WSJ: PPPs faster, but cost more

Link to article here.

Public-Private Road Projects Are Faster but Exceed Budgets by More
December 22, 2010, 6:17 PM
Wall Street Journal

According to a yet-to-be published study, which looked at delays and cost over-runs in public-private highway projects, when the private sector gets involved, roads are ready sooner but costs escalate more frequently.

In projects that exceeded initial spending estimates, costs escalated by 21% where there was private participation compared to 6%  for projects carried out by the government alone.

The findings come from a follow-up research conducted by Delhi School of Economics associate professor Ram Singh, whose earlier work on infrastructure delays we wrote about in May.

In the previous study, Mr. Singh looked at data on around 900 projects from 17 infrastructure areas, including power, roads and railways. He found that all together, these projects experienced cost increases that amounted to 54% of the total initial budget for these works. One reason for delays and cost over-runs: “contractual incompleteness.”
This paper looked more closely at roads and railways projects, and also compared the performance of 50 highways built with private participation to 145 built without it.

A similar percentage of both types of highway projects saw time over-runs—about three-fourths of them. But public-private projects required comparatively less additional time, exceeding the initial estimate by 17% rather than 49% on average.

Mr. Singh said the reason private contractors get projects to completion faster is probably very simple: The contracts for these projects are often structured so that contractors won’t begin earning toll or annuity revenue till the project are up and running.

“It incentivizes the contractor to avoid delays,” he said.

But costs for public-private highway projects were more likely to come in higher than estimated. This applied to roughly three quarters of such projects, compared to 55% of regular, government-run projects.

For projects with cost over-runs, additional costs amounted to 21% of the initially estimated cost for private participation projects, versus 6% for the public ones.

However, the cost over-runs in the private projects are not necessarily negative, said Mr. Singh. He believes the use of better quality materials could be one of the factors driving up costs, at least for projects where the private contractor is responsible for both construction and maintenance.

“It makes better sense to provide better quality roads” to reduce the frequency of repairs which they would have to pay for themselves, he said. “It will disrupt traffic flow and revenue flows so they want to minimize that. In a public road, if you are a contractor you provide the minimum acceptable quality. Maintenance costs are not your headache.”

Mr. Singh said government audit reports appeared to back this hypothesis, noting more quality problems in public projects than in public-private ones. But he said he plans to carry out further research to assess what other factors could also be driving up costs.

Copyright 2008 Dow Jones & Company, Inc. All Rights Reserved

Editorial: Privatization scheme props up big government


Link to article here.

Again, the Washington Times gets it. One of the few conservative media outlets that does.The rest are still swimming in the Reason Foundation Cato Institute Kool-Aid of privatization talking points that don't mirror reality.

This Editorial Board is connecting the dots and discovering that the so-called "privatization" of our public infrastructure is nothing more than a taxpayer rip-off and a big government SCAM! They involve massive public subsidies and grant monopolies over things we need for daily living -- ie, ROADS! Click here to read their other excellent editorial last year on the failed San Diego toll road PPP.

EDITORIAL: Nickel, diming and quartering the public

Windy City privatization scheme props up big government

By THE WASHINGTON TIMES

6:37 p.m., Tuesday, January 18, 2011


It's not often that prominent rivals for public office find themselves in full agreement on a contentious policy issue. Yet those hoping to take the reins of Chicago's political machine in elections next month - including former White House Chief of Staff Rahm Emanuel - are eager to distance themselves from an infrastructure privatization deal dreamed up by outgoing Democratic kingpin Richard M. Daley. The longtime mayor's scheme has proved to be a nightmare.

Nothing better exemplifies the "live for today" attitude adopted by state and local government officials than the resurgence of so-called "public-private partnerships," where jurisdictions sell or lease assets in return for a pile of cash. From the Windy City to the Old Dominion, political leaders are proving all too willing to sell their constituents down the river for this short-term gain.

That's what happened in December 2008 when Mr. Daley, with essentially no public notice, rammed through a 75-year agreement leasing his city's parking meters to a group owned by Morgan Stanley in return for a $1.2 billion up-front payment. The deal allows Morgan Stanley to pocket every quarter popped into a Chicago meter between now and the year 2083. Though Mr. Daley touted the long-term benefits of this financial windfall, that money has dried up.

Instead of repairing roads and building bridges, more than a billion has already been spent patching holes in the municipal budget. The next mayor will only have a few million left to spend from the lease proceeds. Instead of making the hard choices required to align revenue with expenses, Mr. Daley was able to avoid all the hard choices and even boost 2011 spending by $49 million. That meant Mr. Daley could leave office without angering any special interests with cuts that many of his colleagues have been forced to make.

If only the public could escape similarly unscathed. Chicago residents looking to catch a movie downtown better have reinforced pockets, as the meters now require a half-pound stack of 40 quarters to park. This already sky-high rate is set to increase on a regular, unending schedule. Candidates looking to replace Mr. Daley as burgomaster have heard the local ire and strongly oppose the lease - now that it's too late to do anything about it. Former Sen. Carol Moseley Braun, Illinois Democrat, wants to break the contract and hope the court agrees with her that the deal was a "rip-off" and not enforceable. Mr. Emanuel said he has a "problem" with the meter deal.

Some conservatives are eager to embrace any project carrying the label of "privatization" or "public-private partnership," even when pushed by a Democratic big-city mayor. The reality is that many of these ideas turn out to be nothing more than the outsourcing of tax increases to a private firm. In this case, Chicago residents could end up paying $9 billion in private meter fees in return for the billion dollars Mr. Daley spent by the end of his term in office. If voters don't force change at the ballot box, they won't have any change left in their pockets.

Oil prices to hit $100 a barrel AGAIN

Link to article here.

In a toll viability study conducted by Vollmer & Associates, it states that toll roads are no longer good investments when gas prices hit $3/gallon -- meaning there won't be enough people with the discretionary income to pay the extra toll taxes for the toll road to pay for itself. When oil reaches $100/barrel, gas prices will hit $3/gallon or higher. So toll roads make no financial sense either for investors nor taxpayers who pay the toll taxes. One of the noteworthy points in this article is that Iran, an enemy to America, now controls the second largest supply of the world's oil -- not exactly a reliable source of oil.

Oil price over $100 'not unrealistic': Iran
Jan 16 06:49 AM US/Eastern
BreitBart.com

Oil prices crossing the 100 dollars a barrel mark is possible but would not merit an emergency meeting of OPEC, Iran's Oil Minister Masoud Mirkazemi who currently heads the cartel said on Sunday.
"The price of 100 dollars is not unrealistic in this situation," Mirkazemi told reporters.

"Even if the oil price crosses 100 dollars a barrel there is no need for an emergency OPEC meeting. Some OPEC members believe there is no need for an emergency meeting even if oil reaches 110 or 120 dollars a barrel."

At the New York Mercantile Exchange, a barrel of light sweet crude for delivery in February closed at 91.54 dollars on Friday.

The rise in global oil prices has been attributed to a harsh winter hitting Europe and parts of North America, as well as growth in China and other developing nations.

The Organisation of Petroleum Exporting Countries has said speculation was also fuelling the price rise.

At its last meeting at Quito, the 12-nation cartel decided to leave production quotas unchanged, stressing the looming risks to the fragile global economic recovery.

Some OPEC members -- Iran, Venezuela and Libya -- were urging higher prices at Quito to above 100 dollars a barrel to offset what they said were rising production costs.

But OPEC heavyweight Saudi Arabia differed, saying between 70 and 80 dollars a barrel was a "fair price."

Iran took over the cartel's rotating presidency from January 1, the first time in 36 years that Tehran holds the leadership of the cartel which accounts for 40 percent of world output.

Mirkazemi also announced that Iran has discovered a new onshore gas field with reserves valued at 50 billion dollars east of Assaluyeh on the Gulf.

"It has 260 billion cubic metres (9.18 trillion cubic feet) of gas, of which 210 (billion) can be exploited, which is about 24 million cubic metres per day," the minister said.

Iran is OPEC's second largest crude exporter and holds the world's second largest gas reserves.

Tricks of the trade: How oil & gas companies exploit property rights

Link to article here.

Barnett Shale tricks of the trade aid gas companies over homeowners

Posted Thursday, Jan. 13, 2011

By Mike Norman - Star-Telegram

This email address is being protected from spambots. You need JavaScript enabled to view it.


I apologize.

Last week in a column about urban drilling in the Barnett Shale, I likened the Railroad Commission's Rule 37 to the use of eminent domain to seize private property for commercial purposes. Natural gas companies use Rule 37 to get official sanction for walking over property owners who don't sign drilling leases.

I apologize for the comparison. I should not have sullied whatever good reputation eminent domain has left.

In fact, I gave Rule 37 too much credit. A full range of laws, rules, court precedents and traditions give gas companies their immense power over recalcitrant property owners, especially individual homeowners in urban areas.

The companies are adept at using those tricks of the trade. And if what some homeowners say is true, some industry representatives are not shy about threatening to deprive people of any financial benefit from the gas under their property unless they accept the company's terms.

