Big rigs still drive on I-35, can’t afford toll road


Link to article here.

The SH 130 toll road is the poster child for FAILED toll road policy in Texas. Taxpayers were sold the SH 130 toll road as the panacea to fix congestion on gridlocked I-35 through Austin. Politicians and planners said it would draw trucks off of I-35 and over to the toll road. As the article below demonstrates, it hasn't worked. Truckers can't afford the toll road any more than motorists can. In fact, the SH 130 toll road is SO EMPTY, a distressed airplane landed on it in the middle of what is supposed to be rush hour! If they really want to relieve I-35 traffic, they'd make SH 130 a FREE bypass route. But as the Texas Turnpike Authority spokesman says below, the government has no motivation to fix I-35 traffic since it means fewer customers for their toll road.

Big rigs still drive on I-35, despite alternative routes
by ANDREW HORANSKY / KVUE News
kvue.com
Friday, May 7

When the SH-130 toll road opened a year ago this week, it was supposed to ease congestion on Interstate 35.  It was also supposed to move cars and trucks from one end of Austin to the other more quickly.
But recent KVUE helicopter video shows a different picture.  Traffic remains congested on I-35, and SH-130 is empty.  The Texas Turnpike Authority has a theory on why.

“A lot of traffic is still coming to destinations in Austin,” said Turnpike Director Mark Tomlinson.  “And if they are, then probably I-35 is going to be the choice for a bigger percentage of that traffic.”

Though some big rig drivers told KVUE the toll road works well, they said they cannot justify the expense.  Ken Dukes says he stays on I-35 because it costs him $27 to take SH-130.

“Yeah, it’s 45 minutes to an hour and a half of my time,” he said, “but it’s not worth $27.”

Others say the saving of time is worth their money.

“Absolutely,” said William Brown, driver.  “It wouldn’t make sense for me to go through that traffic every day.”

A spokesperson for the Texas Turnpike Authority believes it will take time, as well as more congestion along I-35, before the public fully embraces the benefits of the SH 130 toll road.

That 130 project commences in 2012, when it will connect I-35 in Georgetown to I-10 in Seguin.

Express-News sold out for tolls

Bruce Davidson, author of the column below, heads the Editorial Board at the Express-News. He, and the paper (as evidenced by their coverage since they laid off the excellent, unbiased, and very fair transportation reporter Pat Driscoll), are sold out on tolls. This is one of many editorials that read like an RMA press release. Whatever RMA Chair Bill Thornton speaketh, Davidson prints as Gospel.

Whenever we've attempted to go to the Editorial Board to dialogue about the toll issue, they flatly ignore us and our concerns (as well as elected officials, attorneys, certified planners, and other experts who have joined us) and print a negative editorial in response to our "visit." After all, the paper has the establishment to please, never mind the Express-News is bleeding readers. Why? Because of columns, editorials, and stories like this one. Or perhaps it's because the RMA has paid the Express-News nearly $25,000 in government advertising.

I find the first line of this column inexplicable. How can we NOT blame the tolling authority, which is precisely what the RMA is, for tolling our existing freeways? Though there's plenty of blame to go around, including the people Davidson cites, our state lawmakers led by Rick Perry (we would add there are culprits who have approved and voted for this at EVERY level of government, local, state, and federal), it defies logic NOT to address the RMA's culpability in the toll road fight.


The RMA is a Board of UN-elected bureaucrats appointed by YOUR county commissioners, who have given them the authority to levy taxes (toll taxes) without answering directly to the taxpayers (which is taxation without representation). Their only source of revenue is tolling (and a heap of loans from the city and county and grants from TxDOT to keep them afloat until they tap the vein of your wallet with their first toll road). RMAs were created in state law for the sole purpose of tolling and off-loading the State's job to build STATE highways to local government and its taxpayers.

This notion that the RMA "doesn't care where the money comes from, they just want to fix the road" is a farce. They're a tolling authority! They exist to toll roads! Most importantly, the needed fix to 281 was already paid for with gas taxes until TxDOT made the money disappear sometime in mid-2008. So the toll agenda for 281 has NOTHING to do with lack of funds. They had the funds...it's about tapping a new revenue stream and levying a discriminatory, targeted tax on 281 users in order to fund 1604 (which they don't have the money for). The fact 281 already had the funding is one the RMA and the Express-News like to ignore so they can push toll roads, making them appear the ONLY option.
Then, the stimulus money the RMA is using to build HALF of a non-toll interchange (for the price of a WHOLE interchange) is a one time deal. We've long objected to the RMA even doing a non-toll project, especially with the pricetag they can't justify ($143 million for just the four southern ramps of the interchange when the RMA's published price to build the northern ramps in 2018 dollars is $59 million. If they can build half of the interchange for $59 million, they can surely build the whole thing NOW for $120 million! For comparison, the 410/281 interchange just built cost $155 million). What on earth are we paying our highway department to do if we now have these high paid bureaucrats at the RMA sitting around duplicating TxDOT's role and charging us $20 million in "management fees" to oversee the interchange project that TxDOT should be doing (without the added cost)? The RMA is a second-tier bureaucracy and a taxpayer rip-off from start to finish.

Here are just two timelines (here and here) to give you a flavor of how corrupt and untrustworthy this RMA is. Then here's a few other zingers. The RMA operates in secrecy and has refused to hand over the financial guts to its potential toll agreements BEFORE the contract gets signed (when the public can actually DO something to stop provisions that are not in the public interest). It hides behind a state law that allows these agencies to keep toll viability studies, the market valuation, and other key financial details SECRET from the public AND even YOUR elected officials. In fact, prior to a crucial vote on financing the 281 and 1604 toll projects at the MPO December 7, 2007, the RMA did not give MPO Board members this information prior to their vote, causing them to vote BLIND.

During the last legislative session, the RMA spent $32,000 of YOUR money to hire a lobbyist to lobby state lawmakers for toll roads and more taxing authority to levy ANY kind of tax to raid your pocketbook. The RMA also recently came out in favor of thwarting legal challenges to its unwanted toll projects by lobbying to force binding arbitration. Then, the RMA Board just voted to do all of its business BEHIND CLOSED DOORS, out of the public eye, unless they have an "actionable item" to vote on. Plus, the RMA has 8 employees whose total salaries with benefits equal more than $1 million dollars annually. All but two employees make six figures, which is totally out of balance with the median household income in San Antonio, which is $36,000/yr.

Credibility gap
As long as the 281 & 1604 projects are marked "toll" in the MPO's plans, the RMA has control of the project and a vested interest in ensuring it remains tolled even when new sources of revenue become available. The RMA is conducting its own environmental studies on both the 281 and 1604 toll projects (the fox guarding the hen house), yet to read the Express-News editorial, you'd think the RMA was a paragon of diplomacy, reaching out to its "enemies." Diplomacy? Pleez...their consultants told the community advisory groups that the RMA didn't have to listen to our feedback nor the public feedback at the hearings either. The RMA is using these "community groups" as window dressing, nothing more. After repeated attempts to sit down with the RMA and work out many issues regarding these projects, they've REFUSED to work with ANYONE who gets in the way of their toll agenda. The RMA opposed the citizens' call for a temporary superstreet fix, too, until they figured out that doing the project could boost their PR with fed-up residents and give them something to do until their first toll project brings home the bacon.

RMA Chair Bill Thornton promised on WOAI radio January 14, 2009 that they'd fix 281 non-toll if they got a new source of funds. When stimulus funds became available, the RMA STILL submitted the project as a toll project (they planned to build it with stimulus money and still charge users a toll to drive on it, a DOUBLE TAX), which is proof-positive that even when they get a new pot of money to do something non-toll, the RMA still pushes its toll agenda...regardless of the opposition to it.

Also, the FHWA also informed MPO Chairman Commissioner Tommy Adkisson that as long as a project is marked toll in the MPO plans, it will be done as a toll project. With 800 people packing an auditorium in October 2009 to tell the MPO they don't want toll roads (and only 100 got to testify with all but 7 against), and with MPO Board members & the RMA assuring the public that both toll and non-toll options are on the table for 281 and 1604, how can they have an ounce of credibility when both are marked toll projects in the MPO's TIP and when the tolling authority (RMA) is conducting the "study" of the options? How can the MPO have any credibility that non-toll options are even being studied when its attempt to find a contractor to do an independent study of non-toll options (apart from the RMA) yielded ZERO takers?

Toll roads NOT inevitable
Then, Davidson would have us accept his premise that toll roads are inevitable because lawmakers in Austin refuse to raise your taxes. First of all, tolls are taxes and they have yet to hesitate to charge commuters the MOST EXPENSIVE tax to fund roads. Second, where is Davidson's call to end the diversions to the gas tax we ALREADY PAY? Why would any thinking person ask government to raise taxes when they're misappropriating the taxes we already send them? Third, why isn't Davidson insisting San Antonio get back the money we already send to Austin and Washington that we're shorted before he advocates for higher taxes (tolls)? Lastly, ending the vehicle sales tax diversion (that's being dumped into general revenue instead of going to roads) would nearly triple our region's road money WITHOUT RAISING TAXES! But Davidson doesn't think that way. He's an extension of the government bureaucrats at the RMA.

Goes to show, one must do his/her due diligence before believing what you read in the Express-News.
________________________________________________________
Austin's aversion to tax hikes makes toll roads inevitable

By Bruce Davidson - Express-News

Web Posted: 05/13/2010

Don't blame the Alamo Regional Mobility Authority when U.S. 281 from north of Loop 1604 becomes a toll road.

RMA officials are in the midst of the lengthy Environmental Impact Statement (EIS) process. They are studying three possible approaches to dealing with the nightmarish traffic on U.S. 281.

One scenario involves overpasses at the key intersections and non-continuous frontage, as RMA spokesman Leroy Alloway described it. Another would have expressway lanes and continuous frontage road from Loop 1604 to the Bexar County line. And a third option would have elevated U.S. 281 lanes, leaving most of the existing structure in place.

RMA Chairman Bill Thornton emphasizes that while the project is listed as a toll road in Metropolitan Planning Organization plan, that status is a placeholder.

Read the rest of the story here.

______________________________________________________
Agua should drop legal threat
Express-News Editorial Board
Web Posted: 05/11/2010

The Alamo Regional Mobility Authority is engaging in some highway diplomacy. Rather than allowing plans for road construction in the U.S. 281-Loop 1604 corridor to get bogged down in challenges, the RMA is bringing potential adversaries to the table and making them part of the development process.

The RMA has created community advisory committees for both of the two major highway projects it is managing — a 7.9-mile segment of U.S. 281 north of Loop 1604 to the county line and a 37-mile stretch of Loop 1604 from Interstate 35 North to Highway 90 West.

Among the stakeholders on these committees are representatives of homeowners associations, school districts and the business and development community.

The RMA has also included groups with which it has traditionally had an adversarial relationship: the Alamo Sierra Club, Aquifer Guardians in Urban Areas, Greater Edwards Aquifer Alliance, San Antonio Toll Party and Texans Uniting for Reform and Freedom.

This diplomatic approach is a wise one. A good faith effort by members of the advisory groups can streamline the process for road construction and avoid lawsuits and political challenges that are both costly and time consuming.

Read the rest of the story here.

Toll roads not a good fit for San Antonio

NOTE: These are TURF's public comments submitted to the San Antonio MPO as feedback on its latest Transportation Improvement Program (TIP).

The people of this community have expressed time and again in every way available to them that they DO NOT want toll roads. With tourism such a major industry and economic engine for our region and the adverse impacts of a high cost of transportation on the region's economy, toll roads are not the right fit for San Antonio, nor are they sustainable. They will bury us in debt to the tune of BILLIONS with no way out (except a taxpayer bailout and draconian tax hikes). When the cost of transportation goes up, driving goes down.

Toll roads rely on ever increasing traffic volumes and more driving to pay off the debt of toll roads, which is anti-thetical to the economic reality of what occurs when the cost of driving goes up...driving goes down and so does toll usage. Also, increasing the cost of transportation through tolling makes the the cost of goods go up, which everyone pays whether they take the toll road or not. San Antonians cannot afford tolls, when a third of Bexar County doesn't make enough money to cover their basic needs for daily living. San Antonio has also been ranked by Forbes Magazine as one of the top 10 cities hardest hit by high gas prices. When tolls are like adding $4.00-$17.00 more to every gallon of gas you buy (for toll rates from 25 cents up to 75 cents per mile as we're seeing around the state), they're completely out of reach for the vast majority of San Antonians.

