MACQUARIE Infrastructure Group considers selling US assets

By Iain McDonald - The Australian - July 09, 2009

MIG to help holders of its securities

MACQUARIE Infrastructure Group is considering ways to help security holders, amid speculation of radical changes for the toll road owner as it grapples with high debt and some poorly performing assets.

"In response to a request from the ASX regarding market speculation, MIG advises that it is reviewing options which seek to enhance security-holder value," it said.

"The decision has been made by the MIG boards in respect of any of these options."

MIG had said previously that it was considering asset sales to boost shareholder value so the fund's use of the word "options" indicated it was considering other measures.

Analysts have speculated recently on a broad range of options for MIG, including a capital raising.

One close source said the choices being considered by the fund were not as broad as those flagged by analysts.

According to MIG, it would update the market no later than its full-year results briefing on August 20. The fund's securities closed down 6.3 per cent, or 9c, at $1.26 yesterday.

In the latest research note, Merrill Lynch analysts say MIG's gearing is too high and Australian fund managers view the listed fund as below investment grade.

They say the ratio of net debt to earnings before interest, tax, depreciation and amortisation needs to fall from 14.4 to about nine, and to get there MIG could give away its US assets, sell its remaining 25 per cent stake in Sydney's Westlink toll road and carry out a discounted rights issue to raise between $1.6billion and $2bn.

"We can't see a solution that doesn't involve a recapitalisation via some form of capital raising," Merrill Lynch's Matthew Spence, David Porter and Simon Chan say.

The overhaul suggestions are the latest in a string of proposals and speculation among analysts, traders and local media about the outlook for MIG, one of Macquarie Group's listed funds.

UBS analysts said in May that MIG's US assets, including the Chicago Skyway, Indiana Toll road and Dulles Greenway, could be sold for a nominal amount to remove fear among investors that the fund might have to pump additional equity into the US assets.

The problem with the US assets is that the debt taken on to buy the roads was too high, given the performance of the assets since they were purchased, according to Merrill Lynch. "Given this dismal view of the US portfolio is largely held across the market, in order for MIG to re-rate, we believe they need to get rid of the US assets," the Merrill Lynch analysts said. "We don't think it matters who takes them, given the nominal equity value."

In June, Macquarie Infrastructure changed its distribution policy so that future distributions will be based on cash flow. Previously, surplus funds were used to supplement cash flow when paying distributions.

It paid distributions of 10c per stapled security in the first and second half of last fiscal year but Merrill Lynch expects distribution of just 4c this fiscal year, which started July 1.

Macquarie Infrastructure first said it would look at selling other assets when it announced the sale of its interest in Westlink last December.
Read more in the Australian

Massive Grapevine highway project could begin this year

By NICHOLAS SAKELARIS and GORDON DICKSON - The Grapevine Courier / Star-Telegram - March 4, 2009
GRAPEVINE — The massive reconstruction of seven Grapevine highways — a $1 billion-plus project known as the DFW Connector — will change the appearance of the city.

And it will change the way motorists from other cities, and Grapevine residents themselves, get around.

Capacity on highways such as Texas 114/121 will double, with the addition of toll and nontoll lanes, making it possible for the first time in decades to drive through the once-sleepy farm town without encountering gridlock.

Gone will be the hair-pulling waits at traffic signals along William D. Tate Avenue, one of the main drags leading to the city’s "restaurant row."

"We don’t go into Grapevine in certain parts of the day because of the traffic. You can’t get around," said Michele Hoffman, who lives in the south part of the city. She supports the project, which may be managed by private developers.

The Texas Department of Transportation, which plans to supplement the long-delayed project with $250 million in federal stimulus money, is expected to select a best value among the bidders this month.

But the progress will come at a cost for area property owners. Part or all of about 16 Grapevine and Southlake businesses could be removed, including the 80-room Fairfield Inn on Texas 121, according to environmental documents provided by the Transportation Department.

The plans show that up to 10 of those businesses could be bulldozed.

Even more businesses will lose parking spaces, including Sam’s Club, Baylor Regional Medical Center, Academy Sports and Classic Chevrolet, officials said.

Classic Chevrolet will lose 173 parking spaces to make way for a flyover ramp, which will allow motorists on eastbound Texas 114 in Southlake to merge onto southbound Texas 121 and head into Euless or southbound on Texas 360 en route to Arlington without stopping.

New landmarks

Some people believe that the dominant structure in Grapevine is the historic B&D Mills, visible for many miles. Others say it’s the Gaylord Texan Resort and Convention Center. Soon, these arguments will be moot.

The DFW Connector will be 16 miles long, with four decks of ramps and overpasses, and at its peak, near the Dallas/Fort Worth Airport north entrance, the structure will rival the five-deck Interstate 30/Interstate 35W interchange, also known as the Fort Worth Mixmaster, in stature.

