Comments that came in after the December 1 article hit the front page…

—“Shame on our elected officials. This is corporate tyranny at its worst. Did our new Troll Masters donate any money to our benevolent ‘elected officials’??? We need some hangings here in Texas, starting with the Tollers who’ve sold their soul to the devil. When they complete our freeway improvements, the toll plazas shall be pushed aside like the trees that have fallen. FREEWAY OPEN!! Thanks for all you’re doing – keep the faith!!”

—“What can I do to help?”

—“what can I do right now? I read the article and I am sick about it. “

—“Maybe this has been addressed – maybe not! As I understand this operation a private company will build and operate these toll roads. There will be right of way takings I’m sure. The State will step in and condemn private propety and turn it over to private companies to operate their business. Is this correct? If so this is a federal constitutional issue.
Thank you for your work on this issue. I support you and wish you success.”

NOTE: He’s right, they’re taking our private land and leasing it back to private corporations. We need to litigate this aspect, absolutely since our politicians are ignoring the will of the people on this and REFUSE to take action!

—“i even read in the paper that in washington they are
looking at a driving tax-the more you drive the more
you pay!
god bless

—“i think we need to band together and buy air time on tv-and
run infomercials telling the american people what
they are planning to do to us-the toll roads-i go down
281 all the time-and the national tax by the mile
driven-maybe we might even have a state tax on miles
driven also-these politicians are constantly thinking
up new ways to tax us.”

Letters and comments about Judge Wolff’s statements in his State of the County address…

—‘Judge Wolff:

I am running as a Democratic Candidate for State Representative in District 122. Part of my platform is to put all toll roads in Texas on the ballot, out in the open. This issue is not a done deal, and I will not accept it. I truly hope that you will not accept it, either. I ask that you take a stand against this kind of secret deal, starting with the secret deal to create toll roads right here in Bexar County. Let the people in Bexar County decide if they want to pay for toll roads.” – Larry Stallings

—“Mr. Nelson Wolff,

As a representative of this county government, I would trust that you would want to assure that the citizens of this area are effectively served by any solution posed by TXDOT or any other state entity. But from the gist of your comments on WOAI yesterday, I surmise you’re more interested in assuring you remain well-liked by your fellow state politicians. From my standpoint, that is quite unfortunate.”

—“Dear Judge Wolff:

I fear that this debacle will ultimately bring San Antonio’s economy to a screeching halt. For example, I am a systems analyst making a fair salary and paying a hefty amount in taxes every year. But that doesn’t seem to satisfy our city leaders’ hunger for more money. Every year my taxes are raised 10%. I am tired of fighting this, as are many others in similar or lesser jobs. I now have my house for sale and I plan to relocate outside of Texas in order to maintain a living in the manner in which I have become accustomed. Perhaps for a good cause I could accept the increase in taxes, but all I can see is corruption, mismanagement, misappropriation, misuse and asinine projects like the toll roads, so I can no longer stomach giving away my hard earned money to a bunch of idiots and/or thieves. It’s too late for me, but I ask you for those who may remain a while longer. Please use some foresight and join the fight against the toll roads before you single handedly crater this economy and get run out of town on a rail.”

—“I am outraged that Judge Wolff dictated “Tolls are coming so get used to them.” Judge Wolff and the business community plan to profit from this toll road scheme and will push their agenda without a vote from the people of SA. Why should we the people of this city carry the load on our backs to finance Bexar County when the roads have already been paid for? Judge Wolff and the business community want to give private companies monopolies over our public infrastructure through secret agreements. This violates the public trust and our principles of open government. Toll roads amount to highway robbery of the citizens. Let the higher public officials take a cut in their salaries and benefits! We the common, hard-working people of SA refuse to carry the weight! We will not support public officials who refuse to listen to our voices. You can bet the voters will find viable candidates to run against tollers. We will take action to vote out those politicians trying to steam-roll their deals over the already over-taxed people of Bexar County!”

—“Dear Judge Wolff,

I respectfully oppose your position on toll roads… I don’t believe you should shove anything down the public’s throat and I think you would find this to be true if you put toll roads up for a vote…This toll road plan is a very bad one, especially when you are using roads which have already been built with taxpayers money… In my book, that’s double taxation…I also can’t believe once the so called improvements would be paid for, that this defective plan never relinquishes the toll from the road… REALLY BAD PLAN…So, if you really did say: ‘Tolls are coming so get used to them’ I resent the implication that it is a done deal and we, the public, can’t do anything about it…I would love to see a signed contract, from TxDOT, showing where all this work has been approved and who will be building these so called toll roads… Maybe you can produce one for the public’s perusal…”

—“Judge Wolff, I respectfully say you are wrong in dictating toll roads for our city and boasting they are coming to SA whether or not the public wants them. You as our public official should represent the wishes of the people of SA. If you cannot listen to our voice, then we will vote in someone who will respect the opinion of the people. You have enjoyed a grand style life and are out of touch with the common people. You have lost sight of the truth and are using your position to deceive and force toll roads onto the people of SA. I oppose your governing methods and stand on this issue.”