Based on the MPO plans, it claims a funding gap figure of $18 billion. To put it in perspective, that’s like saying they need more than $10,000 from every man, woman, and child in San Antonio in the next 25 years…that’s from every person in San Antonio, not just motorists, and that’s $40,000 from a family of 4! A study conducted by the Surface Transportation Project published in June of 2005, shows the two biggest costs for every household since 1984 are housing and transportation and account for 52% of the average family’s budget (or $21,213 a year)…the highest level in 20 years! Now compare that with the median household income in San Antonio of only about $36,000 a year and compare it with TxDOT’s claim they need $40,000 from the average family in San Antonio in the next 25 years, and you’ll see this will not only cripple the economy, it’ll tax people into bankruptcy. Their plan is unrealistic and totally unsustainable! With 57 toll projects in the MPO's plans, there will be NO ESCAPE from this new tax on driving.
Stop raiding road funds for things un-related to roads!

Add to that, San Antonio has been consistently shorted the highway funds that it sends to Austin and Washington. In addition, vehicle sales tax revenues have been dumped into general revenue instead of going to roads as the taxpayers intended. Ending this diversion of funds amounts to $2-3 billion a year (on track for $4 billion this year, this reaps more than doubling the gas tax) for roadways, and would nearly triple our region's money for roads WITHOUT RAISING TAXES! Restitution needs to be made before ANY taxpayer is asked to pay more.

As long as ANY project is marked "toll" in the MPO's TIP (and there are 57 of them), the RMA (which is the tolling authority) has control of the project and a vested interest in ensuring projects remain tolled even when new sources of revenue become available. RMA Chair Bill Thornton promised on WOAI radio January 14, 2009 that they'd fix 281 non-toll if they got a new source of funds. When stimulus funds became available, the RMA STILL submitted the project as a toll project (they planned to build it with stimulus money and still charge users a toll to drive on it, a DOUBLE TAX). The FHWA also informed MPO Chairman, Commissioner Tommy Adkisson, that as long as a project is marked toll in the MPO plans, it will be done as a toll project.

With 800 people packing an auditorium in October 2009 to tell the MPO they don't want toll roads (and only 100 got to testify with all but 7 against), and with MPO Board members assuring the public that both toll and non-toll options are on the table for 281 and 1604, how can they have an ounce of credibility when both are marked toll projects in the MPO's TIP and when the tolling authority (RMA) is conducting the "study" of the options? How can the MPO have any credibility that non-toll options are even being studied when its attempt to find a contractor to do an independent study of non-toll options yielded ZERO takers?

This demands ACTION, not words, and must be remedied.

MPO MUST remove all toll projects from its plans

The federal government requires an agency to show a reasonable source of funding for a project in order to place it in an MPO plan. The RMA can't show any of its toll roads are funded by any reasonable funding sources since toll revenue bonds won't cover 100% of the project costs and all of them need massive public subsidies. In other words, none of the toll projects in the TIP are toll viable (meaning they cannot pay for themselves with the toll revenues of projected users).

TIFIA loans can only fund up to a third of the project costs. The current federal TIFIA loan pot of money is EMPTY, and there's a cloud over the program after the first PPP toll road to receive a TIFIA loan went bankrupt a few months ago (at the hands of an Australian firm, Macquarie. (Read more here). The taxpayers aren't going to get their money back, and many in Congress are doubting the efficacy of this controversial program that has, up until now, been used as a backstop to primarily benefit private toll operators at taxpayer expense. The TIFIA program may or may not be funded in the next federal highway bill, and there's talk that the focus be shifted away from funding PPP & toll projects and directed to more mass transit and rail projects. Yet the RMA lists it as a "reasonable" source of funding for both the 281 and 1604 toll projects.

Second, TxDOT issued a letter to the MPO last fall saying the Texas Mobility Fund money ($200 million) isn't available in one chunk any longer, it's only available in $25 million chunks over 7 years (2012-2019). So how is this a "reasonable" source of revenue for the RMA's toll road when the entire sum is needed in 2012 for just 281? So with two-thirds of the 281 project revenues in doubt (TIFIA and TMF), the RMA cannot demonstrate that the 281 toll project is funded by any reasonable sources of revenue. Ditto for segments of 1604 that also rely on TMF or TIFIA funds.

The RMA also has to spend $83 million on ROW acquisition for 281 (the figure given in the last TIP), when the MPO does NOT have to come up with that sum under a non-tolled scenario (since TxDOT funds ROW out of a different pot of money apart from the MPO). This ROW cost thereby drives up the project cost that the RMA bonds have to cover.

So with the RMA Chairman admitting the toll funding is a mere "placeholder" to keep certain road projects in the MPO plans, why can't a non-toll source of funding be used as a placeholder instead and keep the plans toll-neutral, which they claim is their goal?

For instance, using the Zachry estimate for US 281 north of Loop 1604 from 2005, the cost to fix 281 as a freeway would be less than $200 million. The 2005 plan cost is $78 million for the first 3 miles (and that was the actual contract bid price, not an estimate, when construction costs were much higher). Extrapolate that for the 7.8 mile project area, and the cost is actually UNDER $200 million ($160-$170 million). So a $200 million project cost (with some flexibility to add extra overpasses where needed) is perfectly reasonable and is based on actual construction costs. No one has yet to give a single reason why this estimate isn't bonafide when Zachry's proposal had engineering and the contract had already been let (prior to clearance being yanked). Clay Smith of TxDOT stated on the record in a Technical Advisory Committee meeting last fall that the Zachry proposal is the "actual" cost, not TxDOT's estimates.

With $3 billion more in Prop 12 bonds are expected to be approved by the legislature next session (they issued only $2 billion of the $5 billion voters approved last session), and Speaker Joe Straus announcing at the NE Partnership meeting April 15 that there is near unanimous support to end at least some of the gas tax diversions, we can use some gas tax revenues with a mix of Prop 12 bonds (or even just solely Prop 12 bonds) as the "reasonable" anticipated source of revenue to fund 281 as a freeway in the TIP to keep it toll-neutral. Prop 12 is a more reasonable expected source of revenue than the RMA's pot of funds listed in the current TIP. With the current batch of Prop 12 monies netting our region about $200 million, a $3 billion issuance would net us closer to $300 million. That would more than cover a non-toll fix to 281.

The Legislature has also placed restrictions on using Prop 12 and other bonds backed by general revenue (and the majority of Texas taxpayers) for toll roads, since it's a DOUBLE TAX to build a road with general funds and charge taxpayers AGAIN (a toll tax) to use the public road.

Return to sustainable transportation policy. Restore credibility and heed the public outcry. Remove toll roads from all MPO plans.

Austin's toll revenue projections cut in HALF

Link to article here.

Note how Austin's toll revenue projections are cut by more than HALF in their long-range plan. Also of note is the acknowledgment that selling our highways to foreign companies in "concession" deals has fallen out of favor with the legislature. That's due to the grassroots' blowback over the last 4-5 years. Stay vigilant so we can keep it that way!

Regional transportation plan nears approval
CAMPO 2035 plan includes reduced road spending and much more for rail, other transit.
By Ben Wear
AMERICAN-STATESMAN STAFF

Published: 8:12 p.m. Sunday, May 9, 2010

Think of a blueprint, one written in chalk.

In the case of Central Texas' official transportation plan for the next 25 years, which a committee of local leaders probably will approve later this month, what goes into that blueprint to a great degree depends on who gets to hold the chalk. The proposed CAMPO 2035 plan is several hundred pages long with several hundred road, rail, bicycle and pedestrian projects in it that add up to $26.8 billion.

That's almost $4 billion more than the last version of the 25-year plan, approved in 2005 by the Capital Area Metropolitan Planning Organization board. But that money might not all materialize. Those numbers assume a much higher rate of Capital Metro sales tax revenue than in recent years, as well as aggressive road bonding in Williamson County.

The new plan includes a much higher percentage of rail and other transit spending than its predecessor and a sharply reduced amount for maintaining highways. In the introduction, the plan claims to embrace a new philosophy of transportation planning based on encouraging dense centers of development rather than continuing suburban sprawl willy-nilly.
But even those working on the plan say the focus on centers — not an emphasis of previous plans — will make little real-world difference. The plan is only as accurate as its assumptions about the future, they said, and making predictions about the next quarter-century is inevitably an exercise in guesswork.

"To borrow a Hemingway phrase, it's pretty to think we can plan 25 years in advance," said Hays County Commissioner Jeff Barton , a Democrat who serves on the CAMPO board. "There's value in the exercise, but we shouldn't kid ourselves."

What's in the plan matters, however, because under federal law a transportation project can't get federal dollars — almost all highway and transit projects are at least partially funded by the federal government — unless the project is in the long-range plan. But the 19-member CAMPO board, made up mostly of local elected officials from Travis, Williamson, Hays, Bastrop and Caldwell counties, can amend the plan at any time. And there will be another wholesale rewrite five years from now, five years after that, and so on.

The CAMPO board, recipient of more than 4,000 public comments submitted on the draft plan in recent months, will take one last listen in a public hearing today. The meeting will start at 6 p.m. in Ballroom B of the Austin Convention Center.

The board probably will vote on the plan May 24, officials said.

If it is approved as written in draft form — and some CAMPO members still intend to push for changes — the plan would include:

• $2 billion for more passenger rail, including $857 million for the City of Austin's proposed streetcar initiative, $467 million for a segment of a commuter line from Austin to San Antonio, $327 million for an Elgin-to-downtown Austin commuter line on Capital Metro's railroad and $149 million for expansion of the MetroRail Red Line.

Rail and bus operations account for $10.3 billion of the plan, almost double from the 2030 plan. The money for this includes an estimated $6.6 billion from Capital Metro's 1 percent sale tax, a $3 billion increase over the last plan's 25-year estimate. The plan assumes, based on numbers from Capital Metro, that the agency's sales tax revenue will increase 5.3 percent a year for the next quarter-century, more than double the average increase over the past decade.

• $10.9 billion for highway and road expansion, a 6.5 percent decrease from the 2030 plan. And the drop would be much greater but for an aggressive forecast by Williamson County — some CAMPO members from other counties say unrealistically aggressive — that it will spend $4.3 billion on new roads. The plan assumes that Williamson County voters will approve $425 million in road bonds every other year from 2011 to 2027.

Travis County Judge Sam Biscoe, chairman of the CAMPO board, said having all that money in the plan, along with dozens of projects tied to it, would give Williamson County an unfair advantage in getting federal funds in future years. Travis County, by contrast, estimates it would have $1.1 billion for new or expanded roads over the next 25 years.

"We have to increase ours, or Williamson County has to reduce theirs," Biscoe said. "I expect that to be discussed on May 24."

Williamson County Commissioner Cynthia Long, vice chairwoman of the CAMPO board, said it's a matter of need.

"What we've seen is very low tolerance among our citizens for congestion, and we are responding to that," Long said. "Rather than asking why Williamson County's number is so high, I would ask why Travis County's number is so low."

• $5 billion of state, federal and toll revenue for roads, down almost 56 percent from the $11.3 billion in the 2030 plan. That reflects the diminishing power of gas taxes to pay for new roads, a trend made worse in Texas because the state Department of Transportation in recent years has borrowed heavily against future gas tax revenue to pay for projects now completed. And the estimate of surplus toll revenue (what's available after paying debt service and operations costs) from Central Texas turnpikes is down sharply, from $3.2 billion in the past plan to $1.3 billion.

As a result, local governments would contribute a greater portion of road spending, including state highways that historically were exclusively TxDOT's province.

"That's something we're going to have to address at the state level," Barton said. "And soon."

• No spending over the next 25 years to expand the capacity of either Interstate 35 through Central Texas or Loop 360 (Capital of Texas Highway) in West Austin, two of the area's most congested highways. Joe Cantalupo , CAMPO's executive director, said that TxDOT is studying what to do about I-35 and that the plan would be amended as plans coalesce.

"We're not looking at it and saying, 'Oh, there's no problem, with 2009" Cantalupo said.

