Stop light onslaught proposed for 281 draws record crowd

Link to article here.

Stop light onslaught proposed for 281 draws record crowd
By Terri Hall
Examiner.com
July 10, 2014

The Texas Department of Transportation (TxDOT) struck a nerve yesterday, and it wasn’t pretty. Nearly 300 angry residents of the Bulverde-Spring Branch area showed up for what they thought would be a public meeting on the fate of US 281, only to be greeted with a standing room only venue stuffed with more people than the little library could handle and a bunch of aerial maps and consultants who couldn’t or wouldn’t answer their questions. No formal presentation was made by TxDOT to explain what the plan entailed. Attendees were expected to piece everything together on their own and know what to ask in order to get properly informed. The line to get in was wrapped around the room and out the door where attendees waited up to 20 minutes just to enter. No one anticipated the record attendance.

Collin County in toll rebellion over US-75

Read letter here.

Link to article here.

Collin leaders to TxDOT: Don’t toll carpool lanes on 75
By Brandon Formby
Dallas Morning News
July 10, 2014

The Texas Department of Transportation’s plans to turn Central Expressway carpool lanes into tolled express lanes just got some serious organized opposition. Several state lawmakers and Collin County commissioners co-authored a letter yesterday that told new TxDOT executive director Joe Weber that Collin County residents are essentially feeling toll fatigue. Not surprising since the county’s three other major thoroughfares (Dallas North Tollway, President George Bush Turnpike, Sam Rayburn Tollway) are completely tolled.

“There is a strong feeling in our communities that they are already paying too much for travel upon our roadways due to tolling of the three major highway corridors in Collin County,” the letter says.

P3 woes in India

Link to article here.

Economic Survey: Reduce tariff if toll road operators don’t deliver
Times of India
July 10, 2014

NEW DELHI: In a move to ensure that toll roads are maintained well and expanded to meet the growing traffic, the latest Economic Survey has recommended to the government to examine whether the contract can provide for "reduced tariff" if the operator fails to meet the promised services.

The report has recommended that international practices such as 'traffic trigger' and 're-equilibrium discount' could be examined to address some of the problems faced in the sector. A 'traffic trigger' clause in the contract implies that once a certain volume of traffic is reached, the concessionaire is obligated to increase the capacity so that minimum level of service is maintained. The 're-equilibrium discount' is used to reduce tariff when performance parameters are not met. In such case a table of discounts is pre-defined in the contract.

Considering the major problem in the execution of road projects on public-private partnership (PPP) mode, the Survey has recommended an alternative strategy. It said government agencies can award projects as engineering contracts to build the asset in which the construction company is protected from political and regulatory risks. In such cases, the government bodies would bear the cost of construction.

Soon after the construction is over, a second contract can be given out to a private firm to toll the asset for one year and produce data about present levels of toll revenue. "This could set the stage for a long-term, say contract combining tolling and maintenance. These projects would be able to absorb a high level of long-term bond-market financing, and thus yield low tolls," the Survey said.

It said these firms would generate cash flows for the government which would offset the original expenditure for constructing the asset.

For all infrastructure sectors, the Survey has said lack of consistency in policies needs to be addressed urgently apart from removing procedural bottlenecks. "Removing procedural bottlenecks, improving governance, and above all maintaining consistency in government infrastructure policies are some issues that need to be urgently addressed," the report said.

The document highlighted how as many as 110 out of 239 central sector infrastructure projects, each costing Rs 1,000 crore or above, have reported delays, which range up to 26 months in cases of steel, coal, power and petroleum projects.

The total original cost of implementation of these projects was about Rs 7.4 lakh crore and their anticipated completion cost is likely to be Rs 8.98 lakh crore, implying an overall cost overrun by 21.3%, it said.

The Survey mentioned that while growth in power and fertilizers segments was higher, sectors like coal, steel, cement and refinery witnessed lower growth.

How does Perry rate on transportation?

Link to article here.

Grading Rick Perry on Transportation
Texas Monthly
July 2014

Rick Perry has repeatedly sought to address transportation in Texas during his time as governor, but there is no other issue on which he has been so reliably thwarted. Next time you’re stuck in a traffic jam, pat yourself on the back. The transportation system we have in Texas today may not be good, but it’s exactly what we’ve asked for as voters.

