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Follow TURFFeeding Frenzy: Texas House makes a mockery of TxDOT Sunset Review
Friday, the Texas House passed the Texas Department of Transportation (TxDOT) Sunset Bill, substituting the House language for the Senate bill, SB 1420. The biggest news is that this bill will revive parts of Trans Texas Corridor TTC-69/I-69 and that the House made virtually no change to the way TxDOT is governed -- a status quo five member appointed commission, after a long string of scathing reviews and audits. The only change was allowing the Lt. Governor to appoint one and the Governor to choose one from a list provided by the Speaker. Even the addition of the Inspector General was watered down from he/she ‘shall’ report suspected illegal activity to law enforcement to ‘may.’
Despite the author’s insistence that in no way does the bill revive the Trans Texas Corridor, the House indeed adopted multiple amendments that would allow portions of the Trans Texas Corridor TTC-69/I-69 project, now referred to as the innocuous I-69, to be built as a foreign-owned toll road controlled by private developers.
Trans Texas Corridor sneaks by without the name
Of course, politicians claim it's not (the Trans Texas Corridor). They know how radioactive those words are. They think we are too stupid to connect the dots. The proposed Trans Texas Corridor TTC-69/I-69 route (see map) shows several of the projects the House adopted that would sell-off Texas roads to foreign toll operators are indeed Trans Texas Corridor projects.
One of the primary issues 28,000 Texans objected to on TTC-69 was the fact it would sell our public roads to a private, foreign corporation, which involves eminent domain for private gain, a loss control over public infrastructure, non-compete agreements, higher toll rates, profit guarantees, public subsidies, etc. So while the footprint may not be 1,200 feet wide and the authority not derived from Transportation Code Chapter 227 (but Chapters 370 and 223 instead), the authority for these Trans Texas Corridor projects have been granted in this bill. It's being done segment by segment as TxDOT announced it would pursue.
"Major corridor projects will now be comprised of several small segments closer to 600 feet wide and will no longer be called the Trans-Texas Corridor. Instead, the department will use the highway numbers originally associated with each segment, such as I-69, SH 130 and Loop 9." (Source: http://www.kbtx.com/home/headlines/37149004.html).
A Spanish company, ACS (who partnered with Zachry), already bid on some of these same segments in the Valley under a prior proposed public private partnership (or PPP called CDAs in Texas) which expired in October of last year (see press release here). ACS/Dragados states the: “The I-69/TTC (Trans Texas Corridor) will connect the Mexican border with the Gulf of Mexico coastline, Houston and major industrial and logistics centres in Texas with the north of the country.” So many of the projects in the list of CDAs make these logistics and port connections.
Selling Texas to special interests
I knew they were going to sell-out Texas when they adopted Alonzo’s amendment right out the gate that allows TxDOT to hire an ‘emerging fund’ manager. So we’re firing teachers over our state’s fiscal crisis, but hiring ‘emerging fund managers’ that specialize in juggling multi-leveraged debt, high finance accounting tricks, and private equity deals that sell our Texas roads to foreign companies. Those are the priorities of the Texas House.
These fund managers are the very same people responsible for the subprime mortgage crisis and the financial meltdown in Greece. The GOP dominated Legislature has become a wholly-owned subsidiary of special interests, not the people’s representatives and guardians of the public interest.
Over 100 amendments got tacked onto what is supposed to be a TxDOT reform bill. Based on its actions Friday, the priority of this Legislature is not fixing an agency run amok, but rather handing Texas’ roads to private, foreign corporations using concession CDAs that will greatly increase taxes on driving. Even worse, it places the power to tax in the hands of private corporations that taxpayers cannot hold accountable. With toll rates of 75 cents a mile, it’s like adding $15 to every gallon of gas you buy.
Rep. Larry Phillips’ HB 2255, was adopted in amendment form and became the primary amendment that lumped all the CDAs into one place to privatize and toll what began as 11 different Texas highways from DFW to the Valley, but then legislators engaged in a feeding frenzy and starting adding project after project once they saw Phillips had the votes.