The Texas 114/International Parkway interchange north of D/FW Airport will have four layers, similar to the 120-foot-tall High Five at Interstate 635 and U.S. 75 in north Dallas.

Construction could begin this year if the plan gets environmental clearance from the Federal Highway Administration, as expected. The Texas Department of Transportation is reviewing three proposals from developers for design and construction. The cost of the project is estimated at $907 million on federal environmental documents, although state officials predict the cost will top $1 billion.

Hundreds of area residents, city officials and elected officials attended a public hearing last week at the Grapevine Convention Center to learn more about the project. It was the last public meeting required in the environmental study phase.

Land lost

The DFW Connector will widen and improve interchanges for Texas 121, Texas 114, Texas 360, I-635 and surrounding arterial streets. The project will take five years to complete.

The Transportation Department estimates that it will need about 192 acres of right-of-way for the project; it could begin acquisition as soon as this summer.

Hagen Durant, general manager of Classic Chevrolet, said he has been anticipating this for several years. His company will probably have to relocate part of the business to another site to make way for the flyover ramp, which will pass right over the dealership.

Another direct connection from Texas 121 and Texas 360 west to Texas 114 will also have a large flyover ramp near Carrabba’s in Grapevine, at a loss of 11 parking spaces for the restaurant.

In Southlake, the big changes include realignment of the Southlake Boulevard and Gateway Drive bridges. A new flyover ramp will let motorists exit Texas 114 directly onto Southlake Boulevard.

To do that, however, Calico Corners, an interior design store at the corner of Southlake Boulevard and Texas 114, will be displaced.

At its widest point north of Dallas/Fort Worth Airport, Texas 121/114 will have up to 24 lanes, including main lanes, toll lanes and access roads. The westbound main lanes will be seven-wide at one point.

Drivers who intend to travel on Texas 114 straight to Irving will have the option of using managed toll lanes that will be similar to the high-occupancy vehicle lanes on some Dallas highways.

The sheer size of the project is a little scary for Grapevine Mayor William D. Tate.

"We assume we’ll be able to learn how to leave town and find our way back home once it’s built," Tate joked.


Public comments

The public can submit written comments on the proposed project until Friday. They can be mailed to:

Maribel P. Chavez, P.E.

Texas Department of Transportation

P.O. Box 6868

Fort Worth, TX 76115
Read more in the Fort Worth Star Telegram

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

TxDOT buys time with borrowed funds for Dallas-area projects

By MICHAEL A. LINDENBERGER - The Dallas Morning News - Sunday, October 5, 2008
State transportation officials are poised to issue billions of dollars in debt to help speed road construction, a move that will keep Dallas-area projects on schedule for now but will do little to shore up the state's long-term road-funding crisis.

The Texas Department of Transportation will likely begin issuing $1.5 billion in bonds within 60 days, pending the recovery of the nation's upended credit markets, and is taking steps to borrow another $6.4 billion over the next few years.

Historic turmoil in the credit markets is already costing the department hundreds of thousands of dollars in extra interest payments each week on some of its smaller loans, and any efforts to borrow much more will be complicated – and likely delayed – if the markets do not improve.

Credit worries aside, the decision to borrow billions enables TxDOT to end months of hand-wringing over whether it will have the money to complete projects local officials throughout Texas have been depending on. Late last year, the agency announced it was going broke and would have to delay some of those projects.

The new borrowing will allow the state to keep projects on schedule. But the big debt will do nothing to reduce the state's long-term shortage of road funds and could make paying for future projects more difficult as interest costs grow.

"Borrowing money does have the benefit of building projects faster," said Michael Morris, North Central Texas Council of Governments' transportation director. "Borrowing money does nothing for building more projects [in the long term]. Some people will be confused that building projects faster solves the problem, but it doesn't address the total funding need."

Mr. Morris says North Texas' transportation needs are $50 billion ahead of expected tax revenues between now and 2030. Some critics call those numbers too pessimistic, but everyone agrees that the number is big. Conservative estimates have said statewide needs will outpace funding by $50 billion to $60 billion.

Meeting last week in Austin, Texas Transportation Commission members said the bond program won't fix a basically busted system – and could make things worse if the Legislature doesn't eventually provide new tax funds.

"The system for funding TxDOT is fatally flawed," said Ned Holmes of Houston, one of five members of the Texas Transportation Commission that runs the department.

A political problem

Few leaders in Austin disagree with Mr. Holmes.

But while lawmakers, the governor and TxDOT all seem to agree Texas needs more money for roads, consensus on a solution beyond more borrowing has proven devilishly difficult to reach.

One camp argues that, of course TxDOT is going broke, given that state gasoline taxes have remained flat since 1991, at 20 cents per gallon. However, efforts to raise the tax rate have been dead in the water for years.

