Link to article here. More proof that toll lanes don’t solve congestion, they actually create congestion for profit.

New Virginia Toll Lanes Designed to Create Congestion
Illegal political donations helped give Australian company full control over Virginia transportation until the year 2087.
The Newspaper.com
July 8, 2008

Illegal political contributions helped an Australian firm land a lucrative toll road deal that grants the company unprecedented power over Northern Virginia’s transportation future. Last week, Transurban wrote and asked state lawmakers to return checks that the Melbourne-based toll road operator had written in violation of federal campaign laws (details). But the deal these contributions helped bring about has already been finalized.

In June, the US Department of Transportation created a first-of-its-kind $1.6 billion financing package that consisted of tax-free bonds, loans and state taxpayer grants to support the project that will add a pair of High Occupancy Toll (HOT) lanes to the Interstate 495 Capital Beltway just outside of Washington, DC. To this amount, Transurban only added $349 million of its own capital — less than the cost of interest — toward the construction of the toll lanes (details).

In return for that small investment, Transurban received from Virginia officials the right to demand payment from state taxpayers any time that improvements are made to a number of free roads near the Beltway. In effect, the contract between the Virginia Department of Transportation (VDOT) and Transurban is designed to ensure the area remains sufficiently congested so that motorists will have an incentive to pay to use the toll lanes.

For example, VDOT can make no changes, expansion or improvements to the free lanes on the Beltway until the year 2087 unless the agency first consults Transurban. VDOT agreed that if any such changes were made to the general purpose lanes without Transurban’s explicit approval, they would at least be made in such a way as to guarantee the company maintained a high level of profit.

“If the department [VDOT] determines that additional traffic lanes on the Capital Beltway Corridor are in the state’s best interests, the department shall consult with the concessionaire [Transurban] as to an appropriate strategy to implement such additional traffic lanes,” the contract states. “At the department’s sole discretion, [it shall] permit the construction of additional lanes as part of the project with a view to minimizing any detrimental impact on the project or its ability to generate revenues…”

In the past, most toll road deals included “non-compete” clauses that strictly prohibited transportation departments from making improvements to nearby, competing roads. They did so because free-flowing traffic on alternative routes would hit the toll road’s bottom line. Simply put: why take a toll road, when there’s a free alternative?

Explicit non-compete provisions have become politically controversial, and as a result companies have recently embraced a more subtle approach that accomplishes the same goal. For example, the contract for the State Highway 130 toll road in Austin, Texas included a provision giving the Texas Department of Transportation a financial incentive to lower the speed limit on the nearby Interstate 35 freeway. As first reported by TheNewspaper last year that, this provision was designed to create congestion and inconvenience for the motorists who choose the free alternative route (details).

For the Beltway project, improvements such as adding additional free lanes to the highway are absolutely permitted — for a price. The contract considers any improvement to the Beltway to be a “Department Project Enhancement” which means that Virginia taxpayers must pay Transurban for the right to improve the free portion of the highway. Given VDOT’s stated lack of funding, adding an extra monetary premium to the cost of any improvements effectively gives the foreign company the ability to prevent such projects from happening.

The effect is not limited to the Beltway. The contract specifies that payments called “compensation events” must be made in the event that the state decides to improve the connections between the Beltway’s general purpose lanes and the Dulles Toll Road or any “improvements to I-66 outside the Capital Beltway Corridor” made over the course of the next eighty years.

An “independent engineer” determines how much compensation Transurban will receive by calculating an expected traffic impact. This means that the more the public is likely to use a free alternative, the more Transurban is paid. In Sydney, Australia, for example, the Lane Cove Tunnel toll project contained a provision requiring the state government to narrow the lanes of a nearby free road to generate congestion that would drive motorists into the tunnel. After the state decided to postpone the narrowing until after an election, the toll road concession was paid A$25 million (US $24 million) for that compensation event.

Transurban’s control goes beyond lane improvements. Although the stated purpose of the “high occupancy” part of the toll lane project is to encourage motorists to carpool, the contract contains a provision directly designed to discourage any increase in the number of motorists sharing rides.

