For Whom the Toll Bells - The North Texas Tollway Authority exacts a stiff price for those who drive willy-nilly on its highways

By Jim Schutze - Dallas Observer - January 14, 2009

Certain things you can do that might turn out very badly for you. Borrowing money from the Mafia, for example. Posing naked for a photographer who is a stranger.

The only sure way to avoid getting one of the tollway authority's trick bills for several hundred dollars is to have a lawyer ride with you.-MORREY TAYLOR

But who worries about driving down a toll road? I can tell you who should: You!

Over the last several years I have received numerous phone calls, letters and e-mails from people complaining that they have been hit with huge, totally unexpected bills for unpaid tolls and associated fines.

For a long time, I brushed these aside. I thought, "Well, you know, people should pay their tolls."

But most of the people calling me don't sound like folks who regularly skip on restaurant tabs or jump over turnstiles. I made up my mind a few weeks ago that the next time I got one of these complaints, I would stop whatever I was doing and take a look. I didn't have long to wait. On a Monday morning I found a phone message from Rick Johns, a probation officer in Tarrant County.

Johns had just received a bill from the North Texas Tollway Authority for $337 for four trips on the President George Bush Turnpike, which runs from near the D/FW Airport east to the vicinity of Rowlett on Lake Ray Hubbard.

For the first trip, which he made a year and a half ago, he was charged at a rate of $3 in tolls and $100 in "administrative fees." The second trip, made about a year ago, was billed at $3 in tolls and $75 in fees. Another cruise down the PGBT the following day cost him $2 in tolls and 50 bucks in fees.

The most recent trip, his most expensive, was made last May and billed at $4 in tolls and $100 in fees.

According to Johns, this statement was the first notification of any kind telling him he owed the NTTA money. His claim—that this was a first notice—was backed up by the notice itself, of which he gave me a copy, and by the NTTA's own description of its billing practices when I called them. The NTTA didn't comment on Johns' case specifically.

Before I even venture into the question of the billing practices, let's you and I see if we can figure out how a normal, law-abiding citizen—a parole officer in this case—gets behind the eight-ball to the tune of three C-notes in unpaid toll road fees.

Johns drives to the Dallas side of the metropolitan area for his son's baseball games. He used to drive on the State Highway 121 tollway between Coppell and Lewisville.

There are no tollbooths on 121. Therefore it is not possible to pay your tolls as you go. Cameras along the way take pictures of you as you pass. If you do not have an electronic TollTag on your windshield connected to a credit card, the NTTA bills you by mail for the amount of your tolls.

Johns didn't have a Dallas-area TollTag. Didn't want one. Was happy to pay by mail. Did so. He even thought mistakenly that he was paying a little extra and didn't mind.

"I was under the impression that the toll may have been even 25 cents higher per toll by not stopping and paying, and I didn't have a problem with that."

He says he paid those bills when he got them. Never had a problem. So where did he do wrong? He started driving on another NTTA toll road—the President George Bush Turnpike. There, the rules are different.

As explained to me by NTTA spokeswoman Sherita Coffelt, the difference is that the PGBT does have tollbooths, while the 121 tollway does not. Coffelt said that wherever there are tollbooths, a motorist who does not have a TollTag must stop and pay cash. Where there are no tollbooths, a motorist does not have to stop and pay cash.

When a motorist is not required to stop and pay cash, he will be billed for the amount of his toll only. When he is required to stop and pay cash but does not, he's a toll jumper. He will be billed for the amount of his toll plus a $25 penalty called an "administrative fee."

No signs along the road warn motorists of this difference. Coffelt told me it's the motorist's obligation to know the rules.

Each skipped toll station incurs a new $25 administrative fee. On his jaunt down the PGBT last May, Johns passed by four toll stations, each one of which took a picture of his license plate and billed him for a $1 toll plus a $25 administrative fee. So four times $26 amounted to a bill for $104, a tab he racked up for 33 minutes of driving.

But wait. We're not done with the different rules on how to pay your toll. There is a third rule. On the Dallas North Tollway, you can pay cash, so if you don't have a TollTag you must pay cash, and if you don't pay cash you'll be billed for the tolls plus the $25 fees. But you can't pay cash.

Say what?

The Dallas North Tollway is a road where you can pay cash, so you have to pay cash, but if you enter the Dallas North Tollway at the main plaza at Wycliff close to downtown, you will notice that you can't pay cash. There are no tollbooths at Wycliff.
Coffelt explained to me that the absence of cash-taking booths at the main entrance to the Dallas North Tollway is just kind of an exception. The Dallas North Tollway is definitely a must-pay-cash toll road except when you get on it, when it is a can't-pay-cash toll road. But that doesn't last; later down the road you have to pay cash.

Maybe you better take notes.

If you enter at Wycliff and you don't have a TollTag and you don't pay cash because you can't pay cash, you will be billed only for the amount of your tolls. Maybe.

If you keep driving, and maybe you think this is a road where you don't have to pay cash because that's what it was when you got on, but you pass another toll plaza farther north at say, Keller-Springs Road where you can pay cash, but you decide not to pay cash because you have been lulled into thinking you don't have to pay cash, this is what you must do next:

Pull over to the shoulder immediately.

Exit the vehicle.

Put your head between your legs.

Kiss your ass good-bye.

You have just become a son-of-a-bitch, toll-jumping, miscreant fool, and you are about to feel the full weight of the law on your no-good, crime-prone head.

Well, you might think, maybe I make that mistake one time. They let me know. I take my medicine, pay my toll plus my 25 bucks. Man, I'll sure never make that mistake again!

