Author: Terri Hall

USDOT misreports dip, sustainability of gas tax revenue

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US DOT Misreports Gasoline Tax Revenue
Motor fuel excise tax revenue was up $185 million in 2008, not down, contrary to US Department of Transportation claims.
December 23, 2008
The Newspaper.com

Mary PetersThe US Department of Transportation (US DOT) has falsely suggested that the nationwide drop in vehicle miles traveled is endangering the revenue source used to maintain America’s highway network. Soaring gasoline prices in the summer and the ongoing recession together forced motorists to cut back substantially on travel, resulting in 100 billion fewer miles being driven in fiscal 2008. Transportation officials seized upon these facts to argue that the gas tax is unsustainable and that the country must quickly shift to tolling to save the highway trust fund.

“As driving decreases and vehicle fuel efficiency continues to improve, the long term viability of the Highway Trust Fund grows weaker,” Transportation Secretary Mary Peters said in a December 12 statement. “The fact that the trend persists even as gas prices are dropping confirms that America’s travel habits are fundamentally changing. The way we finance America’s transportation network must also change to address this new reality, because banking on the gas tax is no longer a sustainable option.”

The federal Highway Trust Fund took in $3 billion less in revenue in fiscal 2008 than it did in 2007, and Federal Highway Administrator Tom Madison placed the blame squarely on the gas tax.

“This (drop in revenue) underscores the need to change our policy so American infrastructure is less dependent on the amount of gas American drivers consume,” Madison said.

The American Road and Transportation Builders Association (ARTBA) crunched the numbers and found this assertion to be entirely untrue. In fiscal 2007, the US Treasury reported that a total of $29.4 billion was collected from the taxes on gasoline and diesel fuel. In 2008, the total figure grew by $185 million to $29.6 billion. Lower traffic volumes did cause gasoline tax revenue to drop $70 million, but this figure was more than offset by a $256 million increase in revenue from the tax on diesel, which is primarily paid by the commercial trucking industry. View revenue chart.

These truckers, hit by tough economic times, cut expenses significantly. Sales of new rigs plunged in 2008. That caused a $2.4 billion drop in revenue from the 12 percent tax on the retail sales of trucks and trailers. An accounting change in the way kerosene and similar taxes were transferred ended up showed a paper loss of $722 million from the fund. Together these factors, which are unrelated to the number of vehicle miles traveled (VMT) in 2008, accounted for the $3 billion drop in trust fund revenue.

“The US DOT misused that data to suggest the federal motor fuels tax can no longer finance federal investments in highway and mass transit improvements,” ARTBA Vice President William Buechner said. “The data in fact suggest that the federal motor fuels taxes can remain a viable source of revenues for highway investments for the foreseeable future. The trust fund’s real problem is not the decline in VMT, but rather the economic slowdown and the fact the federal motor fuel tax rates have not been changed since 1993.”

TheNewspaper has previously reported that gas tax revenues have not plunged at the state level. In Virginia, for example, fuel tax revenues were up 2.6 percent in fiscal 2008 (more). Motor carrier fuel tax receipts likewise increased in Illinois (more). At the same time, overall traffic has plunged on toll roads forcing huge increases in the tolling rates to prevent a loss in profit for private investors (more).

Transportation agencies may merge, allowing vote on toll roads

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Voters may get say on toll roads
By Pat Driscoll
Express-News
December 20, 2008

Talks are gaining steam to abolish San Antonio’s fledging toll-road agency and give voters a long-demanded say-so on toll roads.Shuttering the five-year-old Alamo Regional Mobility Authority, which still is several years away from opening a toll road, would be a byproduct of a still-sketchy idea to merge the agency and VIA Metropolitan Transit into the existing Advanced Transportation District.

Voters approved the ATD and its quarter-cent sales tax in 2004 to expand bus service, upgrade city streets and build highway lanes. The district, which follows the city’s boundary, also can construct and operate toll roads and light rail.