“The department agrees to pay the concessionaire, subject to Section 20.18, amounts equal to 70% of the average toll applicable to vehicles paying tolls for the number of High Occupancy Vehicles exceeding a threshold of 24% of the total flow of all permitted vehicles that are then using such toll section going in the same direction for the first 30 consecutive minutes during any day, and any additional 15 consecutive minute periods in such day, during which average traffic for a toll section going in the same direction exceeds a rate of 3,200 vehicles per hour based on two lanes,” the contract states.

This means if carpooling becomes popular on the Beltway, taxpayers could end up making multi-million dollar annual payments to Transurban.

Finally, the contract insists that if any homes happen to lie in the way of the the construction of the new lanes, Transurban will pay no more than the current market value to purchase the land in question. If the owner refuses to move, VDOT will condemn the property and confiscate it for the use of the private, for-profit company through eminent domain. The Beltway project, however, was designed to be built within existing VDOT right-of-way to ensure the exercise of this power would not be needed.

Transurban shares on the Australian Stock Exchange jumped 15 cents to A$4.60 today after the company announced quarterly earnings results. On Virginia’s Pocahontas Parkway, the company reported a 7.8 percent increase in revenue over the same quarter last year, despite a 6.9 percent drop in the number of motorists using the toll road. It credited the positive performance to an 11 percent toll hike in January and the cancellation of the discount previously given to transponder users.

Relevant excerpts from the Transurban contract are available in a 260k PDF file at the source link below.

Source: Comprehensive Agreement Relating to Route 495 HOT Lanes – Excerpts (Virginia Department of Transportation and Capital Beltway Express, 12/19/2007)

Link to article here.

ELECTION LAW
Toll Road Firm Made Illegal Contributions
Transurban Gave $172,000 To 90 Campaigns in 3 Years

Transurban gave money to Gov. Timothy M. Kaine (D), foreground, and House Speaker William J. Howell (R). Both have pledged to return it. (By Steve Helber — Associated Press)

Washington Post Staff Writer
Thursday, July 3, 2008; Page B05

Link to article here.

Toll road operator shifts into reverse
By Scott Rochfort
Sydney Morning Herald
June 20, 2008

TOLL road operator Transurban has become the first of an expected long line-up of major infrastructure companies to go to the sharemarket for a handout, after it yesterday announced plans to raise around $1 billion in capital in an effort to reduce the level of debt on its balance sheet.

In a stark reversal to Transurban’s deliberate strategy of gearing-up its balance sheet under former chief executive Kim Edwards in late 2006, the group’s new CEO Chris Lynch said the model of using debt to fund distributions was “not sustainable in this market”.

Advocating a “new investment proposition to the market”, Mr Lynch said the increased cost and difficulty in raising debt meant the company needed to return to a “more basic business philosophy”.

“This is more a fair dinkum business that we’re talking about here. What we’ve got are great assets and we’ve got strong cash flows that will grow coming off [the equity raising],” Mr Lynch said.

Transurban, operator of Sydney’s M2 motorway and Eastern Distributor and Melbourne’s CityLink, maintained its guidance of a 58c payout this financial year.

But in a rude shock to Transurban unit holders reliant on the distributions paid by the company, it said distributions would fall to 22c next financial year.

But Mr Lynch stressed the capital raising and new distribution policy would put Transurban on a sounder footing to allow it to fund new initiatives, such as Vancouver’s Port Mann Highway project for which it is shortlisted.

“We’ll have a lower yield than we would have if we targeted the aggressive debt-based distribution,” he said.

“But we’ll also have a much better growth story because we’ll have an underlying business that can do some things other than figure out how it’s going to feed this big distribution.”

Transurban said a placement of 120 million shares managed by UBS would be fully underwritten by the Canadian Pension Plan, with which it has partnered several toll-road projects.

