Author: Terri Hall

Moody's warns gas prices may lead to toll increases

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Link to article here.

Moody’s: Gas Prices May Lead to Toll Increases
Bond Buyer
Thursday, August 7, 2008

WASHINGTON – Gasoline prices at $4.00 or more per gallon for a prolonged period could depress toll road traffic and revenue, and compel governments to increase tolls to prevent credit rating downgrades, Moody’s Investors Service warned in a report issued today.

Despite the warning, Moody’s gave the government-owned toll road sector a cautiously stable outlook for the next year to 18 months, pointing to steady traffic in commuter-heavy metropolitan areas as a stabilizing factor. However, greater leveraging of toll road assets could put downward pressure on the sector’s A1 median rating.

“We expect continued steady debt issuance, particularly as service area economies grow and toll facilities are tapped to undertake projects that local governments would rather not fund with taxes,” the report said.

Traffic and revenue growth are likely to decelerate in some regions because of deteriorating economic conditions, Moody’s said. But most toll roads rated by Moody’s – especially those in major metropolitan areas – should see steady, if slower, gains in traffic and toll payments.

All but four of 45 government-owned toll roads that Moody’s rates are stable, and its two ratings changes this year so far have been upgrades.

“The sector’s credit strength reflects favorable historical economic conditions and traffic growth in the U.S., the low elasticity of demand experienced by many toll roads, and financial strength and stability of the sector,” Moody’s said in its sector overview.

Other factors keeping the sector stable are solid liquidity levels, the ability to independently increase toll rates, and the “relatively resilient underlying service area economies” for many major metropolitan areas that are served by toll roads.

Moody’s gave examples of why some ratings were downgraded last year.

The North Texas Tollway Authority’s revenue bond rating was downgraded by Moody’s in November due to increased debt issuance and “steady toll increases” to support the additional debt, Moody’s noted. Nevertheless, the traffic growth rate has remained steady. As of May, traffic was up 6% over 2007.

The Santa Rosa Bay Bridge Authority’s rating was downgraded because traffic and revenue failed to meet expectations. The authority had to tap its debt service reserve fund to pay on its bonds. Lower-rated toll roads tended to be new, single-asset facilities that underperform because of local economic slowdown or “overly optimistic” predictions, the report said.

Moody’s analysts said older, established toll roads linking residential centers with employment centers in both urban and rural areas are not likely to suffer from sustained drops in traffic. In fact, they said, established toll roads may be the exception to a national trend.

The U.S. Department of Transportation announced last week that drivers traveled almost 10 billion fewer miles in May than in that same month last year. It was the third-largest monthly drop in U.S. vehicle miles traveled ever recorded. All three of the largest monthly mileage drops were this year.

But “the numbers cited there are on all U.S. highways, not just on toll roads,” explained Maria Matesanz, a Moody’s senior vice president who authored the toll road sector outlook. Matesanz said the rate of traffic growth on toll roads “may have slowed a bit, but the usage isn’t declining.”

Analysts emphasized that a clear-cut trend has not yet emerged that shows toll road traffic and revenues are in trouble. If tolling does see a decline because of a prolonged period of high gasoline prices, toll increases may be necessary, the report indicated.

The report did not speculate on a breaking point at which drivers might stop using toll roads because of higher toll costs.

“There’s always that point, and that potential, that you could be compounding the problem, so it is a balancing act,” said Tom Paolicelli, Moody’s vice president and senior analyst. “Some roads are more inelastic than others.”

It remains unclear, the analysts said, whether the economy, gas prices, or a combination of both is causing the decline in traffic growth rates.

Slowing regional economies combined with high fuel prices have, however, already affected some toll roads more than others, the analysts said.

The report said the government-owned toll road outlook is “more uncertain” for 2009.

“Given the reluctance to increase federal and state taxes to the levels needed to close the funding gap for road and bridge infrastructure, Moody’s expects the increased use of tolling to help pay for new transportation projects, leading to greater toll revenue-backed debt issuance,” the analysts wrote. In addition, more leveraging of existing toll road systems “may have a negative impact on some credit ratings.”

Moody’s cited examples of trends that may bolster the sector’s credit health.

Increasing use of electronic toll collection and open road tolling – or cashless tolling – and congestion pricing could bring in more toll revenues, the rating agency said. But the analysts recommended against sharp bumps in toll prices, suggesting instead that “gradual, smaller” toll increases may be more acceptable to drivers and lawmakers. Cashless tolling could speed the flow of traffic and cut operating and capital costs of government-owned toll road facilities, the report said.

“Also, as tolling becomes more electronic,” Matesanz added, drivers may pay less attention to toll rates. “So they’re a little bit more insulated from the toll rate increases.”

TxDOT caught in deception, hid docs from the feds that prove violation of the law

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Link to article here. This violation of federal law is much more than a “snag,” it blows a hole right through the 281 toll project. TxDOT was caught in willful deception, so this story is the understatement of the year!

