By Fox4 - VMYFOXDFW.COM - July 22, 2010
AUSTIN, Texas - A government watchdog group is filing a complaint against GOP Gov. Rick Perry's campaign for failing to disclose how it spends money at the governor's mansion and at his interim residence.
Since 2001, Perry's campaign has spent more than $800,000 on "mansion expenditures."
Texans for Public Justice said in a complaint Tuesday that Perry's campaign violated disclosure laws by failing to itemize the spending.
Records obtained this year by The Associated Press show Perry has used campaign money to throw parties, buy food and drink, and pay for cable TV and other services at his official residence.
Perry and his wife, Anita, were in a rental property in 2008 when an arsonist set fire to the under-renovation governor's mansion. Nobody has been arrested. The Perrys are still in a rental house.
Showing posts with label Rick Perry. Show all posts
Showing posts with label Rick Perry. Show all posts
Wednesday, June 23, 2010
Thursday, May 13, 2010
Diversions continue cheating and misinforming taxpayers
By Faith Chatham - DFWRC - May 13, 2010
DFWRCC consistently opposes diversions from dedicated funds and refusal of the Legislature to appropriate of full amount dedicated to specific sectors of the state budget when there are appropriate needs for such services. Slush funds do not benefit the citizens or the Governor to veto scuh appropriations.
Some examples of costs to the citizens from such diversions include:
- Toll Roads costing citizens more to travel per mile than on non-tolled roads while part of the premises for "justification" of financing by tolls is based on lack of funds. Transportation dollars have been spent on advertising, lobbying, travel for promotion of other departments, and transfers into the General Fund in years when the General Fund showed a surplus (violating the balanced budget laws of the state).
- Lack of funding for services by departments and non-profit organizations participating in the vanity license plate program. Organizations ranging from animal spay and neutering to state parks and children's groups such as the Boy Scouts were hindered in their mission by the refusal of the state to appropriate and release funds to them collected by the state through the vanity license plate program where individuals elected to pay additional dollars to the state in behalf of those departments or non-profit organizations. During the Rick Perry Administration this practice, in our opinion, has misled the public and defrauded citizens of dollars they were led to believe they were contributing to specific purposes. If private citizens conducted business in the same manner, they would be subject to arrest for fraud. The Legislature has acted to end some of these diversions but corrective action does not erase the dishonest actions of the Governor and many in the Legislature.
- The State Park budget has been a political field of misrepresentation, misappropriation and under-appropriation while maintenance and services suffered.
- During a period when the number of oil and gas production sites, storage sites and pipeline construction sites and miles of pipeline to be inspected and enforced by the Railroad Commission and TCEQ increased by 300% the number of inspectors and budget for staffing has consistently been reduced for the past decade. Currently fines and fees paid by the industry to these agencies goes into the General Fund instead of being paid to adequately fund field inspections and air quality and water quality testing/monitoring by these agencies. It is dishonest to show a "surplus" in the General Fund when funds paid for specific purposes are not spent to adequately protect the citizens of Texas.
- Employment Insurance Fund:
DFWRCC consistently opposes diversions from dedicated funds and refusal of the Legislature to appropriate of full amount dedicated to specific sectors of the state budget when there are appropriate needs for such services. Slush funds do not benefit the citizens or the Governor to veto scuh appropriations.
Some examples of costs to the citizens from such diversions include:
- Toll Roads costing citizens more to travel per mile than on non-tolled roads while part of the premises for "justification" of financing by tolls is based on lack of funds. Transportation dollars have been spent on advertising, lobbying, travel for promotion of other departments, and transfers into the General Fund in years when the General Fund showed a surplus (violating the balanced budget laws of the state).