Not so fast, Kemo Sabe. In Johns' case, for example, he had no idea he was doing anything wrong until he was on the tab for $337. He told me he certainly would have figured out a smarter way to behave had he known what was going on at the get-go.

"I get on George Bush, which I assume is the same deal as 121, and obviously if I had known this—a $25 administrative fee per tollbooth—I mean, good grief, I would have made other arrangements."

I asked Coffelt why people don't get billed or notified right away, the first time they hit the buzzer, so that they won't keep making the same mistake. She said the NTTA wants to spare people the annoyance of being billed every time they have a two-bit toll.

"We're not sending out a 40-cent bill, and then you end up paying 42 cents for postage, because what person would want to write a check for 40 cents. So we save up a couple of transactions."

I said I understood about the normal tolls, but did the agency try to let people know the first time they made a mistake and racked up a $25 administrative fee? She said no. They save up those too.

"We will save it, and you may get two, three transactions with $25 fees on it, so yes, we do save those."

Problem. Johns, indeed, had only four toll road trips on his first bill. But those trips took place over an 18-month period. And because the system hits him with a separate $25 fee every time he ticks past another camera, his total administrative fees for those four trips came to $325. The first trip alone, a year and a half ago, cost him $100 in fees.

They couldn't have given him a heads-up a year and a half ago?

I asked Coffelt how much the agency collects in administrative fees and fines. Apparently that is a really tough question to answer. She said she would have to get back to me.

I did not hear from her before the deadline for this story, but I did the best I could on my own. I looked online at the NTTA's annual financial statements.

According to the NTTA's 2007 financial statement, it collected $4.4 million that year in administrative fees "for collection of tolls from toll violators [the bastards]," representing 2.1 percent of its total income.

Note to reader: I added "the bastards."

What I found more interesting was this: Between 2001 and 2007, the agency's toll revenues grew by 89 percent. In that same period, its revenues for "administrative fees, parking transaction fees, statement fees and miscellaneous charges" grew by 356 percent.

So I guess if you are the bright person at the NTTA in charge of squeezing money out of people with non-toll fees, right about now you've got a big gold star over your name.

While they're at it, the NTTA should set up a special tollbooth just for people who get really behind on their administrative fees. Deadbeats would be required to park their cars and come inside.

There should be some old pinball machines in there and a couple guys in zoot suits smoking cigars, one of them cleaning his fingernails with a switchblade. They might say something like, "Pal, you gotta lotta administrative fees youse owes us. We'd like to settle this peaceful."

They might as well be honest about the type of operation they're running.


Read More in the Dallas Observer

Highway 121 project receives federal environmental clearance

By MICHAEL A. LINDENBERGER - The Dallas Morning News - Thursday, October 18, 2007
The federal government issued an environmental clearance Wednesday for the controversial -- and much delayed -- State Highway 121 toll road project. That clearance was required before the Texas Department of Transportation could sign the project agreement already negotiated and agreed to by the North Texas Tollway Authority.

Mark Ball, a spokesman for TxDOT's Dallas district, said it was not immediately clear how soon the department's executive director would sign the project agreement.

NTTA, which has promised to pay $3.3 billion for the road contract, has already signed the agreement and has been waiting for weeks for TxDOT's signature. The latter was delayed, however, until final federal environmental clearance was achieved.

Faced with the delay by the Federal Highway Administration, the Texas Transportation Commission voted Aug. 23 to cancel a deadline that had initially stipulated that if NTTA could not sign an agreement by Aug. 29, the deal would revert to Spanish builder Cintra.

Now that the federal clearance has been issued, TxDOT is expected to sign the agreement. Once it does, NTTA will have 45 days to close its financing and make the upfront payments. The payments are in return for the right to build the 26-mile toll road in Collin and Denton counties and collect tolls for the next 50 years.

Already, local governments in North Texas have proposed hundreds of transportation projects that would be paid for by the money NTTA has promised to pay.

The initial $3.3 billion figure may be adjusted somewhat, thanks to the variations in the bond market that have taken place because of the mortgage market crisis, regional transportation and NTTA officials have said.

Read more in the Dallas Morning News

Highway 121 money split - Denton, Collin get most of $3 billion; some in Collin upset

By THEODORE KIM - The Dallas Morning News - Friday, October 12, 2007

ARLINGTON – After years of arm-twisting over the sale of the State Highway 121 toll road, the payoff is finally here.

And while nobody got exactly what they wanted, forgive Denton County for smiling a little more than its neighbor to the east.

On Thursday, the Regional Transportation Council approved the division of the roughly $3 billion payout from the sale of the toll road to surrounding counties.

The decision came despite the grumbling of leaders in Collin County, who said the divisions will shortchange their county out of millions.

At stake is billions of dollars that will be generated almost immediately under the state's deal to sell tolling rights on Highway 121.

Earlier this year, the North Texas Tollway Authority agreed to pay the state $2.5 billion up front and $833 million in additional revenue for the right to collect tolls on the road for the next 50 years.

The council, a 40-member panel of local officials that sets transportation policy, was tasked with dividing that payout among area counties.

Under the plan, the majority of the money was set aside for Denton County, which will receive $1.56 billion, and Collin County, which will get $1.18 billion. The proposal was based in large part on estimates of how many vehicles will use the highway in each county in the future.

Those amounts fall far short of the roughly $9 billion in total requests the counties had initially made to the council for road projects.