A further 75 per cent of the group’s planned $239 million (29c per security) second half distribution reinvestment plan has been underwritten by UBS, and up to $100 million of stock will be offered to retail shareholders via a share purchase plan. The purchase plan will be capped at $5000 per unit holder and at a 2.5 per cent discount. In all, the raising will represent about 16 per cent of Transurban’s current market value.

Transurban shares remained in a trading halt yesterday but the move was enough to trigger a sell-off in other toll road operators, such as ConnectEast, the owner of Melbourne’s yet-to-open EastLink. Its shares plunged to a new low.

Macquarie Infrastructure fell 24c to $2.68, while the ports operator Asciano plunged to a new low of $3.32 on concerns it could be forced to raise capital to ease its crippling debts.

It is less than two years since Transurban started loading more debt on to its balance sheet.

At the group’s annual meeting in 2006, Mr Edwards argued the re-gearing of Transurban’s balance sheet would not raise its cost of debt.

IMMEDIATE RELEASE

Austin, TX, June 26, 2008

After the overwhelming public feedback preferred the “no build” option and after the Legislature made it clear it wanted time to slow down this train of privatizing our public infrastructure, TxDOT’s selection, today, of a private partner to develop TTC-69 is a total slap in the face to the people of Texas.

This proposal awarded to ZAI/ACS (Zachry American Infrastructure and ACS, based in Spain) is chalk full of egregious taxpayer exploitation. For instance, it tolls loops around Riviera, Driscoll, Corpus Christi and other cities (7 loops total) to fund non-toll improvements to Hwy 77 in yet another Robin Hood scheme. The deal gives ZAI/ACS a guaranteed 12% rate of return on their investment, and it relies heavily on public funds, like federal taxpayer backed private activity bonds (PABs) and TIFIA loans to front the vast majority of the construction costs and then gives all the profit to Zachry & ACS!

They also plan to use taxable zero coupon fixed rate bonds issued by the Cameron County Regional Mobility Authority and controversial Transportation Reinvestment Zone (TMZ) funds, which will essentially heist property taxes. The deal also gives ZAI/ACS cherry-picking rights (or right of first refusal) on multiple segments for the TTC-69 without being subjected to a competitive bidding process. The sham of an announcement pandering to landowners promising to use existing highways for TTC-69 wasn’t a concession at all. The private “partners” informed them the new corridor route wasn’t toll viable so they reverted back to using existing freeways (which would have been the tollway’s biggest revenue “competitor”) so as to capture more toll revenue. It was Cintra and Zachry who determined the re-route, not TxDOT being responsive to an outraged public!

“If this isn’t a wake-up call to the Legislature that it’s business as usual at TxDOT until they forcibly restrain them via state law, we don’t know what is. This removes any requirement for competitive bidding, which on its face is an absolute failure of the State’s fiduciary duty to protect the taxpayers from monopolistic sweetheart deals and what’s certain to be inflated costs. We must make Legislators pay at the ballot box for their malfeasance in granting the authority for such no-bid contracts and for failing to rein-in TxDOT with a GENUINE moratorium last year BEFORE this next private sweetheart deal got signed. If they don’t completely clean house at TxDOT and end this public fleecing, there won’t be enough political cover for the consequences at the ballot box. Enough is enough. End this now!” notes Terri Hall, TURF Founder.

“At today’s Transportation Commission meeting, it was a lovefest between David Zachry and the South Texas politicos pushing this nonsense. TxDOT and their buddies at Zachry/ACS found a way to follow the bare minimum of the law to sign this CDA and continue to steamroll a plan the majority of Texans don’t want. It was also evident the Transportation Commission is desperate to come up with their own alternative reforms since they’re facing an angry public demanding TxDOT be scrapped, a discontented Legislature, and scathing Sunset Commission recommendations,” observed Hank Gilbert, TURF Board member and acting President of the Piney Woods Subregional Planning Commission who attended and testified at today’s meeting.

For more detailed analysis of how TxDOT can legally award a Comprehensive Development Agreement (CDA) outside the moratorium (SB 792), go to TURF’s web site here.