Amid the bureaucratic wrangling lies a catch. Promises made during the ATD referendum forbid spending on tolls or rail without additional public votes.

“That was a valid pledge,” insists attorney Tim Tuggey, a former VIA and ATD chairman now advising the toll agency.

Giving the public a vote on toll roads is the right thing to do anyway, say a bevy of toll supporters now advocating the consolidation of the agencies.

“After all these years, I’ve just come to the point, if they want it, fine, if they don’t, fine,” County Judge Nelson Wolff said. “I believe people ought to get what they ask for.”

Toll critics aren’t sure whether to smile or frown.

The result could be ugly if funding isn’t tied to specific projects and limited to a time frame, said Terri Hall of Texans Uniting for Reform and Freedom.

“Yes, we want the public vote,” she said. “But I don’t want a public vote to be a sweetener to a really bad deal before opening the door to a big Pandora’s box.”

Sales tax revenues traditionally used for transit could end up subsidizing toll roads, Hall said. Or tollway profits could shift to another side of town to help pay for a light-rail line.

Tuggey, who’s writing possible legislation to create the superagency, maintains voters would have to sign off on mixing different piles of money.

“This is not an end run to get toll roads,” he said.

The merger idea bubbled into the public spotlight this week after germinating a month ago in behind-the-scene talks among members of a city-county task force. The group is drawing up regional transportation goals.

Piecemeal authority of too many agencies has hobbled planning and financing the city’s roads and transit, officials argue. Also, speaking with one voice could help tap transportation funds that soon could flow more freely from Washington.

“If we’re going to be in the hunt for what we think is going to come down the line, we have to get organized sooner than later,” VIA board member Mary Briseño told the task force, which she sits on. “We don’t have time to just kick this around. We need to be bold.”

Many hoops remain — enough to foster concerns on how the agencies should be meshed.

“I want to see it in black and white before I make a decision,” VIA board and task force member Linda Chavez-Thompson said. “The devil is in the details. Where exactly does the power and authority lie?”

Other task force members say the challenges can and must be met.

“I think there’s a real good chance of it,” Terrell McCombs said of the possibility. “We need to do this if we’re going to take the next step to the future.”

Tuggey, working pro bono to craft an enabling bill, laid out key issues to work out:

•The jurisdictions to collect and allocate ATD and VIA sales tax revenues — VIA levies a half-cent — would have to remain independent unless voters later say differently.

•The ATD board — with five members appointed by the city, three by the county and two by suburban cities — might expand to give the county two more seats and the governor a pick. On the tollway panel to be phased out, the county fills four seats and the governor selects the chairman.

•The tollway agency’s agreements with the state, including a $12.4 million loan and $18.7 million left from a grant, would have to be transferred.

Bill Thornton, who chairs both the task force and the toll agency, urged officials to press on with the enormous chore.

“This isn’t baby steps, it’s huge,” he told the task force Wednesday. “Let’s aim toward getting something on paper.”

Bush unleashes highest possible "market-based" tolls nationwide

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This last minute rule change MANDATES market-based tolling nationwide. Remember, it started here in Texas with the counterfeit moratorium bill, SB 792, that Rick Perry signed into law with glee largely due to the market-based tolling provision. It unleashed the MOST EXPENSIVE transportation tax on Texas and, as we predicted, across the country.

Market-based tolls means charging motorists “whatever the market will bear,” bringing us the HIGHEST possible toll tax. It’s runaway, punitive taxation based on greed, not the actual cost of constructing the road or retiring the debt. This will be the Bush-Perry legacy: name your price and we’ll hand over Americans’ wallets. We were the only grassroots group that actively fought this provision from becoming law. Help us fight to roll back this rule change and fight against tolls on freeways and the Trans Texas Corridor on the federal and state level next year. Sign-up for our email alerts here.

Bush road rule takes effect Jan-Transportation Dept
Thu, Dec 18 2008
http://www.afxnews.com by Lisa Lambert

WASHINGTON, Dec 18 (Reuters) – The Bush administration will finalize changes on toll road regulations on Friday that it says will make privatizing infrastructure more efficient, counter to the view of leading Congressional Democrats that it will rob states of revenue and drive up tolls.