Moreover, the counties will actually receive somewhat less because, in part, the earmarks include the cost of finishing Highway 121, slated for completion by decade's end.

Because of that, some officials said they felt the agreement unfairly penalizes Collin County. Denton's segment of the road, funded largely by gasoline-tax revenue, is mostly complete. Collin's half is being built now and will be funded by its portion of the toll-road deal.

Of Collin's payout, about half – $600 million – will help the NTTA finish the project. By comparison, Denton will contribute about $41 million to the project from its payout.

"Why are the construction costs of [Highway] 121 being added to the county's share?" asked Plano City Council member Loretta Ellerbe, the only transportation council member who voted against the plan. "It makes no sense."Thursday's action is the latest development in the closely watched sale of Highway 121, which runs about 30 miles between Dallas/Fort Worth International Airport and U.S. Highway 75 near McKinney.

The project has come to symbolize the new and controversial way that communities nationwide are paying for roads and highways.

With gasoline-tax revenue unable to cover growing transportation needs, political leaders here and elsewhere have pioneered the practice of selling long-term tolling rights on roads in exchange for large upfront cash payments.

While others echoed Ms. Ellerbe's dissent, the transportation council said they generally supported the plan.

Member Cynthia White, a Denton County commissioner, encouraged her colleagues to set aside regional biases in favor of curtailing growing traffic across the area.

"All these [road] projects are interdependent," she said.

Another member, Collin County Commissioner Joe Jaynes, said he voted for the plan because in the end it will mean hundreds of millions for new roads.

"Nobody was completely satisfied," Mr. Jaynes said. "I think that's a sign of a good compromise."
Read more in the Dallas Morning News

NTTA on road to more tolls - North Texas Tollway Authority set to expand vision, role with new projects

By MICHAEL A. LINDENBERGER - The Dallas Morning News - Sunday, July 22, 2007
The North Texas Tollway Authority's second decade promises to be nothing like its first.

Today, at age 10, NTTA is promising to expand its focus beyond Dallas and Collin counties to mesh with state and local plans that will radically increase the number of toll roads in North Texas.

As a result, the authority is poised to exert more influence than ever before over the way North Texas drivers get from one place to another.

"I call it the maturing of the NTTA," said Michael Morris, transportation director for the North Central Texas Council of Governments. "Ten years ago, the NTTA's attitude may have been, 'We'll do a few projects, but we're not interested in managed lanes, or electronic toll roads. We basically build these big fat cash lanes.' " But that's changing fast, Mr. Morris said.

In addition to building the 26-mile State Highway 121 toll road, NTTA has been asked to build or operate at least five other toll roads, and will partner in several other "priced" projects such as pay-to-use HOV lanes.

Critics: Change needed
Critics caution, however, that as NTTA plays a bigger role in solving transportation problems, it will need to do a better job of paying attention to the whole region.

"I have nothing against them, except for their history," said Denton City Council member Pete Kamp, who said NTTA has long ignored Denton and Tarrant counties. "They are telling us that they are now going to be, and I trust them to be, good to their word. But in the past they've simply been in Dallas and Collin counties."

Bill Hale, the engineer in charge of the Dallas district of the Texas Department of Transportation, said North Texas' transportation solutions have long depended on pooling resources from the state, the region's elected officials and the toll authority. "It's a three-legged stool, and everyone has a role to play," he said.

If that's true, NTTA's leg is about to get a lot stronger, as Mr. Hale conceded in an interview last week.

And that means it will be under more scrutiny, said Mike Nowels, a former Regional Transportation Council member from Lewisville. Answerable only to an independent board of directors, the authority has had too little oversight, he said.

"Does the Dallas North Tollway from [Interstate] 635 south into Dallas, is it really up to standards? Is it anywhere close?" Mr. Nowels asked. "Why hasn't the tollway authority invested in fixing it? It's gridlock every morning and gridlock every evening – and it's been that way for 20 years."

Optimism
NTTA officials and Mr. Morris said negotiations over Highway 121 are well ahead of schedule. An agreement is expected to be ready before the Texas Transportation Commission meets in Sugar Land on Thursday – a month before the deadline.

If the deadline is not met, the contract will go to Cintra, the Spanish firm that won preliminary approval in February to build the road.

Many of the Regional Transportation Council members who voted to let Cintra keep the contract said they now think NTTA will do a good job.

Mesquite City Council member John Heiman Jr. said many of the "no" votes were cast in opposition to the way NTTA was allowed to make a late bid after Cintra had been named the preliminary winner.

"I didn't vote against the NTTA; I was simply opposed to the process. It was awful," Mr. Heiman said.

Most RTC members have put the differences over Highway 121 behind them and are focused on building the region's badly needed roads, he said.

"There is so much need – and I am not talking about wants, I am talking basic needs of transportation – we're going to need a big head of steam to get it all done," Mr. Heiman said.

Mr. Morris said NTTA must be given the support it needs to live up to its commitments on Highway 121 and other roads it has promised to help build.

"We want them to succeed," Mr. Morris said. "We're going to do everything we can to assist them."

NTTA chairman Paul Wageman said board members have benefited from criticism.

"I think it has been very instructive, and we're changing," Mr. Wageman said. "We're having to grow and adapt to a changing environment. Perhaps we were a little slow to adapt to that as a board, but the board is now fully focused on our road ahead."

That path ahead, he said, includes an increased focus on communities in Tarrant and Denton counties who have long felt ignored by NTTA.

Higher tolls ahead

Still, what has changed most of all is not NTTA, but the way local officials and transportation planners have so enthusiastically embraced tolling as a road-building strategy.