Yes, they can do that.

Blame the "rule of capture." This accepted legal doctrine says anyone can drill on their own land and, so long as they do it safely and without waste, can pull up and sell anything that comes out of the hole. The Barnett Shale is a mile deep, which means the gas there is under tremendous pressure and will migrate toward that hole if given the opportunity.
That means the first one to drill gets the gas, even if before the drilling that gas was under somebody else's property. Hydraulic fracturing -- injecting huge amounts of water and sand into the well to break open cracks in the gas-bearing shale -- is OK even if some of those cracks cross property lines.

The rule of capture is a cousin to, but ends up carrying more weight than, the doctrine of correlative rights, which says that everybody has claim to the minerals under their property.

In rural areas where people own large tracts of property, the theory is that each of them has an equal shot at being the first to drill and get the gas. That theory turns to vapor in urban subdivisions. Nobody can drill in their own back yard.

Also in theory, Rule 37 would protect owners of small tracts. For the Barnett Shale, it says somebody else's well bore can't come within 330 feet of your property line (after extending that property line from the surface to the earth's core) without a lease. But gas companies are honing their skills at getting the Texas Railroad Commission to grant exceptions to that limit.

Even better for them, in 2005 they got a commission ruling (the "take point" rule) that allowed them to wire around the 330-foot barrier. It's called a "no-perforation zone."

Drillers blast holes in (perforate) a well's underground casing to let the gas in. So long as none of those holes are within 330 feet of your unleased property, you lose. The gas companies don't even dispute that they'll still be taking at least some of your gas. Boo-hoo for you.

For the first time since that 2005 ruling, the Railroad Commission is about to take an in-depth look at no-perforation zones and decide whether they really are fair.

A week from today, the commission is scheduled to publish draft rule revisions in the Texas Register. It will accept comments on those revisions until March 22.

The way the draft is written, no-perforation zones will survive. Whatever protections are provided by Rule 37 will be gutted. Gas companies will pay a little more for permits, about $100 per application. They'll pay about $25 more to provide the commission with a plat to show where the perforations are. They'll avoid Rule 37 hearings, which can cost them $50,000 or more.

It's pretty certain that the comments from gas companies will be favorable. But anybody else can comment, too, even homeowners.

Mike Norman is editorial director of the Star-Telegram / Arlington and Northeast Tarrant County.

Krugman: Texas deficit as bad as California

Link to article here.

Krugman reveals how Rick Perry's claims of how great Texas is doing compared to California don't square with reality. Texas' deficits are as bad or worse than the "liberal" states of New York and California and almost as bad as New Jersey's!

January 6, 2011

The Texas Omen

By PAUL KRUGMAN
The New York Times

These are tough times for state governments. Huge deficits loom almost everywhere, from California to New York, from New Jersey to Texas.

Wait — Texas? Wasn’t Texas supposed to be thriving even as the rest of America suffered? Didn’t its governor declare, during his re-election campaign, that “we have billions in surplus”? Yes, it was, and yes, he did. But reality has now intruded, in the form of a deficit expected to run as high as $25 billion over the next two years.

And that reality has implications for the nation as a whole. For Texas is where the modern conservative theory of budgeting — the belief that you should never raise taxes under any circumstances, that you can always balance the budget by cutting wasteful spending — has been implemented most completely. If the theory can’t make it there, it can’t make it anywhere.

How bad is the Texas deficit? Comparing budget crises among states is tricky, for technical reasons. Still, data from the Center on Budget and Policy Priorities suggest that the Texas budget gap is worse than New York’s, about as bad as California’s, but not quite up to New Jersey levels.

The point, however, is that just the other day Texas was being touted as a role model (and still is by commentators who haven’t been keeping up with the news). It was the state the recession supposedly passed by, thanks to its low taxes and business-friendly policies. Its governor boasted that its budget was in good shape thanks to his “tough conservative decisions.”

Oh, and at a time when there’s a full-court press on to demonize public-sector unions as the source of all our woes, Texas is nearly demon-free: less than 20 percent of public-sector workers there are covered by union contracts, compared with almost 75 percent in New York.

So what happened to the “Texas miracle” many people were talking about even a few months ago?

Part of the answer is that reports of a recession-proof state were greatly exaggerated. It’s true that Texas job losses haven’t been as severe as those in the nation as a whole since the recession began in 2007. But Texas has a rapidly growing population — largely, suggests Harvard’s Edward Glaeser, because its liberal land-use and zoning policies have kept housing cheap. There’s nothing wrong with that; but given that rising population, Texas needs to create jobs more rapidly than the rest of the country just to keep up with a growing work force.

And when you look at unemployment, Texas doesn’t seem particularly special: its unemployment rate is below the national average, thanks in part to high oil prices, but it’s about the same as the unemployment rate in New York or Massachusetts.

What about the budget? The truth is that the Texas state government has relied for years on smoke and mirrors to create the illusion of sound finances in the face of a serious “structural” budget deficit — that is, a deficit that persists even when the economy is doing well. When the recession struck, hitting revenue in Texas just as it did everywhere else, that illusion was bound to collapse.

The only thing that let Gov. Rick Perry get away, temporarily, with claims of a surplus was the fact that Texas enacts budgets only once every two years, and the last budget was put in place before the depth of the economic downturn was clear. Now the next budget must be passed — and Texas may have a $25 billion hole to fill. Now what?

Given the complete dominance of conservative ideology in Texas politics, tax increases are out of the question. So it has to be spending cuts.

Yet Mr. Perry wasn’t lying about those “tough conservative decisions”: Texas has indeed taken a hard, you might say brutal, line toward its most vulnerable citizens. Among the states, Texas ranks near the bottom in education spending per pupil, while leading the nation in the percentage of residents without health insurance. It’s hard to imagine what will happen if the state tries to eliminate its huge deficit purely through further cuts.

I don’t know how the mess in Texas will end up being resolved. But the signs don’t look good, either for the state or for the nation.

Right now, triumphant conservatives in Washington are declaring that they can cut taxes and still balance the budget by slashing spending. Yet they haven’t been able to do that even in Texas, which is willing both to impose great pain (by its stinginess on health care) and to shortchange the future (by neglecting education). How are they supposed to pull it off nationally, especially when the incoming Republicans have declared Medicare, Social Security and defense off limits?

People used to say that the future happens first in California, but these days what happens in Texas is probably a better omen. And what we’re seeing right now is a future that doesn’t work.

Gas taxes shouldn't fund public education

Link to article here.

Note the astonishing figures below: TxDOT only has $700 million in cash on hand to build roads out of a $16 billion biennium budget! The rest is paid for with DEBT or is tied up in paying interest on the debt. You can thank Rick Perry for his reckless transportation policies bankrupting the next generation. He's no conservative and certainly not fiscally responsible. Remember that when he wants to run for President in 2012!

House transportation chair: Public education should not be funded through gas tax receipts

 11:43 AM Fri, Jan 07, 2011 | Permalink
Michael Lindenberger/Reporter    Bio |  E-mail  |  News tips

Is it good policy to give public education one-fourth of every penny collected by the state motor fuels tax?

Every gallon of gasoline sold in Texas carries a 20-cent state tax, but the Texas Constitution permits only 15 cents of that money to go to transportation, reserving a nickel per gallon off the top for public education.

 That's too much, and Texas' underfunded highways need that money too bad to let it be sent to pay for our schools, said Rep. Joe Pickett, D-El Paso, the House transportation chairman. (Photo: Joe Pickett.)

Speaking at a gathering of transportation advocates, engineers, state wokers and others Wednesday, Pickett said public education is already funded by roughly $50 billion a year -- once local, state and federal funds are included.

"I think our schools could survive without it," he said, emphasizing the small role the gas tax funds play in the overall education budget. He stopped short of saying he would actually push for such a change this session, a nod to the political odds against it.

How much are we talking? According to the FHWA, the motor fuels tax generated about $3 billion for the state of Texas in 2009. If a quarter of that went straight to education, that's $750 million.(Here's the FWHA chart.


That would be serious money for transportation, though probably not enough to solve all of its funding problems. For one thing, of the approximately $2.25 billion in gas tax receipts left over for transportation, about $600 to $750 million per year are siphoned off for uses only tangentially related to our highways, including the Department of Transportation, which gets about $1.2 billion of its funding every two years from the gas tax.
Ending those diversions has proved very difficult, despite near unanimous agreement in the Capitol that DPS should not be funded with gas tax dollars. The problem, as Pickett noted Wednesday, is that everyone agrees the funding should change, but no one believes that DPS should go without. That means finding new money to replace the gas tax dollars, something that enjoys much less widespread support.

Plenty of conservatives would welcome the idea of ending the practice of diverting the nickel to education, just as they argue it shouldn't be used to pay state police. That's a philosophical position that basically argues that gas taxes should be used for things that support the activities that are taxed in the first place. If drivers are taxed for driving, then the money generated should be used to improve roads, for instance. That would make the gas tax more like a true user fee.