A Department of Transportation spokesman told Reuters on Thursday that details of the rule will be published in the Federal Register and will go into effect on Jan. 18.

The rule will require states to charge public toll authorities fair market value to lease roads built with federal assistance, in the hopes of making the authorities equal competitors with members of the private sector, said Doug Hecox.

“When a company wants to come in and bid for the work, they need to have some idea as to what the value of that would be,” Hecox said. The transportation department worked with states on the regulation changes, he said.

“In some states they may give the first pick or first chance to public agencies before they give it out to the private sector. In that case, it’s a little risky because there’s no guarantee they’re going to be choosing the fair market value,” he said.

In a letter sent to Transportation Secretary on Monday, Reps. James Oberstar and Peter DeFazio said that relying on fair market values would push up the fees to drive on those roads and that the values “bear no relation to the true financing, construction, operating and maintenance costs of the facility.”

Oberstar, a Minnesota Democrat, chairs the U.S. House of Representatives Transportation Committee, and DeFazio, a California Democrat, chairs its Subcommittee on Highways and Transit.

A committee spokesman said they had no comment on the finalization of the rule, which was proposed Oct. 8.

The representatives have said that changes to how toll roads are valued should be made in the upcoming transportation bill, to be written in 2009. But Hecox said the administration is concerned that might delay establishing a standard when the appetite for public-private partnerships is growing and states are looking into alternatives to fund infrastructure projects.

In most of the partnerships, also called “P3s,” a corporation leases a road from a state and then recoups its losses through levying tolls. The leases extend for decades so the companies may also deduct depreciation costs from their taxes, according to the Government Accountability Office.

Because the partnerships are fairly new in the United States, the GAO, the nonpartisan congressional investigative office, has not been able to quantify how many exist in the country.

The rule change will provide consistency for the corporations bidding for the contracts in different states, Hecox said.

“The businesses that…are waiting to compete for this kind of work can do so from a position of a level playing field, rather than having to be the best friend of the governor in this state or the best friend of the mayor in that state,” he said.

(Reporting by Lisa Lambert) Keywords: MUNIS ROADS/

(lisa.lambert@thomsonreuters.com; +1-202-898-8328; Reuters Messaging: lisa.lambert.reuters.com@reuters.net)

Commission supports TxDOT overhaul

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Our own Mel Borel attended the meeting along with several other TURF supporters and does a great job during the interview! Thanks Mel!

Lawmakers want outside review, one
commissioner

Last Edited: Tuesday, 16 Dec 2008, 8:16 PM CST
Created On: Tuesday, 16 Dec 2008, 4:56 PM CST

AUSTIN (KXAN) – The Sunset Commission , comprised of senators and representatives, voted almost unanimously to support an overhaul of the Texas Department of Transportation on Tuesday.

“It’s an agency operating like it is in the 1920s,” said Chair Rep. Carl Isett (R-Lubbock).

The Sunset staff made several key recommendations for the agency. They want a Legislative Oversight Committee to be appointed to oversee the agency both when the legislature is in and out of session. They also want more transparency within TxDOT as well as restrictions on TxDOT’s lobbying capabilities. The aim is restore the public’s faith in a state agency that has come under fire for tollroads, various road projects and discrepancies in the budget.

“They’ve had free rein to do whatever they want to do,” said anti-tollroad activist Mel Borel. “They have abused legislation made years ago and imposed projects on the people of Texas.”

When asked if TxDOT agreed with an oversight committee being appointed to oversee the agency, the spokesperson said they would follow whatever the legislature wanted.

“We look forward to working with the Legislature to implement policies they create,” said Chris Lippincott.

Sunset Commission votes to abolish Transportation Commission

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Link to article here. The Commission was divided on whether TxDOT’s head should be elected. Perry has too many well-placed cronies. Sunset Commission Chairman Rep. Carl Isett tried to place an albatross over any effort to get TxDOT directly answerable to the PEOPLE of Texas by making the agency head be an elected position.