—“But the tides of history are turning. Wolff and all the rest of those professional elites will be the last ones to figure out how disconnected from the people they have come. But just you watch – incumbents are going to go down in flames all over the place in the 2006 elections, and they won’t even see it coming because they’re so out of touch.”

—“keep up the fight-judge wolff is rich-he can afford toll
roads-they could get to like 5.00 to go on them i have
heard others say-with gas as high as it is-and if
registration fees go up and they get those 35.00 car
inspections-pretty soon us poor people will not get to
drive our cars-and they are a necessity in the modren
world-you have to be able to get to work”

Sent to candidate for Governor Carole Strayhorn’s campaign and forwarded on to us…

—“i rang up nelson wolfes office and they confirmed it- the toll road is to go in on a 6-8 mile stretch of highway 281 north, just outside of loop 1604. its going to be operational in late january. i asked why we weren’t allowed to vote on the matter and i was told that local governments aren’t allowed to hold referenda on state mandated projects, and that i had to contact my local reps, who are the ones who voted for it on my behalf. lunacy. balderdash.

tell her she has my vote, along with the votes of my circle.”

WORD OF CLARIFICATION: The toll road will not be operational in January, construction of the road begins in January. There is no toll agreement for US 281 at this time and the earliest a toll would be charged is after construction is finished in 2009.

US 281 on road to tolls.

NOTE: TxDOT presented in public hearings that 281 would be a 12 lane tollway in the widest parts, now it’s 16! The ORIGINAL plan for 281 was $48 million (See it here.), now as a tollway $83 million ($77 million in gas tax, $6 million utility relocation costs where the ratepayers of CPS will pick-up the tab)…FULLY funded, yet they want to charge you a lifetime toll tax to drive on it!
We can’t trust that these bureaucrats tell the truth!

Timber! U.S. 281 on road to tolls
Web Posted: 12/01/2005 12:00 AM CST
By Patrick Driscoll
Express-News Staff Writer

The newest signs of construction on U.S. 281 aren’t pretty, but they’re the first visible proof that, yes, toll roads are coming to San Antonio.

Crews have begun scraping live oaks into piles along the highway and putting up fences to catch silt that rains soon will scour from the naked ground.

In January, workers will begin constructing frontage roads and later add four to eight express toll lanes from North Loop 1604 to Stone Oak Parkway. The new roadway will be 16 lanes at its widest points.

“It’s a lot of pavement,” said Frank Holzmann, a Texas Department of Transportation engineer.

The $83 million job, mostly funded with $77 million in gas taxes, is expected to take three years. TxDOT studies anticipate toll fees of 14 cents a mile.

While motorists welcome the extra lanes, they frown at the idea of paying tolls.

“It should have been done a long time ago,” said John Hay, who drives on that stretch of U.S. 281 to get to work.

“But is that the toll road?” he added after a pause. “I think that’s a bunch of crap. I don’t think it needs to be a toll road.”

Like many others, Hay will scout for the best alternate free road and figures he may have to add 8 miles to his 25-mile commute.

“But I won’t have to deal with the tolls, I guess,” he said.

Citing a shortfall of $8.4 billion over 25 years to build needed transportation projects in San Antonio, the Metropolitan Planning Organization has included more than 70 miles of toll roads in its long-range plans.

The agency also set aside more than $500 million in public money to subsidize toll projects.

Two private consortiums are competing to fully finance, build and operate the most lucrative toll lanes — a 47-mile system on Loop 1604 and U.S. 281 on the North Side.

The construction that starts next month is for the first 3 miles of U.S. 281 toll lanes, which will be the heart of the 47-mile network and a bargaining chip for the state in upcoming negotiations with the toll-road companies.

“It’s a big step for the city of San Antonio and in improving mobility for the area,” Holzmann said.

Some motorists are furious that existing U.S. 281 highway lanes will be replaced with frontage roads — even though the number of lanes will be the same — and say the toll lanes won’t fix traffic problems.

Critics haven’t given up on efforts to stop new lanes on U.S. 281 from being tolled.

“Have toll roads solved Houston’s or Dallas’ congestion and highway funding issues? No!” said Terri Hall of Texas Toll Party — San Antonio. “This toll mandate is an outrage, and our grass-roots movement is growing by the day.”

Other hapless drivers still are learning the news.

“Toll lanes! My gracious,” said John Perrott, stroking his chin. “Well, I don’t know, I might go the back way.”