Link to article below here. Yep, TURF nailed it. Read our analysis earlier this week here. The moratorium bill only specifically prohibits awarding contracts to build and collect tolls. It does nothing to prevent TxDOT from awarding development contracts or what this story refers to as a “design” contract. It also reveals what we tried to sound the siren about years ago…the development rights contract granted to Cintra-Zachry for TTC-35 gave them the right of first refusal on 5-6 segments of that Trans Texas Corridor (verified in Cintra’s own annual report in 2005).

This removes any requirement for competitive bidding, which on it’s face is an absolute failure of the State’s fiduciary duty to protect the taxpayers from monopolistic sweetheart deals and what’s certain to be inflated costs. We must make Legislators pay at the ballot box for their malfeasance in granting the authority for such no-bid contracts and for failing to rein-in TxDOT with a GENUINE moratorium last year BEFORE this next private sweetheart deal got signed (or more appropriately, they should have banned these public-private partnerships, known as CDAs in Texas, altogether!).

TxDOT contract today will push Trans Texas Corridor forward
By MICHAEL LINDENBERGER / The Dallas Morning News
Thursday, June 26, 2008

AUSTIN — The second half of the massive Trans Texas Corridor will take a large step toward reality today, when state transportation officials award a $5 million design contract to a team of private toll road operators. The operators will develop a master plan for the portion of the project that will run from Northeast Texas to Houston and then to Mexico – about 650 miles.

The contract will not directly authorize the winning consortium to build any part of the super highway. But it will give the winning bidder a position of power for winning the much larger construction contracts — almost certainly to be worth billions of dollars – for the toll roads that will make up the super highway. The design contract will give the winning team 12 to 18 months to flesh out a master development plan for the project, which is expected to largely follow the path of the proposed southern extension of Interstate 69.

The two teams competing for the contract are led by subsidiaries of Spanish firms that are among the world’s largest toll road operators.

One, called ZAI ACS TTC-69, is run by Texas construction company Zachry American Infrastructure Inc. and ACS Infrastructure Development Inc., perhaps the world’s largest toll road developer.

The second, Bluebonnet Infrastructure, is led by Cintra, the Spanish firm that is already developing the master plan for the other half of the Trans Texas Corridor. Cintra last year won the design contract for the segment of the corridor that will run north to south, roughly parallel to Interstate 35. It is also the firm that was initially slated to build State Highway 121 in North Texas.

State transportation officials said Wednesday that Cintra’s contract to plan the 600-mile I-35 corridor of the Trans Texas Corridor is a good model for the contract to be announced today. Since winning a $3.5 million design contract for that project last year, Cintra has been working to develop plans for the massive network of toll roads that will stretch from the northern tip of Texas to Laredo.

Although that deal did not authorize the building of any aspect of the road itself, it did allow the firm to fast-track a proposal to build and operate a toll road on one of the most lucrative segments of the project, the State Highway 130 extension outside of Austin.

The extension of SH 130 had long been planned by state transportation officials as a gas-tax road, and then was considered as a publicly operated toll road. But officials of the Texas Department of Transportation said Wednesday that future toll revenues would not have been high enough to allow the state to borrow the full price of the project — well over $1 billion — in order to build it itself. Instead, it would have had to spend $600 million or more of scarce tax dollars on the project, said assistant executive director Phil Russell.

After winning the design contract last year, Cintra focused on that project and offered to pay the state $25 million for the right to build and operate the toll road. It also will cover all construction costs. Private operators are often able to borrow more money against future toll revenues because they accept far more riskier projections than the more conservative projects required by bond markets in which state or other public entities borrow.

Under the terms of its design contract, any proposal to build a toll road that does not require state tax dollars can be negotiated with Texas without competitive bids from other potential toll operators. Mr. Russell said the state accepted the proposal from Cintra because doing so fast-tracked the development of the badly needed toll road and allowed the state to save well over a half billion dollars in tax money.