Planned U.S. 281 tollway hits another bump
By Pat Driscoll
San Antonio Express-News
August 7, 2008
A federal lawsuit blasted as frivolous has dug up some documents that throw yet another curve at San Antonio’s planned U.S. 281 tollway.

The documents were uncovered in a discovery process for the lawsuit, which challenges the thoroughness of the tollway project’s environmental study.

The Texas Department of Transportation, which did the study, won’t say what the documents are but is handing them over to the Federal Highway Administration, which approved the study last year.

“We wanted to take the cautious advice of the attorneys and give the FHWA another opportunity to review this project,” TxDOT Director Amadeo Saenz said in a statement.

TxDOT asked the court’s judge to delay the lawsuit for two months to give federal officials time to review the documents and decide whether to amend the environmental study or reconsider approval. Pulling the clearance would delay the toll project even more.

Widening eight miles of U.S. 281 north of Loop 1604 has been on hold for years, first as TxDOT waited to build it as a freeway and then converted to a tollway plan, and then after activists filed a 2005 lawsuit to force a redo of the environmental study.

The more recent lawsuit, filed in February by Texans Uniting for Reform and Freedom and Aquifer Guardians in Urban Areas, is similar to the 2005 suit in that it calls for a closer look at impacts to motorists, water and wildlife.

One of the documents missing from the latest environmental study is a report on how the 10- to 20-lane tollway could affect the Edwards Aquifer, which supplies most of San Antonio’s drinking water, said TURF founder Terri Hall.

“They have withheld information from the Federal Highway Administration that could blow a hole in the middle of the 281 project,” she said.

The Alamo Regional Mobility Authority, which took over the $472 million toll project from TxDOT, hoped to sell bonds in October and planned to start opening new lanes in three years, now must push its schedule back at least two months.

BREAKING NEWS: TxDOT caught withholding 281 docs from the feds

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CAUGHT IN DECEPTION!
TxDOT asks court for 60 day delay on 281 case

In what amounts to a total victory for the grassroots, TxDOT has to ask the court for a 60 day delay in the 281 lawsuit so they can beg the Federal Highway Administration (FHWA) NOT to yank their environmental clearance for the 281 toll project. Through the discovery process of our lawsuit, the Judge required TxDOT to hand over the complete administrative record for 281, including all the financials and the stuff from when the improvements were funded with gas taxes that would keep 281 a FREEway. It’s been discovered that TxDOT withheld key documents not only from the public and our attorneys, but also the feds!

There are a heap of emails that show TxDOT tried to “fix” the environmental work for 281 to pre-determine a “Finding of No Significant Impact” (or FONSI) BEFORE the study even began. They rigged it! That is a DIRECT VIOLATION OF FEDERAL LAW! TxDOT then hired a company, HNTB, to do the so-called “independent” environmental study even though HNTB has a MAJOR conflict of interest, in that, the tolling authority (ARMA) also hired HNTB to do the preliminary engineering for all their toll projects! So HNTB had a vested interest in a “Finding of No Significant Impact” (or FONSI).

Then, it’s also been discovered that TxDOT purposely withheld a key study from a geologist they hired that stated the potential harmful effects of the toll road on the Edwards Aquifer. Such a study didn’t conclude what TxDOT wanted it to in order to get clearance from the feds, so they intentionally hid the report and failed to submit it to the FHWA who uses that crucial information in their decision on whether or not to give federal approval for the project.

TxDOT, thanks to our lawsuit, now has to submit these documents to the feds who will completely re-consider their previous approval of the 281 toll road. It’s likely the feds will yank their environmental clearance for the toll road in light of this deception by TxDOT. If they don’t, the court is likely to do it for them. So TxDOT is in total damage control mode and released a statement about their motion for a 60 stay in our lawsuit that tries to minimize what the documents reveal and, of course, blames us for the delay instead of their own incompetence and deception. As usual, they seem to think they can wiggle out of their corruption without consequences simply by supplementing the record. They were FORCED to come clean through a lawsuit brought by concerned citizens, not by them being forthcoming. The tactics at TxDOT never cease to amaze.

So stay tuned, we’ll see how the Judge rules and what other damaging information these “other” documents reveal.

________________________________________________

Official TxDOT propaganda on the request…

The Texas Department of Transportation (TxDOT) has asked a federal district court judge to issue a stay of the litigation regarding the expansion of U.S. Highway 281 in San Antonio.  We recently located documents which they feel may need to be reviewed by federal officials as part of the environmental evaluation of the transportation project.

In the process of responding to discovery requests for the lawsuit, staff identified documents that had not previously been submitted to the Federal Highway Administration (FHWA).  TxDOT will submit these documents to FHWA for their review.  FHWA will then determine whether the administrative record for the U.S. 281 project should be amended and whether the project’s prior environmental clearance would need to be reconsidered.  In order to provide FHWA time to review the documents, TxDOT requested that the ongoing litigation be delayed up to 60 days.

