12.14.06
Nutty As Fruitcake? More Like Crooked As A Dog’s Hind Leg!
The Texas Observer on the toll road scams in Texas, The Highwaymen. It’s a long article and all of it’s worth reading. Here’s a little excerpt:
Yet even the (TxDOT chairman Ric Williamson) is perplexed by some details of the new public-private partnerships being forged to build thousands of miles of roads quickly. During a break in a recent commission meeting, Williamson shook his head in befuddlement when asked why the state has begun paying millions of dollars in “stipends†(pdf) to companies because they weren’t picked to build some of the toll roads.
The notion of paying the losers, Williamson agreed, is “nutty as a fruitcake.†But the department is bound by law to do it, he said, a law Williamson suggested might be a holdover from the era of big government.
Actually, million-dollar parting gifts for the losers is a more recent Texas custom, courtesy of the huge 2003 transportation bill sponsored by Mike Krusee, a Republican state representative from Round Rock and chairman of the House Transportation Committee.
Already, TXDOT has paid roughly $4.3 million to companies whose proposals to spearhead two different road projects were rejected, according to documents obtained by The Texas Observer under the state’s Public Records Act. As much as $10 million more will be doled out in the coming months.
The payments, sometimes called “work-product stipends,†or “consolation stipends,†are needed to encourage competition and innovation, TXDOT officials say. But agency records give no indication that the stipends are actually encouraging more companies to compete for the jobs.
Instead, records show the same small pool of companies, sometimes in different configurations and under different partnership names, vying for the contracts. Sometimes they’re winners. Sometimes they’re losers. Either way, they walk away with a hefty bundle of cash.
The millions in stipend payments are small change compared with the billions that will be spent on toll roads, multimodal corridors, rail lines, bridges, and port expansions in the coming years. Perry’s signature project, the Trans-Texas Corridor—really a series of superhighways crisscrossing the state—could cost more than $36 billion, by one company’s estimate. That’s greater than the entire annual budgets of some countries.
[…]
The effort to privatize infrastructure dovetails nicely with the agenda of public officials who want to build new roads and repair old ones without increasing taxes. “What we’re seeing,†says Pat Choate, an economist, author, and Ross Perot’s vice presidential running mate in 1996, “is an era in which governments will be selling off their infrastructure to keep their no-tax pledges.â€
Hat tip to Sal Costello who has more excerpts if you don’t want to read the whole thing.