The 2030 plan envisioned making Loop 360 a toll road, with frontage roads alongside, and doing so by leasing the road to a private company. Such "concession" agreements fell out of favor with the Legislature, and new ones are no longer legal under state law. Given that and the looming cash crunch at TxDOT, Cantalupo said, Loop 360 expansion fell out of the new plan.

LaHood: If you build it, they will come

By Terri Hall
San Antonio Express News/Houston Examiner
May 6, 2010

It doesn't take long to size-up a gathering of transportation lobbyists hosted by the U.S. Secretary of Transportation, Ray LaHood, when 99% of the feedback at a supposed "town hall" ran to the mic to ask for their industry's piece of the taxpayer pie.

Scarcely a handful of taxpayer advocates dotted the invite-only crowd at the George R. Brown Convention Center in Houston May 5, and none were happy with what they heard. The purpose of the gathering was supposed to be to solicit feedback on the next federal highway bill. The last one, called SAFETEA-LU, was a disaster for taxpayers.

Remember the bridge to nowhere? How 'bout the 6,000+ earmarks for congressional pet projects that had little or no relevance to the federal highway system? What about the strings it attached to our gas taxes that hold our money hostage for "enhancements" like landscaping and free WI-FI at rest stops? Worse still, are the programs in SAFETEA-LU that use "innovative financing" to sell America's highways to foreign companies in sweetheart deals (called public private partnerships or PPPs) propped-up with low interest, taxpayer-backed loans (TIFIA loans and private activity bonds or PABs). It's public money for private profits.

But the majority of the invited speakers, as well as LaHood, advocated PPPs. During one of the panel discussions, the USDOT's Chief Financial Officer, Chris Bertram, actually had the audacity to claim the feds don't push innovative financing (what are toll credits, TIFIA loans, and PABs if not federal incentives for innovative financing?), and then proceeded to say how PPPs need to stay part of the mix. So much for a "listening session."

Bertram also attempted to defend the bankruptcy of the San Diego PPP toll road, the first to receive a federal TIFIA loan, saying it had little to do with the lack of traffic to pay for the debt, and was a result of contractors arguing over cost of the road. The tollway had been open to traffic for over two years, and he claims the bankruptcy is due to quibbling over construction costs? When the projected traffic volume was off by nearly 40,000 vehicles per day, it's beyond disingenuous to blame the default on anything other than flawed traffic projections!

Tolling existing interstates rises again

Another panelist advocated the new highway bill lift the ban on tolling existing interstates. This is what un-elected bureaucrats are doing on the taxpayers' dime...listening to high-powered lobbyists find every way under sunshine to not only make taxpayers pay dearly for roads, but also to make them pay TWICE!

"Houstonians are willing to pay to get out of congestion," noted Congresswoman Sheila Jackson Lee in her remarks. I'll say, whether they like it or not, too. The new toll lanes, called "managed lanes," on I-10 are 100% paid for with gas taxes and should have opened as free lanes. But instead, Houston elected officials chose to charge motorists tolls to access these lanes that are rarely used. With elected officials more than happy to double tax its citizens, perhaps that's why Houston residents experience some of the highest transportation costs in the country.

If you build it, they will come

One of LaHood's initiatives for the next highway bill is to "keep our communities economically competitive and affordable." When foreign-owned toll roads (using PPPs) charge commuters 75 cents PER MILE to drive, that's like adding $17 to every gallon of gas you buy. That's not only unaffordable, it's unsustainable! Texas Transportation Commission Chair Deirdre Delisi admitted in testimony February 1 that PPPs cost more due to the private operators' building in profit (and other records show it's guaranteed profit!).

Also unsustainable is this notion of LaHood's that "if you build it, they will come." Not so with toll roads. SH 130 is the poster child of failed, underutilized toll roads. The taxpayers are paying to bailout this tollway EVERY year for the life of its debt. It's so empty that a distressed airplane landed on it in the middle of "rush hour." SH 130 was sold to the public as the panacea to unclog I-35 through Austin by getting the truck traffic off of the city's main artery. Few can afford to pay the $13/day to take the toll road, so the tollway sits near empty while I-35 stays mired in gridlock. If they really want to solve congestion on I-35, they'd turn SH 130 into a FREEway so truckers and those who need to get beyond Austin will take it.

Full court press by Trans Texas Corridor lobbyists

One of the first questions after LaHood's speech was offered by Alliance for I-69 lobbyist Gary Bushell. Bushell is the guy TxDOT illegally hired with taxpayer money to lobby for the Trans Texas Corridor TTC-69/I-69. Bushell also cut a backroom deal with Senator Robert Nichols during the waning days of the 81st (2009) legislative session not only to ensure TTC-69 would continue (despite a bill that would have repealed the Trans Texas Corridor as Texans have demanded -- the bill never became law), but also to ensure the private developers, ACS of Spain and Zachry of San Antonio, would never lose money on the deal.

Bushell said the TTC-69/I-69 environmental document was ready for approval by LaHood's department and asked for a green light, to which LaHood responded, "Sure."

The lobbyist for the Ports to Plains Trans Texas Corridor (often called a "priority corridor" by Congress is slated to go from Mexico, through Del Rio, San Angelo and Lubbock, Texas through Denver, Colorado up into Alberta, Canada) was also sure to plug his trade corridor.

Exotic financing = RISKY financing

Jeff Moseley, a panelist with the Greater Houston Partnership (Chamber of Commerce), was a voice of reason emphasizing that when the federal government fails to properly fund roads, it forces the states to resort to "exotic" financing (think "innovative financing" where taxpayers subsidize private toll road profiteers with the same multi-leveraged, risky debt financing schemes that caused the sub prime mortgage crisis). Texas power-brokers have fast-tracked and embraced such "exotic" (and risky) reliance on toll roads thanks to Rick Perry. However, Texans continue to revolt against such tax and spend schemes, resulting in their biggest grassroots victory to date: KILLING public private partnerships last year. The real challenge that lies ahead is how to keep it that way.

Read TURF's written comments submitted to the Secretary of Transportation here.

___________________________________________________________________________________

Link to article here.

LaHood: President still opposed to gas tax increase
By Michael Lindenbarger
Dallas Morning News
May 6, 2010

775.thm.jpegIn a speech in Houston Wednesday, Transportation Secretary Ray LaHood said Congress and the White House are largely in sync about what ought to be in the next big transportation reauthorization bill. (Photo: Transportation Secretary Ray LaHood speaks while IBM chairman and CEO Samuel J. Palmisano looks on. Source: IBM.)

"There is great agreement between the DOT and the Congress about what should be in the bill," LaHood said. "The dilemma is finding $500 billion to make it happen."

So I asked him afterward, what are the ideas being kicked around to find that money?

"There are lots of ideas. The president proposed an infrastrcuture fund, that's a $4 billion initiative. We still have the highway trust fund, even though we know that it's insufficient. And there are going to be some PPP's."

What about a gas tax increase?

"The President has consistently opposed raising the gas tax," he said.

So what will the authorization bill look like? Here's what he said in his speech:

"Having gone through this process, we've committed to a new recipe of legislative ingredients. It consists of: Ingredients that improve safety and reduce injuries and fatalities; ingredients that keep our communities economically competitive and affordable; ingredients that maintain the reliability, capacity, and efficiency of our entire transportation network; ingredients that give people more than one choice about how to get from one place to another - so kids can walk or bike to school and veterans or seniors can get to a doctor's appointment if they can't drive; ingredients that reduce America's reliance on oil and greenhouse gas emissions.
Blended together, this mix will help ensure that a student in Houston can go from a neighborhood with safe streets to a school that prepares her to collaborate and compete in the global economy. It will help ensure that student's parents go from an affordable home to a job that pays the bills.

Now, we need to figure out how to pay for it."

Sec. of Transportation wants to divert more of our gas taxes to non-road uses


Link to article here.

Most Texans aren't aware that 40% of our federal gas taxes fund mass transit instead of highways. Secretary of Transportation Ray LaHood has announced a "sea change" where our gas taxes will no longer favor "motorized transportation" but bicycle paths, sidewalks, and transit.

He says: “People are sick of being stuck in traffic, stuck in their automobiles, and we want to help communities and neighborhoods that want more walking paths or biking paths—more transit.” Well, that may sound great, but not with our gas tax money that's supposed to fund roads.

For more about diversions of our gas taxes and wasteful federal highway spending, go here and here.

Transportation Secretary Explains 'Sea Change' He Envisions for U.S. Transportation
Monday, May 03, 2010
  By Christopher Neefus

In this Jan. 28, 2010 file photo, Transportation Secretary Ray LaHood listens to a question during a news conference at the Transportation Department in Washington. LaHood said Tuesday, Feb. 2, 2010, Toyota was slow to realize safety problems with its gas pedals that has led to the recall of millions of popular Toyota brands. (AP Photo/Luis M. Alvarez, file)

(CNSNews.com) – Transportation Secretary Ray LaHood said Friday that Americans are “tired” of the congestion caused by motorized transportation, and instead are looking for other options such as bicycle lanes and walking paths, which the government will add to its infrastructure.

“People are sick of being stuck in traffic, stuck in their automobiles, and we want to help communities and neighborhoods that want more walking paths or biking paths—more transit,” LaHood told CNSNews.com.

President Obama’s top transportation official was following up on comments he had made on his official blog in March, when he announced a “sea change” in transportation.
“Today,” he wrote on March 15, “I want to announce a sea change. People across America who value bicycling should have a voice when it comes to transportation planning. This is the end of favoring motorized transportation at the expense of non-motorized.

“We are integrating the needs of bicyclists in federally funded road projects. We are discouraging transportation investments that negatively affect cyclists and pedestrians,” LaHood wrote.

With those comments in mind, CNSNews.com asked the secretary how he would implement that sea change.

“Well, look,” he began, “we have a state-of-the-art interstate system in America. We have the best road system in the world. That’s not going to change, and we’re going to continue to support our road system—our interstates—but we know that people want a lot of other alternatives.

“People are sick and tired of being stuck in traffic, stuck in their automobiles, and we want to help communities and neighborhoods that want more walking paths or biking paths—more transit. Some communities are going to be launching street car programs, more bus programs, but we’re promoting all forms of transportation,” he said.

“But we know that people are tired of all the congestion that’s created in cities, and so we think that promoting livable, sustainable neighborhoods by creating bike paths and walking paths and more transit and uh—really is what the people want,” LaHood added.

As for how to pay for the projects that he said would not come at the expense of the current interstate system, LaHood suggested the money would also come out of the general Treasury fund.

“We already pay taxes,” he said. “I mean, people all over America pay taxes. They pay their income taxes. People pay property taxes. People pay all kinds of taxes every day. If they buy something, they pay a sales tax. The point is, people pay a lot of taxes, and so we’re going to use—really use the resources that we have to create the kind of opportunities that people really want in America.”

LaHood had just appeared at Washington, D.C.’s Newseum, where he participated in live broadcasts of “The Oprah Winfrey Show” and “The Gayle King Show,” which runs on satellite radio. Both revolved around “National No Phone Zone Day,” an initiative to create awareness among young drivers about the dangers of texting from behind the wheel.

Winfrey, via satellite from Chicago, pointed out that several states had instituted a penalty for those found texting while driving, but LaHood said he wanted a federal statute with “good enforcement” to solve the issue.

“There are some bills pending in Congress,” he told CNSNews.com. “I’ve talked to a number of senators and House members about this, and we will work with them and hope that they can pass legislation. We think national legislation with good enforcement would be very, very helpful here.

“We’re going to work with Congress,” he said.
 
The following is a transcript of Secretary  LaHood’s conversation with CNSNews.com:

CNSNews.com:  "You wrote on your official Transportation Department blog last month that a sea change in transportation was coming, that it would be the end of favoring motorized transportation over non-motorized. Can you explain a little bit how you would equalize, say, bicycle and motorized transportation? How do you create that sea change?"

LaHood: "Well, look, we have a state-of-the-art interstate system in America. We have the best road system in the world. That’s not going to change, and we’re going to continue to support our road system—our interstates—but we know that people want a lot of other alternatives. People are sick and tired of being stuck in traffic, stuck in their automobiles, and we want to help communities and neighborhoods that want more walking paths or biking paths—more transit."