But few folks in that camp, and few state leaders, are willing to support new revenue to replace the funds restored to transportation. Without that new revenue, the idea of ending the diversions remains a pipe dream.

Thumbnail image for Thumbnail image for perry.JPG.jpegThat is, unless, you agree with Gov. Rick Perry, who says budgeting is all about making choices. If Transportation needs more money, he said, it should get it -- but only if lawmakers decide to take it from some other purpose that isn't so critical.

But he has typically stopped short in suggesting which areas should be cut, or from saying how much. And it will take that kind of hard-nosed cutting, or a willingness to raise new revenue, to make real any commitment to end the diversions, whether it's the smaller step of keeping the gas tax dollars away from DPS or the giant step of changing the Constitution to cut public education out of its nickel.

As for TxDOT's budget, it's going to need more money soon, or else it's going to have to stop doing a lot of the things that Texans have counted on it to do. That's the inescapable conclusion you reach once you look at its budget.

txdot budget graphic2.jpgPickett showed an interesting breakdown of TxDOT's budget. It's budget for 2010-2011 is about $16 billion, not counting the money it got from NTTA that is restricted for use in North Texas.

Of that total, though, Pickett points out that more than $10 billion is immediately spoken for -- either to make payments on previously issued loans (1.64 billion), to make continuing payments on mutli-year projects that have already begun construction ($3.1 billion), or to pay for maintenance on the sprawling network of aging highways and bridges ($5.65 billion).

That's two-thirds of its two-year budget gone, and not a single penny has been spent on a new highway or bridge. For new construction, TxDOT is spending this year and next a total of $2.71 billion, of which fully $2.01 billion will come from issuing more debt (meaning that the debt service figure quoted above will only rise in future years.) The department is spending just $700 million in cash on new construction.

The rest is tied up in a bundle of uses -- including about $1.6 billion on "project development costs" which presumably are design and right of way acquisition for future projects -- and a host of smaller items, from rail safety programs to rural public transit inititiatives.

So, another $750 million a year from the gas tax would mean a great deal to drivers who are looking for TxDOT to begin building more roads or who worry that it will soon begin robbing maintenance dollaras to keep the construction program on life support.

That, of course, was the real point of both Pickett's comments and those made by Sen. Tommy Williams: Sooner or later, both men said, Texans will have to pay more for transportation. The chart below, presented by Pickett, shows how we compare with other states.

Perry's eminent domain 'emergency' hazardous for landowners

Buyer beware: Perry's eminent domain bill hazardous for landowners
By Terri Hall
January 12, 2011
San Antonio Express News / Houston Examiner

Stop the presses...Rick Perry declared a state of emergency over eminent domain. Yet, no one, not even the press, believes Perry sincerely wants genuine eminent domain reform to protect property owners from abuses and takings for private gain. Declaring it an "emergency" allows the bill to be on a fast track, which is perhaps by design to avoid needed scrutiny.

Ever since the Ft. Worth Star-Telegram Mike Norman expose' of Rule 37 abuses by oil and gas companies hit the fan a week ago, is it any wonder that the Perry-inspired eminent domain bill, SB 18, being carried by senators Craig Estes and Robert Duncan is a handout to oil and gas firms and declared an "emergency"?

In another part of the Texas, in case you haven't heard of it yet, the Keystone tarsands oil pipeline project is creating a Trans Texas Corridor level uprising in East Texas, and many landowners are already at war with both our state and federal government about the safety of the pipeline, the eminent domain abuses by TransCanada, the company perpetrating the project, and the gestapo tactics (threats, trespassing) employed by a private company emboldened by Texas' weak eminent domain laws for a project that hasn't even been environmentally cleared yet. They know the tidal wave of opposition is coming and they had better change the eminent domain laws so that the oil and gas industry can continue its land-grabbing abuses of property rights.

Did I mention that another tarsands oil pipeline is part of the Trans Texas Corridor known as Ports to Plains through west-central Texas? In fact, the Alberta government (the northern link for the pipeline) is formulating a monitoring system for the risky oil sands type pipeline in anticipation of potential leaks and hazards (think Deepwater Horizon oil spill), and the expected environmental impacts. So the timing of this bill is strategic and necessary for Perry and the oil and gas industry as well as his friends like Spain-based Cintra, in the toll operating business, whose public private partnership (PPP) projects Perry promised to advance this session.

SB 18 expands the number of entities who can take your land by changing much of the language to include any "entity," not just governmental entities with eminent domain authority. In fact, it removes the word "governmental" in many sections of the code, thus making it possible for Cintra or any other private toll operator or private developer to take your land for commercial purposes. The urban blight exception is WAY too broad and could be used to take anyone's land when a developer convinces government it can make them more money off a hotel than on an existing older home.

You cannot trust Rick Perry on property rights. The reason we don't have property protection now is because Rick Perry's minions have watered down EVERY eminent domain bill since the Kelo decision to benefit Perry's cronies. Now he wants to rush it through to avoid genuine reform once the public backlash mounts. Start calling your representatives now...we don't want Rick Perry's version of eminent domain "reform"!

Rule 37 eminent domain giveaway to oil & gas industry

Link to article here. Perhaps this is why Perry has declared a state of emergency for eminent domain, to ensure the backlash from oil and gas pipelines that are mounting around the state (ie - Keystone pipeline in East Texas), don't run into genuine reform efforts.

Texas gas drilling's 'Rule 37' is eminent domain by another name

By Mike Norman, Star-Telegram / Posted Tuesday, Jan. 11, 2011

No right-thinking and right-voting Texan would stand by and let somebody take away their private property or somebody else's private property.

Heck no.

Well, it's OK to take away somebody else's property for a school or some other vital public use. But you darn sure can't have your property taken away just so someone or some company can make money. No way.

Eight in 10 Texas voters in 2009 approved a constitutional amendment saying just that. They put shackles on government's use of eminent domain -- legally taking away someone's property -- for commercial purposes.

The worst political mistake governor-for-as-long-as-he-wants Rick Perry ever made was his 2002 plan for the Trans-Texas Corridor. That multi-decade idea for wrapping the state in superhighways died not because Texans don't like roads but because it would take away too much private property.

In Texas, what's yours is yours and nobody can take it from you.

Unless it's the oil and gas industry. They're different. We even have laws that tilt the table in their favor.

Fort Worth city and school officials got a taste of those laws earlier this week. Chesapeake Energy started a process at the Railroad Commission that eventually could allow the company to take Barnett Shale natural gas from under city and school property in east Fort Worth.
Then as quickly as the threat appeared, it went away. On Tuesday, Chesapeake sent a letter to the commission withdrawing its request. Company officials blame the original filing on a clerical error.

Plenty of other Tarrant County residents might wish their problems would go away so easily. They're the targets of similar Railroad Commission "Rule 37" proceedings brought by Barnett Shale natural gas companies.

In the last six months of 2010, Chesapeake started at least 29 such cases, and all are still pending.

Rule 37 has become the eminent domain of the mineral lease world. It started out as a way to protect property owners, and in rural Texas where land and mineral rights ownership is measured in the dozens or hundreds or thousands of acres, it probably works out that way.

What it says is you can't drill within a certain distance of somebody else's land or the minerals below it unless they've signed a lease saying you can. The theory is, they have the right to get somebody else of their choosing to drill on their land.

In Barnett Shale urban drilling, it's different. People who own residential lots in the middle of a sea of other residential lots have to sign leases with the same driller as their neighbor. If they don't, Rule 37 lets the Railroad Commission give its official blessing for drillers to leave the holdouts behind, empty-handed.

The theory behind the rule gets turned on its head: No property owner can stand in the way of other property owners getting what they want.

People who lose their property in eminent domain proceedings at least have the right to a court-determined payment. Not so for Rule 37.

Eight Euless property owners who were the final holdouts in Chesapeake's "BC Associates 4H" set of leases, the subject of a Rule 37 proceeding started in November, this week were sent letters from a Railroad Commission hearing examiner. Chesapeake had ended the process, they were told, by deciding to drill past their property and leaving the wellbore sealed for the required 330-foot distance around them.

That leaves them to choose between leasing to Chesapeake or nothing.

That's property rights, Texas style.

Mike Norman is editorial director of the Star-Telegram / Arlington and Northeast Tarrant County.

Sunset review of TxDOT a sham

Postcards from the Lege...
Sunset Commission goes soft on TxDOT
By Terri Hall
January 12, 2011
San Antonio Express News / Houston Examiner

Today the Sunset Advisory Commission, a group of lawmakers tasked with reviewing state agencies for inefficiencies, waste, and abuse of taxpayer money, went decidedly soft on the Texas Department of Transportation under the leadership of Senator Glenn Hegar. Hegar, once a critic of TxDOT and particularly of the Governor's choice of installing his former Chief of Staff, Deirdre Delisi, to head the Transportation Commission, whom Hegar's colleague, John Carona, called a "political hack," actually chastised fellow lawmaker Rep. Linda Harper-Brown for wanting to extend discussion of how best to implement reforms at TxDOT.