"As far as the gas tax goes, there is simply no appetite in the Legislature for that. None at all," said Allison Castle, press secretary for Gov. Rick Perry, said. "To make a real difference, you'd have to raise it 50 to 55 cents per gallon. Raising it a nickel or two would be just giving false hope."

But even simply indexing the 20-cent-per-gallon rate to inflation would have a huge impact over time, said Senate Transportation Chairman John Carona, R-Dallas. He said he is going to press for that this session.

"If we had had the courage to do that two years ago, we'd be in a substantially better place already," Mr. Carona said.

Tolls

For the past five years, the governor has pushed instead to build more toll roads and then to borrow heavily against future revenue.

"Toll roads are fair, as they are essentially user fees, and drivers can decide whether to use them or not," said his spokeswoman.

Opposition to tolls, especially private toll roads, was a powerful force during the 2007 session, and even lawmakers who say some tolls are helpful also argue that Mr. Perry has pushed too hard for tolls.

"We have 15 major highways proposed in Dallas-Fort Worth, and all 15 are planned as toll roads," Mr. Carona said. "In that situation, you can no longer say tolls are an option for motorists. If they are all built, you won't be able to drive anywhere in Dallas without using a toll road."

Mr. Holmes, too, acknowledged the governor and the agency under former chairman Ric Williamson had been too focused on tolls as the solution.

"They came up with a solution that did not require TxDOT to go to the Legislature to ask for new funds," he said. "But tolling was never going to work by itself."

Ready to borrow

For now, the only solution lawmakers and the governor have agreed on is to borrow another $8 billion.

It's not a new direction. From 2002 to 2007, the department first went on a borrowing spree – and then a building spree, much to the delight of traffic-clogged regions like North Texas. In those years, the department spent as much as $5 billion a year in construction contracts.

But by 2007 TxDOT had spent the money and was left with flat revenues, rising costs and hefty interest payments. TxDOT says it has about $2.5 billion in tax money to spend on major road contracts annually, about half what it was spending in recent years. It also warns that soaring maintenance costs could soon eat up as much as $2 billion a year.

"We're fast going to be at a place where we simply have to tell the locals, we're out of the business of building new roads," said Commissioner Ted Houghton of El Paso.

To delay that, TxDOT is ready to borrow again. But those new dollars will only delay, not solve, the department's long-term funding crisis.

More time may be what TxDOT needs most of all, said Mr. Holmes, who reluctantly supported the new borrowing.

"It's going to take some time – this next session, the next one and maybe one more after that – before we reach a real solution," he said.

Read more in the Dallas Morning News

Why are we still paying for the Dallas North Tollway?

By David Schetcher - WFAA-TV - Tuesday, April 15, 2008
DALLAS — Believe it or not, the Dallas North Tollway was supposed to be free by now. That obviously didn't happen, and it never will.

With a drastic funding shortfall for new roads in North Texas, local leaders rely on toll roads to keep paying for what the state cannot afford.

Take State Highway 121 across Collin County. The North Texas Tollway Authority recently won the right to build what will be a concrete cash cow.

"It's the lure of money," said David Stall, a transportation watchdog with CorridorWatch.org. "It's the lure of big money."

In less than ten years, SH 121 is expected to bring in $223 million a year in tolls. One can also add $202 million for the Dallas North Tollway and $179 million on the President George W. Bush Turnpike.



DALLAS — Believe it or not, the Dallas North Tollway was supposed to be free by now. That obviously didn't happen, and it never will.

With a drastic funding shortfall for new roads in North Texas, local leaders rely on toll roads to keep paying for what the state cannot afford.

Take State Highway 121 across Collin County. The North Texas Tollway Authority recently won the right to build what will be a concrete cash cow.

"It's the lure of money," said David Stall, a transportation watchdog with CorridorWatch.org. "It's the lure of big money."

In less than ten years, SH 121 is expected to bring in $223 million a year in tolls. One can also add $202 million for the Dallas North Tollway and $179 million on the President George W. Bush Turnpike.


"It's important for the NTTA to be able to continue to provide transportation choices for drivers and alternative funding sources for the region," said Sherita Coffelt, a NTTA spokesperson, on why all that money is needed.

On SH 121, the NTTA has the authority to collect tolls for 52 years. In exchange, the NTTA wrote the region a check for $3.2 billion. The money will fund construction of non-tolled road projects the region needs, but that the state of Texas cannot afford.

"There is very little pressure to turn that money back, or lower the tolls or turn that road into a free road," Stall said. "There's a tremendous pressure to find more things to spend the money and grow your organization and your empire."

Originally, the idea behind toll roads in North Texas wasn't to generate revenue, but instead to build roads, pay them off and then eventually make them free.

In fact, the Dallas-Forth Worth Turnpike is a good example of just that. In 1977 it was paid off, became a free road and was renamed Interstate 30.