That would have been hard to imagine in June 1997, when the Legislature voted to create NTTA.

Former Dallas County Judge Lee Jackson helped lead the charge to persuade lawmakers to dissolve the Texas Turnpike Authority and replace it with NTTA.

At the time, the authority's only job was to maintain the Dallas North Tollway and collect millions of dollars in tolls. In time, it used those funds and others to build the President George Bush Turnpike, and has since embarked on a handful of other, smaller projects.

But Mr. Jackson, chancellor of the University of North Texas system since 2002, said the philosophy about the role of toll roads in the highway system a decade ago barely resembles what has emerged since the Highway 121 debate began.

"When the NTTA was formed, the idea was that every toll road would be built and operated to the lowest possible cost to the drivers," Mr. Jackson said. "The idea was to set the smallest possible toll rates."

These days, the idea is to set the toll rates high enough to create a rich revenue stream that can be used as collateral for massive upfront loans from banks or bondholders.

In the Highway 121 case, for example, NTTA has promised to pay the state $3.3 billion in cash to help finance a stream of other North Texas projects. The money will come from the sale of bonds secured by future toll revenue that exceeds what is needed to build and operate Highway 121 in Denton and Collin counties.

"Obviously money talks," Mr. Jackson said. Still, he said the new approach is necessary because of the paucity of funds from more traditional sources such as state and federal gas taxes.

Mr. Morris agreed.

"We're in such a financial crisis when it comes to transportation that the gas taxes are basically paying for the maintenance of the roads we already have," Mr. Morris said. "Ten years from now the only improvements we will be able to make will be the ones that are paid for by toll roads."

Fairness of toll rate
Some local leaders say they can stomach the increasing number of toll roads. But they say it's wrong to abandon the old policy of keeping toll rates as low as possible.
Frisco City Manager George Purefoy is among them. It's bad enough, he said, that Frisco's two main avenues to the rest of the Dallas-Fort Worth area – Highway 121 and Dallas North Tollway – both will be tolled.

But what's worse, he said, is that Frisco drivers will be paying artificially high rates just so NTTA can borrow the billions it has promised to pay upfront. He says the higher toll rates amount to an extra tax on drivers unlikely to use the roads on which the extra money is spent.

"Everyone wants to keep focusing on how much money the region is getting from this project, and no one seems to care how much more drivers are going to have to pay," he said. "Our drivers are going to have to pay a toll, an extra tax and then the gas tax, too."

The Frisco City Council is considering filing suit to try to block the toll road, Mayor Mike Simpson said, but no decision has been made.

Last week, Mr. Morris said that legal threat could make it more difficult for NTTA to close the Highway 121 deal within the deadline.

In the meantime, drivers may need to get used to paying higher tolls – a price transportation officials such as Mr. Morris said is needed if residents want to ease the congestion that continues to clog North Texas roads.

Read more

Perry reiterates toll road support

Governor tells builders the need for road funds will overcome critics
By RAD SALLEE - Houston Chronicle - July 19, 2007


AUSTIN — Gov. Rick Perry told road builders at the Texas Transportation Forum here Thursday that he stands firm in his support for toll roads and public-private partnerships despite some setbacks in the past legislative session.

"When you have big dreams," he said, people tell you, "You can't get there from here. But I assure you we can get there from here, and we're going to get there together."

Perry said traditional sources of road funding — "a trickle of federal funds and a gas tax that few legislators would even think of raising" — aren't nearly enough to meet the state's needs.

"There isn't even enough money to maintain our current system," he said.

And the fuel tax "has problems on its face," he said. Unlike toll roads, which typically have a free alternative, fuel taxes are paid by all drivers, and hit rural residents hardest.

"The boys out in Lubbock, Odessa and Marfa really don't see the benefit
in it for them," he said.

"If we don't build roads with innovative financing and tolls, roads are not going to be built in our state," he said.

Driving the private sector

Perry said even the prospect of the state contracting with the private sector to build and operate toll roads is paying off.

"Projects that local toll road authorities would not have bid on a few years ago are now attracting very strong interest because private companies are now competing to build those same projects," he said.

This was an apparent reference to the North Texas Tollway Authority's offer to pay the state $3.3 billion to build and operate for profit in a 50-year lease, a segment of Texas 121 in the Dallas area. The offer topped a previous $2.8 billion bid from the Spanish firm Cintra.

"They may never say it," Perry said of lawmakers opposed to such long-term public-private toll partnerships, "but the Legislature admitted we were on the right track.

"While they were calling for a moratorium on toll roads, on one hand, they were insisting on toll road projects in their own districts because their constituents wanted to see things moving. They wanted to see those roads built."
Read more

Regional Transportation Council's chairman slowing down to speed things up

By O.K. CARTER - Star-Telegram Staff Writer - Thu, Jul. 05, 2007
North Richland Hills Mayor Oscar Trevino is only 30 days into his role as chairman of the Regional Transportation Council, but he's already discovered that leading the council resembles herding whales: It takes a while, and some whales always wander off in new directions.

Last month's vote to recommend a builder and operator of a future Texas 121 toll road, for example, was 27-10 in favor of the North Texas Tollway Authority, with some of the 10 voicing adamant opposition. Regional transportation issues rarely achieve consensus because interests and needs are so varied.

The council, part of the North Central Texas Council of Governments, is the chief planning agent for future regional transportation needs: highway improvements, toll roads, regional passenger rail and the like. The regional council's 40 members include elected or appointed officials from 16 Metroplex counties, as well as representatives from transportation planners like The T or Dallas Area Rapid Transit. Nothing big in regional transit happens without the regional council's endorsement.