My how things change in just two years! Hegar who in the last round of the Sunset review of TxDOT asked why someone wasn't fired for its $1.1 billion "accounting error," is now the Chair of the Commission and is suddenly all love and kisses for the agency who is still planning on building some version of the Trans Texas Corridor TTC-69 through his district.

For the last four years, the Sunset Commission has been inundated with scathing comments from an angry public about TxDOT jamming toll roads and the Trans Texas Corridor down Texans' throats. The Sunset Staff issued a blistering report stating that transportation cannot move forward in our state until the public's trust is restored.

One of the public's clarion calls is for accountability through ELECTED leadership to head TxDOT. Instead of doing what the PEOPLE want, the Commission continues to vote for a single appointed commissioner to replace the current five appointees. A single appointee will be no more accountable to the taxpayers than the current five.

And yet this very same board voted DURING THE SAME MEETING to have the Texas Railroad Commission governed by a single ELECTED commissioner! Then, when Rep. Rafael Anchia wanted a single ELECTED commissioner to head the Texas Commission on Environmental Quality, the board rejected the idea yet again. These lawmakers are all over the map and it seems the only rhyme or reason to explain their erratic votes is pure politics!

Perry's extremely unpopular toll road policies are protected by and implemented through his pay-to-play appointees to the Transportation Commission, most of whom have no experience in transportation. It's been well-documented that Perry's campaign donors get plumb political appointments to various commissions. The system is broken and costing taxpayers dearly, yet the Republican majority has failed to fight the Governor on transportation, and they seem to lack the spine necessary to implement true reforms that will finally get transportation policy on the right footing.

After today's meeting, the entire Sunset process is rightly called a joke. Not only did they vote to keep appointees and bureaucrats in charge of TxDOT, they voted against Sen. Robert Nichols' proposed limitations on design build contracts that will surely come back and bite lawmakers as he predicted.

Design build contracts eliminate low-bid contracting and give this already out of control agency the ability to hand out contracts to whomever they wish, perhaps doling out contracts to the Governor's pet campaign contributors instead of to the contractor who can do it at the lowest cost to the taxpayer.

So the Sunset process took a highly unimpressive turn for the worse today. So for the taxpayers, there's lots of work yet to be done in order to get fundamental reform at TxDOT, such as elected leadership or no deal on ANY new funding...and I mean ANY new funding. Both Senator Steve Ogden and Senator Tommy Williams have signaled their willingness to give TxDOT more funding (Ogden through more borrowing, Williams through much higher car registration fees).

But when an agency commits a $1.1 billion dollar "accounting error" with impunity, when its financial statements cannot even be verified, when an audit revealed they have no regard for saving the taxpayers money by more efficiently managing projects, when the audit also shows they never give unfavorable employee reviews even when its warranted, when they have unlicensed personnel that are required to be fully licensed, when they've illegally hired registered lobbyists using our taxpayer money to lobby for higher taxes, which are all among the long list of indiscretions at TxDOT, and when lawmakers thumb their noses at the reforms the public asks for, there's NO WAY the taxpayers will EVER agree to giving TxDOT more of our hard-earned money.

So rather than strike a conciliatory tone with the grassroots, the Sunset Commission and lawmakers in general, have continued "business as usual" attitudes, despite the taxpayer revolt that continues to swirl around them. The more they ignore the will of the people, the more engaged and committed to change the people become. These "representatives" must be taught they rule by the "consent of the governed," since it's been a foreign concept to them due to years of apathy and corrupt special interest politics ruling the day. Dig in, it looks to be one rancorous session, but victory can be won!

_______________________________________________________________________________________

Link to article here.

Sunset panel votes to replace Texas Transportation Commission with single chief

Thursday, January 13, 2011
By MICHAEL A. LINDENBERGER / The Dallas Morning News

Erin Mulvaney in Austin contributed to this report.

Gov. Rick Perry could gain even tighter control over the Texas Department of Transportation under a series of proposals approved Wednesday by the Texas Sunset Advisory Commission.

The panel voted 7-5 to abolish the five-member Texas Transportation Commission and place the department under the authority of a single statewide commissioner.

Perry would appoint that commissioner, just as he has all five of the highway chiefs who now oversee the department, and the appointment would have to be confirmed by the Senate.

"I see this as being an almost Cabinet-level-like appointment," said Rep. Dennis Bonnen, R-Angleton, the sunset panel's vice chairman. "A single person would be accountable [to the governor], and the governor would be accountable statewide for this appointment."

Rep. Linda Harper Brown, R-Irving, agreed. "This is just so that there is no more passing the buck. ... It just makes it easier to communicate," she said.

The proposal joins more than a dozen others to form the TxDOT sunset bill, which won't become law unless it wins support from the full Legislature and avoids a governor's veto.

It may encounter rough treatment in the Senate. All five senators on the panel voted against the single-commissioner idea. They were split between wanting to retain the five-member commission and wanting to return it to its previous makeup of three.

Two years ago, Sen. Glenn Hegar, R-Katy, supported a single-commissioner model, barely getting enough votes to get it out of the sunset panel, only to have it rejected by colleagues.

"I led the charge to go to one commissioner, and it was a 6-5 vote," he said. "On the Senate side, the vast majority of the Senate believed it would be better with a five-person commission."

Staff writer Erin Mulvaney in Austin contributed to this report.

Texas budget hole comparable to California's

Link to blog here.

Dewhurst actually admits that a lot of what's in the state's budget doesn't square with the priorities of most Texans. Then says a line that plays well politically, but doesn't remotely resemble the truth since Dewhurst is for handing our Texas highways over to the highest bidder on Wall Street who will charge Texans 75 cents a mile to get to work? Here's what he said: "People could stake me and Gov. Perry on the ground and torture us, and we still would not raise taxes.” How is 75 cents a mile in new taxes on driving NOT a tax increase, Lt. Gov Dewhurst?

News of Texas budget hole continues to spread

By Jason Embry, February 7, 2011 -- Austin American Statesman
While those of us in the Texas press have been writing about the coming budget problems for years, especially during last year’s gubernatorial campaign, the rest of the country is starting to take notice. And some who have been the target of our state’s jabs appear to be getting some satisfaction out of it.

From this morning’s Los Angeles Times: “The lecturing from Texas leaders about how California wouldn’t be in such a budget mess if its politicians did business the way it is done in Austin has been relentless for years. … But the latest budget projections out of Texas have sharply changed the discussion: The Lone Star State is facing a budget gap of about $27 billion, putting it in the same league as California among states facing financial meltdowns. The gap amounts to roughly one-third of the state’s budget. … The scene in the statehouse in Austin in recent days would be familiar to those who frequent California’s Capitol. Throngs of advocates for the poor, the disabled and the elderly told ashen-faced lawmakers on the Senate Finance Committee about the various horrors that would befall their clients if the state made its planned cuts. Nursing homes, rural health clinics and counseling centers for at-risk youth would close, they warned. One advocate said that under the Legislature’s plan, her grandchildren in Louisiana would have a more secure safety net than Texas children. The unfavorable comparison to a state many Texans regard with disdain was delivered like a gut punch. As if to punctuate the point that Texas has found itself in a California-style mess, a power-grid problem caused rolling blackouts statewide Wednesday as the Capitol was consumed with fiscal crisis. … The Texas budget crisis is prompting some experts to reconsider what had been dubbed the Texas Miracle. The state has much lower unemployment than California, but economists note that many of the jobs are low-paying. One out of three wage earners in Texas earns too little to keep a family of four above the federal poverty level, according to a 2009 study by the Corp. for Enterprise Development, a Washington-based nonprofit. That is double the percentage of similarly low-wage Californians. Such figures call into question whether Texas’ economy has really transitioned into a new 21st century model, or whether it has been buoyed by high oil prices and lots of loosely zoned land where construction of cheap houses endured through the recession. … Texas lags far behind California in major research universities, patents produced, high-tech infrastructure and venture capital investment, according to the Missouri-based Kauffman Foundation. The foundation’s 2010 ranking of states in ‘movement toward a global, innovation-based new economy’ put California at No. 7. Texas was No. 18.”

I thought the Texas miracle was in education during the 1990s?

Also from that story is this from Lt. Gov. David Dewhurst: “A lot of the things we are doing arguably aren’t priorities for the people of Texas. People could stake me and Gov. Perry on the ground and torture us, and we still would not raise taxes.”

Should Dewhurst be saying that a lot of what the state’s doing are not the people’s priorities when he has been the lieutenant governor during the writing of the last four budgets?

What's a transportation tax vs a 'fee'?

Link to article here. I would ask Mr. Heflin how can he claim "it's wrong to raise more money for roads" until the gas tax diversions cease, and then sit back and watch every new lane and new road in Texas become a toll road, what his good buddy Rick Perry calls a "user fee," some charging as much as $1.50 PER MILE in NEW TAXES to access PUBLIC ROADS, all the while gas tax diversions have continued?! Doesn't pass the smell test.