Though the highway lobby and most of our public officials were giddy at the news that trees were coming down to make way for their MAMMOTH toll corridor on US 281 today, the cold hard facts revealed in the article are what will sink their ship! San Antonio was a buzz with talk about toll roads, all of it NEGATIVE! Whether you were in board rooms or restaurants, the common theme was, “Can you believe what they’re gonna do to 281?” “This doesn’t pass the smell test, it’s being built with tax money but they’re going to charge us a toll, too!” and “Where is all my gas tax going?”

Careful scrutiny of the words in this article reveal many of the dirty little secrets about these toll plans that few people understood until now (when details finally make front page news). TxDOT has been saying we have no money for roads, we have no money….yet there it is IN PRINT, $77 million in gas tax money dropped out of the sky to build an excessively large toll corridor–16 LANES–, when all that’s needed is 4 overpasses at the lights and it’s all done in less time for almost half the money ($48 million).

They have the money to build it as a toll road (that’s nearly twice the cost), but they don’t have the money to build it as a free road! Remember, all that’s in writing is a contract to BUILD the road, THERE IS NO SIGNED CONTRACT THAT MAKES US 281 A TOLL ROAD AS OF YET! Also in today’s article we find out they’re ADDING TWO MORE TOLL LANES in addition to the 4-6 lanes they revealed in the public hearings, so more bait and switch. In total, they want to pave 16 lanes in the widest parts of the plan! Note how the foreign companies are vying for these “most lucrative toll lanes” in the plans! I’ll say lucrative, that’s because the private firms are only fronting 7% of the cost to build and then get to charge us tolls for the next 50 years!

OK, let’s make this real simple. Toll roads cost more to build & maintain, only half of all motorists can afford to drive on them while 100% of taxpayers are footing the bill to build it, we’re being charged THREE times to drive on the same stretch of pavement (taxed to build existing freeway, taxed to pay for the improvements, then lifetime toll tax to drive on it), they want to charge us THREE taxes to drive on our highways (gas tax, ATD sales tax, and tolls), the toll money is going to a foreign corporation for the next 50 years, and our elected officials are DICTATING this to us without a vote of the PEOPLE!

This is nothing short of HIGHWAY ROBBERY! THIS CANNOT STAND and WE THE PEOPLE need to RISE UP and STOP IT! We cannot let the Governor, the Legislature, and a host of local politicans do this to us. Link to the story or read on and get incensed!

Timber! U.S. 281 on road to tolls

12/01/2005

Patrick Driscoll
Express-News Staff Writer

The newest signs of construction on U.S. 281 aren’t pretty, but they’re the first visible proof that, yes, toll roads are coming to San Antonio.

Crews have begun scraping live oaks into piles along the highway and putting up fences to catch silt that rains soon will scour from the naked ground.

In January, workers will begin constructing frontage roads and later add four to eight express toll lanes from North Loop 1604 to Stone Oak Parkway. The new roadway will be 16 lanes at its widest points.

“It’s a lot of pavement,” said Frank Holzmann, a Texas Department of Transportation engineer.

The $83 million job, mostly funded with $77 million in gas taxes, is expected to take three years. TxDOT studies anticipate toll fees of 14 cents a mile.

While motorists welcome the extra lanes, they frown at the idea of paying tolls.

“It should have been done a long time ago,” said John Hay, who drives on that stretch of U.S. 281 to get to work.

“But is that the toll road?” he added after a pause. “I think that’s a bunch of crap. I don’t think it needs to be a toll road.”

Like many others, Hay will scout for the best alternate free road and figures he may have to add 8 miles to his 25-mile commute.

“But I won’t have to deal with the tolls, I guess,” he said.

Citing a shortfall of $8.4 billion over 25 years to build needed transportation projects in San Antonio, the Metropolitan Planning Organization has included more than 70 miles of toll roads in its long-range plans.

The agency also set aside more than $500 million in public money to subsidize toll projects.

Two private consortiums are competing to fully finance, build and operate the most lucrative toll lanes — a 47-mile system on Loop 1604 and U.S. 281 on the North Side.

The construction that starts next month is for the first 3 miles of U.S. 281 toll lanes, which will be the heart of the 47-mile network and a bargaining chip for the state in upcoming negotiations with the toll-road companies.

“It’s a big step for the city of San Antonio and in improving mobility for the area,” Holzmann said.

Some motorists are furious that existing U.S. 281 highway lanes will be replaced with frontage roads — even though the number of lanes will be the same — and say the toll lanes won’t fix traffic problems.

Critics haven’t given up on efforts to stop new lanes on U.S. 281 from being tolled.

“Have toll roads solved Houston’s or Dallas’ congestion and highway funding issues? No!” said Terri Hall of Texas Toll Party — San Antonio. “This toll mandate is an outrage, and our grass-roots movement is growing by the day.”