"The process of getting things done in regional transportation is miserably slow, like watching grass grow," the thrice-elected North Richland Hills mayor jokes. It helps that he's also a civil engineer and highway construction expert.

It's already obvious that Trevino's style is to speed up by slowing down, giving council members plenty of time to get their say. His first meeting ran almost four hours. It's a hypothesis that long meetings equal faster projects.

"Letting members have their say and having open civil discussions may result in meetings going a little long," Trevino concedes. "But when everybody can present positions and have them openly debated, even members that don't get things 100 percent their way will know that we hashed it out and gave them a fair shake."Trevino knows that at the same time, the clock is ticking on transportation issues and speeding up projects is crucial.

A recent census study revealed that the percentage of people commuting to work in a vehicle by themselves actually increased by 2 percent over the past five years. The population of the Metroplex is projected to increase 3.5 million over the next three decades.

"More cars and people add to pollution and congestion problems," he said.

Trevino's watch as council chairman did not begin on a cheerful note. A pitch to the Legislature to allow Metroplex residents to vote on a half-cent sales tax to fund regional passenger rail was essentially ignored.

"If transportation planning moves slow, the Legislature moves even slower," Trevino said. "If you want something done in one session, you have to introduce it an earlier session. Basically, all we're asking is that the Legislature allow voters here to make that call."

Without the tax, Trevino sees no way to fund regional rail, which is why one of the top two priorities of his council term will be to organize a more focused and determined legislative lobbying effort two years from now to get lawmakers to allow a vote on a tax.

The other priority? When he hands over his gavel to a new chairman in 11 months, Trevino would love it if the tollway authority had resolved not only the 121 issue, but had also established firm timetables for toll road projects, including a widening of Texas 360 in southeast Tarrant (Arlington/Mansfield), Texas 171 in north Fort Worth and north Tarrant County, and the Southwest Parkway. He'd also like the tollway authority to pick up the pace on a George Bush Freeway extension and the Dallas Trinity Parkway project.

"It's also obvious that [the Texas Department of Transportation] is going to have to recognize that it's going to have to take care of some mobility issues without assistance from tolls, including problems on I-35, Loop 820, S.H.183 and the downtown funnel," Trevino said, though with a proviso: He favors construction of toll-funded express lanes on 820.

That's much to do with less than a year to do it.

O.K. Carter's column appears Tuesdays and Thursdays.
Read more

UPDATE 3-Texas agency again tops Cintra for road project

By Joan Gralla - Reuters - Thursday, June 28, 2007
NEW YORK, June 28 (Reuters) - Texas on Thursday conditionally approved a public agency to overhaul a busy Dallas-Fort Worth highway instead of Spanish toll-road firm Cintra (CCIT.MC: Quote, Profile, Research), a decision that analysts said could stall road privatization plans in other states.

The North Texas Tollway Authority outbid Cintra by $500 million, offering a $2.5 billion upfront payment and $833 million in annual lease payments.

Thursday's decision was made by the state transportation commission, which selected the North Texas Tollway Authority by a vote of four to one, said spokesman Mark Cross.

Cintra in February won the deal to overhaul State Highway 121, but critics said the terms overly favored the developer by including a non-compete clause and a 50-year lease.

Texas lawmakers responded by asking the local highway authority to submit a competing bid.

The legislature also enacted new curbs on such privatizations, which allow developers to lease state highways for long periods in return for the toll revenue.

New Jersey and other states weighing road privatizations have said they are closely following the twists and turns of Texas' saga because they want to avoid a similar backlash.

Cintra and the JPMorgan Fund, its partner, said in a statement on Thursday their bid was better because "contracts are in place, toll rates are capped, lending commitments are made, design work is complete and we are ready to roll up our sleeves and get to work."

The companies added their deal would invest $7.3 billion in the Dallas-Fort Worth area over the next 50 years.

Texas' Regional Transportation Council on June 19 picked the public authority instead of Cintra and state Commission Chair Ric Williamson has set a policy of deferring to local policy-makers, said his spokesman, Randall Dillard.

The regional council and the North Texas Tollway Authority now have about 60 days to draft more detailed plans, including the timing, annual payments, enforcement clauses, toll policy and the length of the pact, Dillard said.

The authority will then have about 45 days to secure the financing and sign a contract with the state commission.

"We've already authorized our staff to sign the Cintra proposal," the Commission chair noted during the meeting, broadcast on its Web site (http://www.txdot.gov).

"If they (the authority) can't get there, we'll sign the project with Cintra," he added.

Commissioner Ted Houghton dissented, stressing how inflamed the battle has been. "It's unfortunate that they (Cintra) have been vilified as foreigners," he said.

Cintra is one of the huge European companies that develops toll roads around the world. This approach is much more common in Europe, Asia and Latin American than in the United States.

The commissioners praised the private road developers for sparking the competition that produced Thursday's award.

Dillard said the State Highway 121 overhaul "was really just a long-range dream" until the private companies competed for the work. Asked if the commission would now return to using public agencies instead of developers, he replied that this project was "a good example of empowering local officials."

State Highway 121 is prized by developers because Dallas and Fort Worth are some of the fastest growing U.S. suburbs. For example, Collin County, which lies just north of Dallas, is expected to draw 514,000 new residents from 2005 to 2030.