“Every day that this project is delayed is another day that Bexar County drivers are stuck in traffic,” said TxDOT Executive Director Amadeo Saenz.  “Nevertheless, we are committed to making sure that the 281 project complies with all federal and state requirements.  The extension we requested would allow FHWA to review these new documents and come to an independent decision about how to proceed.  We recognized that we should bring these documents to the attention of FHWA, and we want to make sure they have the time they need to review them.”

Saenz said that the documents will be submitted to the FHWA out of an abundance of caution.  “A new, more conservative view of TxDOT’s records related to the 281 project would require these materials to be forwarded to FHWA,” he said.  “We wanted to take the cautious advice of the attorneys and give the FHWA another opportunity to review this project.  On balance, this is a small addition to the 24,000-page administrative record, but it deserves scrutiny from FHWA.”

In its filing with the court, the department wrote that it has no intention of delaying the proceedings but wants to ensure that the FHWA has ample time to examine the recently identified information to determine whether the administrative record should be amended.

We recently adopted new policies on how to assist FHWA in the preparation of the administrative record showing the environmental review of a transportation project.  “Preparing the administrative record for a complex transportation project is an enormous task.  We will do our part to make sure the process is the best it can be,” said Saenz.

TTC-69 lobby group, Alliance for I-69, takes their show on the road

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Link to article here.

Alliance for I-69 is the biggest pro-TTC-69 lobby group in the state. Their chief lobbyist, Gary Bushell, is also the same lobbyist TxDOT illegally hired with our taxpayer money to lobby elected officials in the path of the TTC-69. Bushell is also a notable campaign contributor to MANY politicians, Bexar County Rep. Frank Corte among them. Today, Alliance for I-69 teamed up with Zachry, who along with Spanish company ACS won the development rights to TTC-69 in June, hit Victoria with their dog and pony show, and they’ve been in Austin hitting up lawmakers, too. Their logo on the material they left with lawmakers even has a Canadian, Mexican, and U.S flag morphed together, yet TxDOT denies the Trans Texas Corridor is about NAFTA, international trade, the movement of freight/goods, or the economic integration of the three countries.

I-69 partners make presentation
Victoria Advocate
August 05, 2008

The Alliance for I-69 Texas and U.S.-owned company Zachry American Infrastruture have partnered up and are traveling across the state giving presentations on I-69. On Tuesday, they stopped in Victoria.

During the short initial meeting, city leaders met with Gary Bushnell of the advocacy group and Gary Kuhn, senior project manager for Zachry, the firm awarded the contract for the superhighway.

The Interstate 69 corridor project is a proposed multi-use, statewide network of transportation routes in Texas that will incorporate existing and new highways, railways, utility right-of-ways and toll roads. Zachry was awarded the contract for the project in June by the Texas Transportation Commission.

The presentation focused on ways Victoria could use I-69 to their economic advantage and about the potential the corridor has in terms of new transportation technology.

According to Kuhn, Zachry is working on a master plan that takes into account local projects Texas communities want to do and how the company can help improve local economic development. Kuhn also discussed Zachry’s proposal for a freight shuttle that would go alongside the existing route of U.S. 77 in Victoria. According to Kuhn, the freight shuttle combines the best characteristics of the rail and truck transportation, but is more efficient, cheaper and causes less pollution. He added that it would run on electromagnetic pulses that create motion and a freight shuttle system across Texas could be up and running by as early as 2015.

“We’ve been working with the Alliance to visit all the communities involved in the I-69 Interstate. There is a lot of collaboration that needs to take place among these communities,” Kuhn said. “It’s a kind of one for all and all for one deal.”

The meeting included Mayor Will Armstrong, Dale Fowler of the Victoria Economic Development Corp. and Lee Swearingen of the Victoria County Navigation District.

ACS of Spain wins 50 year right to develop TTC-69, without competitive bidding!

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Link to ACS statement here.

TxDOT has repeatedly misled the public about the Trans Texas Corridor projects and has denied they’re part of any effort to economically merge (through trade and commerce) the U.S. with Canada and Mexico through key transportation corridors. Yet the release by ACS below clearly states the opposite. TxDOT also tried to misrepresent the breadth of the TTC-69 development contract awarded to ACS/Zachry in June leading even lawmakers to believe it only included upgrading Hwy 77 to interstate 69.

Yet as TURF warned (and the media has failed to report), the devil is in the details and the request for proposals by TxDOT clearly stated this contract was for the long-term development of the TTC. TxDOT also denies this grants ACS/Zachry the right of first refusal (preferential contracts without competitive bidding) for TTC-69 segments, but again, this statement by ACS tells its investors otherwise.