San Antonio’s Rep. Ruth Jones McClendon attempted to amend the Sunset recommendations to reflect what 70% of the public feedback asked for, a single ELECTED commissioner to head TxDOT. When the Board split over her amendment, she promised to put forward a bill in the House to make it law with Rep. Linda Harper-Brown and Rep. Lois Kolkhorst pledging to back it. Nonetheless, Isett stated: “I suspect you may have a problem getting it out of the Senate.” The Commission’s recommendations clearly didn’t go far enough. It’s our job to make sure the needed reforms become law. Hold onto your hats, we’re in for another wild ride.

Sunset for TxDOT board? Lawmakers prefer single chief
But ‘sunset’ report is only advisory to Legislature. Some want to retain five-member board, while others want to elect TxDOT leader.
By Ben Wear
AMERICAN-STATESMAN STAFF
Wednesday, December 17, 2008

The five-member Texas Transportation Commission should be abolished and replaced with a single commissioner appointed by the governor, the Texas Sunset Review Commission decided Tuesday.

However, the 7-5 vote by the commission, as well as many other changes for the Texas Department of Transportation included in the commission’s report, amount only to suggestions to the Legislature. The narrow vote, and the opposition of four of the five senators on the commission, suggests that the question of how to govern TxDOT is far from settled.

“I suspect you may have a problem getting it out of the Senate,” commission co-chairman Carl Isett, a Republican House member from Lubbock, said immediately after the vote.

One member pointed out one significant impact of having a single commissioner: no more open meetings of the commission, which makes key decisions. And some members, reflecting the bulk of public comment in recent months, said they would prefer that Texans elect a transportation commissioner. State Rep. Ruth McClendon, D-San Antonio, said she’ll carry legislation to make that change in 2009.

“We’ll continue to have this discussion for 140 days” during the coming legislative session, said state Sen. Glenn Hegar, R-Katy, also a co-chair of the Sunset commission.

The discussion, which lasted most of Tuesday afternoon, was another in a string of unpleasant ones for the TxDOT executives lined up in the Capitol hearing room’s front row. The Legislature in 2007 began and ended the session in open revolt against what many lawmakers of both parties see as the high-handed tactics of TxDOT during the past five years or so. That official restiveness had the bad luck, from TxDOT’s vantage point, of coming just as the once-every-12-years sunset review was scheduled to occur.

Make that once-every-four-years, at least for now. The commission approved giving the agency just four years until its next turn on the griddle. In addition — all of these changes would only become law if they are included in a final sunset bill for TxDOT next spring — a newly created Transportation Legislative Oversight Committee would examine everything TxDOT does and how it does it in the coming years. A consultant company would be hired to conduct what would amount to a management audit of the agency. And four divisions of TxDOT, including vehicle licensing and its motor carrier office, would be broken off into a new Texas Department of Motor Vehicles.

“We are trying to restructure an agency,” Isett said.

But he opposed the single commissioner idea, arguing that for a service like transportation where large sums of money are spent on roads throughout the state, it would be better to retain the five-member commission and stipulate that the members come from five geographic districts. Historically, governors have attempted to maintain some sort of rough balance in their appointments of transportation commission members, but Isett would put that requirement in law.

Isett said that the real problem with TxDOT isn’t the appointed leaders, but rather the “culture in that building across the street” (TxDOT’s headquarters on 11th Street) of making it difficult for outsiders to accurately gauge what is going on.

But state Rep. Lois Kolkhorst, R-Brenham , one of TxDOT’s harshest critics in recent years, said changing to a single commissioner will make it clear who is responsible for the agency’s actions.

“It sends a clear signal,” Kolkhorst said, “that we do want change.”

