U.S. Eyes Privatizing Cargo Security Work

link to Washington Times article here.

Commentary: See a trend here? Yet more privatization of key public infrastructure. Seems EVERYTHING is for sale, and that there is seemingly no end to the public infrastructure politicians are willing to privatize at the expense of national security and the public good. As long as the good ol’ boy BIG MONEY interests get their pay-offs, our politicians seem to think all is well in the world. Shutting out and ignoring the grassroots will NOT work and in fact, will BACKFIRE! No one is opposed to contracting with private companies when there’s efficiency, transparency, oversight, and competition, but Americans have well-founded concerns and even outrage when our limited public infrastructure is handed over to private companies for commercial gain. Taxpayers can’t go build another highway if we don’t like how Cintra or some other foreign company tolls us. Highways are the responsibility of government not private contractors who have profit as their motive. Highways, ports, cargo inspection, and airport management SHOULD NOT BE OUTSOURCED!

Whether it’s toll roads, ports, cargo, highways, or airports, foreign companies are buying up control of America through control of our commerce and major trade routes. If these companies control our commerce, they control America and can bring us to our knees. Giving foreign entities 50-99 year monopolistic sweetheart deals, kept secret from the public, with no cap on rates and no oversight by any elected official (like Governor Perry and our Legislature is doing on toll road contracts) isn’t American, Capitalism, or free market…it’s highway robbery and the citizens of this GREAT REPUBLIC will not sit idly by and allow it to happen! It’s time for the President, Congress and our Texas politicians to get their priorities straight. If we’re so mismanaging our hard-earned tax money that we can’t hire proper personnel to oversee puboic infrastructure and national security, then they don’t deserve to hold office. Look no further than the $295 BILLION highway bill Bush signed last summer with 6,000 earmarks for congressional pet projects that have little to do with maintaining or improving needed highways. Between that and other pork-laden bills, we’re clearly paying enough taxes, what we have is a spending problem which lies at the feet of our politicians. To our weak, lobby-friendly, easily purchased politicians: get your priorities straight and house in order or we’ll do it for you! Thank God we have elections this fall to ensure that they do!

U.S. eyes privatizing cargo security work
By Audrey Hudson
THE WASHINGTON TIMES
March 21, 2006

Homeland Security officials are looking to have private companies validate the security procedures under which cargo travels from foreign ports into U.S. terminals.
The program, which would give speedier entry to U.S. ports to ships and suppliers that meet the security standards, is now in the hands of 80 Homeland Security inspectors who have to plow through more than 10,000 applicants.
Although Homeland Security plans to hire an additional 40 inspectors in the coming months, the department also is looking to outsource to private companies some of its duties, in particular the validation process, which has dragged for years and involves on-site inspections of ships and cargo abroad.
More than 5,800 companies currently get some shortcuts by being “certified.” But only 1,545 have been “validated” to receive the full benefits of the program after first-hand inspections, such as fewer on-site checks at U.S. ports, said Jayson P. Ahern, assistant commissioner of field operations for Customs and Border Protection.
Mr. Ahern says the manpower shortage has the department exploring other options, including contracting the work to the private sector.
“I am not happy where our progress has been,” Mr. Ahern told a House panel last week.
The Customs-Trade Partnership Against Terrorism (C-TPAT) was initiated after the September 11 attacks to secure the cargo chain from port to port. Companies that open their doors to full security inspections get fewer checks at ports of arrival and faster processing.
Although critical of the program’s sluggish pace, Rep. Loretta Sanchez, California Democrat, endorsed the idea of outsourcing.
“We are relying on companies that we haven’t even gone out to check to see if in fact they have the security things in place that you said they had,” says Miss Sanchez, ranking member of the House Homeland Security subcommittee on economic security, infrastructure protection and cybersecurity.
“I mean, you have 80 people that can’t possibly check these 10,000 companies. What about having somebody else check them?” said Miss Sanchez, who formally asked the agency to consider privatizing the work.
“We have, to this point, resisted the notion of third-party validators. We think it is a responsibility that we should be doing in the government, and not necessarily contracting it out. However, given the current situation … we want to have more parties involved with a trusted program. We want to have the largest corporations in the industry, the importers reaching back to their suppliers, vendors, manufacturers, putting levels of security in place throughout the supply chain,” Mr. Ahern said.
“So perhaps we are coming to a point in time where, in certain environments with certain countries that may not be of a significant risk, maybe [using] the third-party validator has a [place] for us. So we are going to be evaluating that with new eyes, but to this point we have been opposed to it,” Mr. Ahern said.
Suzanne Trevino, a spokeswoman for CBP, said yesterday that her agency is looking at the prospect of hiring third parties to validate security.
“At this point, the only thing we will say is that we will look at it, but we have not started a formal process. We don’t have the resources to complete the validation necessary or that Congress wants,” Mrs. Trevino said.
Last March, the Government Accountability Office criticized the program and cited weaknesses in the validation process, which it said “is not rigorous enough to achieve its stated purpose, which is to ensure that the security procedures outlined in members’ security profiles are reliable, accurate and effective.”
As of Nov. 2, 2004, more than 7,300 applications had been filed. Of them, 4,153 had been certified and slightly more than 400 validated. Almost 3,000 applications have since been filed.
Peter Tirschwell, publisher of the Journal of Commerce, called the Homeland Security idea an “outsourcing of security.”
“They exist in a commercial environment to facilitate commercial transactions. Something as important as our national security, asking them to perform what is a government role — it’s hard to see how that could be successful,” he said.
The move comes on the heels of furor over a plan for a Dubai company to operate terminals in six U.S. ports. Asked whether the current mood against foreign companies operating in matters of national security might affect this proposal, Mr. Tirschwell said, “I think it would not be looked at favorably.”
Seth Stodder, former director of policy and planning for Customs and Border Protection, said private validation firms can serve as a “force multiplier” but the final responsibility has to lie with the government.
The devil’s always in the details, but in the abstract, I think it’s a good idea to help CBP get more validators out there, and that’s critical,” said Mr. Stodder, who works with the lobbying firm Akin Gump Strauss Hauer & Feld LLP.
“There is a need to step up validation and make it faster, but there are hurdles to think about when using third parties — training and management, vetting employees,” Mr. Stodder said.