Read more about the egregious contract and taxpayer rip-off on the first segment of TTC-69 in the Rio Grande Valley here.

ACS to participate in the development of a great transportation infrastructure corridor in Texas

Iridium and the North American Zachry have been chosen by the State of Texas as strategic partners for 50 years to design, plan and develop a great infrastructure corridor of 1,000 kilometres in length.

The estimate project investments, involving the construction of road and railway infrastructures, exceed 30,000 million dollars, 5,000 million during the first seven years.

The I-69/TTC (Trans Texas Corridor) will connect the Mexican border with the Gulf of Mexico coastline, Houston and major industrial and logistics centres in Texas with the north of the country.

This is the second concessions project awarded to ACS in North America in seven days, after last week being awarded the A-30 highway in Canada.

Madrid, June 26, 2008. ACS Infrastructures Development, the North American branch of Iridium, the concession development company of ACS, and the Texan concessionaire Zachry American Infrastructure have become the successful bidders for the design, planning and development, as strategic partners of the Texas Department of Transportation (TxDOT), of the I-69/TTC infrastructure corridor for the next 50 years.

The I-69/TTC will be a great road and railway infrastructure corridor that will cross the State of Texas from north to south. Specifically, it will start in the Rio Grande valley to Houston offering new exits towards the centre of the Union from large industrial and logistics centres in the south of the State, including a branch towards the Gulf of Mexico and the port of Corpus Christie. The estimate investment for the entire project is around 30,000 million dollars, of which 5,000 million shall be invested during the first 7 years.

With the award of this project, ACS and Zachry, the largest construction group in the State of Texas, have become strategic partners of the Texas Department of Transportation and shall propose the development of specific projects and activities for which they will have a preferential negotiation option without public tender. In fact, the consortium is already considering the renewal of a first route whose concession will be negotiated with the Texas Department of Transportation, the US 77, which shall include the construction of a series of highways under concession regime connecting to it and which shall require an investment of 2,500 million dollars.

The I-69/TTC development project includes, in its initial design, the construction of a 1,000 kilometre network of highways and roads as well as railway lines. Based on this, ACS and Zachry will draft a Master Plan with the Texas Department of Transportation to establish the priority activities as well as the form and deadlines for their execution.

The winning consortium for the project, led by Iridium and Zachry, and which has UBS as its financial advisor and SDG as infrastructure planning consultant, also enjoys the involvement of Dragados, the parent company of the ACS construction area, and SICE, company belonging to its Industrial Services area and which has extended experience in the installation of traffic control systems, as well as other engineering and construction companies in the State of Texas.

The I-69/TTC is one of the high priority transportation infrastructure corridors identified by the State of Texas, the first of which has already been set in motion. In total, it entails an infrastructure network of around 3,000 kilometres and investments of 150,000 million euros to improve State communications with Mexico, centre and north of the country and Canada. Eight States of the Union, including Texas, which is the developer, are involved in the project.

Second concession in North America in one week

The awarding of the I-69/TTC represents the consolidation of the presence of the ACS Group in United States, where it already has considerable presence in civil works, and is the second concession won by Iridium in North America in seven days. Last week the ACS concessions developer was awarded by the State of Quebec, together with Acciona, the project to finance, build and operate for 35 years the A-30 highway in Canada, a project with an investment of 1,000 million euros, which shall require the execution of important civil works to connect the south of Montreal with the North American border. The A-30 is also the first concession awarded to Iridium in Canada.

This way, ACS continues its expansion process in North America, a market it has defined as strategic. Through Dragados, the parent company of its construction area, is already present in United States in its civil works activities since 2005, when it became the successful bidder for the first expansion of the New York Subway; a large engineering project connecting the Grand Central Station in Manhattan to Queens under the Hudson River, representing 400 million dollars. Later Dragados assumed new projects in the north east of the country to improve roads, dams and subways, and recently was awarded the construction of a dam in Puerto Rico and the first contract for the expansion of Miami airport. In December 2007, it acquired 100% of Schiavione; a company specialized in construction in the north east of the country.

Iridium, the ACS concessions company, has been for the last ten years the greatest private transportation infrastructure investor in the world, with promoted investments exceeding 22,000 million euros. The infrastructure and public equipment company participates in the management of more than 40 companies of these characteristics, encompassing the entire concessional business value chain.

Texas School Land Board votes to invest $100 million in toll roads

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Link to article here. Even more appalling than this investment handed to Goldman Sachs (for presumably a variety of toll road infrastructure projects), is the fact that the GLO has already given that amount to a single company, Australia-based Macquarie. This is the same company that bought dozens of Texas newspapers in the path of the Trans Texas Corridor to control the negative press it’s been getting, a bidder on many Texas toll projects, and proposing to takeover the Austin airport.