At the time, there were proposals to keep the tolls on and use them to pay for more roads.

Opponents lined up, including the city of Fort Worth, which complained about the "unlawful, illegal, immoral and fattening activities" of the toll authority. The opponents won and toll booths came off.

The Dallas North Tollway was built with the same promise: When it was "paid off" it would be "free," too.

That never happened.

"Before it was paid off, the decision was made to extend it," Coffelt explained.

To pay the bill, the NTTA used the revenue from the existing portion as collateral for the new loans. Since then, every time the NTTA builds a new road it uses existing toll revenue as collateral.

"Well, with the tremendous amount of money that comes in on a regular basis, you institutionalize it," Stall said. "You build an organization and a structure that is dependent on that revenue and constantly looking for new projects and new ways to spend that."

The NTTA has grown into an agency with more than 700 employees and a payroll of almost $27 million. And while the NTTA said it's an accountable and transparent organization, critics point out its board members are appointed, not elected by voters.

"You're not invited to the decision-making process," Stall said. "Those making the decisions know they're not accountable to you."

The NTTA is currently negotiating to build another new toll road that would lead to the new Cowboys stadium in Arlington: State Highway 161.

Transportation sources said during those negotiations, the NTTA asked for permanent tolling authority and has also asked to rewrite its 52-year deal for SH 121. It now wants permanent tolls there, too.

"As you know, there's a huge need in North Texas for additional transportation choices and additional funding sources," Coffelt said when asked if toll roads will ever be free. "And as long as that need exists, the NTTA will, too."
Read more on WFAA

Study to kick-start highway bill lobbying

By Jim Snyder - The Hill - January 15, 2008
Business groups are looking at Tuesday’s release of a transportation study as a start-your-engines moment to what is likely to be one of the most aggressively lobbied highway bills in recent memory.

A panel of public and private officials who reviewed the country’s transportation needs for the past two years wrote the long-awaited report. Congress formed the National Surface Transportation Policy and Revenue Study Commission in the last highway bill.

“Every stakeholder in the transportation industry … has been waiting for this report to come out,” said Janet Kavinoky, director of transportation infrastructure at the U.S. Chamber of Commerce.

“Nothing like this has been done before,” said Rosario Palmieri, vice president for infrastructure policy at the National Association of Manufacturers.

The report will examine all four components of the transportation infrastructure system: freight rail lines, highways and bridges, ports, and mass transit systems.

The current highway bill lasts until 2009, but lobbyists anticipate the debate over surface transportation will begin this year given the rising importance of transportation bottlenecks on operating costs. An anticipated $4 billion shortfall in transportation accounts in 2008 is also likely to drive the transportation debate on Capitol Hill.

One key element of the debate is whether the gas tax should be significantly increased to help pay for new spending.

Under the plan endorsed by a majority of panel members, the federal share of transportation spending would increase from 37 percent to 40 percent, according to one lobbyist.

There is a broad coalition of forces arrayed in support of tax increases, but increasing the gas tax is likely to remain politically difficult.

“A special commission came up with an old, cold, bad idea,” said Sen. Chuck Grassley (R-Iowa), the ranking member on the Senate Finance Committee. “This is a disappointment and probably even a big waste of tax dollars,” Grassley said in a statement anticipating the panel’s report.

Transportation lobbyists said the committee itself was split on the need to raise taxes. The Bush administration opposes a tax hike, and current Transportation Secretary Mary Peters reportedly is one of the panel members to have argued against raising taxes as a way to spend more on infrastructure.

However, groups like NAM and the U.S. Chamber of Commerce, normally allergic to tax hikes, in this case have joined contractors, civil engineers and others in support of higher user fees.

“This is a priority for [our members] as the costs for logistics are increasing much faster than they have before,” Palmieri said.

The issue of infrastructure spending “has never been more important to them. It is very high on the agenda,” he said.

He noted one estimate that congestion adds $8 billion a year in prices for consumer goods.

Kavinoky, who is also the executive director of Americans for Transportation Mobility, one of several infrastructure coalitions formed in anticipation of the next highway bill debate, defended the tax.

“Right now, a user fee is the simplest and most straight-forward way to collect revenues,” she said.

Even though the bulk of the new money would come from an increased gas tax, long the mainstay in transportation funding, business lobbyists also anticipate the report will recommend the sort of paradigm shift they were looking for.

One lobbyist, for example, expected the report to call for the creation of a permanent commission that would develop a transportation bill through a process that mirrors the Base Closure and Realignment Commission method Congress adopted to handle the politically sensitive work of closing military bases.

Under that scenario, Congress would approve or reject the commission’s transportation report. But lawmakers would not be able to amend the legislation.

The report is also expected to advocate for a performance-based matrix that would tie funding to improvements in safety, congestion and maintenance efforts.