The problems—the sprawling congestion, the crumbling highways—were all predicted. They were also predictable, given the various trends over the past ten or fifteen years: the soaring population, the growth in industries such as energy and manufacturing, the stagnant revenue streams, the political torpor. According to the Texas Department of Transportation, over the past 25 years, Texas’s population has grown by 57 percent, and overall road use has nearly doubled. State road capacity, however, has grown by only 8 percent during that time.

Perry has called for greater investment in infrastructure since his first year as governor, when he signed a measure designed to create the Texas Mobility Fund, which had the authority to issue bonds for highway construction and other transportation projects. It marked a conceptual departure from Texas’s long-standing pay-as-you-go approach to road funding, and voters approved the constitutional amendment in November 2001. Two months later Perry unveiled his master plan. The Trans-Texas Corridor called for the construction of four thousand new miles of toll roads, with high-speed rail, oil and gas pipelines, and utility lines running alongside them. All told, the project would cost about $175 billion. “Nothing is too big for Texas,” he said, “when economic security and quality of life are at stake.”

Republicans and Democrats alike disagreed. They complained about the fees Texans would pay on toll roads, the expansion of state debt, the unprecedented use of eminent domain, and the prospect that a foreign company like Cintra—a Spanish toll road operator—would stand to profit. Faced with the most sustained backlash of his career, Perry amended his hopes for the TTC, scaling them back many times before 2009, when TxDOT quietly abandoned the idea in favor of a more modest, incremental approach. In retrospect, it was true that there were things to dislike about Perry’s sprawling vision for the TTC. On the other hand, it was better than no vision at all, which is effectively what the governor’s critics were proposing as a counteroffer—and which is what we have now.

Since that setback, Perry has narrowed his efforts to focus on transportation funding. He has supported some reasonable proposals, such as ending diversions from the state highway fund. He has also supported some creative responses, such as a measure passed during special session last summer that will, if voters approve a constitutional amendment to this effect in November, allocate a portion of future revenues heading toward the Rainy Day Fund to a different bucket of money dedicated to transportation projects. The amendment is worth supporting, but it won’t solve the funding problem. TxDOT has said that it needs about $4 billion a year just to “maintain current levels of congestion,” and the measure would bring in less than a quarter of that.

Perry’s preference, over the course of last year’s session, was for the state to take on more debt to build roads. That’s not a terrible idea on its face; as the governor has noted, interest rates are low, and Texas’s growth is expected to continue. At the same time, there are reasons to be skeptical about borrowing. Drew Darby, a Republican representative from San Angelo, mentioned one last session during a floor debate: the state has borrowed $17 billion for roads since 2001, and it will ultimately cost $32 billion to retire that debt.

As an alternative, Darby suggested raising the vehicle registration fee for the first time since 1985. That proposal went nowhere after Perry threatened to veto it. The governor has also dismissed the idea of raising the gas tax, which currently stands at 20 cents a gallon. That’s the thirty-eighth-lowest rate in the country, according to the Tax Foundation, and it hasn’t changed since 1991. Hiking it wouldn’t be a long-term solution, because cars are becoming more fuel-efficient, but by the same token, it wouldn’t be a crushing blow to Texas’s consumers either.

Then, too, it’s worth noting that investing in transportation infrastructure shouldn’t be such a hard sell. Left to his own devices, Perry would surely have done more for roads, as he has for economic development, and he deserves credit for championing this issue when so many ankle-biters have scoffed at him for trying. But transportation infrastructure, in a state this size, is not an issue that can be adequately addressed via an executive officer, however ambitious. In a 2001 editorial, the Dallas Morning News noted that the new governor had done well in some respects but suggested that Perry might learn from George W. Bush’s more engaged approach to the Lege: “More stroking here or there could have yielded greater progress on such issues as transportation.” That was good advice. If Perry had taken it, we might not be in this jam.

Quick stats:

Change in population since 1989: 57%

Change in state road capacity since 1989: 8%

Are you paying for toll roads already paid off?

Link to article here.

Are you paying for toll roads already paid off?
May 22, 2012
By Wayne Dolcefino
ABC News 13

HOUSTON -- Do you use the toll roads? Half a million of you do every day and now we have some bad news for you. You may be paying forever, even if the roads were paid off a long time ago.

The next time a politician asks you to vote on something, you might want to get all the fine print in writing. Don't you get sick of broken promises?

It's another morning drive to work, and before this day is over, half a million of you will pay a toll just to get where you need to go.

Doesn't that make you feel like you want to cheer? Well, we really did cheer when the West Belt Tollway opened in 1989. Of course, maybe that's because the girl band The Bangles were playing a live concert on top of the new highway.