LaHood: "Some communities are going to be launching street car programs, more bus programs, but we’re promoting all forms of transportation. But we know that people are tired of all the congestion that’s created in cities, and uh, so we think that—uh – promoting livable sustainable neighborhoods by creating bike paths and walking paths and more transit and uh—really is what the people want."

CNSNews.com:  And as you create that new infrastructure then, how would it work for the users of those – cyclists, people on foot—would they be paying taxes to utilize these extra—

LaHood:  "We already pay taxes. I mean, people all over America pay taxes. They pay their income taxes. People pay property taxes. People pay all kinds of taxes every day. If they buy something, they pay a sales tax. The point is, people pay a lot of taxes, and uh, and so we’re going to use—really use the resources that we have to create the kind of opportunities that people really want in America."

CNSNews.com: "And we saw Oprah showed on the map several states that have banned texting while driving. Is there anything you can do on the federal level, legislatively?"

LaHood: "Well, we’re going to work with Congress. There are some bills pending in Congress. I’ve talked to a number of senators and House members about this, and we will work with them and hope that they can pass legislation. We think national legislation with good enforcement would be very, very helpful here."

Congress wants smaller role in building highways…what?

Link to article here.

If Congress wants a smaller role in building highways, they can kindly return 100% of our gas taxes back to taxpayers and let the states build them. It's total fraud to keep taking our road money only to spend 40% of it on transit instead of highways, and to DOUBLE TAX motorists with tolls on top of gas tax now that they've figured out raiding the gas tax means there's not enough money for roads.

April 26, 2010

Congress wants a smaller role in the highway biz

By Gordon Dickson
Star Telegram

CapitolCongress may shrink its historic role as the main funding source for building new highways, and officials from several states worry that the result could be crippling traffic across America. “In Washington, D.C., we’re hearing voices say we’re done investing in highways and we can’t build our way out of congestion,” said John Horsley, executive director of the American Association of State Highway and Transportation Officials.

The group on Monday released a report, Transportation Reboot: Unlocking Gridlock, which warned that demand for car travel is far outpacing the available space on the nation’s roadways, and an infusion of new federal highway dollars is needed to avoid a level of gridlock that will choke the economies of dozens of cities. The report identified more than 100 urgently needed road projects, including one in Texas — U.S. 290 in Houston. But members of Congress, who are expected to debate a five-year transportation bill later this year, are showing little appetite for raising the gas tax or other funding sources to pay for new road work, Horsley said. Even if a new revenue source is identified, the money is more likely to be spent on public transportation such as buses and rail.

“In the field of high-speed rail, President Obama is considered visionary,” Horsley said during a news conference after releasing the report at the National Association of County Engineers’ annual conference in Fort Worth. “In the field of transit and highways, we’re still looking for that visionary leader.”

 If states balk at paying for highway projects themselves, local governments such as cities and counties could be left with a greater responsibility for handling traffic, said Chris Bauserman, president of the National Association of County Engineers. About 70 percent of existing roads are already maintained locally, he said. As a result, new roads may not get built at all. In Texas, an estimated $300 billion in new dollars is needed to provide roads for an expected population boom during the next 30 years, said Texas Transportation Commission member Bill Meadows of Fort Worth. Because of a chronic shortage of gas tax funds, the Texas Department of Transportation has supported development of toll roads and investment from private developers to keep traffic moving in the state’s major metro areas. Texans pay a federal gas tax of 18.4 cents per gallon, and a state tax of 20 cents per gallon — and neither amount has increased since the early 1990s. “If we’re going to meet our transportation needs,” Meadows said, “the obligation is great.”

GORDON DICKSON, 817-390-7796


Read more: http://startelegram.typepad.com/honkin_mad/2010/04/congress-wants-a-smaller-role-in-the-highway-biz.html#ixzz0n11Odgjg

Privatized Toll Road Letdown

Link to article here.

Published: April 27, 2010 3:00 a.m.

Toll Road letdown

Journal Gazette

Opponents predicted this would happen.

When Gov. Mitch Daniels sold his plan to lease the Indiana Toll Road for 75 years, some opponents said the financial projections were too rosy, that the $3.8 billion proceeds and interest would not fully fund the lease’s share of a much-touted 10-year highway construction plan.

Now, as Niki Kelly’s Sunday story explained, the Indiana Department of Transportation has begun to take projects off the 10-year plan while delaying others. In all, projected spending for new highway construction in the 10-year plan has dropped from $6.4 billion to $5.5 billion.

Some of the reduction is because of other forces – a drop in gasoline tax revenue, lower estimated construction costs. But a significant portion is because of lower-than-expected interest income from the lease proceeds. Two years ago, in the most recent update, the state said the shortfall was $220 million and counting.

“I think this is absolutely predictable,” said state Rep. Win Moses, whose Democratic Party was in the minority of both chambers of the General Assembly when lawmakers approved the lease in 2006. “It was always oversold.”

If so, it isn’t the first time supporters of a big, controversial government program used overly optimistic projections to help sell the program. Nor is it that unusual for financial projections to be revised, particularly during and after the economic changes of the past three years.

But uncertainty about the future was a primary reason to question a proposed 75-year lease. Of course the finances will change dramatically.

While a few forward-thinking lawmakers such as Moses examined and challenged the finances of the lease, the focus of the opposition was more on the philosophical decision to lease such an enormous state asset to a private, foreign company. Proponents won, largely because it meant a lot of money to finance numerous highway projects over the following decade.

Now that some projects are falling off the list doesn’t mean that Toll Road drivers pay any less. The cost for a passenger car to traverse the 157-mile length of the Toll Road was $4.65 before the lease was signed. Today it is $8 for those without electronic tolling devices, and the price will continue to rise.

Costs are even higher for truckers; the $14.55 cost for a five-axle truck just before the lease was signed has now jumped to $32. Ever-higher tolls could well force some truck drivers off the interstate onto highways such as Indiana 20, raising the cost of maintaining those roads.

Great improvements promised by lease supporters aren’t apparent either. Construction lingers on portions of the road near Chicago, causing backups and dangerous driving conditions. Occasional Toll Road drivers who don’t use the road enough to buy the electronic tolling device are finding longer lines at the cash toll booths.

Tellingly, four years after Daniels and other lease proponents sold the privatization deal as the “next big thing” for cash-strapped states, few – if any – have followed the model.

Perhaps one of the most troubling aspects of the lease isn’t that the 10-year plan is falling short but that it was designed to finance a highway plan for only 10 years – while a private company will continue to bring in revenue for 65 years after that plan is over.

DMN: Texans to pay “stiff tolls”

Link to article here.

Here's the most elitist attitude in print from transportation bureaucrats pushing this oppressive toll taxation ("managed lanes" are toll lanes):

"The managed-lane approach will give people a choice between traffic for free or a fast ride for a price."

What about all the gas tax we're paying? Wanna know where it's going? DPS, Tourism promotion, mental health, and enhanced benefits for employees in the Attorney General's office. Then, the federal highway program won't send some of our gas taxes back to Texas unless we spend it on "enhancements" like $18 million rest stops with FREE WI-FI!

Add to that, the vehicle sales tax paid for roads is getting dumped into general revenue instead of going to roads. Ending the diversions of the vehicle sales tax amounts to $2-$3 BILLION a year and yields more than a 10 cent per gallon gas tax increase would. Ending this diversion alone could nearly triple the money for roads WITHOUT RAISING TAXES! They opine we're not giving them enough money to keep up with demand, but in reality they're pilfering our money and spending it on things that have nothing to do with roads.

N. Texas highway improvements come with a toll: Expect construction snarls for 5 years, stiff tolls after that

12:00 AM CDT on Sunday, April 18, 2010

By MICHAEL A. LINDENBERGER / The Dallas Morning News

Dallas-area traffic has been among the worst in the nation for years, and for many commuters it's about to get a lot worse before it gets better.

Call it growing pains, or just one big mess, but construction has either already started or soon will on no fewer than a half-dozen of the most heavily traveled – and already backed up – traffic corridors in North Texas, as the region embarks on what may be the most aggressive road-building program in the country.

Commutes will be lengthened and lanes closed as orange vests and red taillights become as common on our highways as bluebonnets in Burnet.

And when it's over in five years or so, many of those same drivers will be stuck in traffic as crowded as ever – unless they want to pay hefty tolls to keep moving.

Nearly all of the biggest highway improvements will add more toll lanes. They involve just about every important corridor in the region, from the complete reconstruction of part of LBJ Freeway in Dallas to the unsnarling of the Grapevine Funnel, now known as the DFW Connector, to the extension of State Highway 161 in Dallas County and the eastward march of the Bush Turnpike.

Some projects, like the LBJ Freeway and the North Tarrant Express in the mid-cities, will combine rebuilt free lanes and improved access roads with brand-new and especially expensive toll lanes. Others, such as Bush Turnpike extension and Highway 161, will be pure toll roads.

Only the DFW Connector, the fruit of 30 years or more of patient advocacy in the Grapevine area, will see the lion's share of the improvement come in the form of free roads. But it, too, will include some tolls.

So, North Texas, this is the toll-road future you've been hearing about. And officials from Arlington to Austin to Washington say it's the best government can do to keep up with traffic in the fastest-growing metro area in the country.

Lack of resources

"We're dealing with the reality that we do not have the resources we need to keep up with our demands," said Bill Meadows of Fort Worth, one of five members of the Texas Transportation Commission. "I know there are people who want to say, 'Those dirty sons of guns, why didn't they build it all free?' Well, we could have done that, but you would have got squat."

Officials at the Texas Department of Transportation have warned for the past year that money for major new projects runs out by 2012. That's thanks partly to heavy borrowing in recent years that has left the state with big annual interest payments, eating away at already inadequate gas tax revenues.

Critics of Gov. Rick Perry's toll-road-first emphasis, and of his no-new taxes mantra, would add that he's failed to push the Legislature to consider higher taxes that would have reduced the state's reliance on tolls.

But on top of those issues is something simpler still: As time passes, and more roads are added, Texas' massive inventory of highways and bridges – some 193,308 miles in all, the most in the U.S. – gets older and larger every day, meaning maintenance costs are a growing burden. Last year, Texas spent $2.98 billion on maintenance, and will spend about that much this year.

Meanwhile, Dallas-Fort Worth added almost 100,000 residents last year, and 1.3 million in the past decade. As regional planners like to say, nearly all of them brought a car, but none packed any new roads and bridges in the moving van.

"Let's face some realities and look at the growth of this state over the past 25 years," said Meadows, an insurance executive who was vice chairman of the North Texas Tollway Authority before Perry named him to the commission. "There are vast areas of Texas losing population, but the opposite is happening here. Given this growth, our roadways are going to be a lot more congested."

Traffic jams have been a way of life in Dallas, and in most big cities, for decades. And the recent stimulus-funded surge of smaller construction jobs has made this spring especially busy. And with more than 1,000 workers building Dallas Area Rapid Transit's Green Line to Carrollton and the Orange Line to Irving, traffic problems and lane closures have become routine.

But to keep all that congestion from turning the highways into permanent parking lots, North Texas has added to the regular mix of highway projects a set of marquee projects across the region, all built at the same time and nearly all of them using a new approach to keep traffic moving once they are done.

For now, it will mean a lot of taillights for drivers.

Widening the Funnel

One project already under way is the DFW Connector in Grapevine, a massive rebuilding of part of State Highway 114/121 and State Highway 26 near the airport and downtown Grapevine.

It will widen some areas to 24 lanes, including new frontage roads and four new express tolled lanes. Lane closings and other traffic bothers have already begun and will continue until the work is complete in 2014.

"I think people here are optimistic, they are just tired of all this traffic," said Jerry Hodge, a former public works director for Grapevine who now works as liaison between the city and the private firms building the connector.

"There is a little bit of question about how bad is it going to get in the meantime. But the other side is that they are relieved to see this happen."

He noted, as did officials throughout the region, that modern highway contracts nearly always carry stiff requirements that encourage builders to keep as many lanes open during the day as possible, and sometimes impose big fines for shutdowns during rush-hour.

Mitigation efforts aside, Maggie Smits of Colleyville has already noticed the traffic snarls near her office on Grapevine's Main Street, and especially when she takes her husband to and from the airport.