Other hapless drivers still are learning the news.

“Toll lanes! My gracious,” said John Perrott, stroking his chin. “Well, I don’t know, I might go the back way.”

The fact that Judge Wolff chose to make toll roads a centerpiece of his state of the county address today, and his attempts to make toll roads sound inevitable only confirms that the LOCAL part of this toll road nightmare comes straight from his office WITHOUT A VOTE OF THE PEOPLE!

Judge Wolff’s comments today are deceptive and they’re an OUTRAGE! It reflects the heavy-handed methods with which our elected officials govern this county and this state. There’s a total disconnect between our elected officials and the PEOPLE they’re supposed to represent with only two noteable exceptions Commissioners Tommy Adkisson and Lyle Larson.

First of all, TxDOT cannot produce a signed contract indicating ANY work is imminent on 281. If tolls on 281 are done deal, where’s the contract? They’re either lying to the public or violating open records laws. This shell game is part of the ploy to make the public think tolls are a done deal. NOTHING IS DONE DEAL in politics until the VOTERS say it’s done! Our grassroots citizen movement doesn’t underestimate the power of the ballot box. With elections coming next year, WE NEED CANDIDATES TO RUN AGAINST TOLLERS!

If you’re tired of our elected officials representing ROAD BUILDERS instead of YOU, then:

1) Help us find and help support viable candidates to run against tollers (tollers in the region: Frank Corte, Carter Casteel, Joe Straus, Mike Villarreal, Ruth McClendon-Jones)
2) Write and CALL Judge Wolff to respectfully express your opposition to this toll mandate (nwolff@co.bexar.tx.us and (210) 335-2626) and submit it in the form of a Letter to the Editor letters@express-news.net.
3) Get your neighborhood associations and small business community involved in the fight (have them call me (210) 275-0640 or email me at: terrh@gvtc.com for how they can help)
4) Help INCREASE OUR NUMBERS by taking a shift to hand out fliers to motorists at key intersections (call or email Operations Chair, Bob Throckmorton at: throck@gvtc.com or at (830) 438-7195)
5) Send this to everyone you know in Texas and ask them to sign our online petition.

Second, Judge Wolff called on the business community to help…That’s precisely who’s been pushing this toll road scheme upon us because they’re the ones who will profit off of what we’ve already paid for. The conflicts of interest within the business community on this issue is exactly what makes the public suspicious of their attempts to push tolls. These secret 50 year agreements that amount to giving private companies monopolies over our PUBLIC infrastructure violate the public trust and our principles of open government. Yet this is what Judge Wolff and the business community is promoting.

Third, a controversial sales tax hike (called the ATD tax) was pushed through just last November that gives Bexar County the ability to get matching funds for highways just like tolls would do, and yet they’re going to make San Antonians pay toll taxes for their lifetimes ON TOP of the gas tax and sales tax hike to pay for highways. That’s THREE taxes for highways! They’re holding us hostage just to drive to work, school, or shop!

Then, Judge Wolff FALSELY claims San Antonio’s economic development is being hampered due to lack of highways. In fact, San Antonio ranks 5th in the nation in number of lane-miles of highway! Our economic development isn’t being hampered by lack of roads but lack of interchanges and better intersections! San Antonio’s economic development seems more hampered by excessive taxation than anything else!

And this is taxation without representation! Unelected tolling bureaucracies are making these multi-billion dollar decisions without accountability for their decisions. These aren’t traditional toll roads either, they’re tolling highways we’ve already built and paid for. That means they’re going to toll lanes we drive on today for free. They’ll tell you they’re not, because they’re bulldozing what’s there, re-arranging the pavement and repaving it as a toll road. But they are, IN FACT, tolling existing highways and rights of way and TxDOT’s own documents prove it.

The cost will be enormous. TxDOT’s own online survey quoted $.39 cents a mile for a 15 mile commute on Loop 1604. That’s $5.90 ONE WAY to work, and more than $3,000 a year (and that’s just the starting toll rate)! The median wage earnings in San Antonio (according to many studies) is slightly higher than $11 per hour. Judge Wolff is asking the median wage earner to spend more than 5% of their income on toll costs. Plus, we ALL pay the higher cost of goods for tolls since our HEB trucks and others will pass that cost onto us, the consumers.

Did the lottery solve our public school funding crisis? Have toll roads solved Houston’s or Dallas’ congestion and highway funding issues? NO! This toll mandate is an OUTRAGE and our grassroots movement is growing by the day. It’s time to restore government to the PEOPLE! We need a taxpayer revolt and a statewide referendum process to redress our government for grievances such as this. If our Governor, the Legislature, and even our local leaders refuse to listen to the PEOPLE they are elected to represent (instead of the highway interests), then we need to be able to put this and other issues on the ballot ourselves. Please take the ACTION STEPS listed above TODAY!