Illinois Governor arrested for toll project in exchange for campaign cash

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Illinois Governor Blagojevich Saw Personal Green in Toll Lane Idea
Illinois governor arrested for approving a toll lane project in return for campaign cash.
The Newspaper.com
December 10, 2008

Governor Rod BlagojevichThe green in Governor Rod R. Blagojevich’s “Green Lane” tolling proposal was headed to the pocket of the Illinois Democrat, according to charges filed this weekend. Most of the attention drawn to yesterday’s arrest of Blagojevich and his chief of staff, John Harris, has centered on the governor’s reported attempt to sell the US Senate seat being vacated by President-elect Barack Obama (D). Blagojevich’s “Tomorrow’s Transportation Today” scheme to impose new tolls on motorists for the enrichment of his personal campaign contributors has received less scrutiny. Blagojevich took office in 2003 after his predecessor, George Ryan (R) was similarly arrested for corruption.

“If (Illinois) isn’t the most corrupt state, it’s one hell of a competitor,” Federal Bureau of Investigation (FBI) Special Agent-in-Charge Robert D. Grant said yesterday. “Even the most cynical agents in our shop were shocked.”

According to the indictment, a wealthy contractor promised on October 6 to make a $500,000 donation to the Friends of Blagojevich campaign account. Nine days later, the governor announced the $1.8 billion program whose centerpiece was the addition of High Occupancy Toll (HOT) lanes to the Illinois Tollway — an extra layer of toll collection on existing lanes within the already tolled roadway. The beauty of the Tomorrow’s Transportation Today concept was that it could be easily expanded to other parts of the state transportation network.

“I could have made a larger announcement but wanted to see how they perform by the end of the year,” Blagojevich said in private conversation. “If they don’t perform, [expletive] ’em.”

According to the most recent campaign disclosures filed, Blagojevich had raised $1.9 million for his campaign in the first six months of 2008. FBI agents seized the campaign ledgers and suggested that Blagojevich’s goal was to reach $2.5 million by the end of the year. After bugging the Blagojevich campaign office, agents intercepted a phone call where the governor emphasized to contractors the need to raise the additional campaign money before January 1, 2009. On that date, a new ethics law designed to stop “Pay for Play” will prohibit companies with state contracts worth more than $50,000 from making donations to officials that approve contracts.

Green Lane construction is not scheduled to begin until 2010. Under the current plans, contractors would be given $400 million in taxpayer money to install extra tolling infrastructure on the existing, already tolled lanes on 41 miles of Interstate 294 — the Green Lanes would not create any new capacity. The extra tolls imposed on drivers would would then be handed to contractors to build expensive interchange replacement projects for the benefit of campaign donors with ties to the concrete industry.

This is not the first scandal involving HOT lanes. In 2002, the Orange County, California Transportation Authority paid the contractors who built the 91 Express Lanes $207.5 million to get out from under a cleverly written non-compete contract. The lanes only cost $139 million to build. Earlier this year, an Australian tolling contractor admitted it had made $177,000 in illegal campaign contributions to Virginia Governor Tim Kaine (D) and members of both parties in the General Assembly. Contractors that run HOT lanes stand to pocket millions even from legitimate deals because tolling by its nature is inherently inefficient. The best run toll roads in the country spend an average of 22 percent of the tolls collected from drivers on nothing but toll collection overhead (details).

Blagojevich and Harris are charged with solicitation of bribery and conspiracy to commit wire fraud. Both face 20 years in prison and up to $500,000 in fines.

A full copy of the indictment is available in a 650k PDF file at the source link below.

Source: PDF File Criminal Complaint for US v. Blagojevich (US District Court, Northern District of Illinois, 12/9/2008)

Capital Area MPO steals money from 183A toll road to fund 290 toll road

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Vote frees NE Austin tollway project to move ahead in 2009
Transportation officials approve financial pairing of U.S. 290, 183-A
By Ben Wear
AMERICAN-STATESMAN STAFF
Tuesday, December 02, 2008

Transportation officials decided to create a financial marriage between two toll roads Monday, a move that could allow the U.S. 290 East tollway project to break ground sometime next year.