"I picked him up Thursday night, for example, and coming out of the north side of the airport onto 114, they had blocked that exit. So we took the bridge over to the back way and took 26 all the way home. It took forever."

When the cones near the DFW Connector are finally put away, drivers like Smits will see real improvement. Most new lanes will be free, and the troubling interchanges that have bottlenecked the region for years will be smoother.

But for drivers in other areas of North Texas, the payoff won't be as neat.

The dilemma is best illustrated on the LBJ Freeway in Dallas, routinely listed as one of the country's most traffic-clogged corridors.

Drivers now have three free lanes in each direction, with a narrow HOV lane occupying what used to be the shoulder. Beginning next year, those lanes routinely will be reduced to two – and occasionally fewer than that – as the private toll operator Cintra and its partners completely rebuild the road.

When it opens, probably in 2016, the new LBJ will be an engineering marvel. In place of the current lanes will be four free main lanes. And tucked underneath the cantilevered top lanes will be three brand-new lanes half-dug into the earth like an open channel.

Those three new lanes won't be cheap, as they will help usher in something new for North Texas: dynamic pricing for toll roads that means the more drivers need them, the more they will cost.

Opening toll rates during rush hour likely will be about 50 cents per mile, more than three times the rates NTTA charges on its roads. Depending on demand, the rates could reach 75 cents or more.

Managed-lane concept

Michael Morris, transportation director for the North Central Texas Council of Governments, said the new LBJ will be a good deal for drivers in North Texas.

Those who won't pay tolls, he said, still will have four rebuilt lanes to choose from. And frontage roads will be improved and made continuous.

Besides, experts have long warned that so many drivers would like to use LBJ Freeway that trying to build enough free lanes there to keep traffic moving would require at least 16 lanes in each direction. Morris noted that's neither feasible nor wise. The managed-lane approach will give people a choice between traffic for free or a fast ride for a price.

Cintra, which also is developing the North Tarrant Express, will be contractually obligated to keep toll traffic moving at 50 mph or more at all times, a commitment it will keep by jacking up toll rates when traffic gets heavy.

Meadows said he knows some residents will feel let down when they see that the only sure escape from traffic will come with a hefty toll.

"Here's the thing," he said. "It really depends on what your expectations are, what the citizenry expects. If my expectation is that my drive in to my office in Fort Worth, on what we call the free roads, is going to be like it used to be – that we are going to return to 1968, when the government built all the roads for free – I'm going to be really disappointed."

NJ: Rest stops, toilets closed on freeways, remain open on toll roads

Link to article here.

Christie Shuts Toilets on Free New Jersey Roads to Save Money
By Dunstan McNichol
April 22, 2010
Businessweek

April 22 (Bloomberg) -- New Jersey Governor Chris Christie wants to shut the last two rest-stop bathrooms on non-toll roads in the most densely populated U.S. state after this year to save $270,000.

“We just don’t have the money for the bathroom facilities,” Christie’s transportation commissioner, James Simpson, told members of the Senate Budget and Appropriations committee today during a hearing on his department’s $1.24 billion budget for the fiscal year that starts July 1.

The bathrooms scheduled to close under Christie’s plan are on Interstate 80 at the Pennsylvania border and Interstate 295 at the Delaware border. Parking areas at the rest areas will remain open for truckers under Christie’s plan, Simpson said. The closings will eliminate 18 maintenance positions, according to the department’s written response to questions from the nonpartisan Office of Legislative Services.

“Lavatory and tourism facilities will now be closed on all of the state’s non-toll roadways,” the response says.

Drivers will still find bathroom facilities on the New Jersey Turnpike and the Garden State Parkway. Those are two of the busiest toll roads in the U.S., according to the New Jersey Turnpike Authority.

Christie, a Republican who took office Jan. 19, last month proposed a $29.3 billion budget that includes $10 billion of spending reductions to help close a $10.7 billion deficit. The legislature, which is controlled by Democrats, is holding hearings on the proposal. A budget must be approved by July 1.

Simpson told lawmakers he is hoping to coax federal officials to give the state an exemption that would allow a private vendor to operate a cafe at the sites where the rest rooms are scheduled to close Jan. 1, enabling the bathrooms to stay open.

--Editors: Stacie Servetah, Ted Bunker

Forbes: Toll roads prohibit China from benefiting from its highway system

Link to article here.

The Cost Of Driving In China
Toll roads prohibit the nation from enjoying the economic benefits of its vast highway network.
Paul Midler 04.20.10
Forbes.com

HONG KONG - China will spend $300 billion on high-speed rail lines over the next 20 years. The world has seen nothing like it, and China-watchers have responded by drawing analogies to America's transcontinental railroad, built in the 19th century, or its interstate highway system, built and expanded throughout the 1950s and 1960s.

High-speed rail is not the only thing on the nation's infrastructure to-do list. China's General Administration of Civil Aviation has budgeted $62 billion to build 100 new airports by 2020. All of this new infrastructure is being seen as the signs of progress, but what has been missed is how high-speed rail and the new airports are a way for China to get around a major problem it faces--an exorbitant, toll-based road system.

Have a mind to jump in your car and drive from Guangzhou to Beijing? Don't forget to bring your wallet. The expressways connecting the south to Beijing are expensive, and a trip to the nation's capital will run you close to $200 each way. Driving on toll roads in China--and almost all of the country's expressways cost money--runs an average of 0.5 yuan (7 cents) per kilometer, or nearly 12 cents per mile. For many types of cars, the tolls are greater than the cost of the fuel burned.
The jacked-up cost of auto travel in China actually makes high-speed rail seem affordable, but tickets for high-speed trains are still out of reach for most Chinese. The speedy rail line meant to connect Beijing to the southern province of Fujian was closed after only two months in operation due to a lack of commercial interest.

Other problems with China's high-speed rail include poor planning. The high-speed rail lines connect only two, sometimes three, major cities. The tracks do not cover the country well; they will not necessarily take folks to where they want to go. They are by no means linked into a network, and already people are complaining that the rail stations do not connect properly to mass transit systems. For many who choose to take existing high-speed rail lines, it can take longer to get to the rail station than it does to ride the train from Point A to Point B.

Transportation infrastructure in China is a curious phenomenon. One of the observations made by New Yorker writer Peter Hessler in his travel book Country Driving is that while China's expressways are clean and well-maintained, they are by and large empty. You can ride down many highways and find your car the only one in sight. What an odd contradiction for an economy said to be the world's largest auto market!

Like it or not, the long-term potential of major auto companies in China--including Ford, Volkswagen, Honda and Toyota--is going to be affected by how the country deals with the high economic barrier posed by road tolls.

Japan is in the process of doing away with toll roads, which today account for 18% of its highway network (excluding the Tokyo Metropolitan and Hanshin Expressways). Japan's Democratic Party pledged to give back thousands of kilometers of fee-based expressways as a political gesture, but the net effect will likely be to lift the economy ever so slightly.

China privatized its expressways as a way of quickly establishing an extensive network. While that was great for the short term, the policy decision means that the highway system may never belong to the public, that it will for some time represent corruption of some kind.

For all the latest headlines visit Forbes Asia.

Chinese leaders have no difficulty tearing down entire villages for the sake of a new high-speed rail line, but getting local and other stakeholders to agree on reforming the expressway system will be an enormous challenge in the not-too-distant future.

Infrastructure is critically important to an economy; transportation is the cornerstone of commerce. A nation whose citizens move around unencumbered is better able to grow and do more business.

China's auto market is seen as an attractive long-term prospect for investors, but the Chinese continue to view automobiles more as status symbols than as means of conveyance. To get folks rolling down these roads, China will have to consider investing heavily in a different kind of "infrastructure"--the reduction of costs associated with auto travel.

Paul Midler is the author of the book Poorly Made in China: An Insider's Account of the Tactics Behind China's Production Game.

For all the latest headlines visit Forbes Asia.

Over 300 properties to be condemned for 290E toll project

Link to article here.

For anyone who still thinks toll roads don't impact private property rights, think again. Here's proof positive that an unnecessarily wide road expansion comes into play whenever TxDOT plans to toll existing roads. It must leave as many non-toll lanes as exist before the reconstruction. So most toll roads being done in Texas today require much larger footprints than would otherwise be necessary. Also, these toll lanes are largely underutilized (for "managed lane" projects only about 8% of the traffic can afford to pay the extra tax to access the new lanes). So this is a BIG price to pay for a project that won't even provide congestion relief for the vast majority of commuters.

TXDOT wants 366 properties to widen 290 corridor
Public comment sought
Jay Blazek Crossley, Apr 16, 10.
Houston Tomorrow


The Texas Department of Transportation (TXDOT) has released the Final Environmental Impact Statement (FEIS) for a proposed project to add traffic lanes to the 290 corridor and fix the 610 / 290 / I-10 interchange.

Four of the additional lanes would be part of a new managed lane facility along the existing Hempstead Highway that would have variable toll pricing for private vehicles as well as HOV and METRO use, replacing the existing HOV lanes in the middle of 290.

The project identifies and preserves land for future transit use, but does not include implementation or specifics on technology or potential stops for transit. Construction could begin in 2011 and the total expected cost of the project is $4.65 billion.
The public now has the opportunity to comment on this proposed project.

The FEIS Notice of Availability Press Release states that TXDOT expected for the notice to appear in the Federal Register on April 16, 2010.  The Notice of Availability states “The FEIS wait period ends May 17, 2010.  Comments regarding the FEIS should be submitted to the Director of Project Development at the Texas Department of Transportation’s Houston District Office located at 7600 Washington Avenue, Houston, Texas prior to 5:00 p.m. on May 17, 2010.  The Texas Department of Transportation’s mailing address is P.O. Box 1386, Houston, Texas, 77251-1386.”

TXDOT states that the project will require the use of eminent domain to take 366 properties to acquire right-of-way, including two churches: Celebration Lutheran Church at 15815 House Hahl Road and Christian Family Church at 14406 Hempstead Road (no apparent website). Appendix D of the FEIS identifies churches, community groups, and civic associations in the area that were contacted and provided information to publish to their constituents on the proposed project. Neither of the churches proposed for eminent domain appear on the list.The proposed eminent domain needs will include 360 residences, including both single and multi-family, and 392 businesses, some of which are listed as multiple businesses on one property.

The Indirect and Cumulative Impacts section of the FEIS states that 413 acres of prime farmland would be converted directly for ROW use, although that information does not appear on Form NRCS-CPA-106, Farmland Conversion Impact Rating for Corridor Type Projects. This form is presented as Appendix A, although it appears incomplete. This form is a consequence of the Farmland Protection Policy Act, which seeks to avoid adverse impacts on American farmlands as a consequence of federal programs, including road projects funded by the Federal Highway Administration. The FEIS does not appear to give an estimate of the amount of prime farmland that will be lost as a result of indirect impacts of the road project, however it states that TXDOT expects that 5,000 to 7,500 acres of additional development will occur in the study area as a result of induced demand from increased lane capacity in the corridor.

TXDOT explains that induced development does not occur because increased highway capacity brings new development to the Houston region, but instead that TXDOT’s decision will allocate development to this area of the region as opposed to other areas.  Referring to a study by the Urban Land Institute, the FEIS notes in section 6.1.2 that “Regional development is primarily driven by regional economics and the major effect of highways is the distribution of development within a region. (FHWA 2004a; Cervero 2003; Hartgen 2003a and 2003b).”  TXDOT notes that the study area currently houses 184,000 acres of undeveloped land, approximately 130,000 acres that is used for pasture and farming, 14,000 of which is cultivated farmland.

TXDOT describes the area surrounding 290 as such: “The transportation network is discontinuous with self-contained, isolated developments with very little interconnectivity of the roadway network.” The proposed addition of freeway lanes will not address this issue. TXDOT instead states that the City of Houston Mayor Thoroughfare and Freeway Plan will be used at a later time to add major thoroughfares “to be designed and built as development occurs.” TXDOT continues: “Thoroughfares are built as development happens, leaving gaps between communities. Bikeways and sidewalks are discontinuous, existing only as part of individual residential developments or isolated public projects along bayous or parks.”