- Lack of funding for services by departments and non-profit organizations participating in the vanity license plate program. Organizations ranging from animal spay and neutering to state parks and children's groups such as the Boy Scouts were hindered in their mission by the refusal of the state to appropriate and release funds to them collected by the state through the vanity license plate program where individuals elected to pay additional dollars to the state in behalf of those departments or non-profit organizations. During the Rick Perry Administration this practice, in our opinion, has misled the public and defrauded citizens of dollars they were led to believe they were contributing to specific purposes. If private citizens conducted business in the same manner, they would be subject to arrest for fraud. The Legislature has acted to end some of these diversions but corrective action does not erase the dishonest actions of the Governor and many in the Legislature.
- The State Park budget has been a political field of misrepresentation, misappropriation and under-appropriation while maintenance and services suffered.
- During a period when the number of oil and gas production sites, storage sites and pipeline construction sites and miles of pipeline to be inspected and enforced by the Railroad Commission and TCEQ increased by 300% the number of inspectors and budget for staffing has consistently been reduced for the past decade. Currently fines and fees paid by the industry to these agencies goes into the General Fund instead of being paid to adequately fund field inspections and air quality and water quality testing/monitoring by these agencies. It is dishonest to show a "surplus" in the General Fund when funds paid for specific purposes are not spent to adequately protect the citizens of Texas.
- Employment Insurance Fund:
Below is a post from Bill White about how Rick Perry diverted payroll taxes into his Texas Enterprise Fund and failed to plan ahead for the Unemployment Insurance Trust Fund. His actions resulted in a massive tax increase on small businesses, the engine of job growth in our state.
Download this white paper, How do payroll taxes and the Texas Enterprise Fund work?, to learn more about payroll taxes, Rick Perry's slush fund, and what can be done about the problem.
Job growth in the private sector, especially in small businesses, is the key to economic recovery. Yet this year Texas nearly doubled the payroll taxes on our businesses. This massive tax increase on Texas jobs was caused in part by the diversion of $161.5 million which Gov. Perry used to subsidize companies he selected and publicized at numerous press conferences.
A sharp increase in payroll taxes hurts job growth.
Employers know better how to manage job growth than a politician does. You can see that from the track record of the Enterprise Fund. Failed subprime lenders Countrywide and Washington Mutual received $35 million. Another $35 million was paid to struggling biotech firm Lexicon Genetics, so it could give mouse stem cells to a non-profit affiliated with Texas A&M. Rick Perry announced this project would create 5,000 new jobs. Instead of adding jobs, Lexicon laid off much of its workforce, and lost more than $500 million.
Before the Perry Administration, all payroll taxes were used to fund the Unemployment Insurance Trust Fund and workforce development activities. The Trust Fund is now empty. More than $52 million was diverted from payroll taxes last year alone, when demands on the Trust Fund were rising. Almost every month, these tax dollars are given to various favored companies, including some associated with Perry's campaign contributors. Meanwhile, Perry will have borrowed more than $2 billion from the federal government to plug its holes, without a plan for paying it back.
Three simple reforms can help avoid further hikes in state payroll taxes, establish public accountability and avoid this type of tax increase during a recession in the future.
Restore diverted funds. The Enterprise Fund should pay into the Unemployment Insurance Trust Fund the full $161.5 million diverted from Texas' payroll taxes. The governor previously vetoed a bipartisan bill to limit these diversions, but there is no excuse for keeping this money in the TEF now that the Unemployment Fund is broke. When these funds are returned to the Trust Fund, all employers will benefit from the reduced tax burden and the employers--not a politician--can decide how best to allocate payroll dollars to strengthen business and expand employment.
Audit the Enterprise Fund. There should be an independent audit of tax dollars used for subsidies. The auditors should report on: (1) whether the Governor conducted sufficient and independent analysis of each application before awarding a subsidy; (2) whether each subsidy recipient fulfilled every promise made; (3) whether these dollars were necessary to accomplish the intended purposes; (4) whether there was any political influence used or lobbyist paid to influence these decisions; and (5) whether the subsidized firms competed with other Texas businesses not receiving a subsidy.
