Texas for Sale: Texas roads may be handed to private, foreign toll operators

FINAL vote on SB 1730 includes I-35, Hwy 183, Hwy 290, Loop 1604 & more!  

(Austin, TX, April 30, 2013) - A crucial vote that will effect the next three generations of Texans is up for a final vote in the Texas House today - SB 1730. The bill would authorize the Texas Department of Transportation (TxDOT) or toll entities to enter into Public Private Partnerships (P3 or PPP) known as Comprehensive Development Agreements (CDAs) in Texas, for more than 20 projects, including commuter rail.
Projects included in the bill:
-I-35 (many segments), I-820, Hwy 183, US 67, Hwy 114, Loop 12, Loop 9 (in DFW)
-Hwy 290, SH 99/Grand Pkwy, Hwy 288 (in Houston)
-Hwy 183, MoPac (in Austin)
-Loop 1604 (in San Antonio)
-Loop 375 & NE Pkwy (in El Paso)
-Loop 49 (in Tyler)
-Hidalgo County Loop, Outer Pkwy Project, Int'l Bridge Project, & COMMUTER RAIL PROJECTS (in Hidalgo & Cameron counties)
-South Padre Island Second Access Causeway Project (in South Padre)
-Hwy 181 Harbor Bridge Project (in Corpus Christi)

The Texas Conservative Coalition sent out a bulletin in support of SB 1730. However, TURF, Texas tea parties, the Texas Libertarian Party, and dozens more watchdog & liberty groups, find nothing 'conservative' about P3s and vehemently oppose such sweetheart deals and corporate welfare. Indeed, conservative columnist Michelle Malkin calls P3s corporate welfare' & Rachel Alexander calls them 'double taxation' and state sanctioned-monopolies.


* Extract exorbitantly high toll rates as high as 75 cents per mile (see details on CDAs for LBJ, North Tarrant Express on p. 2 here)
* Grant private, even foreign, entities state-sanctioned MONOPOLIES for 50 years
* Represent eminent domain for private gain (take land in name of 'public use,' then becomes private purpose for private gain)
* Limit expansion of free roads (guarantees congestion on the free routes) through non-competes
* Manipulate speed limits to drive more traffic to the toll road (increase speed on tollway, decrease on free route)
 Example -
    The CDA for SH 130 gave financial incentives to TxDOT for raising the speed limits.
    TxDOT received a $100 million pay-off from Cintra (2012) for raising the speed to 85 MPH.
    TxDOT subsequently lowered the speed limit on the free alternative US 183 in Lockhart.

* Put taxpayers on the hook for 'uncollectable tolls' from out-of-state & foreign drivers
* Keep traffic forecasts & revenue studies SECRET from the public (Transp Code Sec. 366. 403)
* Allow private corporations the power to tax
* Eliminate low-bid, competitive bidding, replaces with 'best-value' bidding, allows P3s to be doled out to the well-connected = CRONY CAPITALISM!
* Heist PUBLIC money for PRIVATE profits. Use massive amounts of public money (gas tax, PABs) & public debt (federal TIFIA loans, potentially the State Infrastructure Bank) to subsidize/prop-up toll projects that can't pay for themselves (see examples on p. 2 here).  
* Hand control of our PUBLIC infrastructure to a PRIVATE entity. Proponents argue the STATE still TECHNICALLY owns the road, however, giving a single corporation a monopoly for 50 yrs. who has the ability to depreciate the 'asset' on its taxes is, in reality, giving the entity effective ownership of our PUBLIC roads for a HALF CENTURY!

Will lawmakers be fooled by the difference between a Design-Build and a concession CDA?
Proponents are trying to lull fellow House members into voting for SB 1730 by saying it may not be a concession CDA (that hands our highways to private toll operators), but could be a design-build CDA done by a public entity (and even non-toll). So therefore 'give us the authority' and TxDOT will decide later who gains control of our public roads and whether they're tolled or not.

A design-build CDA is a truncated concession CDA. A full blown concession CDA includes design-build-finance-operate-maintain (and a 50-yr leasehold/ownership stake), whereas design-build stops short of handing operations over to a private entity. Design-build CDAs are fraught with potential abuses as well (not competitively bid, can be handed to the well-connected, no apples-to-apples bid comparison or final design to compare against, and payments to losing bidders, etc.).

Regardless of the type of CDA, the bill does not separate design-build authority from concession authority - if lawmakers pull the trigger, it could be either. So a 'YES' vote means Texas roads could be handed to PRIVATE, even foreign entities for a HALF CENTURY with no further oversight from the legislature or PEOPLE of Texas.

What Texans think
"The bill doesn't differentiate between the types of CDAs being authorized -- whether tolled or non-toll. So while it's clever to say the toll element is 'optional,' whether or not Hwy 290, Hwy 183, I-35, Hwy 288, Hwy 114, Loop 9, Loop 12, or Loop 1604 (to name a few) get handed to a private toll operator will be decided later by un-elected boards & TxDOT, not the PEOPLE. Bottom line is TxDOT would NOT be able to hand these roads to Cintra or another private entity unless this bill passes.

"The PEOPLE of Texas haven't changed their minds since the Trans Texas Corridor or the CDA moratorium in 2007 - they do NOT want Texas sovereignty over our PUBLIC infrastructure handed to PRIVATE corporations who can GOUGE taxpayers for 50 years," Terri Hall, Founder/Director of Texas TURF, warns.

P3s are the financing method behind the Trans Texas Corridor and the primary mechanism keeping aspects of it alive today. Texans went radioactive at the notion of having private land handed to private, even foreign, corporations for private gain, rather than a public use, and the idea that a private company could dictate what roads get built (non-compete agreements) and how high the tolls would be.

P3s differ from a completely private road/project and differ from the government simply contracting work out to the private sector since a P3 involves an ownership stake or a long-term leasehold. While claiming to be built with private money and transferring the risk from the public sector to the private sector, this controversial financing mechanism virtually always involves PUBLIC money and public RISK through profit guarantees and taxpayers being on the hook for potential losses.