January 6, 2011

Dallas Morning News blog

Is a transportation fee really a tax?

 4:50 PM Thu, Jan 06, 2011 | Permalink | Yahoo! Buzz
Rodger Jones/Editorial Writer      Bio |    E-mail  |  News tips

Yes, says Talmadge Heflin, big policy guy at the Texas Public Policy Foundation. The foundation's legislative recommendations will be the songbook for many conservative lawamakers this coming session.

I asked Heflin about this after colleague Michael Lindenberger's report that Sen. Tommy Williams put the possibility of a new vehicle registration fee on the table to raise more money for highways. Williams made a presentation to the Texas Transportation Forum. Lindenberger wrote on this blog:

Sen. Tommy Williams, R-The Woodlands, would not rule out the possibility of legislation requiring higher vehicle registration fees, or some other fee, passing this session. But he acknowledged that it's more likely that this session will be spent making changes to how Texas operates and how its projects are selected to better its reputation among lawmakers and the public. ...
The senator, who was named earlier this year to replace Sen. John Carona, R-Dallas, to lead the transportation and homeland security committee, laid out a plan he hopes will catch on with his colleagues that would raise motor vehicle fees as much as $50 a year.

That increase, he said, would support $18 billion or so in new construction. That would fund, he said, the most important congestion-relief projects in all of Texas' largest cities and leave enough left over for a statewide series of safety measures.

OK, I thought, does Williams see a way through the gantlet of conservative obstacles to new revenue? Will a "fee" somehow make it through where a "tax" would not?

I took a spin through the TPPF's guide for lawmakers for the 2011 session, looking for its transportation position. Its recommendations on highway funding call for stopping diversions, setting better priorities, more transparency finding highway money in other areas, etc. And this:
Resist calls to increase the state motor fuels tax.
I didn't see the word "fees," and so I called Heflin thinking fees just might get a pass with his group. What a naive thought.

"It's the same as raising gas taxes," he said. "As long as diversions continue, fees become a tax."

Heflin said the gas tax should be regarded as a user fee that should not be siphoned off for non-highway purposes. Until lawmakers can discipline themselves on this, it's wrong to raise more money for roads.

But, I asked, isn't the "diversion" amount really an insignificant one for road construction -- a little over a billion a biennium? That would build maybe four freeway intersections every two years. It would take eight or 10 years of all the diversion money to build the I-35 project from Dallas to Denton.

Heflin doesn't deny the diversion amount doesn't build a whole lot, in a relative sense, but he said stopping the practice is an important first step.

So there it is -- another stanza in the songbook: "no new fees."

Panel blasts private toll contract as 'sweetheart deal'

Link to article here.


California Legislative Analyst Blasts Public Private Partnership
Doyle Drive reconstruction plan blasted as a sweetheart deal for private contractors.
The Newspaper.com
12/24/10

Doyle DriveThe California legislature's Legislative Analyst's Office (LAO) blasted a public-private partnership deal between the California Department of Transportation (Caltrans) and investors for the development of Doyle Drive. The plan was to give a private company, Golden Link, a 30-year lease on this vital southern route to the Golden Gate Bridge to perform needed renovation to the route. The state would pay the consortium $173 million for finishing the road, followed by $28.5 million in "availability payments" each year the road is open.

"Overall, our analysis finds that the Golden Link agreement does not meet all the goals Caltrans intended and is not likely to be a good fiscal deal for the state," Legislative Analyst Mac Taylor wrote. "In light of these findings, we think that the state should consider not signing the contract with Golden Link, and instead build the project with a more traditional approach."

The total cost of the project is estimated at $594 million on the partnership model, while traditional methods would cost around $490 million -- not counting a number of potential cost overruns on the riskier partnership model. In terms of bearing risks, the deal put state taxpayers on the hook if any discoveries of endangered species threatens roadside construction. It offered no guarantee that the companies undertaking the project would finish on time. Because the interest rates that will apply are not yet known, the analyst was unable to estimate the final cost with more certainty.

"Based upon our own analysis, we disagree with Caltrans' conclusion that the agreement results in a lower lifecycle cost," Taylor wrote. "As described in detail in another section below, we have concluded that a traditional design-bid-build procurement would be less expensive in this particular case than under the Golden Link agreement."

The analyst recommended dropping the public-private partnership contract. A copy of the letter is available as a 450k PDF at the source link below.

Source: Public Private Partnership letter (Office of the Legislative Analyst, 12/22/2010)

Tolls are taxes, not 'prices'

Link to article here.

'Taxes are just prices…' draws sharp response from professor

Posted on Toll Road News / Sat, 2010-12-18

"Reproaching people who complain about taxes, Liane Ellison Norman insists that 'taxes are really just prices”'(Letters, New York Times Dec 17).

"No ma’am.  Prices are terms of exchanges voluntarily agreed to by willing buyers and willing sellers.  Because prices result from people spending – or not spending! – their own money, they reflect genuine consumer desires and resource scarcities.

"In stark contrast, taxes are forced extractions.  Even when spent with the intent of benefiting taxpayers, taxes – unlike prices – are never the result of bargains between buyers and sellers.  Taxes, instead, are the result of commands issued by rulers to subjects.

"Buyers who refuse to pay sellers’ asking prices go without the goods.  Subjects who refuse to pay the sovereign’s demanded tax go to jail," Donald J. Boudreaux, George Mason University Economics Department.

see http://cafehayek.com/

A line of reasoning worth bearing in mind for the taxes versus tolls debate.

Perry's council wants TxDOT exec paid 'millions'

Restructure Council calls for TxDOT exec to be paid 'millions'

January 6th, 2011 2:56 pm CT
By Terri Hall, San Antonio Transportation Policy Examiner

A Restructuring Council hired to dig into the troubled Texas Department of Transportation (TxDOT) and make recommendations on how to reform the broken agency suffering from an "acute erosion of public confidence in TxDOT," gave its report to the Transportation Commission yesterday. It's two top recommendations are a far cry from taxpayer-friendly reforms: lift the salary cap for the Executive Director from $192,500/yr to "millions" (said one councilmember) and adding yet two more executive pay positions. Are they nuts?

During an economic recession with public sector jobs salaries rising far faster than private sector jobs, with Texans struggling to make ends meet and hang onto their homes, these cronies of Rick Perry and David Dewhurst, one an ex-Transportation Commissioner himself, have the unmitigated gall to suggest lifting the pay cap for a government bureaucrat in charge of building our state highways? These people have lost their grip on reality. Wake-up and smell the grassroots! This is what reform is supposed to look like?

The public has bombarded lawmakers on the Sunset Advisory Commission tasked with reviewing state agencies for waste and inefficiencies, with calls for ELECTED leadership at TxDOT for the past four years.

The Sunset Advisory Commission has recommended the current Transportation Commission, comprised of 5 appointees by the Governor, be abolished and replaced with a single appointed commissioner. At a public hearing December 15, 2010, Rep. Dennis Bonnen failed to see how a single appointee of the Governor would fundamentally change the problems at TxDOT, especially its unresponsiveness to the public and even lawmakers. He's exactly right. It won't fix the leadership problems at TxDOT, neither will throwing more money at government bureaucrats.

TxDOT's leadership does not "recognize the need for self-correction," the 69-page report said, which is all the more reason to scrap the current Transportation Commission and replace it with ELECTED commissioners who answer to the taxpayers.

It's OUTRAGEOUS to think taxpayers need to pay a private sector CEO wage to the TxDOT Director so they can bring a "business" sense and finance background to the agency. That's code for "innovative financing," experts who have gotten an earful from Goldman Sachs (the same jokers who advised the government of Greece that went bankrupt and tanked the Euro with its multi-leveraging schemes with public debt) and those who want to sell-off our highways to foreign corporations who are granted 50 yr monopolies and then charge Texans 75 cents a MILE to use our PUBLIC roads. TxDOT's primary role is to build and maintain our Texas state highways, not tinker around in high finance and complicated public private partnership (PPP) contracts that en debt generations.

This isn't the kind of change we can believe in. The Commission itself needs scrutiny and this report and the timing of the release of it is to provide smoke and mirrors to try and get the Sunset Commission to vote to leave the leadership at TxDOT as appointees and hired guns (controlled by the Governor), not elected commissioners accountable to the PEOPLE of Texas ahead of its Jan. 12 vote on the sunset bill.

How much are Railroad Commissioners, the Ag Commissioner, Land Commissioner paid? That's what a TxDOT Commissioner ought to be paid. The 2010 Grant Thornton Audit had a chart showing TxDOT executives pulled down anywhere from 30-50% more than their counterparts in other states, yet all the focus by the Governor's cronies is on comparing TxDOT salaries to the private sector instead of public sector salaries. The taxpayers aren't obligated to pay them private sector CEO salaries to build Texas highways!