TXDOT summarizes the major changes between the Draft Environmental Impact Statement and the FEIS as such:

The Preferred alternative has the same general configuration as the Recommended alternative, with some changes in the number of proposed main lanes on US 290: 12 lanes from West 34th Street to Pinemont Drive (revised from 10 lanes), 12 lanes from FM 529 to Eldridge Parkway (revised from 10 lanes), and 10 lanes from Eldridge Parkway to Telge Road (revised from eight lanes).  Some direct connector and access ramp modifications were also revised.  The other major change in the Preferred alternative is the relocation of the transit reserve from north of the managed lanes along Hempstead Road to between the managed lanes and the UP railroad from IH 610 to BW 8.

The stated purposes of the US 290 Corridor projects are:

Reduce congestion in the US 290 corridor within Harris County,
Improve LOS and mobility on US 290 and Hempstead Road,
Bring the roadway facilities up to current design standards, and
Improve safety in the US 290 Corridor.

Main My290 project website
Full US 290 FEIS Report (link is to a webpage with a series of pdf’s)
Executive Summary
Section 6 – Indirect and Cumulative Impacts
Appendix A – Farmland Conversion Impact Rating for Corridor Type Projects
Section 1 – Need for and Purpose of Proposed Action
Public Comment and Response Report (This document includes written responses to the DEIS, transcripts from public meetings, and an attempt by TXDOT to respond to every issue raised in a manner that groups public comments into a series of questions)

Image credit: deltaMike

PA State Auditor blasts Turnpike Authority for "gambling" with taxpayer money

Link to article here.

Remember this is written by a toll road industry advocate, so the tone is pro-toll. It's enlightening as to the financial chicanery being played with taxpayer money regarding interest rate swapping and other tricks with public debt that are not only risky, they're downright malfeasance!

State auditor hits Penn Pike for "gambling" with $2.23 billion in interest rate swaps
Toll Road News
Posted on Fri, 2010-04-09

The state auditor-general in Pennsylvania, Jack Wagner has criticized the Turnpike for "gambling" with $2.23 billion variable interest rate debt tied to 26 different interest rate swaps. He said his office calculated the cost to terminate the swaps could be $146m - the equivalent of around three months toll revenues.

Wagner wrote in a letter to Turnpike CEO Joe Brimmeier: "Swaps are tantamount to gambling with taxpayer money and they have no place in the public sector.  With drivers already paying higher tolls mandated under Act 44, the Turnpike Commission must do all that it can to show Pennsylvanians that it is handling money wisely."


In his letter to Brimmeier, Wagner urged the Turnpike Commission to:

- stop using swaps,

- conduct a financial assessment to determine the financial impact of its swaps, and

- hire financial advisers through a competitive selection process.

He asked Brimmeier to provide more detailed information about the Turnpike Commission’s swaps giving a deadline of April 19.

Wagner is quoted: "The fundamental guiding principle in handling public funds is that they should never be exposed to the risk of financial loss. Swaps have no place in public financing and should be banned immediately."

Carl de Febo spokesman at the Turnpike said the commission is "reviewing that correspondence, and we have no comment at the moment."

Wagner is a candidate for the Democrat Party's nominee in the state governor election this November, since the incumbent governor Ed Rendell is term-limited out.

Populist politics?

Critics of Wagner will say he's engaging in populist politics and pandering to people's prejudice against complex financing instruments. Economists argue that all borrowing is risky. It is, they say, a gamble because future revenue streams to pay the interest and repay capital are uncertain, and because prevailing interest rates are unpredictable.

Interest rate swaps can - at a price - reduce the risk of interest rate volatility and such 'hedging' will make variable interest borrowing less of a gamble. Properly used they can be an insurance against big increases in interest rates on variable interest debt or on refinancing debt as debt matures.

To prohibit public authorities from hedging, they will say, could increase the "gamble" they take when they borrow - like prohibiting insurance.

But interest rate swaps that shielded borrowers in the boom turned out to be big lossmakers in the great financial crisis from 2008 on. Engineered to protect against rises in interest rates they turned into major lossmakers when interest rates plunged.

Carelessness and fraud

And many theoretically defensible swaps and auction rate securities seem to have been carelessly written, some were fraudulent. In addition many contracts just fell apart when the bond insurers lost their required credit rating. That risk had not been properly explained or considered.

Brian Chase an investment consultant and former Nossaman and Carlyle Group staffer says: "Frequently, we have seen that the public sector does not in fact understand the financial risks it has taken through its use of interest-rate swaps and auction-rate securities."

Elaine Greenberg, top SEC official in Pennsylvania, has said there is widespread pay-to-play corruption and bid fixes in bond underwriting and derivatives transactions in that state.

Small cliques seem to get the great bulk of the profitable work of underwriting and legal and financial advice.

Size of debt may be biggest issue

But the biggest question of all may lie not in hedging via interest rate swaps but in the absolute size of the Turnpike's borrowing relative to its income stream and its obligations.

How sound is the basis for the Turnpike's huge borrowing - $6.11 billion at end December last year? Can the Turnpike realistically deliver on the fixed Act 44 obligations it has assumed to support unpriced and loss-making transportation elsewhere in the state?

Public authorities held to lower standard of liability disclosure

Greenberg of the SEC told Business Week recently that public authorities like the Turnpike have not been required to fully disclose the liabilities they are taking on nearly as fully as investor owned companies.

So while they provide sexy subject matter for gubernatorial campaigning the interest rate swaps may turn out to be a trivial side issue compared to the fundamental question of whether the borrowing of these many billions is justified. Some say it isn't clear that the proceeds of the borrowings been productively invested to generate cash flows five and ten years off to service that huge debt.

TOLLROADSnews 2010-04-09

Tea Parties bring critical mass to fiscal issues


TURF speaks to Dallas Tea Party
By Terri Hall
Examiner.com
April 19, 2010

Though much maligned in the press, the Tea Party movement has the potential to bring much-needed attention to a host of fiscal issues that, if left unchecked, threaten to bankrupt the country. I was invited to speak at the Dallas Tea Party event at Quick Trip Stadium in Grand Prairie for its April 15th Tax Day anniversary, along with national talk radio host Mike Gallagher and Dallas talk radio hosts Chris Krok and Jeff Bolton. Fourteen-thousand concerned citizens from all walks of life, many political stripes, and of all colors gathered to express their concerns with a host of fiscal issues from government spending to unsustainable debt across a broad range of policies.

TURF Founder, Terri Hall, with national radio talk show host Mike  
Gallagher


The new version of toll roads using "innovative financing" relies on heaps of multi-leveraged public debt (the same risky financial schemes that brought us the mortgage crisis and bailout era) and has caused our infrastructure to teeter on the edge of insolvency. Many in the DFW area heard for the first time about this new-fangled version of toll roads (totally different than the traditional turnpikes that have been in North Texas for decades) that co-mingle public and private funds and ultimately sells America's public infrastructure to the highest bidder on Wall Street in order to generate quick cash for government. Think of it as a government bailout as a result of decades of out of control spending and a lack of properly funding legitimate priorities like public infrastructure.


Hall - Tea  Party.JPGThe crowd response was nothing short of amazing with shouts of "who's responsible for this?" and "what a rip-off," along with other sentiments of fiscal disgust. North Texas is under an all-out toll road assault, with virtually every new lane slated to be tolled and close to 600 miles of planned toll lanes. All three of the current public private partnership (PPP) contracts that will sell our roads to foreign companies are in North Texas: the DFW Connector, North Tarrant Express/I-820, and LBJ/I-635. These deals will charge extremely high tolls, 75 cents PER MILE, which is like paying $17 more for every gallon of gas you buy, just to use a single road! Hall with Dallas radio talk show host Jeff Bolton

PPP contracts essentially give private corporations the power to levy taxes and it's also opened the door to eminent domain abuse for private gain. PPPs are yet another example of socializing the losses and privatizing the profits that awakened the sleeping giant in the first place. Your average Joe is not gonna tolerate being taken to the cleaners for government irresponsibility nor for private gluttony.

With DFW and Houston comprising the largest population centers, their grassroots involvement on toll tax issues are critical to halting toll road proliferation and returning to sensible, affordable, and sustainable transportation policy in Texas. Clearly our elected officials have ignored the public outcry against tolls in Austin and San Antonio for years. But with the rise of the Tea Parties and the newly awakened electorate they represent, a massive, organized coalition can now be mounted against runaway toll taxation.

Fasten your seat belts, we're in for a wild ride in the next legislative session!

Read the complete text of TURF's Dallas Tea Party speech here.

Perry breaks state law, fails to report stimulus money

Link to article here.

Perry accepted $2 billion in stimulus money for road projects, 70% of which was slated to go to toll projects in a massive TRIPLE TAX scheme (gas tax, federal taxes to pay for stimulus, then another toll tax to use the road). It's inexplicable that anyone would call this man a "fiscal conservative."

Perry ducked state law on disclosing some stimulus money
Spending report was not posted on Web site as required.
By Laylan Copelin
AMERICAN-STATESMAN STAFF
Published: 9:39 p.m. Tuesday, April 13, 2010

Gov. Rick Perry has always publicly stiff-armed federal stimulus dollars, even as he accepted billions to balance the state budget and tens of millions that he could award to constituents.

He even ignored state law and his own executive order that require all state agencies and institutions of higher education to be "accountable and transparent" by posting their stimulus spending reports on their Web sites.

Until Tuesday, that is.

After a reporter's inquiry, the Governor's Criminal Justice Division began posting reports, some of them months old, on its Web site. Perry's spokeswoman, Katherine Cesinger, would not elaborate on why the governor chose not to follow the law that he expected other state officials to follow.
State Rep. Jim Dunnam, D-Waco , who leads the House committee overseeing federal stimulus programs in Texas, said Tuesday that he isn't surprised by the governor's actions.

"Unfortunately, it's a pattern of the governor publicly distancing himself from the federal stimulus while accepting the majority of the money," Dunnam said. "They took $16 billion, and most Texans think they haven't taken any of it."

Last year, Perry accepted about $16 billion in federal stimulus money so lawmakers could avoid deep budget cuts or tax increases. But he refused to accept smaller amounts for unemployment benefits and education programs, saying that money came with "strings attached," an argument his critics rejected.

Perry's failure to file reports on the governor's Web site involves only the money administered directly through his office.

The governor's office has received about $92.2 million of the $110 million it requested from the federal government for law enforcement purposes. About $81 million has been obligated and $6.8 million disbursed, according to the Comptroller of Public Accounts, which maintains weekly reports of the state's stimulus activities.

Perry's office submitted the weekly summaries with totals, but Texans looking for greater detail were directed from the weekly report back to the governor's Web site to find a report from 2006 — three years before the stimulus program existed.

Citizens looking for spending details would have had to navigate the federal site,

recovery.gov, where all agencies, including the Texas governor, must post reports.

The Legislature demanded more disclosure than posting to the federal site. The appropriations act requires each state agency and higher education institution to post stimulus reports on their state Web sites for easier public access.

In his Aug. 25 executive order, Perry cited those requirements when he directed state officials "to maintain transparency and accountability in all cases." He also required every agency to designate a representative "to maintain a flow of current information relating to the receipt, deployment, management and use of funds received by the state and any of its political subdivisions or contractors" under the stimulus program.

The governor's office has been hands-on in administering the money, with senior adviser Mike Morrissey running meetings with agency officials once or twice a week until recently.

The information on state Web sites varies. The Texas Department of Transportation has a "project tracker" that shows each construction project, contractors, amounts being spent and location. It can be viewed at apps.dot.state.tx.us/apps/project_tracker/stimprojects.htm.

Even the tiny Texas Commission on the Arts has a link to all National Endowment for the Arts awards in Texas at www.nea.gov/grants/recent/09grants/states2/arra.php?STATE=TX.

The public can view the efforts by the governor's office at governor.state.tx.us/cjd.

New diversion of road tax discovered, citizens demand end to diversions


Link to article here.

Anti Toll Groups Would Back Gas Tax Increase
but only if 'diversions' from gas tax fund are ended
By Jim Forsyth
Friday, April 16, 2010

Leaders of the anti toll road movement in Texas are quietly notifying state lawmakers that they would support an increase in the state gasoline tax as an alternative to toll roads, but they are demanding some concessions in return, 1200 WOAI news reports.