Public-private partnerships spread like a national canker

Innovation Briefs
News Analysis
March 20, 2006

We have received numerous requests for periodic updates to our “Tipping Point” brief documenting new developments in highway tolling. Here is a roundup of news since the late January. Its highlights are the final passage of the Indiana Toll Road concession bill (signed by Governor Mitch Daniels on March 15) and the March 10 announcement by the private equity fund, The Carlyle Group, that it will start investing in transportation infrastructure. These brief overviews are not meant to replace the excellent in-depth reporting by my colleague, Peter Samuel, in his web-based TollRoadNews.com (which we recommend highly to anyone wishing to follow toll road developments in depth.) Our succinct announcements are merely offered in further evidence of the growing role of highway tolling and private sector involvement in developing and financing highway infrastructure.

January 24, 2006: Ohio Secretary of State Ken Blackwell, a candidate for Governor, proposes to lease the Ohio Turnpike to private investors. The proposed concession should generate $4-6 billion according to Blackwell. Unlike Indiana whose concession payment will be devoted fully to expanding and modernizing the state’s transportation network, Blackwell would invest the funds in economic development projects across Ohio, a move that has already stirred up criticism.

February 19: Federal Highway Administration approves a Colorado DOT study that recommends a $385 million plan to add toll lanes on C-470 between I-25 and South Kipling Parkway, a 12.5 mile road that handles up to 100,000 vehicles a day. With Colorado’s highway budget extremely tight, tolling, it seems, has emerged as a preferred way of paying for highway expansion.

February 22: A proposal championed by State Senate president and former Gov. Richard Codey would lease or sell the New Jersey Turnpike or the Garden State Parkway, a deal that Codey advisers say could raise more than $12 billion to replenish the nearly bankrupt state Transportation Trust Fund. For the time being, Gov. Corzine has taken a wait-and-see attitude, and is leaning in favor of refinancing the fund’s debt of approximately $7.3 billion, according to press reports. Corzine is the former head of Goldman Sachs, the Wall Street firm that has figured prominently as financial advisors to Governor Mitch Daniels in the Indiana Toll Road negotiations. Some of our sources speculate whether his former colleagues might not eventually change the Governor’s mind.

February 28: Future sections of Interstate 540 and the Triangle Parkway through Research Triangle Park are being considered as toll roads. Building the roads now and paying for them later with tolls could speed up road construction, according to Perry Safrant, head of the North Carolina Turnpike Authority. The first toll road is expected to be under construction in the Research Triangle area within a year.

February 28: The House Select Committee on Toll Roads of the Pennsylvania State legislature releases a study recommending approval of legislation that would enable the state to enter into public-private partnerships and use toll-generated revenue to fund construction of new roads (“Study of Innovations in the Funding and Delivery of Transportation Infrastructure Using Tolls” by John T. Durbin, former executive director of the Pennsylvania Turnpike Commisssion). “The bottom line is that existing public funding is insufficient to meet the growing needs of Pennsylvania’s transportation infrastructure…We’re just not going to be able to raise any more revenue at the pump,” said Richard Geist, chairman of the House Transportation Committee. The most likely first candidate for a tolling concession is the proposed MonFayette Expressway/Southern Beltway south of Pittsburgh.

March 1: A bill (SB 80) authorizing Utah’s DOT to enter into public-private partnerships to build new toll roads passed the state legislature. According to press reports, the first likely target will be the planned Mountain View Corridor stretching from the Salt Lake City International Airport to Pleasant Grove.

March 10: Texas DOT issues a Notice of Intent to issue Requests for Proposals to “develop, design, construct, finance, maintain and operate” a series of toll projects. Among them are two segments of the Trans Texas Corridor (I-35 and I-69), two Managed Lane projects (IH-635 and IH-820/SH-183) and seven other toll-related procurements. The projects will be developed under “Comprehensive Development Agreements” with private road builders.