The same kind of arrangements could flow from the contract announced today. Mr. Russell said, however, that the development agreements do not obligate the state to accept the winning firms’ proposals to build the more profitable aspects of the road. It can still reject those proposals, or require that the firms enter a competitive bidding process.

Link to article here. See what we have to look forward to? Cintra won the development rights to TTC-35 project and now has control of SH 130, the first segment of the Trans Texas Corridor TTC-35 project. It’s also one of two bidders on TTC-69. Let’s not forget that the toll rates doubled this year. That’s why the foreign toll operators could “invest” $46 million in improvements. It’s a cash cow!

Drivers complain about virtually all aspects of Indiana Toll Road
Landline Magazine
June 24, 2008

In Indiana, several state offices are being bombarded with complaints from drivers about the Indiana Toll Road, which is operated by two foreign companies.

According to The Associated Press, drivers complained about time-consuming backups at toll gates, dirty restrooms at travel plazas, and inflated fuel prices. Some people also complained about the toll road’s mascot – the “I-Zoom Girl” – saying she is a little too curvaceous and that the campaign using her portrays Hoosiers as hillbillies.

The toll road operators – Cintra of Spain and Macquarie of Australia – have since addressed some of the problems. The companies stated that they’ve spent $46 million on electronic tolling and a new fleet of snowplows.

The Texas Transportation Commission meeting this Thursday has an agenda item that shows the Commission will consider executing a private toll contract for the development of Trans Texas Corridor TTC-69 despite the moratorium prohibiting private toll contracts through September of 2009. Cintra is likely who had the most influence in the change in route for TTC-69 since Senator Steve Ogden let the cat out of the bag the week before our rally saying the TTC-69 new corridor was “dead.” This is because the new route for the corridor was deemed by the private bidders NOT to be toll viable (they weren’t getting any bites from the private sector to build it because it wouldn’t make enough money).

So they had to go back to existing footprint to toll the “competing” existing freeway so as to capture more toll revenue outside the Houston area (which was likely the only toll viable segment of the new corridor alternative). One of the reasons we objected to the moratorium bill, SB 792, was because it excepted out portions of TTC-69 from the bill allowing it to move forward.

The language of the moratorium seems only to block contracts allowing the private entity to collect tolls. There are many types of private toll contracts for the various phases of development. Since TxDOT may not be granting a construction contract that allows the collection of tolls yet, TxDOT may in fact be authorized to choose and execute a contract with a “developer” or “planning partner” for TTC-69. First they sign a deal for development and financing, then for design, construction, and collection of tolls of the individual segments.

See the agenda item for Thursday’s Transpsortation Commission Meeting below:

6. Toll Road Projects
a. Various Counties – Act on the recommendation of department staff concerning:
(1) the selection of the best value proposal for the planning, development,
acquisition, design, construction, financing, maintenance, and operation of the
element of the Trans-Texas Corridor System from Northeast Texas to the
Texas/Mexico border (I-69/TTC); and (2) the execution of a comprehensive
development agreement for I-69/TTC

Here’s the text of SB 792 that allows private toll contracts (called comprehensive
development agreement) to be executed for portions of TTC-69 (here referred to using the federal name of “high priority corridors 18 & 20”) :

(f) Subsection (b) does not apply to a comprehensive
development agreement in connection with a project:

(1) on the ISTEA High Priority Corridor identified in
Sections 1105(c)(18) and (20) of the Intermodal Surface
Transportation Efficiency Act of 1991 (Pub. L. No. 102-240), as
amended by Section 1211 of the Transportation Equity Act for the
21st Century (Pub. L. No. 105-178, as amended by Title IX, Pub. L.
No. 105-206), including land adjacent to the project needed to
widen the project for a transportation use, if the project remains
in a highway corridor designated by those laws; and
(2) located south of Refugio County.

Also, the moratorium on private toll contracts leaves out the word “develop” in its prohibition. It seems to allow TxDOT to sign a development contract for the TTC-69 corridor which is still allowed in Subchapter 223 of the Transportation Code and is different from a design and construction contract (directly involving the collection of tolls). Though the Commission’s agenda item for Thursday includes the whole enchilada (development, design, construction, etc.), their Request for Proposals so far involves just what they refer to as a “planning partner.”