The Capital Area Metropolitan Planning Organization board voted 15-3 to create a tollway system made up of the existing, and profitable, 183-A toll road in Cedar Park and U.S. 290 East, which based on projections will not have sufficient revenue to persuade investors to lend more than a half billion dollars to build it. The existing tollway, which opened in March 2007 and is making a profit of about $5 million a year, will in effect act as a co-signer for the new project.

The U.S. 290 East project would cost $623.5 million, the Central Texas Regional Mobility Authority says. It involves expanding 6.2 miles of the existing four-lane, divided highway between U.S. 183 in Northeast Austin and Parmer Lane just west of Manor. It would have six toll lanes and six free-to-drive frontage road lanes alongside.

Some CAMPO members objected to the financial partnership Monday, saying it violates the intent of policies adopted in October 2007, when the board approved the U.S. 290 East project and four other potential toll roads. At that time, the board agreed that excess toll revenue from the five roads would be spent first in the general area of each road rather than being used for improvements far afield.

That will still be the case, according to the mobility authority, which operates 183-A and will build and operate U.S. 290 East. Given 183-A’s profitable status, they say, no money would need to go from U.S. 290 East to 183-A.

In fact, mobility authority Executive Director Mike Heiligenstein said no money is likely to go either direction. The authority says that preliminary traffic and revenue studies show that U.S. 290 East will be able to meet its debt payments and operating costs without any transfer of money from 183-A.

However, investors normally require that toll road revenues be well beyond projected costs. A summary of the traffic analysis released Monday shows that, based on charging 20 cents a mile for U.S. 290 East, the road would make about a 30 percent profit — which Heiligenstein said was not high enough for the mobility authority to borrow the full amount needed to build U.S. 290 East without riding on the back of 183-A.

Voting against the plan were Travis County Commissioner Sarah Eckhardt, Sunset Valley Mayor Jeff Mills and state Rep. Eddie Rodriguez.

Heiligenstein said Monday’s vote was necessary to sustain engineering work and keep the project on schedule. Officials expect to get federal environmental clearance for the road in the first half of 2009, borrow the money on the bond market later in the year and begin construction soon after that.

Guerra: 281 toll road study needs trustworthy agency

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Time for a new participant in toll-road controversy: AACOG
By Carlos Guerra
Express-News
12/02/2008

Amazing how an already long tale keeps growing, all because we refuse to deal with the reality of our drinking water.

Commuters who drive into town via U.S. 281 know all about long morning waits. Of course, that’s because they moved into the city’s then-unincorporated northern reaches, where they could have expansive yards, be away from the city’s hustle and bustle and. initially at least, pay no city taxes.

The problem is they weren’t alone.

Over the past five years, more than half of all new “San Antonio” homes have been in unincorporated areas of the city’s northern extraterritorial jurisdiction, and the impact has been significant. Especially along the U.S. 281 corridor, where every morning tens of thousands of cars pour onto the highway in a southerly migration.

But much of the congestion is around the light-controlled intersections, where arterial roads pour thousands of additional cars into the flow.

The Texas Department of Transportation proposed an absurd plan to deal with it all: Instead of building overpasses over the congested intersections that would allow southbound drivers to cruise over them, the agency proposed toll roads along the route, and along the northern reaches of Loop 1604, so a foreign-owned company could excise tolls from all those who wanted to get into town quickly.

Two minor problems arose.

First, the Legislature ordered that no toll roads replace existing highway lanes, which in essence required TxDOT to double the highway lanes on 281 so they could toll them.

The other problem was that the entire area lies over the most sensitive areas of the recharge and contributing zones of the Edwards Aquifer, our sole water source, and, because the project requires federal money, federal laws apply, so they had to take environmental concerns into account.

TxDOT’s “outside contractor” for the “environmental assessment” — a lightweight appraisal of the environmental impact — turned out to be a company for which a TxDOT employee’s husband worked. It found that a U.S. 281 toll road over the most sensitive part of the aquifer’s recharge zone would have no significant impact.