Link to article here.

The more you drive, the more you pay?
Web Posted: 11/26/2005 12:33 AM CST
Jim Abrams
Associated Press

WASHINGTON — Taxing hybrids and other fuel-efficient cars and billing drivers for miles driven are among the approaches being suggested to avert a shortfall in money to maintain the nation’s highways.

Less than four months after President Bush signed a six-year, $286.4 billion highway and public transit act, a report commissioned by the U.S. Chamber of Commerce says the federal Highway Trust Fund is running out of money and Congress needs to think about new revenue sources.

“Decisions are going to have to be made in the very near future,” said Ed Mortimer, the business lobby’s director of transportation infrastructure, acknowledging it could be a tall order.

The next highway bill is years away, and lawmakers may be loath to return to a measure widely criticized for being padded with thousands of special-interest projects.

The Senate came to an acrimonious halt recently when a senator suggested shifting to hurricane relief the money from two Alaskan bridge projects, including a $223 million project linking Ketchikan to a sparsely populated island with an airport that critics have dubbed the “bridge to nowhere.”

Congress later removed the bridge from a list of protected projects, but money for it still is part of Alaska’s share of federal highway dollars.

The recently issued study, commissioned but not endorsed by the chamber, estimated the trust fund, financed by the federal tax on gasoline, will take in only $231 billion over the six-year course of the act, and that the highway portion of the fund would hit a zero cash balance in 2008, a year before the act expires.

The report also concluded revenues from all levels of government will fall $500 billion short of what’s needed just to maintain pavement and bridge conditions and traffic levels through 2015, and $1.1 trillion short of what is needed to improve the nation’s infrastructure.

“Without a significant influx of new revenues,” said Associated General Contractors of America CEO Stephen Sandherr, “our nation’s transportation network will also continue to deteriorate, impacting mobility and economic well-being.”

The Transportation Department, in a statement, said it “has recognized for some time the growing strains placed on the Highway Trust Fund, which is why Secretary (Norman) Mineta championed the creation of an extensive review of the fund’s future in the recently enacted surface transportation bill.”

In the short term, the study recommended that the federal gas tax, set at 18.4 cents a gallon since 1993, be indexed for inflation. Of that, 15.44 cents goes to highways, with most of the rest to mass transit accounts.

Last year the House Transportation Committee backed raising the tax, the only major tax not adjusted for inflation, by 4 or 5 cents to pay for a $375 billion bill.

The administration warned that the president would veto any bill that increased taxes.

The study argued that the fuel tax has lost one-third of its purchasing power since 1993 and that of the 60 cents per mile that drivers now pay to operate a car, only 1 cent goes to federal taxes.

Other possible short-term money-raisers include expanded use of tolling and bonds, closing fuel tax exemptions, recrediting interest to the trust fund and dedicating 10 percent of U.S. Customs import revenues to port and freight facilities.

Proposals for the longer term could be more controversial.

One is that owners of hybrids and other alternative fuel vehicles pay a vehicle fee, the argument being that drivers should bear their fair share to fill the potholes and fix the bridges, regardless of how much or what kind of fuel they use.

In the same vein, the report said federal and state governments should begin moving from the fuel tax to a mileage-based system.

The current tax, in place since 1956, could have diminishing returns as cars become more fuel efficient and if Americans, turned off by rising gas prices, buy smaller cars.

Revenues deposited in the trust fund in the 2004 budget year totaled $34.7 billion, unchanged from four years earlier.

Oregon has initiated a voluntary “vehicle miles of travel” program under which cars are equipped with GPS systems that track miles driven. Drivers pay a periodic fee based on that rather than a tax at the pump.

Rep. Peter DeFazio, D-Ore., a senior member of the Transportation Committee, expressed some doubts about the experiment, saying it penalized fuel-efficient vehicles and was “very high-tech, very complicated and very controversial.”

Our fellow Americans feel our pain as their government converts public highways into private monopolies against the public good. See this article on Indiana.
See this article on Delaware.

This is the print version of this story.

Australian Broadcasting Corporation
TV PROGRAM TRANSCRIPT
LOCATION: Link here.
Broadcast: 20/10/2005
Cross City Tunnel documents released
Reporter: Emma Alberici

KERRY O’BRIEN: Welcome to the program. 2,000 pages of contractual detail is not the stuff of best sellers, but right now there’s plenty of eager readers poring over the fine print of the deal that has given the nation’s biggest city its biggest traffic headache. Under intense pressure from motorists, the State Opposition, and a legion of other critics, the New South Wales Government has unlocked the secrets of the Cross City Tunnel, the east-west tollway running under the city. Nowhere near enough people are using it. But the system of feeder roads above ground is creating chaos and an enormous amount of anger. This particular tunnel is the latest in a long and winding grid of ‘user-pays’ roads in the nation’s eastern capitals – each one adding to an intensifying road rage over cost and responsibility as governments increasingly walk away from their own infrastructure responsibilities and hive them off to private enterprise. Finance editor Emma Alberici reports.