SB 792 language with no reference to “development” and allows these contracts if it doesn’t involve collecting tolls yet:

(b) comprehensive development agreement entered into with
a private participant by a toll project entity on or after May 1,
2007, for the acquisition, design, construction, financing,
operation, or maintenance of a toll project may not contain a
provision permitting the private participant to operate the toll
project or collect revenue from the toll project, regardless of
whether the private participant operates the toll project or
collects the revenue itself or engages a subcontractor or other
entity to operate the toll project or collect the revenue.
Language of the Transportation Code giving the authority for comprehensive development agreements:

§ 223.201. AUTHORITY. (a) Subject to Section 223.202,
the department may enter into a comprehensive development agreement
with a private entity to design, develop, finance, construct,
maintain, repair, operate, extend, or expand a:
(1) toll project;
(2) facility or a combination of facilities on the
Trans-Texas Corridor;

AND LATER…(it tells how the moratorium doesn’t apply to CDAs that don’t directly involve the collection of tolls)

(h) Subsection (f) does not apply to a comprehensive
development agreement that does not grant a private entity a right
to finance a toll project or to a comprehensive development
agreement in connection with a project:
(1) that includes one or more managed lane facilities
to be added to an existing controlled-access highway;
(2) the major portion of which is located in a
nonattainment or near-nonattainment air quality area as designated
by the United States Environmental Protection Agency; and
(3) for which the department has issued a request for
qualifications before May 1, 2007.

So at Thursday’s Commission meeting we’ll all see how TxDOT tries to wiggle around the citizens’ vehement objections to privatizing our public infrastructure and plowing ahead with the universally detested Trans Texas Corridor!

Link to article here. You bet this is incredibly risky business, especially with gas prices at $4 a gallon and the sharpest decline in driving in recorded history!

Risky Business
June 13, 2008 | Political Intelligence
Tolls for Tots
Texas Observer

Texas’ School Land Board is set to invest $100 million of public school endowment funds in a controversial company that privatizes public assets of cash-strapped cities and states that need billions of dollars to support aging infrastructures. The company, Macquarie Infrastructure II LP US, hopes to build private toll roads in Texas and across the United States. Its Australian parent, Macquarie Group Ltd., already owns private toll roads, airports, and other infrastructure assets around the globe.

So far, Macquarie has made a handful of unsuccessful bids on toll roads in Texas, including State Highway 121 and U.S. 281-Loop 1604 in San Antonio. It is still waiting on the results of an offer for Interstate 635 in Dallas. Recently, Macquarie also entered negotiations to lease Austin-Bergstrom International Airport. Another subsidiary of the Macquarie Group owns several small-town newspapers in Texas.

General Land Office Commissioner Jerry Patterson, who oversees the School Land Board, said he sees nothing wrong with investing public funds in private toll roads. “With a 15 to 16 percent annual rate of return, I don’t see a problem,” he said. “My duty is to make money for the Permanent School Fund.”

Patterson said the fund would invest nationwide and not necessarily contribute to toll roads in Texas. “This is a bluechip fund that is not just limited to toll roads,” he said.

Dallas Republican state Sen. John Carona, chair of the Transportation and Homeland Security Committee, takes a more cautious view on the investment. He said this summer his committee will look closely at the policy implications of public pension fund and endowment investment in companies like Macquarie that privatize publicly owned properties.

“The state needs to invest very carefully and with significant due diligence,” Carona said. “We need to keep a close eye on this.”

Carona is concerned about reports in business publications charging that Macquarie has overpaid for projects and engaged in risky financial schemes. In a 2007 Fortune article, the magazine was critical of what it termed the “Macquarie Model,” whereby the company buys the rights to run toll roads from cash-strapped governments and then sells the roads back to the public via a stock offering.

