 years in the case of the Chicago Skyway – the more disadvantages there are to the public, the authors stated.

Next, the OIG identified ways that PPPs can overcome these cost disadvantages, and one of the preferred methods is through toll increases. But as the public knows, if the tolls get too high, the benefit of using the roadway diminishes and the traffic will divert to secondary roadways.

The OIG noted that the private sector has the ability to tap into federal loan programs such as TIFIA – the Transportation Infrastructure Finance and Innovation Act – while public entities do not. TIFIA basically works like a bank to grant or loan money for infrastructure projects. Typical uses for TIFIA funds involve projects that aim to relieve congestion.

Do public-private partnerships help close the infrastructure funding gap as some policymakers claim? The Office of Inspector General says no.

Under a PPP, the private investor is not generating any “new” money in most cases. The investor merely provides a sum of money up front and expects to be reimbursed with a profit over the length of the agreement, the OIG said.

“PPPs are not likely to significantly reduce the infrastructure funding gap because they change the timing with which funds become available, but generally do not increase overall funding levels,” the report’s authors wrote.

The report advises that a state entity considering a PPP should research and study the pros and cons on a case-by-case basis.

In response to the report, Federal Highway Administrator Victor Mendez agreed with the OIG that PPPs can provide benefits and should be considered on a case-by-case benefit. Mendez also said the report did not take risk-reward or project delivery times into account – both of which would favor private-sector agreements over traditional funding methods.

The Office of Inspector General’s report did not reject the concept of PPPs, but it was hardly a glowing endorsement, either.

OOIDA is opposed to the lease or sale of existing roadway infrastructure to the private sector, and cites the agreement in Indiana as an example. Just five years into that 75-year agreement, truckers are paying more than double the toll rate to operate on the Indiana Toll Road.

OOIDA does not categorically oppose new highway capacity that involves tolls to pay off the costs, but as the inspector general’s report cautions, it’s on a case-by-case basis.

Aussies campaign against tolls

Link to article here.

Taxpayers will always find ways to avoid the new tax, especially when their paychecks are shrinking while costs for food, energy, and basics continue to soar! Australia was one of the first countries to embrace and aggressively push public private partnerships as the answer to their transportation funding (largely at the urging of Macquarie, an Australian company and global toll road investor/operator). Now several years later, after pension scandals (they invested public pensioners in the risky deals), toll hikes, and toll roads that are in the red, the PEOPLE are rising up and boycotting these road rip-offs.

Road rip-offs: Hills resident campaigns against tolls

Local News
3 Aug 11 @ 01:30am by ROBBIE PATTERSON

FRUSTRATED commuter Ziggy Zapata is urging all city drivers to join a fight against toll ways after becoming “flabbergasted” with Sydney’s infrastructure and transport systems.

His frustration was further inflamed when the Times recently reported toll increases on the M2.

Mr Zapata started the group Citizens Against Road Rip-offs (CARR) and says he has tips to save commuters thousands of dollars annually on tolls.

“For years I have been angry about the fact that motorists pay so much money in fees, charges, fines and yet governments cannot even build decent free roads, but instead resort to colluding with private operators to construct toll roads,” he said.

Mr Zapata said taxpayer-funded roads such as Epping Road at Lane Cove were almost unusable.

He said they had been “narrowed to try to force motorists to use the Lane Cove Tunnel. And streets in the area have been made inaccessible to prevent motorists from using them as rat-runs to avoid the toll road.”

So Mr Zapata established the non-profit organisation, CARR.

The website aims to teach motorists how to “fight back against the completely unjustified gouging to which they are subjected”, he said.

“CARR is there as my personal protest against being used as a victim for bloodsucking governments and toll road operators.”

Mr Zapata urges anyone who is not happy with the current system to join.

The website contains handy tips to avoid fines and tolls.

“Using technology such as GPS receivers and a bit of common sense, every motorist can avoid being a cash cow for government and toll road operators,” he said.

Mr Zapata said the most powerful tool people had “is the power of the boycott and this is where CARR can help motorists save a lot of money.”

* Buy a cheap GPS and use the no tolls option;
* Use a Bluetooth hands-free device at all times to avoid being booked on your mobile phone;
* Put power in numbers: if enough people don’t use the toll ways they will become free like they should always have been.
* For more handy hints and tips, or to join the group go to -

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