Disclose the plan for repaying borrowed federal stimulus funds. Gov. Perry declined federal grants to strengthen the Unemployment Insurance Trust Fund, but has accepted federal loans under the stimulus legislation. No family or business or governmental entity should borrow money without a plan to repay, but in April the chair of the Texas Workforce Commission did not have a plan in place on how and when to repay these amounts. A repayment plan should be made public immediately.
In prior years Gov. Perry took credit for the beneficial effects of modest decreases in employer payroll taxes. Because of lack of planning during economic growth and the diversion of payroll taxes, payroll taxes have almost doubled for many Texas businesses. Obviously this hurts employment, at a time when the number of Texans unemployed is near a record level. Texas must put all payroll taxes into the Trust Fund to reduce further tax increases, the Legislature must have an independent audit of the use of TEF funds, and taxpayers should not have to wait until after an election to find out how the massive borrowings will be repaid.
Friday, September 11, 2009
Taxpayers get shafted in toll deal with Spanish company
By Terri Hall - San Antonio Transportation Policy Examiner - September 10, 2009
Is there ANY elected official looking out for the taxpayers anymore? So much for taxpayer protections and oversight from Texas Attorney General, Greg Abbott. Even after Abbott held-up several controversial comprehensive development agreements (CDAs, also known as public private partnerships, PPPs) for months declaring them unconstitutional, he recently gave final approval to allow a contract with Spanish toll operator, Cintra, to takeover parts of the LBJ freeway, I-635, in Dallas. The deal will use Dallas Police and Fire Pension System and will charge 75 cents PER MILE to use toll lanes, and even worse, a half a billion in gas taxes will subsidize the deal with Cintra, in a massive DOUBLE TAX scheme.
It's the hefty amount of public money in the deal that caused Abbott to deem it unconstitutional - to have one Legislature bind a future Legislature with its obligations. Wasn't this a major objection to the Wall Street bailouts? Privatizing profits and socializing losses?
Governor Rick Perry, who has grown fond of criticizing Washington, has taken a page out of their playbook and applied it to Texas toll roads. There's a reason these deals are called public private partnerships. The private operators come in and milk the taxpayers by exploiting the government powers of eminent domain and raiding public money to subsidize toll roads that aren't viable otherwise, and they walk away with the profits for a half-century at a time.
CDAs are sweetheart deals that guarantee congestion on free routes through the use of non-compete agreements (which prohibit expanding or building free routes without paying penalties), guarantee 12-19% annual profits, lower the speed limits on surrounding free routes (to drive more traffic to the toll road), and cash-in on taxpayer-backed low interest loans.
The authorization to enter into CDAs expired last week. The grassroots saw to it that such deals were squashed in Perry's special session that attempted re-authorize the contracts that sunset August 31. Many lawmakers took offensive to being called back to Austin for to extend sweetheart deals for private industry.
However, Perry and some sold-out legislators made certain that about a dozen CDAs were excepted out of a moratorium passed in 2007 to allow many CDAs to move forward until 2011, including the LBJ project, I-820 in Tarrant County, Loop 9 in North Texas, the Grand Parkway in Houston area, and both Trans Texas Corridor contracts among others.
As the details of these remaining CDAs are made public, the taxpayers must remain vigilant to require the Attorney General to do his job and protect taxpayers from billions in risky leveraged debt that prices 90% of motorists off our public freeways. The race for the next Governor, Attorney General, and state legislature must keep these CDAs and toll road policies front and center. In every public forum, ask each and every candidate his/her stand on privatized toll roads, the Trans Texas Corridor, and how he/she plans to address transportation funding in the next session.
Read more on San Antonio Policy Examiner
Is there ANY elected official looking out for the taxpayers anymore? So much for taxpayer protections and oversight from Texas Attorney General, Greg Abbott. Even after Abbott held-up several controversial comprehensive development agreements (CDAs, also known as public private partnerships, PPPs) for months declaring them unconstitutional, he recently gave final approval to allow a contract with Spanish toll operator, Cintra, to takeover parts of the LBJ freeway, I-635, in Dallas. The deal will use Dallas Police and Fire Pension System and will charge 75 cents PER MILE to use toll lanes, and even worse, a half a billion in gas taxes will subsidize the deal with Cintra, in a massive DOUBLE TAX scheme.