“That is the equivalent of a massive earthquake in transportation policy,” Kavinoky said.

Kavinoky said federal dollars are distributed by program with little regard to how the money will improve performance.

A variety of other funding mechanisms are expected to be proposed by panel members to improve system performance.

Those are likely to include public-private partnerships for toll roads that are controversial in some quarters, and a transit tax to support expansion of public transportation programs.
Read more in THE HILL

TxDOT attorney admits ad campaign is ongoing

By Terri Hall - T.U.R.F. - Dec. 20, 2007


Austin, TX, December 20, 2007 – Today in Travis County District Court, Judge Orlinda Naranjo did not sustain TxDOT’s objection to the requested material’s merits to the case, but ruled TURF’s document request was worded too broadly and needs to be resubmitted as part of the discovery phase TURF's lawsuit against TxDOT for illegal lobbying and use of taxpayer money to sell the public on toll roads.
“After tweaking the wording of the request a bit, we’ll be back in business. The Judge clearly agreed we have a right to get access to this information. She wanted to be sure we weren’t buried in piles of irrelevant documents,” notes a positive Terri Hall, Founder of TURF.

The court also granted TURF another 30 days to give them time to reword the document request and to depose witnesses based on the information discovered.
The most significant admission from the State was that the Keep Texas Moving ad campaign does have multiple phases (as the documents we presented to the court show that the State tried to deny), and that TxDOT is obligated to hand over any new documents related to any current lobbying or that relate to spending public money to promote toll roads.

“That’s HUGE! We went from a sworn affidavit saying the ad campaign is over therefore the case is moot, to an admission the campaign has multiple phases and is ongoing. We believe TxDOT is in the midst of rolling out Phase II or III of the Keep Texas Moving campaign since the public hearings for Trans Texas Corridor (TTC) 69 project start in February and are the target for the next phase of the campaign. The State admitted it MUST turn over any current information related to these allegations. It keeps the case alive and means we have a real shot at stopping the use of taxpayer money to promote the TTC!” Hall predicts.

The Attorney General Counsel representing TxDOT, Kristina Silcocks, tried to attack the merits of the case once again stating there is no ongoing lobbying of Congress and argued the Forward Momentum report sent to Congress in January that asks for legislation to allow them to buy back and toll existing interstates is in the past and cannot be explored in this lawsuit.

“Once again, TxDOT is wrong. An appropriations bill before the President RIGHT NOW includes an amendment PROHIBITING TxDOT from buying back interstates. There is CURRENT legislation pending as a direct result of TxDOT’s lobbying (in this case, as a backlash to TxDOT’s lobbying efforts). So for the State to tell the court TxDOT isn’t currently engaged in efforts to effect the outcome of legislation or support for toll roads, they’re quite mistaken,” notes Hall.

This lawsuit is brought pursuant to § 37, Texas Civil Practice and Remedies Code. TxDOT’s expenditure of public funds for the Keep Texas Moving campaign is illegal, and an injunction prohibiting any further illegal expenditures in this regard.
TxDOT has violated § 556.004 of the Texas Government Code by directing the expenditure of public funds for political advocacy in support of toll roads and the Trans Texas Corridor, and have directly lobbied the United States Congress in favor of additional toll road programs as evidenced in its report, Forward Momentum as well as the Texas Legislature when it tried to defeat HB 1892, a private equity toll moratorium bill.

October 18, 2007, Judge Naranjo granted TURF a 90 day continuance and allowed them to move to discovery and take depositions. On Monday, September 24, Judge Naranjo did not grant a temporary restraining order (TRO). TxDOT unearthed a law that says they can advertise toll roads (Sec 228.004 of Transportation Code) and the citizens invoked another that says they can’t (Chapter 556, Texas Government Code). The burden to obtain a TRO is higher than for an injunction.

“TxDOT is waging a one-sided political ad campaign designed to sway public opinion in favor of the policy that puts money in TxDOT’s own coffers. School Boards cannot lobby in favor of their own bond elections, and yet TxDOT cites its own special law to line their own pockets at taxpayers’ expense,” says Terri Hall, Founder/Director of TURF.

Hall also notes that TxDOT’s campaign goes beyond mere advertising, “It’s propaganda and in some cases, the ads blatantly lie to the public! In one radio ad (scroll down to radio ad “continuing maintenance”), it claims it’s not signing contracts with non-compete agreements in them and yet last March TxDOT inked a deal with Cintra-Zachry for SH 130 that had a non-compete clause (which either prohibits or financially punishes the State for building competing infrastructure with a toll road).”

On August 22, 2007, TURF filed a formal complaint with Travis County District Attorney Ronnie Earle to investigate TxDOT’s illegal lobbying and asked him to prosecute TxDOT for criminal wrongdoing. See the formal complaint . The petition seeks immediate injunctive relief in a civil proceeding.