Bill Bunch, lead attorney for Aquifer Guardians in Urban Areas, took TxDOT to court, not once but twice — and won twice.

“We’ve beat them twice, and both times, each time, before ever going to trial,” Bunch says with a chuckle.

But the next step is nothing to laugh about.

A news release from the Alamo Regional Mobility Authority states: “County Judge (Nelson) Wolff requested the Alamo RMA take the lead role in developing a new environmental document for 281 …”

Now, honestly, do we want the Regional Mobility Authority, which was created for the sole purpose of selling toll roads, to conduct an “impartial environmental assessment of a new toll road route” now?

Annalisa Peace, head of the Greater Edwards Aquifer Alliance, a coalition of 45-plus water activist groups, had this to say: “I think that the Alamo Area Council of Governments would be the appropriate agency to conduct the (environmental impact statement) for 281 and all tolling projects within the San Antonio area. AACOG is the agency tasked with addressing our air quality compliance, certainly an important issue for an EIS to address. And the many small municipalities and county governments that will be impacted by these projects are members of AACOG.

“The sooner we can begin to address transportation issues on a regional basis, the better. The EIS process for 281 is an excellent opportunity to begin doing this.”

Makes sense to me.

Citigroup spends bailout money to buy debt-ridden toll roads

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Bailed-Out Bank Goes on Toll Road Buying Binge
Bailed out Citigroup fund spends $10 billion buying 44 foreign toll roads.
The Newspaper.com
December 1, 2008

Citi toll roadJust one week after receiving a pledge of $306 billion in support from US taxpayers, Citigroup announced the intended $10 billion acquisition of a debt-laden Spanish toll road group. Citi Infrastructure Partners will hand over $3.6 billion in cash and assume $6.3 billion in debt from Sacyr Vallehermoso, the parent company of the Intinere Infraestructuras toll road group. Itinere operates 32 toll roads in Brazil, Chile, Costa Rica, Portugal and Spain and Ireland. Another twelve concessions are under construction. Sacyr today issued a statement to Spanish investors noting that the company succeeded in offloading 37 percent of its total debt to the US firm.

“With this transaction, the group reaps the value that Itinere accumulated for its mature concession assets and strengthens its financial situation by considerably reducing its indebtedness,” the statement explained.

On November 23, the US Treasury announced that it had invested $20 billion in US taxpayer funds in Citigroup in addition to “protection against the possibility of unusually large losses” on $306 billion in bad debt the company had acquired primarily in commercial and residential real estate markets. Armed with the new taxpayer capital, Citigroup believes its purchase of the toll roads will hold long-term value. In the immediate term, Citigroup will sell off Itinere’s stakes in five Spanish and Chilean toll roads to Spanish tolling giant Abertis, allowing that company to assume full ownership of its tolling assets. The deal is valued at $786 million.

Other analysts, including Fitch Ratings, view tolling as a risky investment as toll road volumes have plummeted in response to the recent spikes in gasoline prices and the global economic slowdown. In August, Fitch issued a warning that its outlook on tolling had changed to “negative,” reflecting a dim view of the creditworthiness of the long-term transactions. In October, Citigroup and Abertis gave up on their joint bid to collect tolls on the Pennsylvania Turnpike. The consortium spent millions bankrolling a slick public relations campaign that ultimately failed to sway public opinion on the wisdom of the 75-year proposal.

TxDOT public relations, lobbying arm questioned

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Link to article here. Read the damaging evidence TURF’s lawsuit to stop TxDOT’s illegal lobbying and ad campaign to promote toll roads and the Trans Texas Corridor uncovered here.

TxDOT spends $10.5 million to inform public
Key legislator takes issue with how agency’s money is spent
By PEGGY FIKAC
Copyright 2008 Houston Chronicle Austin Bureau
Nov. 30, 2008

AUSTIN — When state lawmakers expressed surprise at the size of the Texas Department of Transportation’s government relations and public affairs operation, they didn’t know the half of it.