March 10: The Carlyle Group, one of the largest and most respected private equity firms, announces creation of an Infrastructure Investment Team “to conduct investments in the infrastructure sector, including investments in transportation facilities…” The team will engage in public-private partnerships with governments at all levels as well as purchase projects outright or through long-term concessions, the announcement said. The eight-member team will be co-headed by Robert W. Dove, former Executive Vice President of Bechtel Enterprises Barry Gold, former Managing Director at Citigroup/Salomon Smith Barney. “The U.S. is finally starting to realize what the rest of of the world has learned, that private dollars can help to alleviate persistent infrastructure challenges,” said David Rubenstein Carlyle’s CEO in announcing the initiative.

In our January/February Brief, “Private Toll Road Financing: Will the US Transportation Community Rise to the Challenge?” we asked rhetorically “What would it take to persuade private equity funds to participate in toll road financing?” Our thanks to the Carlyle Group for providing the answer.

March 15: New York State holds a conference in Albany New York to address innovative approaches to the funding of transportation infrastructure. Participating in the conference were Thomas Madison, Commissioner of New York State DOT, Michael Fleisher, Executive Director of the NYS Thruway Authority and members and staff of the New York State legislature. The 300 attendees included a Who’s Who of the financial and construction world, including the Wall Street firms JP Morgan, Lehman Brothers, UBS, Merrill Lynch and Macquarie Securities; and construction/engineering giants, Bechtel, DMJM+Harris, Fluor, HNTB Corporation, Kiewit, Parsons Brinckerhof and URS Corporation. Discussion centered around two types of initiatives – public-private financing of new transportation projects and concessions of existing toll facilities as a means of raising capital for new construction. The conference was organized by the Region 2 University Transportation Research Center, Robert Paaswell, Director.

March 15: Governor Mitch Daniels signs a landmark bill authorizing a concession of the 157-mile Indiana Toll Road to the Macquarie-Cintra consortium for 75 years. In exchange, the state will receive an upfront payment of $3.8 billion with which the Governor intends to finance a program of highway improvements across Indiana, called “Major Moves. As one of our colleagues remarked, “For those of us who are used to waiting decades for the funding needed for projects to advance, this transaction is mind numbing. Suddenly, the State’s entire 10-year plan is funded.”

Some media dispatches chose to focus on the fact that the bill “squeaked by” in the House by a mere three votes. Undoubtedly, the measure suffered in the final weeks from adverse publicity generated by the Dubai port deal and the nativist sentiments that it aroused. But the anti-foreign opposition, we suspect, will be short lived, as the public learns of improvements in the toll road’s operation by its new “owners” and as the U.S. investment community becomes more involved in concession-type deals (see the Carlyle Group announcement above).

C. Kenneth Orski
Editor/Publisher
Innovation Briefs
10200 Riverwood Drive
Potomac, MD 20854
tel: 301.299.1996
fax: 301.299.4425
www.innobriefs.com

Wentworth claims to be advocate of Open Government, but what about secret toll road agreements?

Jeff Wentworth touts himself as a strong advocate for open government and yet DOES NOTHING to force the Department of Transportation (TxDOT) to open the records on secret toll road agreements. Having just concluded Sunshine Week: Your Right to Know Texans are demanding just that! Texans have a RIGHT TO KNOW what taxpayers are being asked to pay for. The courts agreed and yet TxDOT and Cintra continue to keep the records secret while they tie up the case in court and continue building the toll road (Read article in Houston Chronicle here.).

Wentworth asked the Transportation Commission to consider the original plan for 281 improvements rather than push tolls, but his law firm represents road builders and the BIG MONEY special interests who stand to profit handsomely off these toll roads. So perhaps the Transportation Commission realizes his letters and gestures are just that, gestures with NO REAL TEETH. Therefore, on they march to convert exitsing highways into tollways without so much as a REAL fight from our legislators! Toothless overtures won’t cut it. Demand toll-free solutions and build consensus (not throw in the towel at a veto threat) to FIX the transportation funding mechanisms (like stopping the diversion of gas taxes to fund things other than highways!). Stop the blame game and get us moving again!

Read how Wentworth’s law firm promises to use its government affairs professionals to “secure competitive advantages for their clients”: “We combine unmatched government affairs capabilities with the substantive and legal background necessary both to discern how decisions made in Washington, DC, and in state capitals will affect clients’ interests, and to develop and implement strategies to defend and further those interests and secure competitive advantages for our clients.”

CONTACT WENTWORTH at (512) 463-0125, (210) 826-7800 or jeff.wentworth@senate.state.tx.us and ask for:
1) a true side by side comparison of highway costs using gas taxes versus tolls (as was done by the Austin MPO who found it was only 2 cent gas tax increase, NOT 50 cents to $1.00 as the Transportation Commission claims with no PROOF)
2) a public vote on all toll projects (whether they’re in progress or not)
3) to put up REAL opposition to tolling 281 and insist the ORIGINAL plan that’s ALREADY FUNDED be installed NOW!

Sunshine Week sheds light on the importance of open government
by Jeff Wentworth
State Senator, District 25
Published: 03-20-06

Texas news media recently observed the second anniversary of “Sunshine Week: Your Right to Know.” While the official weeklong observance has concluded, I believe that the spirit of Sunshine Week should continue throughout the year.

As a strong advocate for open government, I am reminding Texans that the Texas Public Information Act affirms each person’s entitlement to complete information about the affairs of government and the official acts of public officials and employees.