Texas Land Office commits $100 million to infrastructure fund
By Robert Elder
Austin American Statesman
August 5, 2008
The Texas School Land Board today voted to invest $100 million in an infrastructure fund run by Goldman Sachs. (To recap the hierarchy of these investments: The school land board approves investments for the General Land Office, which does real estate and land investing on behalf of the Texas Permanent School fund. Income from the PSF helps pay for public education. Got it?)

Rusty Martin, deputy commissioner for funds management, told the land board that the Goldman fund will top out at about $7.5 billion and invest primarily in transportation and utilities infrastructure.

The generally dismal state of global infrastructure has spurred great interest in infrastructure as an investing asset class. The need is obvious, from bridge collapses in the U.S. to China’s goal of adding the equivalent of the U.S. highway system in the next few years.

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The area has also drawn the attention of Texas lawmakers such as Sen. Steve Ogden (right), chairman of the Senate Finance Committee. The Bryan Republican has floated the idea of Texas public pension funds as a source of capital for infrastructure in the state. If the funds are investing — or contemplating investing — in infrastructure deals all over the world, Ogden reasons, why not put some of that money work in Texas?

To date, Texas public pensions have not committed large sums of money to infrastructure, although some funds hold stock in publicly traded infrastructure companies.

The Goldman Sachs investment is the General Land Office’s second infrastructure deal. The GLO in February committed $100 million to Macquarie Infrastructure Partners II. Macquarie Group Ltd. is an Australian investment bank.

Toll road traffic down due to high gas prices

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Link to article here. Once again, the price of gas is causing driving to go down, including on toll roads. There isn’t enough money in the family budget to pay for tolls on top of high gas prices. We’ve been sounding these warning bells for years, when will politicians and the pro-tollers listen? They’re foolishly putting generations into risky leveraged debt in order to build what they believe will be cash cow toll roads only to have them all fail due to high gas prices. We don’t need another mortgage crisis for the taxpayers to bail out in keeping with the “too big to fail” mantra of government. It’s time to rethink this toll proliferation.

Toll roads feeling the fuel-price pinch
Landline Magazine
August 1, 2008
Traffic is decreasing on some toll roads around the nation and officials say it’s because of high fuel prices.

It’s happening in Texas, where dozens of toll roads and tolled metro loops are being designed and built to handle a steep increase in population and traffic.

The North Texas Tollway Authority, which operates the 30-mile President George Bush Turnpike in the North Dallas area, saw traffic decrease by 1.4 percent in May and 2.3 percent in June compared to those same months in 2007.

“Historically, we have seen slight decreases in traffic when fuel prices spike and that traffic adjusts as prices decline,” NTTA spokeswoman Sherita Coffelt told Land Line.

Traffic on the Dallas North Tollway has increased, but by just 0.1 percent during the same timeframe. That’s much lower than the 3 percent growth seen from January to June of this year.

“Fuel prices may be one factor in the change,” Coffelt said.

It’s also happening in Maine where officials with the Maine Turnpike Authority publish a monthly vehicle count. The latest count shows the number of Maine Turnpike users decreased from 5.66 million to 5.34 million – 5.7 percent – in June 2008 compared to June 2007 traffic. Click here to view the chart.

“We believe it’s probably the increase in the cost of fuel,” spokesman Bruce Pelletier told Land Line. “Commercial vehicle traffic is down also, and that’s an indication that the economy is weakening or slower as well.”

Pelletier said traffic on weekdays remains steady, but weekend traffic that includes tourists is down.

He said overall traffic counts on the turnpike are down 1.8 percent year-to-date for 2008.

– By David Tanner, staff writer

Senate questions value of public-private toll roads

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Link to article here.

Senate subcommittee questions value of public-private partnerships
Landline Magazine
July 31, 2008
Though public-private partnerships have been discussed at both the state and federal level for quite some time, there are still some areas of the controversial plans that have yet to be fully explored.

The Senate Finance Subcommittee on Energy, Natural Resources and Infrastructure examined some of those areas, including taxes and financing, at a hearing Thursday, July 24.

Subcommittee Chairman Jeff Bingaman, D-NM, started off the hearing by saying he has mixed feelings about public-private partnerships.

Bingaman said that, although he’s not necessarily opposed to the idea of private investment in U.S. highways, he’s also not convinced that it is the silver bullet that many of its proponents make it out to be.

“There’s no denying the seriousness of our surface transportation funding challenges, but the question is whether our federal response should be to encourage states to essentially sell off vital components of the Interstate Highway System,” Bingaman said.

“I am personally open to the role of the private sector, but I have real concerns about this rush into public-private partnerships and its adequacy to replace or supplement a strong and vital federal infrastructure program. Before we move away from our long-term state and federal highway partnership, we must better understand the consequences of doing so.”

Bingaman went on to say that he was concerned about the practice of selling longer and longer leases in order to take advantage of subsidies in the tax codes.