Read about TURF’s victory in court October 18 and
read TURF’s amended petition and supplemental affidavits go here: (Scroll to the bottom for links to the petition and affidavits)

Perry signs legislation to halt private toll roads

But the moratorium excludes virtually all North Texas projects
By CHRISTY HOPPE and JAKE BATSELL - The Dallas Morning News - Monday, June 11, 2007

AUSTIN – Gov. Rick Perry signed a new transportation law (SB792) Monday that
eases some of the fears over runaway toll roads and gives local
authorities more control over road projects.

The bill was a compromise hammered out in the final days of the
legislative session between the governor, who has championed private
toll roads as a way to quickly build highways without raising taxes, and
lawmakers, who have felt the wrath of rural landowners and skeptical
urban commuters.

Legislators revisited a 2003 law that many felt had hidden consequences,
such as allowing private firms to take over large swaths of the state
highway system, stripping property owners of their land and discouraging
public entities from competing for toll projects."Texas was becoming the test tube for private equity plans," said Rep.

Lois Kolkhorst, R-Brenham, who pushed for a two-year moratorium on
private toll deals.

Lawmakers initially – and overwhelmingly – passed a bill that would have
placed more restrictions on the governor's efforts to privatize roads.

Mr. Perry vetoed that bill.

The bill he signed Monday has a partial moratorium in place. But the
two-year freeze was dubbed the "Swiss cheese moratorium" because it's
riddled with exemptions, including virtually all North Texas toll roads
already in the works.

"I am proud to sign this legislation because it will help Texas build
the roads we need to manage our state's tremendous population growth,"
Mr. Perry said.

The bill halts at least one project in San Antonio. And Texas
Transportation Commission members have said the moratorium, despite all
its exemptions, still sends a chilling effect to private investors.

"A seemingly innocuous moratorium is, in effect, a freezing of the
entire program," said Ric Williamson, the commission's chairman, in an
earlier interview.

Mr. Williamson acknowledged that the past five months were humbling for
the Transportation Department.

Lawmakers repeatedly criticized what they described as the agency's (TxDOT)
rogue and arrogant tactics in awarding toll road deals."The whole process has been inalterably changed," he said. "We know
clearly what [lawmakers'] concerns are, what they want us to do, what
they don't want us to do. And we will change our behavior accordingly."

The bill gives local entities such as the North Texas Tollway Authority
the first option to build toll projects, limits private toll contracts
to 50 years and establishes a new process to determine a road's market
value.
On Thursday, transportation commissioners will consider a list of
possible projects to develop under the new legislation, which takes
effect immediately.
...
As lawmakers sought to curb private toll roads, they also thwarted bids
to raise the state gas tax to keep up with inflation and to expand
transit systems through voter-approved sales-tax hikes. They even toyed
with suspending the gas tax for the summer.
...
"What people seem to forget in this whole debate about roads is that the
citizens always pay for the roads," said Sen. Robert Nichols,
R-Jacksonville, a former transportation commissioner and a leading
backer of the moratorium. "The question is, how do you want to collect
the money?"

Read more

Lobbyist describes status of toll roads

by LAUREN THOMPSON - Longview News-Journal - Friday, June 08, 2007

Hank Gilbert was not impressed with the 80th meeting of the Texas Legislature.

Gilbert, a former candidate for agriculture commissioner and Democratic anti-toll road lobbyist, offered his opinions and reported on his efforts, specifically on bills concerning the toll roads, at the Texas Democratic Women of Gregg County's monthly meeting Thursday.

"The 80th session probably had some high points," he said of the Democrats' progress. "But I didn't see them; except the raising of the minimum wage to $7.25, which won't go into effect for another two years."

Gilbert spoke in detail about Texas House Bill 1892, a piece of toll-road legislation putting a two-year moratorium on all toll-road projects.

"They said, 'Hey, let's stop where we are, study the vitality of these roads and make a decision from there,'" he said.

The bill was approved by the House and the Senate with a combined vote of 166-5. Gov. Rick Perry promised to veto the bill, prompting the Senate to compromise with Senate Bill 792. This new edition added amendments protecting certain roads and businesses from the two-year moratorium, including the development of Interstate 69, as it would hinder the economic development of the Rio Grande Valley. Interstate 69 is expected to extend from Northeast Texas to Mexico.

He said he saw this compromise as big business deliberately infringing upon smaller towns' rights, which will be affected if the Trans-Texas Corridor continues adding highways through small towns.

The Trans-Texas Corridor is a 4,000 mile plan of tollways, according to texastollparty.com.

"We have to work together to campaign against the legislators down in Austin who aren't there to represent their people regardless of their political party," he said.

Read more

"I guess they can overrun us."