Unfortunately, public officials often fail to provide Texans with the information that they request and are entitled to have. These officials fail to provide the requested information in spite of landmark freedom-of-information legislation that I authored and the Texas Legislature passed in 1999.

Requests for open records rulings made to the Attorney General’s Open Records Division have increased nearly 50 percent over the last two years. In 2005, the division received more than 12,000 open records requests. More than 10,000 calls per year are made to the Open Government Hotline’s toll-free number, (877) OPEN TEX (673-6839).

While it is the Attorney General’s job to determine what information must be disclosed and what may legally be kept confidential, many of the requests would not be necessary if public officials knew the law. While some public officials may deliberately stonewall those requesting information, the vast majority may request an Attorney General’s ruling because they simply aren’t sure what is public information and what is not.

To ensure that state government is both open and responsive, I filed Senate Bill 286 during last year’s regular legislative session at the request of Attorney General Abbott. The Legislature passed the bill, and it was signed by the Governor. Senate Bill 286, which became effective January 1 of this year, requires that the elected and appointed public officials in the 2,600 governmental entities in Texas take an open government training and education course through the Attorney General’s Office.

I am happy to report that 4,600 public officials have completed the one-hour Public Information Act course, and 5,000 have completed the Open Meetings Act course. The courses, which are available both online and on video, are being taken by city and county officials, school board members, and state agency and commission employees.

One Texas city sponsored an open meeting where all city board members watched the two-hour video. After the video, a panel answered questions. My Jurisprudence Committee director and general counsel, M. L. Calcote, was a panel member.

Information about filing open records requests and filing open records complaints is available on the Attorney General’s Web site: www.oag.state.tx.us.

I am happy to see that public officials are responding in such a positive manner. To ensure that state government is open to all Texans, I encourage every public official to follow the law and take the required courses so they may better understand their
responsibilities and respond appropriately and in a timely manner.

Letter to Editor challenges Chapa pro-toll article

Read it in the Express-News. Jonathan Epstein and Tom Bergo both address the toll road debacle in their letters…WAY TO GO! The Express-News has been flooded with letters like these, and yet they only print drips and drops! Notice how Tim Tuggey, HUGE pro-toll proponent, gets all kinds of ink to tout Via without questioning his conflicts of interest. His law firm represents the highway lobby and he sits on the Via Board and yet he advocates gobbling up all available transportation dollars for highways without seeing to it public transit is properly funded.

LETTERS TO EDITOR
Put $200 million toward things we really need

It is amazing how quickly County Judge Nelson Wolff and his cronies can find $200 million to throw at a Major League Baseball team and I am driving on major arteries filled with potholes and trash.

Extending the hotel and rental car tax seems to be the answer to funding everyone’s boondoggle. The tax funded the SBC/AT&T Center, which, of course, had nothing to do with tourism. Now that it will soon expire, either rescind it or point it toward something that tourists actually use, such as our roadways and other infrastructure.

The tax itself is one of the highest in the country, and it is time to make good use of the funds on things the city actually needs and not pie-in-the-sky projects.

Jonathan Epstein

Toll roads stifle growth, slow everyone down

The Editorial Board needs to reconsider its stance on toll roads and their value to a community. I can think of no better way to stifle growth and slow down the efficient movement of people and goods. Having lived in Chicago for 10 years and seeing the tollways there in and around Illinois, I have concluded toll roads are no better than free roads during any period of heavy traffic — just more expensive.

The article “The logical route” by Rebeca Chapa seems to rely heavily on quotes by those interested in seeing the tollways built and not on those who oppose them. This myopic view pays a disservice to readers and exposes the paper to the criticism that it and its editorial staff are influenced by those who will profit financially from the toll construction and not by the people of the community who have already paid for the roads and will have to do so again.

It is not so much the fact that the construction will merely have to build frontage roads and call this “equivalent.” The fact is that the right of way that they will be assuming and charging me for was already paid for with my tax dollars once.

This pattern of missed opportunities for leadership seems to be rampant throughout the Texas government. Saying every future road should be a toll road allows Gov. Rick Perry to sidestep one of the hard issues, just as he and the Legislature have sidestepped other hard issues. Another example is school funding and property tax reform. By doing nothing, the politicos have had a solution forced on them by the courts so they can individually claim they are not responsible for the outcome.

Any publication worth its salt would investigate all sides of an issue and report both sides fairly — which the Editorial Board has plainly not done. The board has obviously missed the fact that improvements for “fixing” the problem with U.S. 281 were already funded and ready to go when the tollway solution was mandated on the unsuspecting public. My suspicion is that inflation will cause these funds to be insufficient when the toll solution is finally rejected and that my tax dollars will have to make up this shortfall.

Further, I have a problem with any deal made between the state and a private concern where the contracts are not available for the public to examine — especially when I’m paying for the service the firm will be delivering.

Please take a step back and re-examine this issue from the standpoint of a taxpayer who has already paid for a service once and will have to pay for many times more if the tollway issue is not stopped. It would not be so bad if the tolls were stopped when the road was paid for, but the profit motive of a private company will ensure they will live on forever.

Tom Bergo

More private companies to jump on infrastructure bandwagon

Read Express-News Reporter Pat Driscoll’s blog.