Steve Malouf now pays close to $200 a month in tolls.

"Makes me angry, really angry," he said.

Because Steve knows what we found downtown inside a building that looks on the outside like it should be torn down; newspaper accounts of the nasty political fight three decades ago over the idea of selling bonds to build toll roads. Seventy percent of you said OK, but all those cheering people...wonder if they'd be so excited today if they knew they had been scammed?

"You feel scammed?" we asked toll road driver David Sartis.

"Oh sure, of course," he said.

We found this brochure from the early days of the Toll Road Authority, printed just after we OKed building the West Belt and the Hardy Toll Road. The promise was simple: "When both roads combined have covered their costs, the roads will become free public highways."

"What'd you think would happen when we paid the roads off?" we asked Sartis.

"Well, you would think they'd take the toll booths away, right?" he replied.

Well, if you used the toll road today, you already know that didn't happen.

But the promise is there in black and white. They used it get us to vote.

"Well yeah, it does make you wonder well why they aren't free," one toll road driver said.

We've already made back the money we paid to build the roads and then plenty more. Take the Hardy. Toll road construction costs $287 million. We made that back by 2004. You've paid a total in tolls of $617 million.

"You sort of wonder what happened?" we asked another toll road driver.

"Yes," she said.

This stretch of the Sam Houston costs $72 million to build. You know how much you've paid in tolls? $865 million.

"Do you feel cheated?" we asked Malouf.

"Very much so," he said.

"The construction of that road has been paid for 12 times?" we asked Harris County Toll Road Authority Director Peter Key.

"It's one system, it's one system that funds all the needs out there," he said.

I didn't see that in the fine print. Did you? But leave it to politicians to welch on a deal. It happened in September 2001 at a Harris County Commissioners Court meeting, way down on the agenda. Look at H, a bunch of gobbygloop about bond stuff and then "a resolution for pooling of a list of toll road projects as component facilities." Translation: you're going to pay tolls forever.
If you were watching Eyewitness News back in 1983, you heard a prediction that was right on.

"These projects will more than pay for themselves, in fact, have money left over at the end," former County Judge Jon Lindsay said at the time.

"You guys are a cash cow," we told Key.

"This agency does take in a substantially amount of revenue," he replied.

"Take a guess," we asked toll road driver Devon Pedrick.

"I don't know -- $1.5 billion," he said.

"It's actually more than $5 billion," we said.

"Wow," he responded.

"Don't surprise me, fourth largest city in the nation -- sure, captive audience, it's awesome," Malouf said.

So much money has been made, the Toll Road Authority has to give some of its extra cash to Harris County commissioners every years -- nearly $900 million so far, not to pay off debts, but to pay to fix up other roads. So when you pay a toll, you're not just paying for the right to drive on a special road, you are paying to fix up roads for other folks who didn't pay a dime.

"Everybody should pay their own fair share and it seems like just a few of us are paying for what they should be paying for and it's just not right," Sartis said.

During that road party in 1989, The Bangles taught us to 'Walk Like an Egyptian.' Twenty-three years later, 13 Undercover has taught you something else.

"The whole free thing -- never going to happen?" we asked Key.

"From practical standpoint, it's hard to imagine the road going free," he replied.

And do you want to see how much money they've made from you on tolls? Just go to 13 Undercover Interactive, where you can see the evidence of a broken promise. Check out a particular road -- try the Sam Houston Tollway. You'll see the how much we've paid in tolls and how much they've made.

Streetcar funds should go to fix US 281 without tolls

Link to article here.

Streetcar funds should be redirected to expand 281 without tolls
By Terri Hall
July 29, 2014
Examiner.com

Undoubtedly, most San Antonians have heard the great news that the city and county have pulled their support for the downtown streetcar plan. Naturally it begs the question, so where will those dollars go now? Anti-toll groups, Texans Uniting for Reform and Freedom (TURF) and Texans for Toll-free Highways (TTH) call on the Texas Department of Transportation (TxDOT), the city, and county to permanently scrap the street car and use those funds to expand US 281 North (outside Loop 1604 to the county line) without tolls.

TxDOT plans to add 12 stop lights on freeway in Hill Country

Concerned citizens are encouraged to submit comments to This email address is being protected from spambots. You need JavaScript enabled to view it. until July 19 and to contact appropriate elected officials to respectfully express their displeasure.