It's the hefty amount of public money in the deal that caused Abbott to deem it unconstitutional - to have one Legislature bind a future Legislature with its obligations. Wasn't this a major objection to the Wall Street bailouts? Privatizing profits and socializing losses?
Governor Rick Perry, who has grown fond of criticizing Washington, has taken a page out of their playbook and applied it to Texas toll roads. There's a reason these deals are called public private partnerships. The private operators come in and milk the taxpayers by exploiting the government powers of eminent domain and raiding public money to subsidize toll roads that aren't viable otherwise, and they walk away with the profits for a half-century at a time.
CDAs are sweetheart deals that guarantee congestion on free routes through the use of non-compete agreements (which prohibit expanding or building free routes without paying penalties), guarantee 12-19% annual profits, lower the speed limits on surrounding free routes (to drive more traffic to the toll road), and cash-in on taxpayer-backed low interest loans.
The authorization to enter into CDAs expired last week. The grassroots saw to it that such deals were squashed in Perry's special session that attempted re-authorize the contracts that sunset August 31. Many lawmakers took offensive to being called back to Austin for to extend sweetheart deals for private industry.
However, Perry and some sold-out legislators made certain that about a dozen CDAs were excepted out of a moratorium passed in 2007 to allow many CDAs to move forward until 2011, including the LBJ project, I-820 in Tarrant County, Loop 9 in North Texas, the Grand Parkway in Houston area, and both Trans Texas Corridor contracts among others.
As the details of these remaining CDAs are made public, the taxpayers must remain vigilant to require the Attorney General to do his job and protect taxpayers from billions in risky leveraged debt that prices 90% of motorists off our public freeways. The race for the next Governor, Attorney General, and state legislature must keep these CDAs and toll road policies front and center. In every public forum, ask each and every candidate his/her stand on privatized toll roads, the Trans Texas Corridor, and how he/she plans to address transportation funding in the next session.
Read more on San Antonio Policy Examiner
Saturday, July 28, 2007
Critics see excess in Gov. Perry's foreign travel - Aides defend frequent trips in name of trade
By CHRISTY HOPPE - The Dallas Morning News - Saturday, July 28, 2007
AUSTIN – Gov. Rick Perry has crossed the deserts bare, man; breathed the mountain air, man; he's been everywhere – visiting at least 11 foreign countries in the past three years as an emissary for Texas.
Thus far this year, he has spent 18 days in five countries – Qatar, Israel, Turkey, United Arab Emirates and Jordan. The plane fare for him and an aide to Istanbul cost $13,586, a tab picked up by political donors. But taxpayers pay the bills for his Department of Public Safety security detail, which always travels with him. DPS declined to say what that costs, citing security concerns.
Mr. Perry's aides argue that with so many foreign companies doing business in Texas, the governor needs to promote the state for it to stay competitive in a global economy. But his penchant for international travel is unique among Texas governors, and Democrats have criticized the practice as special interest-financed vacations.
And whether on a trade mission or policy retreat or delivering speeches in foreign lands, Mr. Perry has traveled well, generally staying in five-star hotels, flying in private jets or being pampered in business class seats.
For instance, for a 2004 trip to the Bahamas to discuss public education funding with staff, supporters and conservative thinkers such as anti-tax guru Grover Norquist, three of Mr. Perry's political supporters donated the $40,400 in travel costs.
Mr. Perry's 12 international visits have included two to Mexico. A trip to Iraq and Afghanistan was financed largely through the Department of Defense. The rest have been paid for with political contributions and the Texas Economic Development Corp. – a nonprofit organization spearheaded by the governor that solicits and uses corporate donations to promote business in Texas.
International travel is new for Texas governors – Ann Richards went to Mexico for a presidential inauguration, as did George W. