05.30.08

TxDOT Message Targeted At Legislature

Posted in Around The State, Commentary, Privatization, Road Issues, Uncategorized at 4:32 pm by wcnews

Yesterday’s first Texas Transportation Commission meeting with Gov. Perry’s new hire, Deirdre Delisi, at the helm doesn’t appear to have changed much of anything. There are some signs though of how those opposed to the Trans-Texas Corridor and corporate/for profit toll roads, have effected this debate. Although nothing really new or earth shattering happened yesterday, TxDOT has finally acknowledged some of its problems by addressing certain issues. The issues of foreign ownership, “non compete” clauses, and property rights which have been some of their obstacles. They acknowledged but did not alter much.

But yesterday’s meeting also shows there’s still a long way to go. At the meeting TxDOT basically adopted what the legislature did last session. More than likely that’s just a nod to some in the legislature (DMN) from Delisi, giving legislators enough political cover to vote for her confirmation in January.

The set of guiding principles, as TxDOT called the minute order approved at its Thursday commission meeting, deals with some of the most controversial aspects of private toll road contracts, but in many cases reflects limits already imposed by the Legislature.

No deal will give private companies, for instance, the right to own a road they build, nor will any private firm have the right to set toll rates, the minute order says. Those rates will continue to be set by TxDOT and local planning entities like the North Central Texas Council of Governments’ Regional Transportation Council.

Here are the specifics from TxDOT:

The Commission reaffirmed its commitment to meet or exceed the requirements of state law on five key issues:

• All state highway facilities, including the Trans-Texas Corridor, will be completely owned by the State of Texas at all times.
• All Comprehensive Development Agreements will include provisions that allow TxDOT to purchase or “buy back” the interest of a private developer in a CDA at any time if buying back the project would be in the best financial interest of the state.
• The Texas Transportation Commission shall approve, in a public meeting, the initial toll rates charged for the use of a toll project on the state highway system and the methodology for increasing the amount of tolls. All rate-setting actions will come after consultation with appropriate local metropolitan planning organizations.
• Only new lanes added to an existing highway will be tolled, and there will be no reduction in the number of non-tolled lanes that exist today.
• Comprehensive development agreements will not include “non-compete” clauses that would prohibit improvements to existing roadways. The Department and any governmental entity can construct, reconstruct, expand, rehabilitate or maintain any roadway that is near or intersects with any roadway under the CDA.

In recognition of the Texas Legislature’s commitment to protecting landowners’ property rights and in following the department’s long-standing practice with other transportation projects, the commission affirmed two additional principles:

• TxDOT will always consider the use of existing right of way that satisfies the purpose and need of the project as a possible project location when conducting environmental studies.
• To the extent practical, TxDOT shall plan and design facilities so that a landowner’s property is not severed into two or more separate tracts and the original shape of the property is preserved.

It all sounds good, makes nice sound bites, and will probably bring about some good coverage from the traditional media. But in reality doesn’t change anything. Terri Hall and David Stall’s comments (HChron) on yesterdays meeting make clear how far there still is to go in this fight.

Opponents remained skeptical. Terri Hall, director of Texans Uniting for Reform and Freedom said that if TxDOT expands or builds a competing road, the toll contractor could require compensation from taxpayers for any resulting loss in toll revenue.

David Stall, who operates the CorridorWatch.org with his wife, Linda, said the state had always intended to own the toll roads that it leased to private operators.

The new rules also call for only new lanes to be tolled, but Stall said that if TxDOT continues to rely on toll financing for new projects, it means “that they are not intending to expand existing free highways beyond the current expansion plans.”

Continuing to rely on tolls only to finance roads is unacceptable, and wasn’t addressed. There never was an “ownership” issue, it was about ceding the control of the toll roads for 50 plus years. And that still appears to be allowed. Regarding the issue of who sets toll rates it would be much better to have those directly elected by the people doing that. I’m not sure how comfortable any Texan is to have the toll rates being set by insulated unelected/appointed cronies of TxDOT or their local MPO/RMA. Especially in light of TxDOT’s recent financial management problems. And the “buy back” provision has holes in it too (DMN).

But Thursday’s minute order does little to truly bind TxDOT in its future dealings. For instance, the policy states that every private toll road contract will in the future contain a clause permitting the state to take over a toll road at any time, should it ever decide doing so was in the public interest. But it’s not the existence of such a term that matters most to critics of the department, because it will be the terms of the buyback that will determine whether it’s a good deal for taxpayers or not.

With all of this stuff the devil is in the details. The most publicized issue prior to this meeting was the ending of so-called “non competes” in CDA agreements.

Non-compete clauses for tollways would be a non-starter under a policy the Texas Transportation Commission will consider Thursday.

Such language in toll road contracts, which generally prohibit a toll road owner (such as the Texas Department of Transportation) from building or expanding a nearby free road, or require compensation for doing so, have been controversial in Texas and elsewhere. TxDOT’s contract with Cintra-Zachry, a Spanish and American consortium that will build and operate a southern section of Texas 130, requires TxDOT to pay up if it makes certain highway improvements within 10 miles of the road.

While TxDOT did disallow “non compete” clauses that would stop construction and improvement of existing roads, there is not mention of disallowing compensation for lost revenue as Hall pointed out.

It shouldn’t surprise anyone that yesterday’s meeting was not targeted at, and didn’t change anything, regarding the real transportation issues facing Texans. Texans were not the target audience. The message from yesterdays meeting was targeted directly at the legislature in an attempt by the new regime at TxDOT to show they’re willing to play nice, for now. Pay special attention to the legislators reactions to this, especially those that were critical of Delisi. Whether the target was hit or not well….we’ll have to wait until January.

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