Note: Carlyle Group is affiliated with Citigroup who regularly attends the Alamo Regional Mobility Authority (tolling authority) board meetings.

The privatization bandwagon
March 20, 2006
By Pat Driscoll

Foreign companies aren’t the only ones interested in buying U.S. roads, rails, ports and other assets.

Does Carlyle Group sound familiar?

The Washington-based firm, formed in 1987, is known for its defense investments and connections to the Bush family and other high-level officials worldwide (as investors, employees or advisors).

But just how American a high-stakes financial company can be in an increasingly global economy is a good question.

Until shortly after the 9-11 terrorist attacks, investors in the Carlyle Group included family members of Osama bin Laden, according to media reports. The word lately is that the United Arab Emirates is an investor. UAE owns Dubai Ports World, whose bid to operate almost two dozen U.S. ports unleashed a political firestorm.

Anyway, Carlyle has started raising money to invest mostly in U.S. infrastructure, in transactions ranging from $100 million to more than $1 billion, the firm said.

The fund is the first of its size that’s focused on U.S. assets, Dow Jones Newswires reported.

Also, from the Dow Jones story, Carlyle and me:

•The U.S. needs an estimated $1.6 trillion over the next five years to replace and expand its roads, rail lines and other infrastructure, according to the American Society of Civil Engineers. Since 1995, more than 20 states enacted laws to allow private companies to take over the financing, construction and operation of public infrastructure.

•Barry Gold of Citigroup will co-head the new Carlyle fund. He led the financing of the Chicago Skyway, Toronto’s Highway 407 and California’s State Route 91. Cintra SA of Spain and Macquarie Infrastructure Group of Australia, companies competing to take over 47 miles of planned toll roads in San Antonio, bought the Skyway operation and Cintra gets half its earnings from Highway 407.

•U.S.-based Goldman Sachs is also raising an infrastructure fund, but one with a global focus. This is the firm that stands to collect about $20 million in fees in a deal to lease the Indiana Toll Road to Cintra and Macquarie.

Perry tries to flee from Dubai port firestorm and his toll road deals

Link to article in Waco Tribune here.

Cintra and its partner Macquarie are planning a hostile takeover of our freeways in San Antonio over the LOUD and WIDESPREAD objection of the PEOPLE. Cintra-Macquarie will contorl the Chicago Skyway, the Indiana Toll Road and are poised to purchase control over our publicly owned freeways in San Antonio. We’ve been linking the public infrastructure takeover like this: the Dubai ports firestorm and Perry’s toll road deals are the SAME THING! According to a Rasmussen poll, over 80% of the country is AGAINST foreign management of our public infrastructure (Rasmussen poll here.) and whether Perry’s campaign wants to acknowledge it or not, that’s what he’s doing. We’re continuing to work with fellow concerned citizens all over this state to inform the public about this debacle and to send the Governor packing since he refuses to heed the will of the people and refuses to stop the foreign management of our public infrastructure! (See previous blog on this subject)

Officials not linking ports deal, new tollway
By Mike Anderson
Tribune-Herald staff writer
Sunday, March 19, 2006

Federal officials have been squabbling in recent weeks over a proposal to give operations of some U.S. ports to a Dubai company, but in Texas, state officials don’t appear to share the same concerns about a Spanish company operating portions of the proposed Trans-Texas Corridor.

On Thursday, a state-owned Dubai company announced it was backing out of a deal to manage some terminal operations at six American ports, amid a political firestorm in Congress. President Bush supported the arrangement, but it was opposed by some in Congress who expressed concern about security issues arising from having a foreign company operating U.S. ports.

Meanwhile in Texas, the Spanish company Cintra, joining with San Antonio-based Zachry Construction, has signed a contract with the state to develop portions of the Trans-Texas Corridor between Mexico and Oklahoma.

Gov. Rick Perry proposed the project in 2002 as a means to handle current and future trade traffic and population growth by providing an alternative to the interstate highway system. The project would bring together highways, rail and utility infrastructure in a 1,200-foot-wide tollway. The Texas Department of Transportation is expected to announce a 10-mile-wide environmental impact study area for the corridor in the next few weeks. The corridor will likely pass through McLennan County.

Cintra has proposed investing $6 billion to build a toll road between Dallas and San Antonio by 2010, with an additional $1.2 billion to extend the corridor to Mexico, state officials have said. In return for the investment, Cintra has proposed to negotiate for a 50-year contract to maintain and operate the new highway as a toll road, officials have said.

When Perry proposed the corridor, he promoted it in part as a way to improve the state’s ability to prevent and respond to terrorist attacks or other disasters by creating hazardous material routes outside major cities. He also touted the corridor as providing transportation alternatives which would make it more difficult to paralyze the state’s infrastructure.

On Friday, Perry spokeswoman Rachael Novier said while ensuring Texans’ safety is the governor’s number one priority, she does not see a parallel between the operation of the Trans-Texas Corridor and the concerns expressed over a Dubai company overseeing American ports. Novier pointed out that Cintra will be working with Zachry Construction, which she described as the nation’s largest construction firm.