Sen. Donna Campbell - (830) 626-0065 or This email address is being protected from spambots. You need JavaScript enabled to view it.
Rep. Doug Miller - (830) 625-1313 or This email address is being protected from spambots. You need JavaScript enabled to view it.
Commissioner Donna Eccleston (north of Hwy 46) - (830) 221-1101 or This email address is being protected from spambots. You need JavaScript enabled to view it.
Commissioner Scott Haag (south of Hwy 46) - (830) 221-1102 or This email address is being protected from spambots. You need JavaScript enabled to view it.
Mayor of Bulverde Bill Krawietz & City Council members - This email address is being protected from spambots. You need JavaScript enabled to view it. or call (830) 438-3612 to reach council members.

Stop light onslaught proposed for 281 draws record crowd
By Terri Hall
July 10, 2014
Examiner.com

The Texas Department of Transportation (TxDOT) struck a nerve yesterday, and it wasn’t pretty. Nearly 300 angry residents of the Bulverde-Spring Branch area showed up for what they thought would be a public meeting on the fate of US 281, only to be greeted with a standing room only venue stuffed with more people than the little library could handle and a bunch of aerial maps and consultants who couldn’t or wouldn’t answer their questions.

No formal presentation was made by TxDOT to explain what the plan entailed. Attendees were expected to piece everything together on their own and know what to ask in order to get properly informed. The line to get in was wrapped around the room and out the door where attendees waited up to 20 minutes just to enter. No one anticipated the record attendance.

GOP platform retreat from tolls gets noticed by NYT

Link to article here.

We disagree with the characterization by TTI that Abbott's promise to fix Texas roads without raising taxes, fees, or tolls somehow means TxDOT can continue to build toll roads at their current rate. Nice try big money boys, but that doesn't compute. If one more toll road is added once Abbott takes office, that's raising the tax burden, period. We can fix our roads without tolls using existing taxes and the voters will insist on it. It requires getting lawmakers' fingers out of our road taxes and prioritizing existing revenues to fund this core purpose of government - public infrastructure.

A G.O.P. Shift Against Toll Roads in Texas
By AMAN BATHEJA
New York Times
JULY 3, 2014

The Republican state convention drew national headlines last month with candidates and activists staking out hard-line positions on homosexuality and immigration.

Less noticed was a significant shift in the party’s stance on transportation, particularly the state’s reliance on toll roads. In the new platform, Republican delegates removed a provision backing “the legitimate construction of toll roads in Texas” and replaced it with language opposing some aspects of toll projects in Texas, particularly the use of public money to subsidize private entities.

The conservative pushback against toll roads comes as Gov. Rick Perry prepares to leave office after 14 years marked by a sustained push for toll roads and toll lanes. With about 25 toll roads, according to the Texas Department of Transportation, the state has used the projects to stretch limited funds and expand its highway network. Most of the toll roads have opened or been expanded since 2000, the year Mr. Perry took office.

“There is an enormous amount of toll fatigue in Texas,” said Susan Fletcher, a Republican delegate from Collin County who supported the new platform language.

Terri Hall, founder of the anti-toll road group Texans Uniting for Reform and Freedom, led the effort to change the platform position. To explain why delegates had adopted her proposals with little debate, she pointed to a 41-mile stretch of Highway 130 between Austin and Seguin. The privately run toll road opened in 2012 with lawmakers promoting it as a model for the future. Yet the road has not proved popular with drivers. Last month, Moody’s Investors Service reported that toll revenue had come in far below initial projections.

Senator seeks to dedicate vehicle sales tax to highways

Link to article here.

We have long-supported dedicating the vehicles sales tax to roads, but Nichols' bill does it far too slow to make an appreciable effort to stop the reliance on tolling. Since lawmakers have stolen from our highway funds for decades, it's time they restore it and make restitution...NOW instead of ask Texans to pay $24/day in tolls to get to work. Nichols has never seen a toll road he didn't like - including those propped up with gas taxes, property taxes, sales taxes, and guaranteed by the Texas taxpayer. He's part of the problem, not the solution. Until thwre's a provision to keep these funds from being used to build, subsidize, or guarantee toll roads, NO DEAL!

Third Proposal Floated to Pay for Road Construction
By Jim Forsyth
WOAI Radio
June 30, 2014

The head of the Senate Transportation Committee says there is a better way to pay for TxDOT's crushing highway maintenance, repair and construction needs than raising the gas tax or building toll roads, Newsradio 1200 WOAI reports.