House ‘made a mockery’ of TxDOT review
It was like watching kids in a candy store, giddy to sell-off Texas to the highest bidder and get to be the next one to do it. The Texas House made a mockery of TxDOT sunset review process. What they did was a disgrace and makes me ashamed to be a Texan.
Andy Hogue of the Lone Star Report reported: “...it became a free-for-all, as legislators lined up to add their own projects to the list of approved CDAs. Five were approved, before Rep. Lois Kolkhorst asked if her colleagues were ‘adding all the highways in Texas’ to the list.”
Rep. Yvonne Davis attempted to sober-up her colleagues at the end saying she was ‘embarrassed,’ and that the way they had conducted themselves was not ‘honorable.’ She chided them that they were misleading the public as to what they were really doing. Davis tacked on an amendment to ensure none of the CDAs could be done with authority from the Trans Texas Corridor chapter of the Transportation Code (Chapter 227), though any CDA authority will lead to essentially the same outcome.
Phillips’ Amendment #90 eventually lumped in George Lavender, Eddie Lucio III’s, and amendments that will revive segments of the Trans Texas Corridor TTC-69/I-69 in East Texas and down in the Valley, bringing the grand total to 20 projects before the pandemonium came to an end. The vote to adopt CDAs was 109-27 (1 present not voting, 13 absent). Authors of the other CDA amendments whether stand alone or under Phillips’ amendment #90 were: Allen Fletcher, Mike Hamilton, Linda Harper-Brown, Tan Parker, and Randy Weber.
“This is a tax bill,” said Kolkhorst in Friday’s Quorum Report. “When you put CDAs on there, it is a tax bill, there’s no doubt about it. All those people who voted against fees? This is a fee bill.”
Kolkhorst remained a stalwart against PPPs and led the fight against them on the floor. She won a round, 69 Nays to 65 Ayes, to shoot down design-build CDA authority for Regional Mobility Authorities (contracts that also eliminate competitive bidding like concession CDAs, but stop short of giving the private entities a leasehold and the right to collect tolls), only to have Phillips, author of HB 2574 that he made into Amendment #67 to the sunset bill, take it up for reconsideration and got it attached (by a vote of 109 to 36) the second try after significant lobbying of urban legislators on the floor.
This is what makes voters’ stomachs turn - when the bad guys don’t like the result of the vote, they just keep bringing it to a vote until they win.
House members embrace revolving DEBT BOMB
At least two other major pieces of controversial legislation were adopted in the sunset bill, one by Phillips which is his bill HB 3218 that involves the State Infrastructure Bank (SIB) and multi-leveraging of taxpayer money being loaned to subsidize both public and private toll roads for which the taxpayer will pay back their own money with interest through tolls. It also allows the SIB to guarantee the toxic debt that private bond investors won’t touch -- in the same way Fannie Mae and Freddie Mac gave home loans to those who didn’t have the ability to pay it back.
The other was HB 2802 by Rep. Joe Pickett that establishes a ‘revolving fund’ using Texas Mobility Fund, Prop 12 and Prop 14 revenues, most of which is borrowed money, and would involve using borrowed money to pay-off and secure more borrowed money. The bill analysis for the revolving fund said it seeks to “mitigate certain project financial risks” and loan money to toll entities who are having trouble securing financing at a reasonable rate. That’s code for private muni bond and toll revenue bond investors aren’t willing to risk their capital on loser toll projects so lawmakers want to risk the taxpayers money to subsidize the toxic debt for toll projects that have no business being built as toll projects.
Mark my words, this will come back to bite us. Politicians are playing games of high finance with other people’s money and we know from experience who loses in the deal...the taxpayers. They’ll be coming to us with draconian tax hikes or asking for an infrastructure bailout or both. It’s not a matter of if, but when.
Sends wrong signal to a rogue agency
The Sunset Committee Advisory Report said: “The Sunset review of the Texas Department of Transportation (TxDOT) occurred against a backdrop of distrust and frustration with the Department and the demand for more transparency, accountability, and responsiveness. Many expressed concerns that TxDOT was “out of control”...Sunset staff found that this atmosphere of distrust permeated most of TxDOT’s actions and determined that it could not be an effective state transportation agency if trust and confidence were not restored. Significant changes are needed to begin this restoration; tweaking the status quo is simply not enough.”