MICHAEL JOOLS, TAXI DRIVER: I’ve been driving a cab for about 20 years now. Back in those days the only toll was the Harbour Bridge and that, from memory, was about 20 cents. That was no hassle.

EMMA ALBERICI: There was a time Michael Jools remembers when roads were a responsibility of governments. It was an era before user-pays delivered to the private sector roads paved with gold. But there’s an upside for those using Australia’s latest toll road – even in peak hour it can feel like your own private piece of tarmac.

MICHAEL JOOLS: The classic ghost tunnel, at this stage. Not a car behind us, not a car in front of us.

EMMA ALBERICI: Sydney’s Cross City Tunnel, at $1.70 a kilometre, is quite possibly the world’s most expensive road and right now Australia’s most contentious. Drivers are staying away way in droves. They’re angry they’re paying privateers so much for the privilege of getting from A to B.

TONY HARRIS, FMR NSW AUDITOR-GENERAL: You can have the private sector design them, you can have them construct it, you can have them maintain it, you can have them operate it and if there are tolls you can have them collect the tolls but there is no sound reason why the private sector should own these toll roads and there are many reasons why they should not.

EMMA ALBERICI: Some of Australia’s biggest companies, even Asia’s richest man, will be hoping this isn’t the beginning of a consumer groundswell. The boom in private roads is underwriting the share market success of companies like Transurban and Macquarie Bank, the world’s biggest owner of toll roads. It’s also lining the pockets of Hong Kong’s Li Ka-shing, the biggest shareholder of the Cross City Tunnel. But while they’re all gung-ho about the future of this new form of investment, that optimism isn’t shared by everyone in the know.

JOHN GOLDBERG, TRAFFIC ANALYST, SYDNEY UNIVERSITY: I think the main concern is that the projects are not sustainable on the traffic volumes and tolls that they can collect.

EMMA ALBERICI: Traffic analyst Dr John Goldberg is one predicting doom and gloom for this growing network of private toll roads. He’s recently completed a 5-year analysis of two of the country’s biggest – Melbourne’s CityLink project and the M2 in Sydney. His reading of the financial foundations for these private roads is explosive.

JOHN GOLDBERG: The traffic forecasting is a tool of the financiers. They’re there to serve the interests of the bank modellers. I’ve been disgusted, frankly, at the ethical standards of some of these people, you know, both in Melbourne and in Sydney. They know they’re doing wrong but they’re paid to do it.

EMMA ALBERICI: CityLink is owned by the Transurban group and makes up 65% of its income. The M2 motorway was Macquarie Bank’s first toll road. It was floated on the stock exchange at $1. When it was sold to Transurban earlier this year investors received $10 a share. It looks like a licence to print money but is it? John Goldberg says the share prices of toll roads are being propped up by borrowed money and government tax breaks and he claims the long-term debt picture is much bleaker than the company’s originally published.

JOHN GOLDBERG: The prospectuses are based on the Macquarie Bank models and they’re frankly misleading or let’s say they’re deceptive and people think that in the long term super funds are going to get these huge returns when in actual fact the project themselves are drowning in a sea of debt. It’s becoming like a mini Enron, this thing.

MARK BIRRELL, INFRASTRUCTURE PARTNERSHIPS AUSTRALIA: What we’re trying to ensure, I think, in Australia is that people will invest in more infrastructure, knowing very well we can’t just rely on governments to provide infrastructure – we need more than that.

EMMA ALBERICI: As far as the infrastructure industry is concerned, there’s plenty of practical, sensible reasons for private enterprise to take on big ticket public projects. Mark Birrell, who chairs the Industry Group, is a former minister for Major Projects in the Victorian Kennett government.

MARK BIRRELL, INFRASTRUCTURE PARTNERSHIPS AUSTRALIA; For a large risky investment like this to go ahead, the private investor has to know that, say, over 20 to 25 years they’re going to get a fair return. That is their call. But they’re taking a risk on that as to how many people will want to use the tunnel. They’re the ones if it doesn’t work who pay the price.

EMMA ALBERICI: Well, not exactly. There are some pretty solid taxpayer-funded guarantees that protect the private operators against losses. Here in central Sydney, for example, the State Government is acting to make sure the toll tunnel gets its share of traffic by closing and narrowing alternative routes. They call it “traffic calming” but it’s anything but.

MARK BIRRELL: This one has been controversial. I think in many ways we’ve learnt a lesson, the operator has learnt a lesson, that you have to have more communication with the public about what is going to occur. There shouldn’t be any surprises.