  State Sen. Robert Nichols (R-Lufkin) told the San Antonio Mobility Coalition he will propose a constitutional amendment when lawmakers meet in January to dedicate a large portion of the vehicle sales tax to roads.

Special interests lobby to rip-off taxpayers with P3s

Link to article here.

Big money's optimism is certainly warranted since they structure every deal to fleece the taxpayer and grant themselves government-sanctioned monopolies. Government is complicit in the scheme as the big money greases their wheels...our politicians are supposed to be safeguarding the public interest yet their fiduciary duty is nowhere to be found among the graft.

Big-Money Optimism but Many Unanswered Questions About Private Infrastructure Investment
By Tom Curry
Roll Call
June 24, 2014

Senate Finance Chairman Sen. Ron Wyden spoke for many transportation officials when he said recently, “There are hundreds of billions of dollars in private capital sitting on the American sidelines. Surely some of that can be invested in American infrastructure.”

Probably no topic is hotter right now in the public infrastructure world than private-public partnerships, which aim to entice the owners of those hundreds of billions of dollars of private capital to invest in rebuilding and expanding the nation’s highways, ports and bridges.

Americans to be taxed by the mile

Link to article and to view the video go here.

The government has plans to tax Americans for every mile they drive.
Daily Sheeple
June 22, 2014

This is about more than just generating revenue or saving the planet from all of those “greenhouse gases”.

This is part of the Agenda 21 lot to corral people in one place. It is to discourage people from living outside the city and commuting to work. It is a plan that will force many to rely on public transportation. Lots of people in a small area are far easier to control than people scattered about in wide open spaces.

Inspector general delves into 460 in VA

Link to article here.

The corruption with P3 contracts continues...meanwhile Texas doesn't have an Inspector General to watchdog such deals despite taxpayers insisting on one. Such fraud is most assuredly happening in lax Texas.

Inspector general delves into 460
By Matthew Ward
Thursday, June 19, 2014

Virginia’s transportation secretary has asked the state Inspector General’s Office to join its internal review of the Route 460 project.

“Secretary Layne directed VDOT’s Assurance and Compliance Office to conduct a review of the Route 460 P3 project,” department spokeswoman Tamara Rollison said Thursday.

The office’s multi-pronged mission, according to VDOT’s website, includes investigating alleged “fraudulent, illegal and/or inappropriate activities.”

Toll collections spark outrage in CA

Link to article here.

Electronic toll collection is a massive money-making scheme where the punishment doesn't fit the 'crime.' It impedes our freedom to travel and ruins people financially - just to get to work and usually for innocent mistakes.

Drivers rack up tickets on toll roads
The switch to a cash-free payment collection system is turning into a potential moneymaker.
By Morgan Cook
Orange County Register
June 27, 2014

The switch to a cash-free payment collection system is turning into a potential moneymaker for county toll roads, in the form of a jump in the number of penalties from toll violations.

The new system also has sparked confusion for drivers and a customer service crisis at the Transportation Corridor Agencies, with tens of thousands of people calling help lines only to face long waits, and often no answer at all, according to documents presented at June 12 board meetings of TCA directors.

Cintra's SH 130 on verge of bankruptcy

Link to article here.

Report: SH 130 Toll Road Company in Danger of Default
By Aman Batheja
Texas Tribune
June 19, 2014

The company behind a privately operated Texas toll road that sports the country’s fastest speed limit is dangerously close to defaulting on its debt, according to a credit rating agency.

According to a report released this week by Moody’s Investors Service, the SH 130 Concession Company, which operates the 41-mile southern portion of State Highway 130, is low on cash and scrambling to get an upcoming payment deadline waived,

The private consortium behind the project owes more than $1 billion and lacks the funding to pay off an upcoming debt payment due on June 30, according to the report. The report adds that the company has “depleted all but $3.3 million of available liquidity reserves.”

In an emailed statement, SH 130 Concession Company spokeswoman Megan Compton did not dispute any of the findings in the Moody's report.

"We remain committed to our long-term investment in SH 130 and are confident that this first-class roadway will play an increasingly important role in relieving congestion along the gridlocked I-35 corridor as Central Texas continues to grow,” Compton said.

The southern portion of SH 130 between Austin and Seguin opened in October 2012 to much fanfare. Along with boasting an 85 mph speed limit, the fastest in the country, the SH 130 Concession Company had signed a first-of-its-kind-in-Texas deal to build and operate the toll road for 50 years in exchange for a portion of the toll revenue.
Yet the company’s projections for traffic and toll revenue were overly optimistic. In October, Moody’s downgraded $1.1 billion of debt tied to the project by five notches, from B1 to Caa3, considered junk status. The financial situation has not markedly improved, according to the rating agency’s latest report.