State transportation department spokeswoman Gabby Garcia said even if Cintra operates the toll road, the state will retain oversight and ownership. She added that while Cintra will be the first at the table to negotiate to build and operate the corridor, that does not mean they are guaranteed to be the builder. She said the competitive process is ongoing.

One person who has been critical of the state’s corridor plan, Waco resident Rick Wegwerth, laughed when ask about a possible comparison between foreign operation of ports and the corridor.

“Isn’t that funny that we give a 50-year monopoly to a Spanish company to put in a highway to nowhere, then at the same time everybody has a huge problem with a foreign company running our ports,” said Wegwerth, an organizer of the McLennan County anti-corridor group DERAIL.

The New York Times news service contributed to this story.

manderson@wacotrib.com

757-5741

Guerra: Non-compete agreements are the devil in the toll road details

Link to article here.

Carlos Guerra: With toll roads, the devils in the details could be astounding
Web Posted: 03/16/2006 12:00 AM CST
San Antonio Express-News

Two decades of white-knuckle drives to Austin on Interstate 35 are proof that highway work isn’t a quick endeavor. But what few realize is that planning started years before construction, and Texas Department of Transportation planners have never stopped altering and tweaking their plans.

It makes sense. Big highway projects can cost hundreds of millions of dollars and permanently change communities.

But other things to consider are that a major highway built to nowhere will, in time, make it somewhere because a highway goes there. Big roads can defy the laws of supply and demand. Planners often warn against trying to “build your way out of congestion” because building a highway might actually increase demand and necessitate even greater expansion.

Phillip Russell, director of TxDOT’s Turnpike Authority Division, is now busily working on details for Texas’ regional toll roads and the Trans Texas Corridor.

With new powers granted by the Legislature, TxDOT’s dependence on fuel taxes to fund road building will decline as reliance on tolls — collected by the state and private-sector concessionaires — increases.

Private-sector money, TxDOT officials say, will accelerate regional projects and fund construction of the Trans Texas Corridor, whose 1,200-foot-wide right of way — with tolled lanes, rails for commuter and cargo trains, and right of way for utilities — will crisscross the state.

But the conceptual map, which depicts the potential quarter-mile-wide routes within 50-mile-wide swaths, has so worried farmers, ranchers, wildlife conservationists, water rights activists and environmentalists that they have coalesced to oppose the project, and toll-roads in general.

“You have to understand that the Trans Texas Corridor will be built as needed and as private-sector funding makes it feasible,” Russell says, adding that, so far, TxDOT has awarded only one TTC contract, a $3.5 million pact with Cintra-Zachry to develop plans for the first leg, which will eventually link Oklahoma and Mexico.

All toll road contracts, Russell emphasizes, will include an option for Texas to buy the road back, a seemingly pointless gesture because if the state can’t afford to build the roads now, how will it afford to buy them back? Russell is also frank about why investors would want into such deals.

“Are they willing to take all this risk out of the goodness of their hearts? Of course not,” he says. “Clearly, they want a return and they want to be paid back.”

He also is clear about another little-mentioned element likely to be part of toll road bond issues: Underwriters will probably require limits on options for people who choose not to pay tolls.

“Wall Street wants to know they’ll get paid,” he says of the no-compete clauses, but adds that discussions with potential investors lead him to believe that the bankers will allow Texas to build competitive commuter rail and roads “already on our 25-year plans.”

But with that reassurance — and realizing how inexact planning can be — TxDOT’s planners better have the finest crystal balls available, because such constraints mean that regardless of unforeseen changes, only those toll-free roads already in the plans will be allowed over the next 25 years.

And since toll road bonds won’t mature for 40 years, after year 25 it would be 15 more years before the state could build competing roads for people to take toll-free.

Do we really want this?

To contact Carlos Guerra, call (210) 250-3545 or e-mail cguerra@express-news.net.

Express-News Neighbors- Resident says: "It's (tolls) doomed before the get-go."

Link to article.

The headline is misleading in that it looks like they’re simply “studying” toll lanes. Not so, 1604 toll lanes are already in the toll plans and contract negotiations are near completion. Perhaps yet another ploy to catch the public off-guard and unawares until it’s too late. Otherwise, a very fair and balanced article.Though TxDOT and the RMA keep stating the public financing option is still on the table, TxDOT’s statements here make it clear the private deal is the way they’re going, “Officials said little or no money would come from public funds because of a plan to use private investments to construct the start-up toll network and open the lanes to motorists sooner. That will free up more money from the state to be used for other needed projects.”

The “public funds” they refer to is the $77 million for the improvements on 281, $48 million of which has been funded and programmed since 2004 along with public bond debt. Bexar County Commissioner Lyle Larson has stated TxDOT has not been honest with taxpayers about the amount of gas tax funds being used to build these tollways (Read his statements in WOAI story here.). TxDOT gives the impression it’s private money fronting this, but a heap of tax dollars and bond debt goes into the equation as well. Over $500 million of YOUR gas taxes have alreayd been allocated for toll projects thanks to the MPO (See what MPO and other toll terms mean here.)!

Officials studying Loop 1604 toll concept
Web Posted: 03/15/2006 12:01 AM CST
Lety Laurel
Express-News Staff Writer

People driving along Loop 1604’s northern arc someday may have a choice between congestion and stopping for traffic lights or paying a toll to avoid them — whether they want the option or not.