Terri Hall, founder of the anti toll group Texans Uniting for Reform and Freedom, says an increase in the gasoline tax would be preferable to 'out of control' creation of toll roads.

The Texas gasoline tax, which is 20 cents a gallon, hasn't been raised since 1991, and the move to more fuel efficient cars is drastically cutting into the amount of money available for highway construction and maintenance, which has led to talk of toll roads.

"The studies we've seen would show that somewhere between eight and ten cents a gallon would meet out road needs, without having to toll our roads," Hall said.

Tax increases are very controversial in the Texas Legislature, with the Republican leadership and Governor Perry repeatedly indicating that they would oppose tax increases.

Hall says she would back the gas tax increase if lawmakers agree not only to completely end the controversial practice of 'diverting' gas tax revenue to pet projects in their districts, and if lawmakers consider using the state automobile sales tax for highway projects.

"We all pay vehicle sales tax when we buy a car, and that money is now going into general revenue, instead of to roads," Hall said.  "My understanding is that there is $4 billion a year that we could put back into roads, without having to raise any taxes."

The legislature is expected to be facing a massive deficit, as much as $15 billion, when the next session begins in January, and Hall concedes that with the state scrambling for general fund revenue, taking billions of dollars out of the general fund may not be politically feasible.

SHAKEDOWN: Blagojevich bribed road contractors on Illinois toll project

Link to article here.

WARNING: There is some profanity contained in this article. Blagojevich uses some profane words when speaking about his plans to extort money from road contractors in exchange for building a much bigger toll project (went from $1.8 billion to a $5 billion project).

Illinois Tollway in clear in Blagojevich corruption case - no staff or board implicated
Toll Road News
Posted on Wed, 2010-04-14 22:47

The Feds have released details of their corruption case against former Illinois Governor Rod Blagojevich. Called "Government's evidentiary proffer" the 91-page document filed in US District Court in Chicago by US Attorney Patrick J Fitzgerald today shows that the Governor tried to use the Illinois Tollway to extort money from Tollway contractors. But it makes no suggestion that Tollway officers or board members were involved in the shakedowns, just the Governor himself and his staffers.

The document is remarkable for the detail of hundreds of conversations between the governor and his immediate staff and telephone calls. Clearly the FBI had Blagojevich's offices wired and other places he met. They tapped into his telephone conversations and those of his immediate staff.  

Most important, key participants in the conspiracies led by Blagojevich are cooperating with the US Attorney in his prosecution, perhaps in return for leniency.

The case begins before Blagojevich won the governorship in an election in late 2002. There are accounts of conversations with associates to plan extortions early in 2002.

From p21 of the US case after he became governor:

"There were occasions after Blagojevich became Governor that Blagojevich, Kelly, Monk, and Rezko (political hacks and flacks) all met to discuss their efforts to make money from state action. For example, the four men met in a conference room at the offices of one of Rezko’s businesses in about mid to late 2003. During the meeting, Rezko led the discussion, standing at an easel or chalkboard and listed at least three or four different ideas or plans to make money being developed by Rezko that involved some kind of state action. At times, Kelly got up during the meeting and clarified or added to things that Rezko was saying. Blagojevich mostly listened during the meeting, but was engaged. As Rezko talked, he indicated how much money Blagojevich, Kelly, Rezko, and Monk could hope to make from the different ideas. The amounts that were associated with the different ideas were typically in the hundreds of thousands of dollars per deal, which would be evenly split four ways."

Obsessed with moneymaking

As pictured in the US Government case Blagojevich was completely obsessed with using the post of governor to enrich himself and his supporters. Everything he did seems to have been geared to self-enrichment and self-advancement. Every issue and decision was discussed in terms of what opportunity it provided to extort and steal. Many cases of corruption are laid out in detail.

The Tollway appears about halfway through

Several pages (from p52 on) are devoted to "Attempted Extortion Relating to the Tollway Program".

That started when Tollway board members talked with Blagojevich about potential construction plans. They presented a $1.8 billion option and a more ambitious $5 billion option. Blagojevich told a flack named Monk that the Tollway's program would be great for engineering firms. If they'd cough up serious money he'd go with the $5b program: "If they don't step up, fuck 'em. I won't do the bigger announcement (the $5b) in January.”

The US case page 53 on: "In about mid-September 2008, Blagojevich met with Monk, Robert Blagojevich, and Construction Executive, who was an executive in a cement company, at the FOB (Friends of Blagojevich) offices. As an active member of a concrete industry association group, Construction Executive had been responsible for raising large amounts of contributions for Blagojevich beginning in about 2002. Monk had become the primary contact with Construction Executive in terms of fundraising for Blagojevich in about 2007.

"At the meeting, Blagojevich also talked about both the potential $1.8 billion and $5 billion Tollway road building programs. Blagojevich indicated to Construction Executive that he was going to announce the small plan that Fall. Blagojevich said that he was inclined to also go forward with the larger plan, but that he did not want word to get out about his interest in doing so. Blagojevich explained that he wanted to keep that quiet so that the legislature would continue to feel pressure to pass a capital bill. Blagojevich suggested to Construction Executive that Blagojevich had the power to go forward with either of the two Tollway roadbuilding programs without the approval of the legislature. In response, Construction Executive told Blagojevich that he was in favor of the building programs because the concrete industry really needed the work."

Get the money in before the law changes

"Shortly thereafter in the meeting, Blagojevich said he wanted to talk about campaign contributions. Blagojevich talked about the change in Illinois law that would restrict the ability of companies that did work with the State of Illinois to contribute money to him, and how that law would take effect by the end of the year. Blagojevich asked for Construction Executive’s help raising money and indicated that Blagojevich wanted to raise the money before the end of the year.

Fobbed off

"Blagojevich asked Construction Executive how much money he could raise. When Construction Executive initially indicated that he did not know, Blagojevich again brought up the Tollway program and discussed additional projects that could be done if the larger program were done. At the end of the meeting, Construction Executive was again asked about how much money he thought he could raise for Blagojevich. Construction Executive indicated that he would have to go back to his people and talk to them about it.

"Both Monk and Construction Executive understood that Blagojevich was making a connection in the meeting between the amount of money that Construction Executive might be able to raise for Blagojevich and his willingness to do the larger Tollway program. As a result of Blagojevich’s statements, Construction Executive felt pressure from Blagojevich to raise money for Blagojevich so that he would allow the larger Tollway program to go forward.

"After Construction Executive left the meeting, Blagojevich directed Monk to ask Construction Executive to raise $500,000 in contributions, which money Monk understood would come both from Construction Executive’s own company as well as from other companies in the road building industry.

Blagojevich: "If they don't perform (pay up) fuck 'em"

"On October 6, 2008, Blagojevich met with Lobbyist A at the offices of Friends of Blagojevich (“FOB”) offices. During their meeting, Blagojevich mentioned an upcoming announcement he was planning to make regarding a $1.8 billion project with respect to the Tollway. Blagojevich said words to the effect of, 'I’ve got Lon going to Construction Executive and asking for $500,000' and 'I could have made a larger announcement but wanted to see how they perform by the end of the year. If they don’t perform, fuck ‘em.'

$1.8 billion or $5 billion is the issue

"Lobbyist A knew that Construction Executive was involved with a trade association that would benefit from the proposed $1.8 billion project. Lobbyist A understood Blagojevich to mean was that he expected that Construction Executive would raise $500,000 in contributions to FOB and that Blagojevich was willing to commit additional state money to the project beyond the $1.8 billion but was waiting to see how much money interested entities raised for FOB before the end of the year.

"In mid-October 2008, Blagojevich announced a plan for a $1.8 billion Tollway building program. On about October 22, 2008, Blagojevich called Construction Executive. Blagojevich talked about the $1.8 billion program and asked Construction Executive something like 'How are you coming with the fund raising?'"

But the US Government account has it that Construction Executive was in fact stringing the governor along, not saying yes, not saying no.

Here's the official account quoting from p55 and p56:

"Construction Executive indicated to Blagojevich that he was working on raising money, but that was not true. Construction Executive did not, in fact, plan on raising any money for Blagojevich, but Construction Executive did not want to say that for fear that Blagojevich would be less inclined to go forward with the larger Tollway project. Construction Executive ultimately did not make or arrange for any contributions to be made to Blagojevich.

"(Flack) Monk also continued to stay in touch with Construction Executive about potential contributions to Blagojevich, and consistently reported on the status of those conversations to Blagojevich and Robert Blagojevich, including on November 24, 2008 (Blagojevich Call #1005).22/"

That's the extent of the Tollway involvement in the 91 page document from US Attorney Fitzgerald.

The Governor tried to use his power over key Tollway decisions to extort money from companies wanting business with the Tollway. But he failed.

Of Blagojevich, apparently, the Construction Executive rightly said "Fuck 'im."

Under his breath anyway.

BACKGROUND: Blagojevich, a Democrat was arrested by US marshals Dec 9 2008 charged with extensive corruption, the most spectacular count being an effort sell to the highest bidder the US Senate seat vacated by Barack Obama after his election as US President.  Blagojevich as governor had the power to appoint a successor to Obama.

An oddly youthful looking man he's in fact53 (born 1956-12-10) his full name is Milorad Blagojevich, his first name anglicized and simplified to Rod. Born and raised on the northwest side of Chicago to Serb immigrants he worked as shoeshiner, pizza delivery, and in a meat plant. He is said to have washed dishes in a camp on the Trans Alaskan Pipeline.

Wikipedia on his education: "Blagojevich graduated from Chicago's Foreman High School after transferring from Lane Technical High School. He played basketball in high school and participated in two fights after training as a Golden Gloves boxer.[19] After graduation, he enrolled at the University of Tampa.[20] After two years, he transferred to Northwestern University in suburban Evanston where he graduated with a BA in history in 1979. He later (obtained) his JD from the Pepperdine University School of Law in 1983. He later said of the experience: 'I went to law school at a place called Pepperdine in Malibu, California, overlooking the Pacific Ocean — a lot of surfing and movie stars and all the rest. I barely knew where that law library was.' "

He married Patricia Mell the daughter of Richard Mell a Chicago alderman.  He clerked for another Chicago alderman, then got a job as an assistant prosecutor under famous mayor Richard M Daley, when Daley was State's Attorney.

His influential father-in-law appears tog have launched him on his political career - first in the state house, then as a US Congressman for the 5th district  (Chicago). He seems to have been a good campaigner but kept out of the spotlight as a state and US representative.

His predecessor as Illinois governor George Ryan, a Republican, also an extortionist and thief, is serving time in a federal jail.

TOLLROADSnews 2010-04-14

Goldman Sachs accused of defrauding investors

Link to article here.

Goldman Sachs has been a key player in advising governments as well as private investors on infrastructure/toll road deals called public private partnerships. They're instrumental in many deals in Texas and have swarmed our highway department, infecting them with their fraudulent schemes that exploit taxpayers. Perhaps if justice is truly served in this case, we may rid ourselves of at least one major canker in this fight.

SEC accuses Goldman Sachs of defrauding investors
Posted Friday, Apr. 16, 2010
By MARCY GORDON
AP Business Writer

WASHINGTON — The government on Friday accused Wall Street's most powerful firm of fraud, saying Goldman Sachs & Co. sold mortgage investments without telling the buyers that the securities were crafted with input from a client who was betting on them to fail.
And fail they did. The securities cost investors close to $1 billion while helping Goldman client Paulson & Co., a hedge fund, capitalize on the housing bust. The Goldman executive accused of shepherding the deal allegedly boasted about the "exotic trades" he created "without necessarily understanding all of the implications of those monstrosities!!!"

The civil charges filed by the Securities and Exchange Commission are the government's most significant legal action related to the mortgage meltdown that ignited the financial crisis and helped plunge the country into recession.
The news sent Goldman Sachs shares and the stock market reeling as the SEC said other financial deals related to the meltdown continue to be investigated. It was a blow to the reputation of a financial giant that had emerged relatively unscathed from the economic crisis.

Goldman Sachs denied the allegations. In a statement, it called the SEC's charges "completely unfounded in law and fact" and said it will contest them.