“Fiscal 2013 revenue performance was about 60 percent below original forecast and fiscal 2014 is likely to be 70 percent below the original forecast,” the report states.

Company officials are working with the project’s lenders on waiving a portion of this month’s debt payment while not triggering an official default, according to the report. The company is also attempting to restructure its debt based on a new traffic and revenue study, according to the report.

SH 130 was designed to allow drivers a route to travel through San Antonio and Austin and avoid the traffic on Interstate 35. The consortium spent $1.3 billion to build the southern portion of SH 130, known as Segments 5 and 6. The northern portion (Segments 1-4) is publicly funded.

State officials have expressed hope that the road will someday relieve congestion from Interstate 35, particularly trucks for Mexico passing through the region and headed north. Company officials have also predicted that future development in small towns along the toll road’s route would boost traffic over the life of its 50-year contract.

For most of 2013, TxDOT subsidized trucks to use the road at a discounted rate. That turned out to be a lasting boost to the road’s performance as commercial traffic levels have not dropped since the discount ceased, according to Moody’s.

“Commercial traffic levels have held since the discount ceased and with the strengthening credit profile of Mexico … commercial traffic along SH 130 is likely to grow over the long-term,” the report states.
__________________________________

Link to article here.

SH 130 tollway, now deep in debt, seeks refinancing deal
By Robert Grattan
Austin Business Journal
June 23, 2014

The tollway company that built a section of State Highway 130 is negotiating with several banks in order to refinance much its debt, according to a report by a debt rating agency.

SH 130 Concession Company borrowed $1.18 billion to build the road and was projected by Moody's Investor Service to not be able to make its June 30 debt payments after seeing revenue reach only about 30 percent of original projections. Still, with a refinancing deal in the works with banks that lent the money, default is unlikely, the Austin American-Statesman reported.

The concession company is a partnership of Spanish company Cintra and San Antonio's Zachry Construction Co. SH 130 is the first privately funded, built and operated state highway in Texas. The road is owned by the state, but operated and maintained by Concession Company in keeping with a 50-year agreement worked out with the Texas Department of Transportation.

SH 130 has been cited as an economic development driver for the cities east of Austin. However, the despite the high speed limit and traffic free drive, the road hasn't met revenue expectations.

A company spokeswoman told the Statesman that the road would play an important part in Central Texas as an alternative to the congested I-35.

SH 130 Concession Co.'s debt was not downgraded by the recent Moody's report, though Moody's has lowered its grade in the past.

In its report, Moody's indicated TxDOT could take over the highway in the event of an extended relief event such as a default by paying "a senior debt termination amount." It wasn't clear how much that amount would be, the Statesman reported.

Congress meets with investment bankers profiteers about P3s

Link to article here.

Members of congress are sitting down with investment bankers to ask them how well public private partnerships are working out for the taxpayers. Really? These are the very scoundrels ripping us off charging toll fees in excess of $23/day and congress gives what they say credibility with this charade?

No Simple Calculation in Comparing Public, Private Investment
By Tom Curry
Roll Call
June 17, 2014

When members of the House Transportation and Infrastructure Committee conferred with investment bankers in New York on Monday, one question they wrestled with was how to compare the cost-effectiveness of traditional infrastructure investment (states or other government entities issuing bonds to pay for projects) with public-private partnerships — PPPs or P3s — that give private investors stakes in toll roads and other projects.


Rep. Scott Perry, R-Pa., asked a panel of investment bankers and one academic urban planner “how public infrastructure projects and facilities are evaluated for efficiency and, if there is such a model, do you folks have it?” He wondered, “Are we just now starting to figure that out” and “is there any metric” that determines cost, risk, and efficiency for public projects compared to private ones.

Cintra facing bankruptcy on Indiana Toll Road, too

Link to article here.

Indiana Toll Road operator facing debt woes
Associated Press
Indianapolis Business Journal
June 19, 2014

A state agency says it is monitoring the Indiana Toll Road operator's finances as it works to make an upcoming debt payment on the financing of its $3.8 billion lease payment to the state eight years ago.

The Indiana Toll Road Oversight Board has asked the Spanish-Australian investor group Cintra-Macquarie about the status of the payment it owes this month after state officials made similar inquiries after news reports that it was struggling last year to make an interest payment, board Director James McGoff told The Times of Munster.