An ELECTED Transportation Commission the fastest, surest way to bring fundamental change, restore the public trust, and get us moving again. Anything less is taxation without representation and an affront to the overwhelming public feedback insisting on elected leadership to transform this agency.

Rendell lobbies for tolls, borrowing, and higher taxes for roads

Link to article here.

For years we've contended that Rick Perry is the same ol' Democrat as he was in yesteryear before he switched parties and became a Republican (when it was politically expedient)...this ought to prove it. Who did Perry tap to carry his water for higher taxes and tolls, particularly public private partnerships (erroneously called private toll roads) where the published toll rates are 75 cents PER MILE to use our public roads? An outgoing Democrat Governor of Pennsylvania, Ed Rendell. When both parties are calling for the same thing, is there really any difference between them anymore? Perry touts his conservative credentials as he sets himself up for a presidential run in 2012, but his record clearly shows he can tax, borrow, and spend just as voraciously as the Democrats he's so fond of maligning. There's a word for that -- HYPOCRITE!

Pennsylvania Democrat urges Texans to tax, toll, borrow for roads

12:00 AM CST on Wednesday, January 5, 2011

By MICHAEL A. LINDENBERGER / The Dallas Morning News
This email address is being protected from spambots. You need JavaScript enabled to view it.

AUSTIN – Texas transportation leaders welcomed one of America's most outspoken Democrats on Tuesday to a stage often used in the past by Gov. Rick Perry, and Gov. Ed Rendell of Pennsylvania spent nearly every minute of his fiery speech calling for more taxes, more tolls and more borrowing to salvage what he called the country's fast-deteriorating highways and bridges.

"This is a seminal test for what kind of country we want to be," said Rendell, whose second and final term in the Keystone State winds down this month. "Do we want to look inward and be selfish and worry only about the moment? Or do we want to be the America we always have been, the America that didn't ever see a challenge it couldn't overcome and, yes, the America that plays football in the snow."

When the National Football League postponed an Eagles-Vikings football game scheduled for last Sunday because of weather, Rendell called it proof that America was turning into "a nation of wusses" – a theme he continued Tuesday as he spoke to an army of engineers, consultants, builders, bankers and local elected officials who gather each year for the Texas Department of Transportation's policy forum.

Perry, who has appointed all five commissioners who oversee the Texas Department of Transportation, has often spoken at the forum to urge lawmakers to fund transportation and endorse the privatization of toll roads.

This year, he left the speaking to Rendell, whose political philosophy couldn't be more different from the Texas governor's. But the two governors agree on one point that has long been of paramount importance to Perry: the need for more privately financed toll roads.

"You've used private toll agreements to build roads more effectively than any state in America," Rendell said approvingly, perhaps because lawmakers in his state quashed a deal he brokered to sell tolling rights to the Pennsylvania Turnpike for $16 billion.

In Texas, at least three major privately financed toll projects are under way, including two in the Dallas area, and supporters of the concept will be pushing the Legislature to expand their use once lawmakers reconvene later this month.

Perry to push for more private toll deals

Link to article here.

It shouldn't surprise any Texans that Rick Perry, the counterfeit "conservative," is calling for higher road taxes through privatized toll roads. It's been the centerpiece of his transportation policy since he became Governor and Texans have twice defeated it...for good reason! The published toll rate to use these "Lexus lanes" is 75 cents PER MILE or over $3,000 a year in new taxes just to get to work! Perry and his pro-tax minions try to claim tolls are a user fee, not a tax ("those who use the road pay for the road" mantra), but that's an out and out LIE. All three of the grandfathered public private partnership (PPP) toll roads in Texas required a HEAP of public subsidies that all Texans are on the hook for -- more than $1 billion in our hard-earned tax dollars yet you can't use the road unless you pay a DOUBLE TAX toll! Perry, "Mr. Conservative," has launched Texas headlong into more than $20 billion in road debt for loser toll projects that won't be in the black for a generation! Texans can't afford Perry's unsustainable tax, borrow, and spend transportation policies, and anyone who claims to be a conservative cannot, in good conscience, vote to re-authorize these oppressive PPP toll roads.

Private toll roads get new push in Texas

06:44 AM CST on Tuesday, January 4, 2011

By MICHAEL A. LINDENBERGER / The Dallas Morning News
This email address is being protected from spambots. You need JavaScript enabled to view it.

AUSTIN – It's been easy to overlook in the Dallas area, where two of the largest privately financed toll projects in the country are under way, but Texas' authority to build private toll roads technically has been extinct since summer 2009.

Over a long July Fourth weekend two years ago, with time running out on a chaotic special session, the Legislature refused to extend authority for the Texas Department of Transportation to contract with private toll firms beyond Aug. 31, 2009.

Since then, the privatization of toll roads, long a centerpiece of Gov. Rick Perry's ambitious and controversial transportation agenda, has been on hold in Texas, even as some grandfathered projects like Dallas' LBJ Freeway and the North Tarrant Express continued.

Now the issue is set to be debated again as lawmakers return to Austin, ready to confront rising construction needs even as they grapple with commitments to keep taxes low and a frighteningly large budget shortfall.
Immediately after the last session adjourned, Perry's chief transportation aide promised a hard push to restore the authority to enter into so-called comprehensive development agreements in 2011.

"Absolutely, the governor is going to keep pushing, pushing for putting this tool back in the box," then-deputy chief of staff Kris Heckmann said.

And in an interview with The Dallas Morning News just before his re-election in November, Perry said he would ask lawmakers to renew authority for the state to partner with private toll firms.

"Now is not the time to leave any tool out of the box," he said, noting the revenue shortfall that the Legislature will confront and the state's growing list of unfunded highway needs.

 

Running out of money
 

Texas Transportation Commission chairwoman Deirdre Delisi has warned repeatedly that without new revenue, Texas will run out of money for new highway projects by 2012.

North Texas elected officials will be pushing, too. They say they have already begun to drastically scale back the scope of transportation projects planned before 2035 and will need all the money they can get – whether from public or private sources.

Toward that end, the Regional Transportation Council's legislative agenda will include efforts to restore the authority to enter into comprehensive development agreements in the state, spokeswoman Amanda Wilson said.

But Michael Morris , the council's planning chief, said this push for private toll road authority will look different than the expansive authority previous bills have given the Transportation Department, which is run by five commissioners appointed by Perry.

North Texas leaders will be asking lawmakers to approve a narrow bill that gives the state authority to contract with private developers for a handful of roads only, Morris said.

"Instead of making this a big major policy issue statewide, our position is, why not focus strategically on specific projects that could be advanced" by privatization, he said. "In our region, we won't have more than three. And we're calling for safeguards, too."

Those safeguards would include the need for any private toll road to have the support of not just state officials but also county officials and the local planning council.

"That way, we do this more strategically and give ourselves time to learn more about the risks and benefits" of the agreements, Morris said.

The three North Texas projects Morris and other local officials hope can be built with private funds are:

•The expansion of Interstate 35E between LBJ Freeway and Denton County.

•An eastern expansion of the already-underway North Tarrant Express, and a portion of Interstate 35W to its north

•Widening and the addition of toll lanes on State Highway 183 in Dallas County, which would provide a Dallas County link to the North Tarrant Express

Each of those roads, like the reconstruction of LBJ Freeway, would involve heavy subsidies from taxpayers and, as a result, provide new free lanes as well as high-priced toll lanes that serve as optional express routes.

State transportation officials have already said the I-35E project alone will cost nearly $5 billion, almost 10 times what they say Texas has available to spend on it without private partners.

The privatization push will likely have allies in the state Senate, where leaders vowed to support renewing the authority for private toll roads in 2011 even as the time ran out of the 2009 session.

Lt. Gov. David Dewhurst and others at the time called the lack of action to extend the authority in 2009 nothing more than a temporary timeout.

 

Everyone not on board
 

Still, not everyone in Texas believes toll roads are a good idea, public or private, said state Rep. Joe Pickett, the El Paso Democrat who is the House transportation committee chairman. Toll roads have been too eagerly embraced by officials and planners in North Texas, he said.

"There isn't the appetite for toll roads in El Paso," he said. "And San Antonio is the second biggest city in Texas, and they still don't have a toll road there."

What's more, Pickett said the huge influx of new members in the House has made predictions of any kind foolhardy. Republicans now control at least 101 of the 150 seats, and it's not yet clear who will be speaker or will lead committees in the new session, he said.

Pickett said he believes House Speaker Joe Straus of San Antonio has the votes to remain in charge, but he said it's not certain.

Still, Pickett said with other sources of funding so scarce, it's likely he will support legislation that allows the state to pursue private investors for specific projects, including several in North Texas.

"It should be a project-specific bill," he said. "It should include an affirmative list of those who wanted in and wanted out."

Pickett said he'd favor a bill that would give the Transportation Department four years to find private developers for a list of badly needed toll roads, after which the authority for private tolls in Texas would expire.

But another area of uncertainty is just how eager the private investors that were so readily available for toll projects a few years ago will be to return to Texas.