Planners bypass Frisco's toll-road objections
This article is being posted again in a prominent place because it highlight how the RTC, and Tarrant County Judge Glen Whitley ignores the will of the people.
GORDON DICKSON - Fort Worth Star-Telegram - Thursday, April 13, 2006

ARLINGTON- North Texas leaders often say they put the good of the region above local desires. On Thursday, that was put to the test.

The Regional Transportation Council, the area's official planning body, agreed to pursue a toll road on Texas 121 in Collin County -- and potentially many other future toll roads in Tarrant and other counties-- over the objection of elected leaders in Frisco.

The RTC also agreed to allow pricing on toll roads to vary by time of day, reaching up to 17 cents per mile during rush hour beginning in 2010. Today's Dallas-area toll rate is a flat 10 cents a mile.

The approval, on a voice vote --with at least three of the RTC's 40 members opposed--was a notable break with tradition. When development decisions are made in North Texas, it's not uncommon for politicians to grant veto power to a city or county directly affected by a project. Not this time.

"We left here with the reaction that the region is the No. 1 priority for the RTC," Tarrant County Commissioner Glen Whitley said.

Frisco Mayor Michael Simpson had a different take.

"I guess they can overrun us," he said after the meeting at the Arlington Convention Center. "I'm not happy about it."

Simpson said he calculated that if the 17-cent maximum was applied to Texas 121, a typical commuter using the road during peak morning or afternoon traffic would spend about $1,100 a year on tolls.
"We want a toll low enough that people are willing to pay," he said. "I hope it doesn't kick traffic onto the streets of McKinney, Allen and Frisco."

Last week, the Frisco City Council withdrew its support for the proposed toll road roughly from the Dallas North Tollway to McKinney.

Frisco originally supported the toll road, on the condition that tolls be kept as low as possible. But other North Texas leaders and the Texas Department of Transportation wanted to seek bids from private companies, to see whether the toll road could generate a large cash payment up front.

All Thursday's action really does is set up a competition for the Texas 121 Collin County toll road project between the tollway authority and any private bidders.

The state transportation department could select a winner by November.

Whether Frisco likes it or not.

© 2006 Fort Worth Star-Telegram: www.dfw.com

RTC ignores people's will in establishing transportation policy
By Faith Chatham - June 6, 2007
On June 4th the NCTCOG staff was asked at the media briefing if they surveyed the public or asked the people whether they wanted to pay for other projects with surplus toll revenue before the RTC adopted the policy of expanding existing highways and building most new freeways as tolled roads with rates set high enough to generate surplus toll revenue to spend on other projects. Mike Morris and Lara Rodriguez stated that "We held 20 meeting last year between Feb. and April and they were well attended. We discussed CDAs, toll rates and surveyed attendees. They were held along the SH 183 corridor, the SH 121 corridor and the SH 161 corridor." THey said that about 161 people attended and they surveyed a few additional people.

Lara sent the survey to DFW Regional Concerned Citizens.
They surveyed 214 people. There are 6.5 million people in the NCTCOG Region.
Not all citizens in all counties were given opportunity to take the survey. Random samples were not taken from different parts of the metroplex attempting to get a sampling of various income groups, ethnic groups, and ages groups (young adult to senior citizen). Most of the questions pertain to SH 121.

No question on the survey asks if the citizen prefers having toll rates set higher than necessary to maintain the roads and retire the debt so that surplus toll revenue can be generated to fund other projects.

The RTC appears to have ignored the preferences of the majority of the respondents to the survey. The policies adopted.

QUESTION: If the CDA anticipates toll revenue greater than the anticipated cost, do we request revenue up front or over time. 97 said OVER TIME.l 17 UP FRONT; 27 LOCAL DECISION. The RTC adopted a policy requiring PRIVATE and PUBLIC toll companies to pay substantial up-front concession payments to acquire and operate toll projects in the region.

QUESTION: The RTC should take into account the number of toll roads in a specific area before setting toll rates? 171 yes; 26 no.
They did not ask any question about how many roads citizens thought should be tolled, about the ratio of non tolled to tolled major highway miles in a county or district. There is no question asking if the citizens think 675 miles of additional toll lanes to existing highways and new toll roads is appropriate for this region.

QUESTION: What should the 2010 toll rate be for SH 121? NO TOLL -28; .09 cents per mile - 17; .10 cents per mile - 17; to NTTA max .12 cents per mile - 121; .14 cents per mile - 1; .15 cents pr mile - 20; .25 cents per mile - 2.

QUESTION: How should the toll rate grow over time? 108 of the 188 respondents answered NO MORE THAN 1.5% per year- no growth increase in 5 year increments as operating and maintenance costs increase. The RTC adopted a plan which escalates every 2-3 years at rates substantially higher than the maximum 1.5% per year favored by the citizens surveyed. Also the rates will escalate upward based on Consumer price index and inflation and other factors.