Chicago sparked U.S. interest in this way of funding new highways without hiking taxes two years ago when it got $1.83 billion for leasing its main commuter link to Indiana, the Skyway toll bridge, to Cintra, part of Ferrovial (FER.MC: Quote, Profile, Research), and MIG, run by Australian bank Macquarie Bank Ltd. (MBL.AX: Quote, Profile, Research)

Fiscal monitors, however, have bashed Chicago's strategy, saying its 99-year pact is much too long and fails to give taxpayers the extra toll revenue the companies can get.

The North Texas Tollway Authority has said private firms may be better suited to developing roads in undeveloped areas because the bigger risk may justify their bigger profits.
Report in Reuters

Thursday, June 28th Texas Transportation Commission Meeting

By Faith Chatham - June 28, 2007

The Texas Transportation Commission will convene at 9:00 a.m. Thursday, June 28 in the Dewitt C. Greer Building, 125 East 11th Street, Austin, Texas.

WATCH THE COMMISSION MEETING ON THE INTERNET.
Agenda
(Requires Quick Time Player to view video.
Download Quicktime (free) player)|

Agenda Item 6. Toll Projects
a. Collin and Denton Counties – Consider the recommendation of the Regional
Transportation Council concerning the financing, construction, and operation of
the SH 121 project from Business SH 121 to US 75 in Denton and Collin
counties (MO)

Agenda

Item 10: d. Right of Way Dispositions and Donations
(1) Denton County – FM 3040 at Valley Parkway in Lewisville –
Consider the exchange of right of way (2 MOs) MO1
MO2

FACTS:
Texas Transportation Commission

The Texas Transportation Commission is a five-member board appointed by the Governor to oversee TxDOT. The Commission:

- plans and makes policies for the location, construction and maintenance of state highways,
- oversees the design, construction, maintenance and operation of the state highway system,
- develops a statewide transportation plan that contains all modes of transportation, including highways and turnpikes, aviation, mass transportation, railroads, high-speed railroads and water traffic,
- awards contracts for the improvement of the state highway system,
encourages, fosters and assists in the development of public and mass transportation in the state, and
- adopts rules for the operation of the department.

[Source: TxDOT website]

State may defy local leaders on 121 toll plan

Money, politics could push panel to override choice of NTTA
By JAKE BATSELL - The Dallas Morning News - Wednesday, June 27, 2007
The Texas Transportation Commission has made a habit of honoring local leaders' decisions.

But when commissioners meet Thursday to consider North Texas leaders' plans for the politically charged State Highway 121 toll road, nobody expects a rubber stamp.

The Regional Transportation Council voted 27-10 last week to endorse the North Texas Tollway Authority for the multibillion-dollar project. If ratified by the commission, the local vote would torpedo an earlier deal the state reached with the Spanish company Cintra.

Commissioners have never overruled a decision by the regional council, but with so much money and politics at stake, Highway 121 could set a precedent.

"As far as saying, 'Thank you all very much for your comments, and now we're going to vote the other way,' they haven't done that in the past," said RTC chairman Oscar Trevino. "But all we are is a recommending body. I can see them not agreeing with us."

Gov. Rick Perry has appointed all five commission members. They have the ultimate say on state road contracts. Transportation officials in Austin, El Paso, Houston and San Antonio say the panel has yet to contradict a local recommendation on a specific road project.

"This commission, more than any prior one, has acted to strengthen decision making at the regional and local level," said Alan Clark, director of transportation planning for the Houston-Galveston Area Council.

Still, Highway 121 is a special case. The state originally picked Cintra for the project four months ago. When that deal prompted a backlash from state lawmakers, regional leaders invited the NTTA to re-enter the bidding process. Members of the RTC – mostly local elected officials – spent more than eight hours combing through the dueling bids before siding with the tollway authority.

Members said they chose the NTTA for several reasons, including the idea of keeping profits in North Texas rather than sending money to Spain.

The tollway authority's cash offer of $3.3 billion was higher than Cintra's. And RTC members said they believe better-than-expected traffic on Highway 121 could generate more revenue for the NTTA to build other roads in North Texas.
The Texas Department of Transportation, which is governed by the state transportation commission, has consistently favored Cintra's proposal.

Since Mr. Perry appoints the five commissioners, the department is under pressure to carry out his initiative to privatize highways. A winning bid for Cintra would signal that Texas' roads are open for business.


Local power

Reversing the RTC's endorsement of the NTTA for Highway 121 would be a hairpin turn from the commission's philosophy of local control, a mantra it has repeated over the past four years.

Regional planning councils used to present the state with a wish list of road projects, then wait for commissioners to pick which ones to fund. Now, the state gives each council a pot of money and asks regional leaders to select projects and prioritize them.

Inflation is chipping away at the state gas tax, the chief funding source to build and maintain roads. Commissioners have encouraged regional councils to generate more public money by seeking toll-road contracts with upfront payments. Highway 121 is Texas' richest such deal yet, with the NTTA and Cintra both offering around $3 billion in cash in return for the right to collect tolls for the next 50 years.

The commission's chairman, Ric Williamson, declined to comment last week on the upcoming vote on Highway 121. But in late March, days after the RTC invited the tollway authority back into the bidding process for Highway 121, Mr. Williamson all but guaranteed that commissioners would defer to regional leaders.

"We want to administer the award of that construction contract according to the regional leadership," he said. "We just believe that if you have a strategy that says empower local and regional government, that's what that means and you stay out of it, other than making sure the law is followed and making sure good engineering practices are used. If you're going to let go and let people assume a regional perspective, that's what you have to do."
Other commissioners, however, have raised concerns that the volatile and unorthodox bidding process for Highway 121 may prompt Cintra to sue the state.