With so many changes in the economy, with ratings agencies, and credit markets, the interest may be less than what it was two years ago, some experts say.

Former U.S. Transportation Secretary James Burnley said in a recent interview that private investors may be more cautious than they were when Perry first pushed Texas to privatize toll roads.

"There will be a lot more interest in attracting private capital than there has been with Democrats in power in Congress," said Burnley, who served in the 1980s.

"But from the private sector's point of view, there are a great many issues that have to be worked through. You can't just blithely wave a magic wand and expect the investment capital to flow."

TRANSPORTATION DEPARTMENT GEARS UP FOR LEGISLATURE
With a new legislative session looming, the Texas Department of Transportation is taking steps this week to bolster its efforts at the Capitol:

•It is hosting an annual transportation policy forum in Austin and has invited Pennsylvania Gov. Ed Rendell to deliver a keynote speech today.

•Rendell, a Democrat, is expected to talk about the need for more highway funding and likely will tout his support for privatization of some toll roads.

•The department's five commissioners will meet in a special session Wednesday to hear proposals on reorganizing the 12,000-employee agency – a move designed in part to get ahead of legislative critics.

The 281 superstreet, a super success

Superstreet deserves 'super' title
By Terri Hall
San Antonio Express News / Houston Examiner
January 5, 2011

The votes are in from those in the trenches...the 281 superstreet is a smashing success. While we acknowledge it is a temporary fix and feel TxDOT not the Alamo Regional Mobility Authority (the toll authority) should be handling the superstreet fixes, it has relieved some of the worst gridlock on the northside for a mere $7 million. For the first time EVER, commuters can hit all of the lights north of Loop 1604 (in those mega-congested first three miles) GREEN!

Commute times have been shaved by as much as half simply by synchronizing the lights, forcing right turns for the cross traffic, and providing elongated "J"-turns. Kudos to Sam and Gene Dawson and the team at Pape Dawson for providing a much needed short-term fix to one of San Antonio's biggest sore spots. Next up, 1604 West, which should open its superstreet sometime later this year.

Gettin' it right
The 281 superstreet is a shining example of how the community can work together to get the job done. Gene Dawson saw the need, personally committed his company's time and money to coming up with an affordable short-term fix, went to the residents with the proposal, got the community's support FIRST, and together they lobbied their elected officials and transportation entities to get it funded and built in record time and under budget.

Of course, the residents have been begging for simple solutions, like synchronizing the stoplights, for years. But once TxDOT figured out it could raid the pockets of northside residents by imposing tolls, it yanked the promised and FUNDED freeway overpass plan and decided NO fixes would be allowed. Toll roads aren't profitable without unbearable congestion as the alternative. When the residents said 'No' to tolls, TxDOT put the screws to commuters by increasing the stoplight times and neglecting the highway to the point that it's decaying into a pothole ridden, gridlocked mess.

As we continue to advocate for the promised non-toll fix to 281 that was funded through the summer of 2008, it's imperative that our politicians and the government agencies they oversee work WITH the community to avert endless legal gridlock in the courts. When government is tone deaf to the people who pay the bills and tries to punish them when they say 'No,' it's incumbent upon we the people to hold them accountable by reminding them who's the boss. Abusive government has come about due to apathy and the naive belief that our elected officials are looking out for us as they promised.

The fastest way to end both the literal and political gridlock is for the citizens to be in the driver's seat and for government to implement their wishes. Not the other way around. So let's follow the method that works and get our freeways fixed without the rancor of divisive, unaffordable, double tax toll roads.

Have politicians gotten the message?

Have they heard us?
Vigilance required
By Terri Hall
San Antonio Express-News / Houston Examiner
January 4, 2011

The voters sent a clear message in November: cut and control government spending, lower our taxes, and overall shrink government (get its boot off our necks!). The question that remains -- did politicians get the message and will anything truly change? With the recent tax cut compromise and the massive proposed spending bill in Washington, it's obvious that our elected representatives continue on business as usual doling out freebies to all sorts of lobbyists and pet industries at the expense of the middle class. Indeed, our politicians are more like unsupervised children, and it's time we the people kick it up a notch!
Every new year brings with it new opportunities, and in 2011, the greatest opportunity in a generation is for taxpayers to watchdog their government at a whole new level and insist upon accountability and sustainability. Take nothing for granted, trust no one, and take no prisoners. We absolutely cannot allow business as usual to continue. Our children and grandchildren are already suffocating under a mountain of debt at both the state and federal levels (to say nothing of local government debt), and the current cavalier borrow and spend mentality gripping our Texas State Legislature in the name of no new taxes is worse than an outright tax increase.

No more borrow and spend
For just the first $6 billion in state borrowing for roads (the vast majority of which went to subsidize loser toll projects at EVERY Texan's expense) will cost Texans $21 BILLION (that's billion with a "B") to pay back with interest. According to the Texas Department of Transportation's financial statements as reported in the Austin American Statesman December 22, not one of Austin's new fangled toll projects will be in the black for a generation. You read that right, NONE of those projects will be paid off for a GENERATION! And that's not counting the heap of other toll projects around the state like the $6-7 billion of debt in Dallas/Fort Worth alone.

If there's one thing our generation needs to learn from the previous one, it's that paying cash for something is far less costly than borrowing and debt. All Texans are now on the hook to guarantee the North Texas Tollway Authority's debt with approximately $8 billion in gas taxes over the next 36 years for a toll road that primarily benefits the Dallas Cowboys. That $8 billion is equivalent to the entire construction budget at TxDOT for a whole year! Such reckless financial decisions must NEVER happen again.

What's in store?
With the Texas Legislature convening on January 11, the road lobby is rabidly pushing them to re-authorize certain contracts called Comprehensive Development Agreements (CDAs) that effectively sell-off our Texas roads to private corporations in 52 year, monopolistic sweetheart deals. In 2009, Governor Perry called a special session to get these CDAs re-authorized.

Ultimately, the two-day session ended with the CDA bill lacking the votes to even get out of committee! That was our biggest victory to date, for without these deals, most of the planned toll roads will face certain death for lack of financing.

Not only the road lobby, but also many local elected officials are pushing for a litany of new taxes for transportation in addition to CDAs. They all think that raising the gas tax is politically radioactive (especially as gas prices rise -- though it's by far the most affordable and fair way to fund roads). But they're convinced they can fool you into thinking tolls and fee increases aren't tax increases or that you can somehow game the system and avoid paying them. The whole "those who don't use the road won't pay for the road" mantra is no longer even remotely true -- ALL Texans are paying BILLIONS in subsidies for these toll projects they may never be able to afford to use.

They plan to raid pension funds for toll roads, expand local government's authority to raise your property taxes to pay for roads (called Transportation Reinvestment Zones, how quaint), to possibly charge you a tax for every mile you drive, to increase your registration "fee," and try to impose a host of other taxes (on things like parking spaces or a commuter tax on out of area commuters) or to install invasive technologies that wreak of big daddy government with toll gantry cameras and toll tags, red light cameras, cameras monitoring ALL our state highways, banning texting while driving, banning the use of cell phones while driving, and the like.

They think we need to be monitored as our freedom of travel gets trampled upon (like the naked body scanners at airports). They think you're not paying enough to keep their gravy train going. This is what we can expect, if we let it happen! Since those who wish to rob us of our freedoms never sleep, neither can we.

Now more than ever, we the people need to demonstrate to our politicians that ignoring the public outcry against tolling our existing freeways, the Trans Texas Corridor, and the sale of our Texas roads to foreign companies who then charge 75 cents PER MILE to drive our PUBLIC roads, will bring wrath at the ballot box, and perhaps even result in a grassroots people's candidate running against them.

In the 2010 midterm elections, we saw a house cleaning of sorts. The taxpayers have had enough, they're watching their representatives' every move like hawks, and they're not going to fall for rhetoric or dirty tricks (like slipping bad stuff in a mega bill that no one reads, and giving taxpayers' hard-earned money away in freebies for industries with the most effective lobbyists).

TURF has been the vanguard, faithfully standing watch on the front lines while educating and rallying their fellow citizens since 2007. You can count on us to keep you apprised of all things transportation this session. Remember knowledge (and taking action) is power. So get informed or get run over. Our next meeting is January 20 at 6:00 PM at Longhorn Cafe off Blanco Rd. (inside 1604). See you there!

Austin tollways in the red 'for a generation'

Link to article here.

Taking the tollways' temperature

Area turnpikes bringing in more revenue than expected, but TxDOT roads won't be in the black for a generation or more.

By Ben Wear
AMERICAN-STATESMAN STAFF

Updated: 2:55 p.m. Wednesday, Dec. 22, 2010

Published: 9:40 p.m. Tuesday, Dec. 21, 2010

Four years into the Central Texas tollway era, gauging how the area's five pay-to-drive roads are doing could be a matter of perspective: Are the turnpike lanes half full or half empty?