Texas Department of Transportation officials are investigating whether placing toll lanes along Loop 1604 between Highway 151 and Interstate 10 East is a feasible and economically viable solution to the traffic woes that exist along the route.

The estimated price tag is $1.4 billion for the entire 47-mile project, which also includes a portion of U.S. 281 from Loop 1604 to Comal County. Officials said little or no money would come from public funds because of a plan to use private investments to construct the start-up toll network and open the lanes to motorists sooner. That will free up more money from the state to be used for other needed projects, they said.

But critics of the plan say they doubt the transportation department’s need for more money and believe its plan to add toll lanes to relieve traffic will manipulate traffic congestion for profit.

“They overspend, and they are a picture of bloated government bureaucracy that needs to tighten its own belt and get its own house in order before it asks drivers to pay a toll tax to existing highways,” said Terri Hall, regional director and founder of San Antonio Toll Party, an organization opposed to tolls on roads or rights of way already paid for with tax dollars.

The group recently scored a victory when the Federal Highway Administration pulled environmental clearances on U.S. 281 toll road projects, halting construction for a year or more pending another environmental assessment.

But the department and the Alamo Regional Mobility Authority are moving forward with the Loop 1604 and U.S. 281 project. TxDOT lent $1 million to the ARMA to evaluate competing proposals to construct the project from two private consortiums, the Cintra Zachry Partnership and the Macquarie 1604 Partnership.

Hall said there are potential legal avenues that opponents can pursue with the Loop 1604 project, but TxDOT and RMA officials said they’re studying the environmental impact thoroughly.

Frank Holzmann, area engineer for the Texas Department of Transportation, said there isn’t yet a construction timeline for the loop project, but he anticipates the department will receive clearance to begin in January 2008, pending environmental clearances.

The idea, he said, is to add two toll lanes in each direction in the median between the lanes that exist now. The current lanes will remain or may be moved out to make room for the toll lanes, he said.

“We’ve done the modeling, and the reason we’ve come up with the lanes we have is we think it will handle the growth (that’s expected on the North Side),” he said.

Drivers could have toll stickers the size of inspection stickers that would allow them to drive through tolling gantries that would electronically charge the driver at each station without requiring them to stop, he said.

“If you think about it, all that traffic that’s going there now, there will be the same people that will say they will never pay the toll, but others like me will pay the toll,” Holzmann said. “You’re paying for convenience, essentially.”

Although the toll rate hasn’t been set, TxDOT is reviewing an amount of about 15 cents a mile, he said. That will change according to inflation, he added.

Hall said the only way to make toll roads work is to price them high enough to keep them flowing. Making them affordable would cause them to be just as congested as the free roads, she said.

“If tolls were so cheap or affordable that everybody could drive on them, they would be so congested because everyone would drive on them,” she said. “To make them work, you have to have free lanes congested and make them so miserable so you want to drive on the toll lanes.

“Those that can afford tolls get congestion relief.”

On the Northwest Side, to expand the loop from Highway 151 to Interstate 10 West using only public funds would take another 19 years, Holzmann said.

“By tolling, we are able to accelerate these projects,” he said. “There is some funding, but it was a number of years out. By tolling, we’re able to accelerate the projects and get them constructed where they are needed.”

Hall doesn’t buy that.

“They promised this to us when they planned (Loop) 1604: It was supposed to be a six-lane highway, but they only had money to build four lanes so they promised money was programmed and set for other lanes within three years. But suddenly they said they were out of money and the only way we will have the highway fixed is if we have toll lanes,” she said.

Natalie Gonzalez, 23, has lived in North San Antonio all her life. She now lives off of Loop 1604 and Hausman and said she’s seen the city’s population explode over the years. It’s not a small town any more, she said, but she’s not sure toll roads are the answer. She may buy a toll pass if the lanes are built, but it all depends on how much it costs.

“Most people who live out here probably can afford it, but probably what would become difficult is multiple vehicles per house,” she said. “I think there are a lot against it, but ultimately we cannot deny the city has grown tremendously.”

Chris Lench, 56, lived in Los Angeles and Washington D.C. before moving to San Antonio. He said he knows something about gridlock, and based on his experience in Los Angeles, specifically the tolling of State Route 91, he also knows about toll systems that don’t work.

“It won’t work,” he said of the local proposal. “It’s doomed before the get-go.”

If people can drive for free, they will, he said. The toll roads will lose money and fail, he predicts.

The answer to transportation nightmares, Lench said, is public transportation.

“All the great cities of the world — Tokyo, Paris, London, New York, Moscow — have good public transportation (systems) that are cost-effective and efficient,” he said.

Jan Gabel, 53, drives Loop 1604 about five times a week. She said she’d pay for the convenience that toll lanes offer. As someone who lived with the toll system in Dallas, she’s used to it, she said. (Note to Ms. Gabel: you got to VOTE on the toll roads in Dallas, it was a brand new road, not slapping tolls on funded, existing freeways, it was a flat toll rate, not charge by mile, and the money stayed local and wasn’t turned over to foreign management in secret deals with no cap on how high the toll rates will go!)

“My time is worth paying a toll every once in a while,” she said. “I think it’s a great idea. I think it will free up traffic a lot and there will be a lot less accidents, especially with all the growth here.”