JayEtta Hecker, director of physical infrastructure issues for the Government Accountability Office, testified that, in addition to Bingaman’s concerns, there are other pitfalls of public-private partnerships to be on the lookout for. Not the least of which is the very real possibility of increased tolls for those who use the roads.

“There are, however, potential cost tradeoffs. It is a concern that there are views that this is somehow free money,” Hecker said. “The reality is that these techniques are going to result in higher tolls to the users because of the way they’ve been managed relative to a publicly owned toll road.”

Hecker went on to say that the way these deals are typically done in the U.S. is vastly different from the way they are done overseas – something the GAO would like to see change.

“In the deals that we looked at domestically, where this process is just beginning, a lot of the focus is on the contract terms. … it was just kind of a big numbers game and getting the terms right,” Hecker said.

“This contrasts very significantly with the experiences in the rest of the world. They have much more rigorous up-front analyses, varying multiple-staged reviews of public interest, multiple dimensions, they have public-sector comparisons – how it compares to what the public sector could do – and those are very distinct, very well developed and present an opportunity for a lesson learned in the U.S., and that was one of our main recommendations.”

Bingaman came back to Hecker’s criticism of the bidding process later in the hearing when he mentioned testimony from another witness at the hearing – David Enright of the New Jersey-based financial consulting firm Northwest Financial.

Enright testified that if state and local officials in the U.S. had done the kind of analysis that officials in Europe do, there probably wouldn’t have been approval for as many road and bridge lease deals in this country.

“Do you have any views on that?” Bingaman asked Hecker.

Hecker said she didn’t think such reviews would have necessarily meant that U.S. officials wouldn’t have gone along with the transactions, but she did qualify her statement.

“I think that the public management of much infrastructure has not been very efficient and there are opportunities to gain benefits and efficiencies,” Hecker testified.

“I don’t think the full costs were very transparent. I don’t think they were detailed. I don’t think potential impact of transfers from the interstate commerce that would fund this, and transferring that to lower stake roads, was really evaluated.”

The GAO’s Hecker also said that she thought that there were a host of issues that weren’t fully evaluated. She said she would “have to agree that the cost of borrowing for these was more expensive …”

“It’s more expensive for the private sector to borrow or to use equity than it is for the public sector to use municipal debt,” Hecker testified. “But it’s whether you get enough benefits in exchange. There are no deals in Europe or anywhere where they monetize the assets the same way we’ve seen here. We never saw that anywhere.”

Bingaman asked her to explain that statement further.

She explained that the focus of both the mayor and the governor in many of the other deals now is to say to the advisors, “Get me a deal that maximizes the cash that I can take out of this asset.” Hecker added that the bid process used in the U.S. has fallen short.

“They (state and local officials in the U.S.) take pride that their whole bidding was a piece of paper with a single number on it – their whole focus. In Australia, in Europe and other places, the bid (process) is competition for the lowest tolls,” she testified.

Bingaman asked Hecker to confirm that what she was saying was that the competition in other countries is about who can keep the tolls the lowest, rather than who can give the government the biggest up-front payment.

“Right,” Hecker testified.

Later on, Bingaman asked the New Jersey financial consultant, Enright, a question that cut right to the heart of the debate over public-private partnerships. Specifically, Bingaman wanted to know which would ultimately cost the public more money – a publicly run highway or a privately run highway?

“Mr. Enright, maybe I’m reading too much into your testimony, but my impression is that your conclusion that the public sector can finance road infrastructure more cheaply than the private sector can and therefore these so-called public-private partnerships end up costing people more in the long run than if the government just went ahead and maintained the roads,” Bingaman said.

“You’re correct,” Enright said. “The public sector is in a position to deliver a much lower cost of capital and therefore keep the user charges as low as possible.

“The private sector (has the incentive) to make a profit, that’s their job. We did separate analyses for both Chicago and Indiana – very extensive – and concluded in both cases that the public sector could have done just as well and held on to the asset and charged lower tolls and made the same amount of money. The problem in infrastructure in (this) country is not capital, the problem is the willingness to charge people for the infrastructure that they want to use.”

In the end, Bingaman promised to schedule more hearings to further examine who really benefits from public-private partnerships.

– By Terry Scruton, staff writer

Electronic tolling nightmares: $200 in fines!

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Link to article here. We’ve heard from many North Texas motorists who have been fined when they didn’t even take the toll road (a relative or friend used their cars). For those who did take the road, there is no way to pay without an electronic toll tag, so those just passing through or making spontaneous trips and who have to wait to be billed get taken to collections for the crime of not having their current address on file with TxDOT. Can you say bureaucratic nightmare and guilty until proven innocent? This is also government coercion to buy into their TxTag system, or else!