EMMA ALBERICI: The roads in the Macquarie Infrastructure Group and Transurban portfolios struggle to make a profit on toll revenue alone but they still manage to pay out generous dividends to investors of 25% plus hefty fees to investment banks. That’s helped make Macquarie the share market darling it is. They’ve relied less on actual traffic flows and more on notional cash flows, money generated by big bank loans and a generous tax deal called the infrastructure borrowing tax offset scheme.

JOHN GOLDBERG: They’re getting 40% – Transurban is – 40% of its revenue from the tax offset scheme, 35% in the case of M2. And yet what is most interesting, particularly for the Transurban case, is that there’s no net profit even with that contribution from the infrastructure borrowing scheme.

EMMA ALBERICI: Transurban and Macquarie reject the house of cards analysis. They declined our requests for interviews but in a written response MiG says there are a number of fundamental flaws in the Goldberg critique, claiming criticisms of its accounts demonstrates a lack of understanding of accounting standards and the group claims the M2’s annual revenue covers the debt interest bill twice over.

TONY HARRIS: There is no reason why the Government could not have borrowed and, if it found it necessary, impose a toll the same way that the private sector is doing. One of the advantages of that is the absurd profits that the private sector is making out of these tollways would have accrued to the public.

EMMA ALBERICI: The analysis Tony Harris relies on comes from the inside as an economist with the Commonwealth Government and as auditor general of New South Wales until 1999. He was at the table for many of the discussions about proposed private public partnerships. He doesn’t buy the argument that governments simply can’t afford to fund the roads themselves.

TONY HARRIS: We don’t have to run a deficit. All we have to do is not pay off the debt so assiduously as each of our governments is doing. New South Wales now has no debt, the Commonwealth is virtually debt-free. Victoria has no debt and this is the same for other States – Queensland has no debt. And yet the population is going without quite important infrastructure.

EMMA ALBERICI: And the privateers are now learning to go without, losing some of the glowing support from key investment banks. Goldman Sachs JBWere has raised questions about the true value of Transurban and has had a sell recommendation on the company since May. The bank is further worried about disappointing traffic growth. And just yesterday Goldman Sachs downgraded its rating for Macquarie Bank, which earns the bulk of its income from the fees it charges its array of infrastructure projects.

JOHN GOLDBERG: As the thing gets bigger and bigger in terms of debt what are you going to do, what are you going to sell it for? Who is going to buy it?

EMMA ALBERICI: And if you want to know what the punters are thinking, ask a cabbie. Michael Jools is no investment banker or traffic academic but he knows what he sees and hears each and every day behind the wheel.

MICHAEL JOOLS: The roads are there for the public to use. Why doesn’t the Government just shoulder the burden, build the roads, run them and that be the end of it. All this nonsense about private infrastructure here, Macquarie Bank there, tolls for this, expenses for that. Just get on with the job and do it simple.

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This is the print version of this story.

Wednesday, 19 October , 2005 08:30:00

Reporter: Stephen Long

TONY EASTLEY: It wasn’t so long ago that toll roads were seen as a sure way to make money but now questions are being asked about whether even some of Australia’s busiest toll roads will make enough in the long run to pay their debts.

One expert says the traffic targets set by the companies are far too ambitious, and he wonders how they’ll turn a profit.

Finance Correspondent Stephen Long reports.

STEPHEN LONG: There’s a lot of millionaires at Macquarie Bank thanks to roll roads and until recently, tollway companies have been darlings of the stock market.

But now there are claims that toll road debts are skidding out of control.

JOHN GOLDBERG: I don’t think it’s sustainable in the long-term at all.

STEPHEN LONG: That’s Dr John Goldberg of Sydney University. He’s analysed the accounts of the M2 motorway in Sydney’s north-west, and Citylink in Melbourne – both now owned by Transurban.

He says the way they value future cash flows is optimistic and implausible, and as to the long-run estimates of vehicle use, well, they’re one big traffic jam.

JOHN GOLDBERG: You’re talking about traffic which corresponds to gridlock, particularly in the peak two hour period in the mornings.

STEPHEN LONG: So basically to make the kind of revenues in the future that the toll road companies are predicting, they would have levels of traffic that would just be choking, amounting to gridlock?

JOHN GOLDBERG: Exactly. Exactly.

STEPHEN LONG: Dr Goldberg claims there are similar problems with Macquarie toll roads.

JOHN GOLDBERG: If you take Connect East, it’s structured the same way. The Eastern Distributor in Sydney is structured the same way.

STEPHEN LONG: Toll roads cost a lot to build and generally don’t make a profit for many years. So to make their stock attractive to investors, toll road companies borrow against future earnings, and pay that yet to be earned money out to shareholders in dividends today, often refinancing and upping the debt again and again.