Strayhorn gains on Perry

See latest Rasmussen poll here.

POLL DATA

Election 2006
Texas Governor
Rick Perry (R) 40%
Carole Keeton Strayhorn (I) 31%
Chris Bell (D) 13%
Kinky Friedman 9%

Election 2006
Texas Governorv
Rick Perry (R) 38%
Carole Keeton Strayhorn (I) 29%
Bob Gammage (D) 18%
Kinky Friedman 8%

Texas Governor: Perry (R) Still at 40%
Strayhorn Gains Ground

Survey of 500 Likely Voters
Conducted February 6, 2006

February 14, 2006–Carole Keeton Strayhorn’s defection from the GOP to run for Governor as an Independent is making things interesting in President Bush’s home state.

In the six weeks since Strayhorn announced plans for an Independent challenge, her support has increased ten percentage points. She is now within single digits of catching Governor Rick Perry. Depending upon which Democrat is added in the mix, Perry leads Strayhorn either 40% to 31% or 38% to 29%.
In our January election poll for Texas, Strayhorn earned 21% of the vote.
Both Democratic contenders currently attract less than 20% of voters and a fourth competitor, Richard “Kinky” Friedman is in the high single digits. At the moment, the Democrats and Friedman appear as by-standers in a Republican civil war.

Perry does better among conservatives while Strayhorn draws more support from moderates and liberals.Perry has a solid edge among Republican voters, but Strayhorn has a nearly 20-point advantage over the incumbent among unaffiliated voters.

Perry is still the favorite in this race, but the unusual dynamic of a Republican official bolting the party to challenge a Republican Governor could make for a wild political season in Texas.

Strayhorn is viewed favorably by 55% of voters in Texas and unfavorably by 31%. For Perry, the numbers are 53% favorable and 45% unfavorable.

Rasmussen Reports is an electronic publishing firm specializing in the collection, publication, and distribution of public opinion polling information.

Rasmussen Reports was the nation’s most accurate polling firm during the Presidential election and the only one to project both Bush and Kerry’s vote total within half a percentage point of the actual outcome.

During Election 2004, RasmussenReports.com was also the top-ranked public opinion research site on the web. We had twice as many visitors as our nearest competitor and nearly as many as all competitors combined.

Scott Rasmussen, president of Rasmussen Reports, has been an independent pollster for more than a decade.

The telephone survey of 500 Likely Voters was conducted by Rasmussen Reports February 6, 2006. The margin of sampling error for the survey is +/- 4.5 percentage points at the midpoint with a 95% level of confidence.

Indiana toll road done deal for Cintra-Macquarie thanks to GOP funded ads; the same companies who want to takeover the San Antonio toll project

See Driscoll’s blog about it.

Note who he calls the losers on the deal, those with concerns but without organization or deep pockets to combat the pro-toller propaganda and misinformation campaigns. We have the organization, now we need to get some deep pockets! Get on the phone folks! But my favorite is the backlash Republicans will get from having pushed this deal through when the public was against it 2 to 1…you bet there’ll be a B-I-G BACKLASH like the one we just helped orchestrate in the primaries!

MOVET IT! Blog
Very big deal
Two foreign companies competing to develop and operate toll roads in San Antonio now have a clear path to team up and pay the most ever for a government asset in the U.S.

By Pat Driscoll
Express-News Reporter
March 15, 2006

After much wailing and thumping, Madrid-based Cintra SA and Sidney-based Macquarie Infrastructure Group got approval Tuesday to lease the 157-mile Indiana Toll Road for $3.85 billion over 75 years. The deal is expected to be finalized in June.

A year ago, the Spanish and Australian firms joined up to lease the 7.8 mile-Chicago Skyway, the first private buyout of a tollway in the U.S., for $1.8 billion over 99 years. In Texas, Macquarie and Cintra are leading various consortiums competing for several toll projects, including San Antonio’s planned 47-mile network on U.S. 281 and Loop 1604 on the North Side.

Here are some of the winners and losers in Indiana’s deal, as gleaned from reports by the Indianopolis Star and Bloomberg:

WINNERS

•Republicans, who squeezed out a three-vote victory in the state House to pass needed legislation. No Democrats voted for the measure while just one Republican opposed. In the 31-19 Senate vote, four Republicans were opposed while two Democrats supported it.

•Gov. Mitch Daniels, who wants to use the money to help pay for his 10-year, $10.6 billion statewide road construction plan, which he says will create thousands of jobs.

Cintra and Macquarie , which are among a handful of companies seeking to build and operate toll roads in the U.S. and profit by raising tolls and installing electronic toll collections to cut costs.

•Global investment bank Goldman Sachs stands to collect about $20 million in fees as Indiana’s adviser.

LOSERS

•Democrats

•Republicans, who might face a backlash in some districts. “We acknowledge that it’s very, very hurtful to a likely Republican majority in the House the next time around,” one leader said.

•The average Joe — an Indianapolis Star poll of 501 Hoosiers statewide found opposition running 2-to-1.

Those with concerns but without deep pockets or organization to quickly respond to well-funded industry propaganda, laments this Fort Wayne Journal Gazette editorial.