The heft of TxDOT’s Government and Public Affairs division, which is budgeted for 63 people and nearly $6.5 million a year, raised eyebrows earlier this year after concerns the agency had promoted issues such as toll roads and the ambitious Trans-Texas Corridor network despite opposition from the public and a number of lawmakers.

It turns out the GPA division is only part of the agency’s public-information picture. Sixty-seven more people do public information or media relations for TxDOT, including those working at the agency’s district office.

TxDOT said it couldn’t tally how much is budgeted for such duties outside of GPA, saying most, if not all, the staffers also perform other tasks. Their salaries alone amount to $4 million a year, according to figures released in response to a public information request from the Houston Chronicle.

That means $10.5 million is spent annually on government and public affairs by TxDOT, largely excluding staffers who promote tourism and travel.

“So, $10.5 million to communicate as poorly as we have communicated is probably not acceptable,” said Rep. Lois Kolkhorst, R-Brenham, a member of the Sunset Advisory Commission, which is considering possible changes at TxDOT and had a hearing earlier this year that included a look at GPA’s size.

Kolkhorst, who pushed a moratorium on privately operated toll roads in 2007, has taken issue with TxDOT’s approach. TxDOT’s commission is appointed by Gov. Rick Perry, who has championed toll roads and the Trans-Texas Corridor, and the agency has been accused of too actively following suit.

TxDOT spokesman Chris Lippincott said agency efforts have been within the parameters of the law.

A huge response to town hall meetings and to a solicitation of comments on the Trans-Texas Corridor shows the effectiveness of its efforts, Lippincott said.

He said issues such as toll roads make up only part of TxDOT’s public information operation, which also works to inform people on such things as routes to take when hurricanes are imminent.

“We touch just about everybody in this state that gets in a car or gets on a bus or a train,” he said, “and that requires a lot of interaction.”

Outgoing House Transportation Committee Chairman Mike Krusee, R-Round Rock, said

TxDOT handles complex issues that require communication and public hearings.

Lippincott noted that the amount spent on the GPA division and other public information efforts amounts to a tiny fraction — 0.125 percent, or just over one-tenth of 1 percent of TxDOT’s nearly $8.4 billion annual budget.

He noted TxDOT is in a hiring “chill” affecting the GPA division, which currently has 54 positions filled.

The total is, however, larger than what the other five largest state agencies in Texas calculate they spend under the label of government and public affairs.

The one that comes closest is the Department of State Health Services, with 30 people in its consumer, external affairs and Web office, with a combined budget of $2.54 million. That’s 0.09 percent of the agency’s total annual budget of nearly $2.8 billion.

Among others:

•The Texas Education Agency has 17 people in communications, governmental relations, media services and Web services, budgeted at $1.3 million. The total is nearly 0.005 percent of the $26.3 billion in funds that flow through the agency.
•The Health and Human Services Commission has 21 people in communications and external relations offices, budgeted at nearly $1.6 million — 0.0099 percent of its $16 billion annual budget. That total doesn’t include $2.35 million for advertising work related to two public information campaigns.
•The Department of Aging and Disability Services has 21 people in communications and government relations, with a $1.15 million tab for overhead and salaries nearly 0.019 percent of its total budget of nearly $6.2 billion annually.
•The Texas Department of Criminal Justice has 18 people in government and public affairs, budgeted at $769,717. That’s nearly 0.027 percent of its total budget of nearly $2.9 billion.
But Krusee said that comparing TxDOT to another agency is “not apples-to-apples.”

“They have a different mission, and it’s a far more complex process which requires communication with the public at a level of pervasiveness and complexity probably unmatched elsewhere in state government,” Krusee said.

Kolkhorst said, “The No. 1 thing that the Sunset report talked about was that this agency had lost the trust of the people.

“And how do you lose trust? You lose trust by actions and words, and I’m very disappointed that we’re spending $10.5 million, more than we’ve ever spent, and the trust could not be at a lower level than it is today.”