The case for a higher gas tax

Link to article here.

The reason Americans won't go for a gas tax hike is the amount of wasteful spending with our existing road taxes. When they divert massive amounts of money to boondoggles like commuter rail, street cars, and hike & bike trails ($48 million in just the next 4 years in San Antonio, TX alone), why would anyone in their right mind agree to give the government more of their hard earned money?

3 reasons a higher gas tax would benefit drivers
By Rick Newman
June 19, 2014
Daily Ticker

Americans tend to regard cheap gasoline as a national birthright. So go ahead and hyperventilate for a moment before considering the alien idea that maybe it would be good to pay a bit more for gas.

Now for the unhappy news: A new bipartisan bill in Congress would raise the federal gas tax by 12 cents per gallon, in two annual hikes of 6 cents each. The reason for this sure-to-be-unpopular plan is that the Highway Trust Fund, which pays for interstate highways and other important parts of the nation’s road network, is out of money. That leaves a choice between taking the needed funds from other programs (every one of which has powerful protectors in Washington) or foregoing road-building and maintenance.

The Highway Trust Fund is meant to be financed by the federal gas tax, which is now 18.4 cents per gallon (and 24.4 cents for diesel). The last time Congress raised the gas tax was in 1993, and inflation has since eroded its current value to about 11 cents, according to the Government Accounting Office. Congress has gotten in the habit of backfilling shortfalls in the trust fund from general tax revenues (which mostly come from personal income taxes), but that exposes highway construction and maintenance to all the dickering and delay voters find infuriating about Washington.

The new bill’s two sponsors — Republican Sen. Bob Corker of Tennessee and Democrat Sen. Chris Murphy of Connecticut — want to eliminate perennial shortfalls in the Highway Trust Fund by indexing the gas tax to inflation, so the tax would rise every year by the same proportion as overall prices. The odds of the bill passing before the November midterm elections seem low, but they might improve next year.

Here’s why the higher tax would be good for drivers:
We have to pay for roads and bridges somehow. Most drivers recognize the value of good roads and structurally sound bridges — especially when potholes start to swallow their tires and detours around failing bridges take them far out of their way. An efficient road network is also an economic necessity, since truckers need to move goods around and commuters need to get to work. Shortchanging transportation so motorists can save a few bucks today will backfire, even on drivers who think they can’t afford the tax or shouldn’t have to pay.

Alternatives to a higher gas tax are worse. The gas tax isn’t perfect, but it does a pretty good job of imposing the cost of building and maintaining roads on the people who use those roads. Using income tax proceeds (or worse, borrowing) to pay for highways spreads the cost to people who don’t even use them, such as urban residents and non-drivers.

Besides, other schemes for financing roads have their own problems. One alternative to a higher gas tax, for instance, is more toll roads, which are also unpopular and penalize drivers who have no choice but to use such roads. Another idea: Congestion fees, which would apply to drivers who use roads during peak driving times — and seem unfair to people who have no other way to get to work except driving during rush hour. Public-private funding arrangements might make sense, except Congress seems to have no interest in taking up such legislation. And one high-tech solution is to attach tracking gizmos to every car in America, to measure “vehicle miles traveled,” or VMTs, and assess fees based on actual road use — since nobody in America minds if the government follows their every move.

You might not even notice. Americans have been driving less, on average, and burning less gas, for a variety of reasons: Fuel economy has improved considerably and will continue to do so, on account of aggressive new government MPG targets. The exodus of people from cities to suburbs and exurbs has reversed, with more people living closer to where they work. And financial pressure has simply forced some people to plan driving trips more efficiently and find other ways to save on gas.

Gas prices overall have generally been rising, because oil prices have been rising and a limited supply of refineries in the United States tends to keep gasoline supplies tight. Even so, a 12-cent gas tax hike could easily be offset by better fuel economy. Since 2010, for instance, average fuel economy has risen from 22.1 MPG to 25.6 MPG. For an average driver logging 12,000 miles per year and paying $3.50 for gas, the savings from fuel economy alone during that time are $260 per year. If a 12-cent gas tax suddenly kicked in, the savings would still be $204. And if that new tax revenue helped repair roads, it might mean fewer potholes, fewer car repairs and a smoother trip to work, too.

Pocahontas reverts to its creditors

Link to article here.