Motorists fuming over past-due toll road bills
By GORDON DICKSON
Star Telegram
July 31, 2008

Brian and Sharilyn Wilson’s boating trip to Lake Texoma last year turned into a tollway bill for $76.60. Star-Telegram/Laurie L. Ward

Star-Telegram/Laurie L. Ward

Brian and Sharilyn Wilson’s boating trip to Lake Texoma last year turned into a tollway bill for $76.60. Star-Telegram/Laurie L. Ward
Woman gets toll road bill for $101.90 Related story HURST — More North Texans are coming forward with complaints that a collection agency hired by the Texas Department of Transportation is unfairly demanding large past-due payments for driving on the Texas 121 toll road in Denton and Collin counties.

“This is highway robbery,” said Brian Wilson of Hurst, who two weeks ago received a bill for $76.60 for a $1.60 toll he incurred on a boating trip to Lake Texoma in June 2007. “This is bureaucracy at its worst. I’ll never use that road again.”

Texas 121 is the region’s first all-electronic toll road. Toll payments can be made either by an automatic account such as a TollTag or by standard mail. For those paying by mail, the common practice is to wait until the Transportation Department’s Texas Tollways office sends a bill and then send a payment.

But that system doesn’t work when the bill gets mailed to the wrong address.

On Monday, the Star-Telegram published a story about Norma Bartholomew of Fort Worth, who had been contacted by a collection agency for a past-due toll that the Transportation Department had sent to an address where she hasn’t lived since 2004.

She had traveled on the road in February 2007, but never received the original bill for $1.90 in tolls, and a few weeks ago was shocked to learn that the state now wanted $109.90, including $100 in fees.

A Transportation Department official said it was a rare incident. The woman’s account was eventually cleared after she lodged complaints with the Texas Tollways office and state elected leaders.

But since then, four other readers have contacted the Star-Telegram to complain that the Transportation Department sent bills to their old addresses and — in all but one case — turned them over to a collection agency, too.

In each case, the readers felt the Transportation Department ought to know their correct address. All said they had submitted address changes to the department after moving, and are currently receiving auto registration renewal notices in the mail.

Wilson’s case

Wilson and his wife, Sharilyn, traveled on Texas 121 in June 2007, using their pickup to tow the family boat to Lake Texoma.

A few weeks after the vacation, they received — and promptly paid — a bill for $3.40 in tolls, charged to the account of their boat trailer.

But at the time they didn’t realize that the camera system on the road had captured not only an image of the license number on their trailer, but also on their pickup. While the bill for the boat trailer toll was sent to their current address, the toll for the pickup — another $1.60 — was sent to Brian Wilson’s old address. Wilson said he never saw the original pickup bill.

Two weeks ago, Wilson opened his mail and found a collection letter demanding $76.60 for that unpaid toll.

Wilson called the Texas Tollways customer service line, but the call taker was unsympathetic, he said.

The call taker did, however, offer to cut the bill almost in half to $39, if Wilson would agree to open a TxTag account so that his tolls could be collected automatically.

Wilson reluctantly agreed, even though opening the TxTag account cost him an additional $20, so he paid the $59 to avoid letting the whole affair smudge his credit rating.

But now he wants his money back. “I felt like my arm was put behind my back and twisted,” he said during an interview at his home, where the unused TxTag remains in its envelope on his kitchen counter.

Others

In addition to Wilson, the Star-Telegram also spoke to or exchanged e-mails with:

Richard LaChance of Fort Worth, who received a collection notice for nearly $700. He agreed to open a TxTag account in exchange for cutting the late fees in half. But he later called again to complain about the original toll bills, which were mailed to an address he hadn’t used in nearly five years, and persuaded Texas Tollways to rescind the charges. “The whole time I was wondering how many other people were treated this way,” he wrote.

Steven Maas of Fort Worth, who was billed for $125 in fees. Maas has since signed up for a TollTag, another form of automatic toll collection operated by the North Texas Tollway Authority, to prevent the problem in future transactions. But Texas Tollways considers the TollTag a competitor to its TxTag and won’t waive his fees.

When Maas complained to Texas Tollways, a call taker confirmed that his original toll bills had been returned to the Austin office, stamped “Return to sender.” But apparently no one investigated whether his address had changed.

“Yet they still invoked . . . the fees. That’s just ludicrous and completely preying on people.”

Joseph Rivera, a former Fort Worth resident now living in Plano, who was told he owes $12 for a 90-cent toll accrued on Texas 121 on Christmas Day 2007. The bill was originally sent to his old Fort Worth address, where he hasn’t lived in nearly three years. “When I talked to them they were very standoffish,” he said.

Don’t let it linger

Transportation Department officials say they’ll work with people on a case-by-case basis, and remove fees deemed improper. But spokesman Christopher Lippincott urged motorists who have used the Texas 121 toll road to avoid problems now by updating their vehicle registration information, rather than waiting for a collection agency to find them.