The SEC is seeking to recoup the money lost by investors and impose unspecified civil fines against Goldman Sachs and the executive, Fabrice Tourre. The SEC could enter into settlement negotiations over the amount if Goldman changed its stance and decided not to fight the charges in a trial.

The SEC said Paulson paid Goldman roughly $15 million in 2007 to devise an investment tied to mortgage-related securities that the hedge fund viewed as likely to decline in value. Separately, Paulson took out a form of insurance that allowed it to make a huge profit when those securities' value plunged.

The fraud allegations focus on how Goldman sold the securities. Goldman told investors that a third party, ACA Management LLC, had selected the pools of subprime mortgages it used to create the securities. The securities are known as synthetic collateralized debt obligations.

The SEC alleges that Goldman misled investors by failing to disclose that Paulson & Co. also played a role in selecting the mortgage pools and stood to profit from their decline in value. Two European banks that bought the securities lost nearly $1 billion, the SEC said.

"Goldman wrongly permitted a client that was betting against the mortgage market to heavily influence which mortgage securities to include in an investment portfolio, while telling other investors that the securities were selected by an independent, objective third party," SEC Enforcement Director Robert Khuzami said in a statement.

But Goldman said in a statement that it never mischaracterized Paulson's strategy in the transaction. It added that it wasn't obliged to "disclose the identities of a buyer to a seller and vice versa."

The charges name only Goldman Sachs and Tourre, who was a vice president in his late 20s when the alleged fraud was orchestrated in 2007. Tourre, the SEC said, boasted to a friend that he was able to put such deals together as the mortgage market was unraveling in early 2007.

In an e-mail to the friend, he described himself as "the fabulous Fab standing in the middle of all these complex, highly leveraged, exotic trades he created without necessarily understanding all of the implications of those monstrosities!!!"

Tourre, 31, has since been promoted to executive director of Goldman Sachs International in London.

Stanford University spokeswoman Elaine Ray said a student by the name of Fabrice Tourre received a master's degree in management science and engineering from the school in 2001.

A call to a lawyer for Tourre, Pamela Chepiga at Allen & Overy LLP, wasn't returned.

Asked why the SEC did not also pursue a case against Paulson, Khuzami said: "It was Goldman that made the representations to investors. Paulson did not."

Paulson & Co. is run by John Paulson, who reaped billions by betting against subprime mortgage securities. He is not related to former Treasury Secretary Henry Paulson, a former Goldman CEO.

John Paulson was among the first on Wall Street to bet heavily against subprime mortgages. His firm earned more than $15 billion in 2007, and he pocketed $3.7 billion. He has since earned billions more, largely by betting against bank stocks and then buying them back after their shares plunged.

In a statement, Paulson & Co. said: "As the SEC said at its press conference, Paulson is not the subject of this complaint, made no misrepresentations and is not the subject of any charges."

Goldman, founded more than 140 years ago, built a reputation as a trusted adviser to investment banking clients and for sending top executives into presidential Cabinet posts.

In recent years, it shifted toward taking more risks with its clients' money and its own. Goldman's trading allowed the firm to weather the financial crisis better than most other big banks. It earned a record $4.79 billion in the last quarter of 2009.

The complaint filed in federal court in Manhattan "undermines their brand," said Simon Johnson, a professor at the Massachusetts Institute of Technology and a Goldman critic. "It undermines their political clout. I don't think anybody really values being connected to Goldman at this point."

He continued: "There are many people who - until this morning - thought Goldman Sachs was well-run."

The SEC's enforcement chief said the agency is investigating a wide range of practices related to the crisis. The prospect of possible legal jeopardy for other major financial players roiled the stock market.

Goldman Sachs shares fell more than 12 percent Goldman and lost $14.2 billion in market capitalization. The Dow Jones industrial average finished down more than 125 points.

The SEC appears to be taking a particularly aggressive approach with Goldman. Typically, cases are resolved by firms agreeing to a settlement before the charges are made public, said John Coffee, a securities law professor at Columbia University.

"The SEC has changed its style," Coffee said. "They wanted to tell the world what they thought Goldman had done wrong."

The charges come as lawmakers seek to crack down on Wall Street practices that helped cause the financial crisis. Congress is considering tougher rules for complex investments like those involved in the alleged Goldman fraud.

President Barack Obama vowed Friday to veto a financial overhaul bill that doesn't regulate mortgage-backed securities and other so-called derivatives. Legislation in Congress would for the first time regulate derivatives, whose value depends on an underlying asset, such as mortgages or stocks. Senate Republicans oppose the bill.

Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee, is "pleased that the SEC is departing from the lax enforcement of the Bush administration and is returning to the SEC's proper role of protecting investors in the marketplace," spokesman Steven Adamske said.

The biggest loser in the alleged fraud was ABN Amro, a major Dutch bank, and the Royal Bank of Scotland, which acquired major portions of it in 2007. The SEC said the Royal Bank of Scotland paid Goldman $841 million to unwind ABN transactions.

IKB Deutsche Industriebank AG, a German commercial bank, lost nearly all its $150 million investment, the agency said. Most of the money the banks lost went to Paulson in a series of transactions between Goldman and the hedge fund, the SEC said.

IKB was an early casualty of the financial crisis. It issued a profit warning in 2007 saying it had been hurt by U.S. subprime mortgage investments. IKB was sold in 2008 to Dallas-based Lone Star Funds.

Ed Trissel, a spokesman for Lone Star Funds, declined to comment on the case.

The SEC charges come after Goldman Sachs denied last week it that bet against clients by selling them mortgage-backed securities while reducing its own exposure to them.

In an annual letter to shareholders, Goldman said it began reducing its exposure to the U.S. mortgage market in late 2006.

AP Business Writers Alan Zibel in Washington, Stevenson Jacobs in New York and Ashley M. Heher in Chicago contributed to this report.

Dixon: We need principled road policy

Link to article here.

Mr. Dixon has been a stalwart supporter of the cause for many years. He's sacrificed more hours than we can count in Austin advocating for taxpayers on transportation issues. This article was also published in the Lone Star Report. It hits the nail on the head of how we move forward...

Tired of Gridlock? Try Principled Road Policy
by Don P. Dixon
Dallas Morning News, Guest blogger
Mon, Apr 12, 2010

The main reasons Texans are stuck in traffic is a massive failure in public road policy, lack of reforms and inefficiency at TxDOT. The fact is that public roads are a low priority for the state.

In 30 years the state budget went up 8.66 times – from $10.22 billion in 1980 to $88.57 billion in 2009. In the same 30 years, road work went up 2.69 times from $1.58 billion to $4.25 billion.

  In 1980, Texas spent 15.45 percent of state budget on road work (maintenance and new construction). In 2009 Texas spent 4.8 percent of state budget on road work.

Whether state leaders believe it or not, in 30 years road work priority and efficiency continue to deteriorate. Car and truck drivers have paid billions in gas taxes and registration fees to build and maintain the roads, but almost half is diverted away from public roads. All gas tax and registration fees should go to public roads.

Taxpayer restitution of at least $12 billion needs to be corrected by temporarily transferring auto/truck sales tax (including parts sales) to public roads, almost $4 billion per year.

Before the public is asked to pay more in new taxes, reform of road policy must occur:

1. Stop building roads with debt such as $12 billion state road debt and $12.7 billion plus off-budget toll road debt.

2. The toll road debt and costs to run toll road bureaucracy are unacceptable, unaffordable, and unsustainable.

3. End diversions completely.

4. Increase TxDOT efficiency and stop wasteful spending.

5. TxDOT must halt the siphoning of billions of dollars from public roads to convert public right of ways into toll roads, i.e., stop tolls, stop CDAs (privatizing road ways).

6. End non-traditional financing (innovative financing).

The off-budget tax increases the state leaders have laid on drivers through tolls and privatizing Texas roads are confiscatory taxes. This must be stopped.

The toll tax of 17 cents to 75 cents per mile means the driver pays $4 to $17 per gallon extra for toll roads.

The 87 toll roads TxDOT has on its books will cost Texans, optimistically speaking, a minimum of $177 billion in toll tax over 22 years, which annualized is more than the current TxDOT budget.

No one likes tax increases; however, if additional funds are needed after reforms, the statewide gas tax per gallon is the most efficient and most fiscally responsible way to fund roads.

With regard to the local option tax, Gov. Pat Neff (father of the public road system) learned it served only to create a patchwork road system. He saw it was a failed system, so he founded the statewide highway system.

A uniform statewide public road system funded at the state level – freely accessible by all citizens, regardless of income, status or location - is the proper and rightful duty of the state.

The once superior ranking of the Texas public road system was lost by compromising sound, principled road policy. Thus we are in road gridlock.

Restoration of an equitable statewide public road system will come about only through our elected leaders, in every branch of government, recognizing the cause and courageously mandating an accountable agency using best practices and a sound fiscal policy in order to regain the taxpayers’ trust.

Don Dixon is a retired engineer who lives in San Antonio.

Toll reader mistakes digits, bills & fines WRONG driver

Link to article here. Electronic toll equipment continues to be rife with problems that fine and harass innocent motorists. Refunds are late in coming if ever, but bills and fines sure aren't!

Toll road computer needs glasses
Misreads an 8 as a 0; issues fine to Army wife in South Korea
By Jon Yates
CHICAGO TRIBUNE
What's Your Problem?
April 11, 2010

It's pretty clear Heather Perry didn't blow through a toll without paying March 10, 2009.

For one thing, she was half a world away, living with her Air Force husband, stationed at Osan Air Base in South Korea.

For another, she didn't own the car photographed by an Illinois tollway camera. Even the license plate number was wrong. Perry's plate, which sat in a storage facility in California, ends in a zero. The license plate in the picture ends in an eight.
By the time the notice of violation arrived at her mother's Broadview home, there had been three violations mistakenly attributed to Perry.

Each missed $1 toll had been assessed a $20 fine, bringing the total to $63. The notice of violation gave Perry 14 days to respond. If she didn't, she would be found liable for the tolls and assessed another $150 in fines.

Her mother, Phyllis Perry, forwarded her the letter immediately.

"Because she's in Korea, she went ahead and paid," Phyllis Perry said. "I told her not to. I said we have some time. I think she was worried she'd get fined, and it would double. She didn't feel like she could fight it."

A short time later, Phyllis Perry called the Illinois State Toll Highway Authority and pleaded her case. A customer service representative reviewed the case and agreed with her.

Turns out, a computer that reads the license plates of toll violators had erroneously interpreted the eight as a zero. A toll authority worker who is supposed to review the computer's work failed to catch the computer's error.

The customer service agent promised to send Perry a $63 refund.

That was more than a year ago.

Phyllis Perry had almost forgotten about the refund until she received another notice from toll authority last month. It seemed history had repeated itself.

The same car that blew through three toll plazas in 2009 had blown through another three this year. Again, the tollway's computer misread the license plate. So did the toll authority's human employees.

For the second year in a row, the toll authority sent Perry a notice that she owed $63.

"It's the same car, the same license plate, the same exits as the car that did this in 2009," Phyllis Perry said. "It's very, very crazy."

Phyllis Perry said she called the toll authority again, and a customer service representative immediately agreed to erase the newest batch of fines. Phyllis Perry then asked about the status of her daughter's refund from last year.

"She told me you have to be patient."

Patience is one thing. But an entire year? Tired of waiting, she e-mailed What's Your Problem?

"I'm very, very frustrated," the mother said. "It bothers me that they want more money for things going on in the state, and they can't take care of this one little problem."

The Problem Solver called toll authority spokeswoman Joelle McGinnis, who looked into Perry's case. A few days later, McGinnis called back with a mea culpa. Put simply, the toll authority dropped the ball.

"We have documentation of the request for the refund coming to our contracted customer service center," McGinnis said. "Unfortunately, that request never was processed."

It has been now. McGinnis said the request was hand delivered to the appropriate office on Wednesday. Perry should be getting her check for $63 within about a week, McGinnis said.

Phyllis Perry said she will call her daughter and inform her of the good news. When the check arrives, she will forward it to Korea immediately.

She said the process still bothers her.

"When I called them this last time, (the customer service agent) told me I just have to be patient, that these things take time," Phyllis Perry said. "She should have told me it wasn't in the system, and we could have gone from there."

Not that she's too upset.

"At least it's coming now," she said. "As long as it's coming, I'm happy."

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