And Transportation Department officials have circulated letters suggesting that yanking the project from Cintra could cost the state federal funds. A state engineer even wrote a memo suggesting that the NTTA could go bankrupt if it's awarded the project. James Bass, the department's chief financial officer, has since called the memo "moot."

The department's two representatives on the regional council voted for Cintra's proposal. And Mr. Bass said earlier this month that if commissioners ask for a staff recommendation on Thursday, the department's review team will recommend Cintra.

How much weight the commission would give a staff assessment is unclear. While commissioners emphasize local control, they also have embraced private companies – Cintra, for example – as a key solution to the state's transportation problems.

"You had a monopoly called TxDOT. We're trying desperately to dismantle that monopoly," Mr. Williamson said during a meeting with reporters last month.

"We try to move wherever we can to insert competition and competitive pressure into the decision-making process, in the broader context of letting regional leaders judge who has the best proposal in that competitive process," he said.


New territory

Should commissioners reject the NTTA proposal, local officials say, it will be the first time the panel has reversed an RTC decision.

Mr. Trevino, the mayor of North Richland Hills and the RTC's new chairman, said members of the regional council tangled with commissioners last year about a proposed Trans-Texas Corridor route that local leaders felt ran too far east of Dallas to benefit the region economically.

Commissioners ultimately agreed to study another route that would include the future Loop 9 project near the Ellis-Dallas county line, bringing the corridor closer to North Texas' urban areas.

Still, Mr. Trevino said, it's possible the commission will overturn the RTC vote on Highway 121.

"I don't think it'd be the best thing for them to do," he said. "But then again, they march to a different drummer than we do."

State lawmakers warn that rejecting the RTC vote would snub the Legislature, which passed a law requiring that NTTA be awarded Highway 121 if its proposal were financially superior.
Transportation officials across Texas will be watching Thursday's meeting for clues on how the commission will handle local recommendations on future toll deals.

"It'll set the tone," said Sid Martinez, director of San Antonio's transportation planning agency. "If they go with the RTC's recommendation, then we know in the future that more than likely they will honor the vote of the local and regional players. If they don't, then we know that it might be a tougher landscape."

The commission overruled El Paso's regional council last year during a debate over whether the city could establish its own transportation authority. But none of the state's five largest planning organizations could recall being reversed on a specific road project.

Michael Aulick, executive director of the Capital Area Metropolitan Planning Organization in Austin, said he couldn't think of any similar battles between his group and the commission.

But Mr. Aulick said the Highway 121 debate is different because of the billions at stake and the unprecedented choice between hefty public and private toll bids. "We're not in y'all's league," he said. "Dallas-Fort Worth plays a much bigger game. They play the NFL compared to what we do down here."
See map in Dallas Morning News
DMN Survey: Tell Us: Should NTTA get the 121 contract over Cintra?

NTTA to Add Two Seats to Board of Directors

By Sam A. Lopez - NTTA - June 22, 2007
Plano, TX – The Board of Directors of the North Texas Tollway Authority (NTTA) will add two seats to their Board of Directors later this year. Senate Bill (SB) 964, passed by the State Legislature during their recent legislative session and signed into law by Governor Rick Perry on June 16, requires that there be two Board members from each of the NTTA’s founding counties: Collin, Dallas, Denton and Tarrant. In addition, there will continue to be one Board member, appointed by the Governor, from a county adjacent to the member counties.

Authored by Senator Florence Shapiro of Plano, SB 964 also allows for a seat to be awarded to new counties with an NTTA roadway project. A second seat for these new counties will be authorized when roadways achieve a minimum length of 10-miles and have been in operation for three years.

“The passage of Senator Shapiro’s Senate Bill 964 is a crucial step in creating equal representation among NTTA’s four member counties and in the decision-making process on projects that benefit our entire region,” said William W. “Bill” Meadows, NTTA Board Member representing Tarrant County and Chair of NTTA’s Legislative Committee.

SB 964 includes two amendments, authored by Rep. Yvonne Davis of Dallas, that would delegate Board seats to different geographic regions within the counties making the appointment, and to the extent possible, require appointments to reflect the diversity of the population of member counties.
NTTA Board Chairman Paul N. Wageman added, “The NTTA is committed to serving our entire region and SB 964 helps us do this. In addition, the legislation permits the NTTA to plan for future relationships with other counties that will need assistance with their mobility needs.”

SB 964 becomes effective September 1, 2007.



Currently, the NTTA is governed by a seven-member Board. Each of the four counties within the service area of the NTTA appoints one member. Two members are appointed on a rotating basis by those counties in which an operating NTTA toll road is located. The Governor appoints the seventh member from a county adjacent to the NTTA's four-county service area. Board members serve staggered, two-year terms, and no member may be an elected official. From their membership, the directors elect a chairman and vice chairman.

About NTTA

The North Texas Tollway Authority, a political subdivision of the State of Texas, is authorized to acquire, construct, maintain, repair and operate turnpike projects in the North Texas region. The seven-member governing board is comprised of Chairman Paul N. Wageman, Vice Chairman Jack Miller, Directors Gary Base, David Denison, William W. Meadows, Bob Shepard and Alan Sims.