“There is no substitute for Texas drivers ensuring that their registration information is correct and up-to-date,” he said.

What you can do

Since April 4, tolls collected electronically on Texas 121 in Denton and Collin counties are billed through the North Texas Tollway Authority, not the Transportation Department. However, there is still the potential for bills being sent to an old address, because the tollway authority gets its vehicle registration data from the Transportation Department.

Steps to take to avoid getting slapped with late fees:

Visit your county tax office and make sure your vehicle registration information is current. Check all three address fields in the database: the vehicle owner’s address, the renewal recipient address and the vehicle location address.

Call the Transportation Department’s vehicle titles and registration division regional office. In the Fort Worth area, call 817-649-5938.

If you suspect you owe a toll but haven’t received a bill, call the Texas Tollways customer service line toll-free at 888-468-9824 and ask for your vehicle information.

If you believe you’ve been erroneously charged late fees and the call-taker won’t budge, ask to speak with a supervisor. If that doesn’t work, consider complaining to a state senator or representative.

Car owners are responsible for tolls, even if the toll is accrued by someone else. However, if you get a bill for tolls on a car that was sold or stolen, you may download a toll violation defense form at www.gotxtag.com/violation.

Consider signing up for a TollTag, a windshield-mounted transponder that makes it possible to pay tolls automatically. TollTag accounts are usually backed by a credit card. The North Texas Tollway Authority administers the accounts and may be reached at www.ntta.org or toll-free at 877-991-0033.

The Transportation Department offers a TxTag, which is similar to a TollTag. For information visit www.txdot.gov or call toll-free 888-468-9824. TollTags and TxTags work on tolls roads in Dallas-Fort Worth, Austin and Houston.

FHWA pushes for more public-private toll roads

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Link to article here. Try to follow this logic…driving is down due to high gas prices, therefore road maintenance costs will also drop, and so will congestion & gridlock, yet the FHWA and the Bush Administration call for more risky leveraged debt to prop up an unsustainable toll road scheme that requires motorists to ante up a minimum of 20 times more money than gas taxes? What’s broken is our government run by politicians and bureaucrats who continue to indebt generations for today’s private profiteering. Yet again, we see a government agency lobbying on the taxpayers’ dime.

FHWA director: U.S. transportation system broken
Tom Greenwood / The Detroit News
Wednesday, July 30, 2008
SOUTHFIELD — James Ray, Acting Administrator of the Federal Highway Administration, called on Congress to engage in serious dialogue on maintaining and improving the interstate highway system.

“Without a doubt, our federal approach to transportation is broken,” said Ray, who spoke at a press conference at the Eaton Corp. Tuesday morning.

“And no amount of tweaking, adjusting or adding new layers on top will make things better.”

Ray said it was paramount that new forms of revenue be considered to supplement the current gas tax, which he described as “unpredictable and unsustainable.”

According to the agency, gas tax revenues have declined as American motorists have dramatically cut back on driving due to a sagging economy coupled with record high gasoline prices and increased vehicle fuel efficiency. Ray noted that increased production of hybrid vehicles was a double edged sword in that they diminished the country’s reliance on oil, but at the same time reduced tax revenue at the gas pump.

Ray said the Bush administration was in favor of a “more progressive direct user fee” similar to a system that is currently being tested in Oregon. Under that pilot program, cars were equipped with on board mileage counting equipment that was read by pumps equipped with mileage reader devices.

When refueling, the mile counters communicated with the mileage readers at the pumps, which then automatically deducted the standard gas tax and substituted a user fee, instead.

Ray said the Bush administration was offering a number of ways to overhaul the U.S. transportation system, including:

• Streamlining the federal review process for new transportation projects, which takes 13 years to design and build new highway and transit projects.

• Consider more direct pricing options like tolls based on miles driven instead of a flat gas tax paid at the pump.

• Develop a Metropolitan Innovation Fund that would reward cities for creative solutions to transportation problems.

• Cut red tape by reducing over 100 federal transportation programs down to eight comprehensive programs that would focus on transportation problems and solutions.

• Allow states and cities to have a greater say in addressing their most needed transit and highway priorities.

• Encourage greater participation by private companies in public roadways by allowing them to lease federal highways and maintain them through tolls.

• Offer economic incentives to motorists not to drive during peak travel periods.

According to the U.S. Department of Transportation, drivers traveled nearly 10 billion fewer miles in May 2008 than at the same time period in 2007. Additionally, for the first five months of 2008, U.S. motorists drove nearly 30 billion fewer miles than in 2007, which will result in a nearly $4 billion shortfall in gas revenues for 2009.

Ray said the Bush administration was not in favor of raising the federal gas tax, which currently stands at 18.4 cents per gallon.

“We’re not looking at raising the federal gas tax,” Ray said.

“The fact is that it’s dying … and relying on a gas tax will not work. We need something which is more agile and responsive than the current gas tax.”