Last April, an independent New York-based corporate governance service, RiskMetrics Group Inc., slammed the Macquarie Group for elevated debt levels, high fees, inadequate disclosure, and poor corporate governance.

Macquarie defended the performance of its funds in the 2007 Fortune article. The firm pointed out that its funds have returned an average of 19.8 percent annually and sold assets for more than twice their purchase price.

“It’s risky,” said Carona of the land board’s investment in Macquarie. “But then, with higher risk, there is a higher return.”

Watch this fabulous report with a brief segment from TURF Founder, Terri Hall.

Link to article here.

The Loeffler Tuggey (et al) law firm represents Zachry Construction, the major toll road player in Texas who partnered with Cintra to win the development rights to the Trans Texas Corridor and landed the first privatized toll road contract in Texas for SH 130. So the connection to McCain is clear just as it was with Giuliani before him.

A Top McCain Aide Quits
Departure Over Ties To Lobbying Group Is Fourth in 2 Weeks
By ELIZABETH HOLMES
May 19, 2008

The McCain campaign lost another top aide Sunday over ties to lobbying, the fourth such departure in less than two weeks.

Thomas Loeffler, a former U.S. representative from Texas, resigned from his post as a national finance committee and campaign co-chairman, a campaign spokesman confirmed Sunday.

Mr. Loeffler is the founder of The Loeffler Group, a San Antonio lobbying shop that has worked on behalf of AT&T Inc. and Southwest Airlines Co. as well as foreign interests, including Saudi Arabia.

Mr. Loeffler’s resignation continues the fallout from a new policy that John McCain, the likely Republican nominee, instituted last week requiring full disclosure of involvement with lobbying firms and other independent political groups.

The policy bans staffers and aides from being registered lobbyists or working on behalf of foreign interests. It allows unpaid volunteers to continue as registered lobbyists as long as they disclose those interests and don’t lobby or advise Sen. McCain on behalf of those interests.

Although Mr. Loeffler qualified under the latter terms, his high rank at the campaign forced him to make a decision, said Charlie Black, a senior aide to Sen. McCain and a former lobbyist.

“Senior staff people cannot be registered to lobby,” said Mr. Black. Mr. Loeffler didn’t answer requests for comment.

Mr. Black severed his ties to the lobbying firm BKSH & Associates Worldwide this year. Campaign manager Rick Davis still owns a stake in his lobbying organization, Davis Manafort Inc., but is no longer paid by the firm.

“Everybody’s making decisions to see if they can live with [the new policy],” said Mark Salter, a senior McCain adviser.

Mr. Loeffler’s resignation follows that of three other advisers. Doug Goodyear and Doug Davenport left on May 10 and 11, respectively, because of their involvement with DCI Group, a firm that once worked for Myanmar’s military junta. Last week, Eric Burgeson, a McCain adviser on energy policy, was jettisoned from the campaign because he was a registered lobbyist on the same topic.

Mr. Loeffler’s departure is arguably the most significant because of his reputation as a successful fund-raiser. He was named to his finance-committee position in December 2006 and is credited with helping the campaign limp through its cash-strapped implosion last summer.

Mr. Loeffler has a long history with Republican presidential campaigns. He served as Texas co-chairman for former President George H.W. Bush in 1988 and was national deputy finance chairman for Bob Dole’s failed bid in 1996. Mr. Loeffler was also a major fund-raiser for the current President Bush, serving as a “Pioneer” in 2000 and a “Super-Ranger” in 2004, meaning he raised more than $100,000 and more than $300,000, respectively, in those elections.

In a release dated March 8, 2007, that announced Mr. Loeffler’s position of general chairman of the campaign, Sen. McCain called Mr. Loeffler “a good friend” and said he would play a “very important role in our campaign.”

The policy, dubbed “McCain Campaign Conflict Policy,” was made mandatory last week after questions arose about the ties to lobbying firms by staff and volunteers.

The policy also bans involvement with so-called 527s — independent groups named for a section of the tax code that are able to accept limitless donations — and other such groups.