Pocahontas 895 toll road under a new operator
Australian company previously controlled Pocahontas 895
BY MICHAEL MARTZ
Richmond Times-Dispatch
June 17, 2014

Pocahontas 895 has a new operator, a year after an Australian company walked away from a long-term concession for the underperforming toll parkway across the James River between Henrico and Chesterfield counties.

DBi Services, based in northeastern Pennsylvania, quietly assumed control of the parkway — the first road built by public-private partnership in Virginia — on May 15 and informed local government officials two weeks later.

The company took over operation from Transurban, an Australian company whose board of directors voted last June to transfer control of the highway to a consortium of European banks that holds $300 million in debt on the project, not including a $150 million federal loan that must be repaid.

Congressman DeFazio announces plans to pay for roads and bridges

Link to article here.

Congressman DeFazio announces plans to pay for roads and bridges
By Reed Black
Land Line Now Magazine
June 16, 2014

Last week, U.S. Rep Peter DeFazio, D-Ore., announced his plan for paying for roads and bridges.



It calls for eliminating the gas tax at the pump and taxing oil at the refinery level instead. The oil tax would be indexed to increase with inflation, and the oil companies could pass along the cost of the tax to consumers.



DeFazio says the 24-cent federal tax on diesel would remain, but would be indexed so that truckers would not pay a disproportionate share.



DeFazio told “Land Line Now” on Sirius XM that the alternative to his plan is a nation of toll roads.



Indiana Toll Road Remains Contentious Infrastructure Financing Case

Link to article here.

Indiana Toll Road Remains Contentious Infrastructure Financing Case
By Tom Curry
Roll Call
June 17, 2014

For Rep. Michael E. Capuano, the senior Democrat in a group of House Transportation Committee members that met with New York investment bankers Monday, the key private infrastructure investment case that needs explaining is the 2006 lease of the Indiana Toll Road by a group of investors including Macquarie Atlas Roads, created by the Macquarie Infrastructure Group, an Australian firm.

As states take a keener interest in public-private partnerships to pay for infrastructure, “the first major one in the country that I remember was the Indiana Toll road and, as I sit here today, I still do not have answers” on the benefits and costs of that deal, Capuano, D-Mass., said during the discussion.

“It’s a relatively straight-up project, it’s not like a water project that might be complicated, it’s not unique” and yet, he complained, there’s not enough data on the cost of the project.

“I need to be able to compare how many cars and how much toll money was being generated before it was sold, and how many cars and how much toll money now. Kind of simple. And we [the Transportation and Infrastructure Committee] haven’t gotten them.”

“If the cars aren’t there [on the toll road], where did they go? And if they’re going on to another road, is that road now need more infrastructure upgrades? Does that other road now have time constraints, now people are being backed up? What about its impact on the rest of our infrastructure? I don’t know the answer,” he said after the event.

Karl Kuchel, chief operating officer of Macquarie Infrastructure Partners in New York, did give the committee members some insights at the roundtable event Monday.

The traffic numbers for the Indiana toll road “are below the projections that were used for the original transaction” in 2006, Kuchel said.

When the Indiana Toll Road transaction was financed, private investors made a $3.8 billion payment to the state of Indiana. Traffic “has not performed to the level of our expectations — no surprise given the economic conditions from when the transaction was completed in 2006 to today.”

But he said, “None of that downside reverts to the public sector. That [loss] goes to equity in the first instance and then to the lenders. So it’s a private-sector risk at the time the transaction was financed. A view was taken on traffic. The present value of that was paid over [to the state] in the purchase price — and the equity and debt holders have to live with that.”

He said the Brisbane, Australia, tunnel example cited to the committee by Columbia University urban planning Professor Elliot Sclar as a case of another private infrastructure investment gone awry was in the same category. It was financed with private money, the project was delivered “and then traffic did not meet projections. From the public-sector perspective, if you wanted to be glib, you would actually say that they [the public] received a piece of infrastructure at well below the cost of its procurement. Because the private sector took the risk on traffic, financed 100 percent of it, and as it turns out, the traffic is not sufficient to justify the return.”

He added, “This is what risk is – and the private sector tries to price it.”

Despite some disappointments, there are still reasons to do private-public partnerships, Kuchel suggested.

He argued that “competition is a powerful driver of efficiency in these transactions. As somebody who invests private capital, PPP transactions can take sometimes years and millions of dollars just to submit a bid. You want to know as you’re going through that process, what the parameters are … and you want know that you will be competitive and hopefully successful. That drives you constantly to be looking at ways in which you can deliver the project more efficiently” – and the cost savings hopefully can be paid through to the taxpayers.

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