This coupled with a scathing 628 page management audit that revealed deep-seated, structural problems in every department division with TxDOT, it’s inexplicable that our legislators are essentially giving this agency a free pass to keep putting the screws to the taxpayers with their unpopular privatized toll road network that are rife with eminent domain abuse and a loss of sovereignty over Texas infrastructure that will cost Texans dearly to move about this state.
The abuse of property rights, the punitive level of taxation, the reckless disregard for the public interest just to get a road built, and the special interest giveaways are simply staggering.
God help Texas if this bill becomes law.
TURF is urging Texans to contact their state lawmakers at (512) 463-4630 to remove CDAs and these controversial debt/loan provisions from the bill and to focus on fixing the highway department.
Complete list of Texas roads eligible to be sold off to private corporations:
(1) State Highway 99 (Grand Parkway) project (loop around Houston);
(2) the Interstate Highway 35E managed lanes project in Dallas and Denton Counties from Interstate Highway 635 to U.S. Highway 380;
(3) North Tarrant Express project in Tarrant and Dallas Counties - State Highway 183 from State Highway 121 to State Highway 161 (Segment 2E);
(4, 5, 6) North Tarrant Express project in Tarrant and Dallas Counties - Interstate Highway 35W from Interstate Highway 30 to State Highway 114 (Segments 3A, 3B, and 3C);
(7) North Tarrant Express project in Tarrant and Dallas Counties - Interstate Highway 820 from State Highway 183 North to south of Randol Mill Road (Segment 4);
(8) State Highway 183 managed lanes project in Dallas County from State Highway 161 to Interstate Highway 35E;
(9) State Highway 249 project in Harris and Montgomery Counties from Spring Cypress Road to Farm-to-Market Road 1774
(10) Loop 1 (MoPac Improvement) project from Farm-to-Market Road 734 to Cesar Chavez Street;
These projects were added in the feeding frenzy
(11) Highway 288 project in Brazoria & Harris Counties (this coupled with TTC-69/I-69 projects means many connections to our ports and major logistics centers in the Valley and around Houston will be controlled by private, foreign companies, not Texans)
(12) Managed lane improvements to the Grayson County Tollway project, an extension of the Dallas North Tollway in Grayson County
(THIS ONE IS A DUPLICATION OF #10 above) Loop 1 (MoPac Improvement) project from Farm-to-Market Road 734 to Cesar Chavez Street
(13) the U.S. 183 (Bergstrom Expressway) project from Springdale Road to Patton Avenue.
(14) Managed lane improvements to the U.S. Highway 290 Hempstead managed lanes project in Harris County from Interstate Highway 610 to State Highway 99
Trans Texas Corridor TTC-69/I-69 Projects
(15) Outer Parkway Project from U.S. Highway 77/83 to Farm-to-Market Road 1847;
(16) the South Padre Island Second Access Causeway Project from State Highway 100 to Park Road 100; or
(17) a project identified as part of the Hidalgo County Loop System or the La Joya Bypass project.
TTC-69/I-69 Projects added in feeding frenzy
(18) State Highway 550 from U.S. Highway 77/83 to State Highway 48.
(19) The Interstate Highway 69 project in Bowie County from the Sulphur River Bridge to Interstate Highway 30 (see the north-east end of the TTC-69/I-69 map - This uses very vague language, presumably because it will convert parts of the existing right of way of Hwy 59 into TTC-69/I-69 and make it a foreign-owned toll road without saying so. Hwy 59 is the new identified route for TTC-69/I-69 in northeast Texas)
(20) Managed lane improvements to the Interstate Highway 69 project from Interstate Highway 10 to the Tyler County line (northward logistics connection from SH 69 in Beaumont east of the Port of Houston to Tyler County which eventually connects up to Hwy 59 near Lukfin, which is slated to be upgraded to I-69)