QUESTION: Should there be a Comprehensive Development Agreement CDA in Collin County?
The majority (141) of the citizens said NO! Only 41 answered yes. The RTC and TXDOT initially selected Cintra and announced plans to sign a CDA with the Spanish-based firm. When the Texas Legislature stipulated that public toll authorities in a region were to be given right of first refusal members of the RTC objected. Judge Glen Whitley at the March 2007 RTC meeting exclaimed: "Why ever would we award the NTTA a contract? They'll have to meet the up-front concession payments offered by Cintra or I know I won't vote for it!"

QUESTION: Should we have a differential toll rate for peak and off peak conditions?
The majority (171) said NO. Only 41 said yes. Both the NTTA and Cintra bids are based on different toll rates for different times of day. The RTC ignored the preference of the people.

Ignoring the preference of the people is a pattern with the RTC and TxDOT.
They adopted policues which will require citizens to pay tolls for 50 years, at rates higher than necessary to construct and maintain the roads, without giving the 6.5 million citizens in the region opportunity to address the questions.
They ignored the peference of the 180-214 respondents to their survey.
They refused to evaluate their plan after hundreds of citizens showed up at EVERY TTC hearing held by TxDOT in the region during the summer following the RTCS series of meetings.

Citizens yelled and protested eminent domain for private developlment, toll roads instead of highways paid for by gas tax and bond money, 50 year contract and CDAs with Cintra, a Spanish company.

The will of the people was unmistakable.

The RTC and TXDOT and most local leaders chose to ignore the people and push through policy which will require the citizens in this region to depend upon toll roads for 50 years and to pay higher tolls than is necessary to build the roads and retire the debt and maintain the infastructure.

The RTC lobbied the State Legislature to exempt this region from the 2 year moratorium on toll roads. The rest of the rest of the state will benefit from a re-evaluation of CDAs before commitments are made on 50 year contracts in their region. It is possibe that the State Legislature will fix some of the problems with Transporatation financing (such as a need to index the gasoline tax to keep up with inflation) and enable Texans to again have roads built with tax money instead of toll money. This region may be left having to pay higher gasoline tax and having to pay high tolls to drive on Texas state highways in this region.

The RTC and local officials have failed to be responsive to the economic welfare of the residents of this region. They appear to place greater priority on moving freight and speak more about "economic growth" than they do on creating systems that efficiently move people at affordable rates.

Their plan contains too many miles of toll roads for one region. They have modeled much of the additional capacity after a toll road in Orange County, CA which has proven to be a dismal failure. Begun as a private public partnership, the rates and management of the road irritated (infuriated) citizens so much that the state bought back the toll road from the private partners at a very high cost to the taxpayers. During rush hour the toll lanes are nearly empty while the not tolled lanes are so congested that traffic hardly moves. They have dedicated valuable real estate to under utilized toll lanes. If all lanes were non-tolled, they could equalize traffic among the lanes and everyone would have a better opportunity to get to their destination in a reasonable time. Because of creative funding strategies, the citizens in that region are poorly served.

It is unfortunate that regional transportation planner have chosen to model much of this regions proposed transportation projects after a project with is neither a success nor an improvement.

RTC Fails to Comply with Federal SAFTEA-LU Public Participation Law

Message sent to Cynthia White, Chair of the NCTCOG RTC on May 29, 2007 by Faith Chatham

Is the RTC deliberately attempting to minimize participation and to violate SAFTE-LU and its own Public Participation Plan? By scheduling only 3 hearings on Revisions to the TIP and Funding, RTC fails to implement its PPP. The RTC has betrayed the trust of the people by shutting most of the citizens of this area out from these hearings. Three sites in a 12,800 sq. mi. area is insufficient access for citizens from all over the region. It is appalling that transportation planners selected these times and sites!

Hearings after work should be scheduled on Transit Lines in both Dallas and Fort Worth. There should be well-publicized shuttle service from Centerport Trinity Rail to the NCTCOG office for the Arlington meeting. To "PROACTIVELY SEEK PUBLIC PARTICIPATION" you must communicate with the GENERAL PUBLIC Requiring the public to drive to adjoining counties for public hearings eliminates economically challenged and infirm people from the process.

There has been no coverage in the main stream media. Sending 6000 postcards (mainly to elected officials, planners and contractors) is insufficient to communicate with 6.5 million citizens. Burying meeting notices 3 tiers down on your website does not give public meetings visibility. To rectify this situation, I urge you to BLITZ the main stream media to publicize these hearings, announcing additional meeting sites and times. Tell the public HOW the TIP and FUNDING directly impacts them.

More sites and times are necessary to accommodate transportation deprived, handicapped, economically challenged and working citizens throughout the region. Failing to schedule meetings after work in Tarrant, Dallas and Denton counties is unacceptable!