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.

TxDOT approves $97 million for El Paso street car

Link to article here.

When TxDOT wastes our road money on silliness like street cars that don't solve (and actually cause) traffic problems, they're never going to win back the public trust or get their cooperation to give them more money. Street cars were removed for safety concerns and the fixed track became obsolete and replaced by more nimble and flexible buses. It's lunacy to install them again and waste taxpayer money on such nonsense when this same agency is whining for more money & claiming we can't get our roads widened without paying expensive tolls.

Funding approved for Downtown streetcar line
Work could begin on $97M project this summer
By Robert Gray
El Paso Inc.
June 29, 2014

A $97-million project to restore streetcar service to Downtown El Paso has received state funding and construction could start as soon as August.

Sometimes called trolleys, the streetcars were a part of life and work in El Paso until the early 1970s.

Returning streetcar service to Downtown has been a dream of many for a long time, but the project had been stymied for years because there had been no funding.

Cintra grabs I-77 public private partnership in NC

Link to article here.

I-77 tolls could be $9 to $11, study says
By the Charlotte Observer
Monday, June 23, 2014

A Mooresville-to-Charlotte round trip on planned Interstate 77 toll lanes is projected to cost $9 during the morning rush hour and at least $11 in the afternoon, according to state documents obtained by a Lake Norman area citizens group.

Widen I-77, which opposes tolls on N.C. interstates, obtained the documents through a Freedom of Information Act request.

The documents predict that Mooresville-to-Charlotte tolls will jump to at least $20 one way by 2035, according to the group.

Local leaders question toll plans on US 75

Link to article here.

State, county leaders question proposed toll lanes along U.S. 75
By JULIETA CHIQUILLO
Dallas Morning News
July 2, 2014

RICHARDSON — Several Collin County and state officials voiced concerns Tuesday about TxDOT’s plans to turn HOV lanes into toll lanes along a section of U.S. Highway 75.

The elected officials were among more than 120 people at the Richardson Civic Center for a public meeting about the proposal.

Under a plan unveiled last month, single-occupancy vehicles would be allowed to use the managed HOV lanes by paying a toll. Car poolers would have to register to use the lanes for free. The plan involves a stretch of U.S. 75 beginning near LBJ Freeway and ending in Allen.

Obama highway plan called 'crazy'

Link to article here.

OBAMA: My Highway Plan Is 'Not Crazy, It's Not Socialism, It's Not The Imperial Presidency'
By Brett LoGiurato
Business Insider
July 1, 2014

A rather exasperated President Barack Obama pressed Congress to find a solution to the looming Highway Trust Fund crisis, arguing "it's not socialism" to want to build new highways and bridges in the country.

"It's not crazy. It's not socialism. It's not the imperial presidency," Obama said Tuesday afternoon during a speech in front of the Georgetown waterfront with the Key Bridge in the background. "We're just building roads and bridges, like we have for the past 50 years."

Toll Roads, State Gas Tax Hike Discussed by Legislature

Link to article here.

It's important to note that Donna Campbell campaigned on an anti-toll platform. Now she's calling for toll roads to be part of the mix in conflict with her own party's gubernatorial candidate Greg Abbott who promises to fix Texas roads without raising taxes, fees, or tolls.

Toll Roads, State Gas Tax Hike Discussed by Legislature
By Jim Forsyth
June 24, 2014

Lawmakers now say it will take between $4 billion and $5 billion a year to simply maintain the state’s crumbling road system, and state lawmakers are considering the possibility of a hike in the gas tax, 1200 WOAI’s Chris Fox reports.

Calls to reform federal transportation spending before tax hikes

Link to article here.

Here’s a Crazy Idea: What About Reforming Transportation Spending Instead of Hiking Taxes?
By Emily Goff, Heritage Foundation
June 26, 2014
Daily Signal

Americans know the drill. When Congress faces a gap between its spending wants and available money, it is quick to ask for more money, instead of fixing the spending side of the budget ledger.
This time it’s Senate Finance Committee chairman Ron Wyden, D-Ore., who has proposed a rag tag group of revenue provisions, including hiking taxes on heavy vehicle use, aimed at filling a hole in Washington’s Highway Trust Fund (HTF). Federal gas and diesel taxes deposited in to the HTF go to pay for road, bridge, transit, and other surface transportation projects in the states.
Yup, you got it: Wyden’s focusing on new ways to collect money – without even mentioning spending reforms.

Conservatives on the committee rightly grumbled at its total lack of spending cuts, and now the committee is going back to the drawing board to try and find more palatable reforms all around.
Wyden isn’t alone: Others in Congress have called for gas tax hikes or bailing out the fund with postal reform revenue. But few have proposed reforming spending out of the HTF. In other words, lawmakers by and large aren’t interested in, changing which programs are eligible for the federal gas and diesel taxes deposited into the HTF.

Lawmakers on collision course with taxpayers on transportation

Link to article here.

Lawmakers on collision course with taxpayers on transportation
By Terri Hall
Examiner.com

It’s been quite a week for transportation in Texas. Senate Transportation Committee Chair Robert Nichols held two interim hearings on highway funding. The first was a lovefest over public private partnerships (P3s) that hand public roads to private corporations who extract extremely high toll rates. The committee, which barely gained a quorum, heard invited testimony from the Texas Transportation Institute (TTI) and three toll authorities about various P3 projects that are advancing. You would think P3s are the greatest thing since cars were invented. The second was a hearing on the state of transportation funding in Texas, the same song as the House Transportation Committee hearing a few weeks ago about the fiscal cliff coming in 2015.

Cintra teetering on edge of bankruptcy on SH 130

Link to article here.

Cintra teetering on edge of bankruptcy on SH 130
By Terri Hall
Examiner.com

It’s hard to resist the temptation to say I told you so. Moody’s reports SH 130 private toll operator Cintra is scrambling to avoid default on the first public private partnership (P3) in the state of Texas. The Spain-based company in partnership with Zachry American Infrastructure is seeking to restructure its over $1 billion in debt and delay its June payment or face default. In less than two years in operation, the southern 41-mile stretch which opened in October 2012 with much fanfare and boasting by Governor Rick Perry now faces bankruptcy.

Abbott has signed off on contracts for big campaign donor

Link to DMN story here.

Wendy Davis is under investigation by the FBI for conflicts of interest with her private law firm representing the North Texas Tollway Authority while also a member of the Transportation Committee that oversees NTTA legislation,  so this appears to be written from a press release by the Davis campaign to deflect her own troubles to try to make Greg Abbott appear to be involved in shady dealings approving a NTTA contract that benefited a campaign donor.

However, by law the AG has to review and sign-off on such contracts, and it’s important to note his office does not determine who gets the contracts, the state agencies who submit them to his office choose the contractors. So there’s no way those campaign contributions could have influenced Abbott’s office. State agencies put out the contracts to bid and select the contractors, so they serve as a third party buffer between the AG and the contractor in this case. We’re no fans of Linebarger and its corrupt practices of trying to buy influence, but in this case, the story seems like an attempt to smear when there’s no real money trail of undue influence to the AG here.

Abbott has signed off on contracts for big campaign
By CHRISTY HOPPE
Austin Bureau
Dallas Morning News
June 16, 2014

AUSTIN — The attorney general’s office under Greg Abbott has approved more than $3 million in state contracts for a law firm that has been a generous political contributor — providing $200,000 to Abbott’s campaigns in the past 12 years.

Subcategories

Eminent Domain

Video

Page 18 of 103

Latest News

Latest Press Releases