Actually, most of the time and for most of those 78 miles in Austin's suburbs, the lanes are well below half full. But according to 2009 Texas Department of Transportation counts, traffic on Texas 45 North near the tollway's confluence with Interstate 35 is close to 100,000 vehicles a day. And all of the roads except the Loop 1 tollway, which connects the north end of MoPac Boulevard to Texas 45 North, are producing more revenue than originally projected.

The $66.2 million generated in the 2009-10 fiscal year by the three financially intertwined roads of TxDOT's Central Texas Turnpike Project — Texas 130, Texas 45 North and Loop 1 — was $6.5 million more than official estimates given to bond investors in 2002, before construction began.

TxDOT's Texas 45 Southeast, while lightly traveled with only about 8,400 vehicles a day on its four lanes, still brought in $3.2 million last year. That's 56 percent above projections for the road in southeastern Travis County. That highway, unlike the other four local turnpikes, was built completely with tax dollars and thus has no debt to pay off.

And the 183-A tollway in Cedar Park, built and run by the Central Texas Regional Mobility Authority , will bring in $21.4 million this year — $1.8 million above the original estimate — and $9.7 million of that is "profit" that the agency is plowing into other road projects.

The half-empty part?

After a fast start financially, the gap between the actual and projected revenue for the three-road turnpike project has narrowed each of the past two years. If that trend were to continue, the gap would essentially disappear by 2012 .

Even though revenue is ahead of expectations, that amounts to a small dent in a debt that is expected to continue for at least the next 30 years. Even in the original estimates, the three roads were not expected to turn a profit until after the debt was paid off.

In 2009, TxDOT expected to have $125.1 million in debt and operating expenses, compared with $78.4 million in revenue from tolls, along with earnings on reserve funds and money made by the agency's toll service center on Loop 1, according to a 2009 agency bond document. That's a one-year deficit of $46.7 million.

That money would come from TxDOT's general funding, fed primarily by gasoline and diesel taxes. Through 2042, according to the document, this "commission support" will exceed $3 billion .

TxDOT officials say they're not worried about the turnpike project's financial vigor.

"For the first three years, we've been higher than projections" on revenue, said James Bass, TxDOT's chief financial officer . "We continue to monitor it and manage it. If it were to get close, we'd look for ways to control and reduce costs before looking at increasing rates."

TxDOT, in its original financial plan for the roads, intended to keep toll rates unchanged until 2015. Although TxDOT turnpike director Mark Tomlinson said that increasing the toll rates (now essentially 12 cents a mile) has come up in informal discussions, Bass said he is "not aware of any interest or discussion at the (Texas Transportation) Commission level to consider that."

As for Loop 1's disappointing performance — 2010 revenue of $11.9 million was almost $3 million below projections — Tomlinson blamed the frontage roads alongside and FM 1325 , which roughly parallels the tollway to Round Rock. And he said the toll roads' financial performance should improve as the economy, and the suburban housing industry along with it, recovers.

"It's the only part of the system that has an accessible free alternative fairly close," Tomlinson said. "In general, due to the economic downturn , there's been less development all over the system than probably the engineers (who did the original estimates) anticipated. That's a short-term blip."

If anything, the struggling economy is building up a latent demand for homes to be built near the area's toll roads, Tomlinson said. More rooftops and more commuters would mean more toll revenue.

"For all those reasons," Tomlinson said, "I'm not concerned."

Trans Texas Corridor TTC-69 resurrected

Link to article here.

PREMEDITATED MERGER

'Nightmare' federal plan resurrected from crypt

Controversial project now promoted under new name

Posted: November 22, 2010
9:15 pm Eastern

By Jerome R. Corsi
© 2010 WorldNetDaily

 It was Amadeo Saenz, the executive director of the Texas Department of Transportation, who not quite two years ago, proclaimed to the Dallas News, "Make no mistake: The Trans-Texas Corridor, as we have known it, no longer exists."

But it's been exhumed, now appearing on numerous government and industry alliance websites as the new and separate projects that are known as the I-35 Corridor and the I-69 Corridor.

Moreover, the Texas agency appears to have made a strategic decision to begin first with the I-69 Corridor portion that had received less attention during the battle that raged over the mega-highway project called the Trans-Texas Corridor from 2006 to 2008 when George W. Bush was president.

That the U.S. Department of Transportation under the Obama administration continues to harbor the dream of Mexico-to-Canada NAFTA superhighways is made clear by the Federal Highway Administration website that proclaims the "Corridor: Interstate 69 (I-69) – Texas to Michigan" is to be fully operational under the following project description: "The 2,680-mile international and interstate trade corridor extends from Mexico to Canada."

The DOT even proclaims the I-69 Corridor under the original understanding of the TTC as an inter-modal automobile-truck-railroad corridor:

"This application [I-69 Corridor] includes freight and passenger movement through a portion of the country that is experiencing both demographic and freight movement growth. The current infrastructure from Texas to Michigan already handles a large flow of goods and this corridor has the potential to shift cargo patterns to relieve existing and projected congestion along existing routes (e.g., I-40, I-65, I-81). This corridor has already been identified by Congress as a high priority corridor, is one of the farthest along in clearly defining its project list, and has the political support of all the states involved."
The Federal Highway Administration further says many of the states have done developmental work and there are 32 separate segments, "all of which are in varying stages of development from acquisition of right-of-way to environmental review and design."


A screen capture of the Federal Highway Administration discussion of the I-69 Corridor
The U.S. Department of Transportation's main website also affirms plans to proceed with the I-69 Corridor, describing under the headline of "Interstate 69 (I-69) Corridor – Texas," that:
"The Trans-Texas Corridor (TTC) is a proposed multi-use, statewide network of transportation routes that will incorporate both existing and new highways, railways, and utility right-of-ways. The Interstate 69 corridor is one of the first elements of the TTC to be developed. The proposed I-69/TTC corridor extends from Texarkana/Shreveport to Mexico, a distance of approximately 650 miles."

Here is a screen capture of the relevant U.S. DOT website
A notice in the Fort Bend Star for a planned I-69 Corridor presentation makes clear that the dream of a Mexico-to-Canada NAFTA superhighway being built through Texas remains live and well.

A report discussing a planned presentation by Fort Bend County Judge Robert Herbert scheduled for the December 15 meeting of the Infrastructure Department of the Central Fort Bend Chamber Alliance notes that, "Once constructed, under present plans, the I-69 Corridor will create a transportation artery from Canada to Mexico crossing through southern Texas and eastern Michigan."

 


A screen capture of the Ford Bend announcement
The Fort Bend Star makes clear that the I-69 Corridor in its full Mexico-to-Canada dimensions has been divided into 32 segments of Independent Utilities, of which 16 are in Texas.

Still, wanting to distance the I-69 Corridor from the TTC designation, the article notes, "Now separated from the controversial 'Trans Texas Corridor' that kept it in Limbo for a few years, I-69 seems imminent for Texas."

The TxDOT website provides further confirmation that rather than end altogether the TTC agenda, the agency simply has rebranded the project to include the I-35 Corridor and the I-69 Corridor, with the tactic of further dividing each project into segments, organized around multiple SIUs, with the plan to form Citizens' Advisory Committees for each corridor segment.

A map on the TxDOT website illustrates how the I-69 segments operate geographically to divide Texas into discrete SIUs from the border with Mexico, running along the Gulf coast, to the northern tip of the Texas border where Oklahoma, Arkansas and Louisiana converge:


At the same time, TxDOT appears to have removed the former TTC website, KeepTexasMoving.com, a step evidently taken by TxDOT to re-enforce the impression the TTC project is dead.

A website created by a trade group organized under the name "Alliance for I-69 Texas" provides a map that details the Texas cities are involved in the I-69 Corridor project:


The Alliance for I-69 Texas website makes clear that I-69 is a combination of two federally designated High Priority Corridors: (a) Corridor 18, extending from Michigan and Illinois, south through Indiana, Kentucky, Tennessee, Mississippi, Arkansas, Louisiana, terminating at the end of U.S. 77 and U.S. 281 in the Rio Grande Valley of Texas, and (b) Corridor 20, designated as U.S. 59, from Texarkana to Laredo.

The website further points out that the I-69 border crossing points from Laredo to Brownsville, Texas, handle 49 percent of the total U.S. truck-borne trade with Mexico.

An I-69 project blog describes the extensive state-by-state progress being made constructing the I-69 corridor.

In January 2009, WND’s Red Alert newsletter warned that Texas Gov. Rick Perry was attempting to engage in a public relations effort to distance TxDOT from the TTC project, while continuing to include on the TxDOT website detailed discussions of TTC-35 and I-69/TTC projects.

As WND has been reporting since 2006, the original Trans-Texas Corridor project was launched by TxDOT as a 4,000-mile network of four NAFTA superhighway consisting of automobile-truck-railroad corridors that TxDOT planned to build over a 50-year period.

The original TTC designed called for TTC-35 to be built as a 1,200-foot-wide corridor of new highways, designed to run parallel to the existing I-35 and to include separate north-south lanes for automobiles, trucks and trains, with included pipelines for oil, water and natural gas.

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