The NTTA serves Collin, Dallas, Denton and Tarrant Counties and is responsible for the Dallas North Tollway System, consisting of the Dallas North Tollway, President George Bush Turnpike, Addison Airport Toll Tunnel, Lewisville Lake Toll Bridge and the Mountain Creek Lake Bridge. The North Texas Tollway Authority is able to raise capital for construction projects through the issuance of turnpike revenue bonds. NTTA toll projects are not a part of the State highway system and receive no direct tax funding. Tolls are collected to repay debt and to operate and maintain the roadways.

Visit the NTTA Web site or call 214-461-2000 for additional information about the North Texas Tollway Authority or call 972-818-NTTA (6882) for Customer Service.

NTTA gets OK for 121 toll project

State board must still approve deal
By MICHAEL A. LINDENBERGER and JAKE BATSELL - The Dallas Morning News - Tuesday, June 19, 2007

The North Texas Tollway Authority won the strong support Monday of local officials charged with deciding who will build the lucrative but controversial State Highway 121 project.

The Regional Transportation Council voted 27-10 to recommend that the state reverse course and award the contract to the tollway authority – and not to the Spanish construction firm Cintra.

The decision marks a reversal from last winter when the Texas Department of Transportation had tentatively awarded the contract to Cintra, which had beat two other private bidders with a promise to pay the state government nearly $3 billion for the right to collect tolls on the 26-mile road for the next 50 years.

"It's probably been the toughest decision that I've had to make in the 10 years I have been on this committee," Tarrant County Judge Glen Whitley said just before casting his vote for NTTA.

Mr. Whitley said the authority's bid promised even more up-front money to the state than Cintra.

"If we go with Cintra, we do leave money on the table," he said. "We leave money on the table up front, we leave it on the table in the payments over the 50 years. ... So, sure it is a risk, but this the crown jewel of toll projects in the state, and maybe even in the country."

The Texas Transportation Commission is expected to render a final decision on the project at its June 28 meeting in Austin.

Over the last two weeks, Cintra had tried again and again to underscore the risks it said were inherent in the NTTA bid. The authority offered more money up front, Cintra said, but it did so at a risk of increased toll rates in the future if traffic volume forecasts are not met.

Many of those casting the 10 votes in favor of Cintra seized on those arguments, and on analyses by the Texas Department of Transportation and global accounting firm Price Waterhouse Coopers that reached similar conclusions.

"We cannot gamble on this," Denton County Commissioner Cynthia White said. "We have to go with what is a for-sure deal. Cintra comes out ahead against NTTA, and that is the cold hard facts. Theirs is the only proposal that guarantees a [financial] return to the region at the end of the contract."

NTTA chairman Paul Wageman had countered earlier in the day, however, that council members should go with the bid by the entity they know best, and with the project that paid the biggest amount of money up front.

"In the end, I think it was that our proposal was a superior financial deal, and because of our track record in this region,"

a smiling Mr. Wageman said after the vote.

Jose Lopez, the president of Cintra's North American operations, said the bidding process was fair. But he said his company's proposal was clearly better.

"We will just have to wait and see what the TxDOT commissioners have to say, since they are the ones that have the final say," Mr. Lopez said. "We respect the decision by the RTC, but we still are certain that our proposal was better, way better, for the region."
The Texas Transportation Commission's five members, all appointed by Gov. Rick Perry, are not bound by Monday's vote.

That worries state Sen. Florence Shapiro, R-Plano, who attended Monday's vote.

Ms. Shapiro noted that the two Transportation Department's representatives on the Regional Transportation Council voted in favor of Cintra's bid. Last week, TxDOT's chief financial officer said his department would recommend Cintra for the contract – if commission members asked for an opinion.

"That's probably pretty indicative of what they're going to do on the 28th," Ms. Shapiro said. "I am very concerned about it and intend to be there to listen and to watch and to see how it's handled.
"The commitment that ... [Texas Transportation Commission members] made – and I heard it with my own ears – was that whatever the region decided was what they would move forward with. This was overwhelming, 27-10, and I think that is a very strong message to take to TxDOT."

Bill Hale, one of two TxDOT employees on the council, said he expects Texas Transportation Commission Chairman Ric Williamson to give great weight to Monday's vote.

"That's what he has said in the past they intend to do," said Mr. Hale, the top engineer on TxDOT's Dallas-area staff.

Mr. Hale, who voted in favor of awarding the contract to Cintra, said he will now support NTTA's involvement in the project.

Ms. Shapiro's concern reflects the mood of many state lawmakers.

The transportation commission gave Cintra preliminary approval for the Highway 121 contract in February. Immediately, lawmakers reacted angrily to the prospect of signing a lease with a foreign company to operate toll roads that will span generations. And they quickly pressured the RTC to invite the NTTA to submit a bid, paving the way for a rival to Cintra.

"It is exactly what I had hoped would happen," Ms. Shapiro said. "We gave them the opportunity today, but they had to perform and they had to produce. And they did."
Fort Worth City Council member Wendy Davis said that if the contract ends up with NTTA, North Texas may lose out on private investment in the future.

"What we are going to do today is not just going to impact our decision on Highway 121, but I can assure you that it will impact our ability to attract private businesses in the future," she said. "If I was Cintra, I would learn a valuable lesson. And that lesson is that no matter how many steps are put in place to make sure the process is fair, the deck is going to be dealt in such a way that favors" a public entity such as NTTA.

Still, Richardson City Council member John Murphy, who voted for NTTA, encouraged his colleagues to feel good about the vote, no matter which side they favored.

"This is about the future and the future has changed for us," Mr. Murphy said. "Not long ago we were at a point where we were saying, 'Oh my gosh, where are we going to get the money to build roads?' Now, we're saying instead, 'Show us the money.' "