Of course those debts eventually have to be repaid. So to keep investors fed with dividends, toll road companies have to buy new assets and start the process all over again. It’s a model widely accepted by the financial markets but that doesn’t convince or surprise the critics.

JOHN GOLDBERG: You know, you’ve got the analysts, stockbrokers and nobody wants to know.

STEPHEN LONG: In fact, some investors are raising concerns.

Goldman Sachs JBWere recently rated Transurban a long-term “sell” because it’s so heavily geared, that nearly half of its future payments to shareholders will come from debt.

But few seem to buy the claims that Transurban’s toll roads won’t make enough to pay their debts or Dr Goldberg’s claim that the projects are only viable because of tax breaks.

A spokesman for Transurban said Dr Goldberg was a lone voice and his analysis was full of fundamental mistakes. He pointed out that the company’s debt has a robust “A-minus” credit rating.

TONY EASTLEY: Stephen Long reporting.

Well, looking into TxDOT’s toll feasibility studies, you can see our toll system isn’t real viable either (regardless of what the toll companies want us to believe like Transurban above). See article on Macquarie’s downgraded status on the stockmarket due to its heavy investment in toll roads: link here. So though Transurban would have us believe Mr. Goldberg’s analysis is a lone voice, it appears the stock market agrees with him.

Based on TxDOT’s own studies, tolls will only pay for the maintenance and operation of the toll roads. NONE of the toll revenues cover the cost of construction. Hence there’s the need to infuse $661 million of taxpayer money into constructing the toll roads along with yet more taxpayer money through the selling of bond debt as well as a heap of private money…all of that private money is likely leveraged to boot! So this explains why these private companies want to steadily increase toll rates and get control of the surrounding free lanes to create traffic jams horrific enough to ensure they get their projected level of toll revenues. It’s a nightmare and, indeed, a taxpayer revolt is in order!

Wow! Wow again! Do y’all realize what we just did? We defeated a statewide proposition (Prop 9) going up against BIG, well-funded highway interests. Only 1% of all propositions get defeated in Texas! AMAZING WORK EVERYONE! Thank you to ALL of the outstanding citizens who tirelessly worked to get the word out, especially our grassroots coordinators Sudie Sartor and Bob & Barb Meshanko. Your faithful efforts paid off. Prop 1 did pass, which was much harder for people to discern the connection to toll roads. But we defeated Prop 9 WITH VIRTUALLY NO MONEY. Let’s use this momentum to bring these toll plans to a screeching halt!

Read the Express-News editorial on our efforts.

Here’s the press release we sent out about the Prop 9 win!

San Antonio, TX, November 8, 2005 – While Constitutional Amendment 2 soaked up the limelight in this election, a grassroots whisper campaign, with virtually no dollars, against the toll roads and the Trans Texas Corridor was taking place in rural and urban centers across Texas. The results were mixed. Constitutional Amendment 1, the Texas Relocation Rail Fund passed and Constitutional Amendment 9, the Governor’s attempt to extend the terms of appointed board members to the Regional Mobility Authorities (the “toll authorities”) was soundly defeated.

“We’re ecstatic that the PEOPLE spoke loud and clear about what they think about these unelected tolling boards…we want to limit their power. Our loyal brigade of foot soldiers faithfully passed out leaflets and educated the public and it paid off,” said an elated Terri Hall, San Antonio Regional Director for Texas Toll Party.com.

Sal Costello, founder of the TexasTollParty.com said, “We fought them with sticks and stones — emails and 100,000 leaflets and the people came through. What this means is that they — the Governor and his minions, like State Rep. Mike Krusee, who sent out an expensive direct mail to his constituents asking them to vote for special interests Props 1 & 9 — are vulnerable. The comptroller’s report found double taxation, unaccountability and No-BID contracts given to Regional Mobility Authority (RMA) board members and their friends – of course they shouldn’t get 6 year terms, what they should get is 10 years – behind bars.”

Linda Curtis, who chairs Independent Texans and is the chief organizer for the TexasTollParty.com said, “Our task now is to use both our losses as well as our gains, to build for the future. That’s going to take a host of reforms, not the least of which is for the ballot language on these propositions to be crystal clear. That’s going to take a full blown statewide movement, across all party lines, for political reform as those who make the rules — for now — rule.”

“It’s a shame people gave private rail companies a blank check from the taxpayers’ checkbook based on vaguely worded Proposition 1 and fears about urban rail accidents. It’s bad public policy and bad fiscal policy, and it will come back to haunt us. These companies have the money as the 83% profits Union Pacific just posted shows. Sadly, this isn’t about rail safety, it’s about an open-ended corporate incentive for rail companies to join the controversial Trans Texas Corridor on the taxpayer’s dime,” said Hall.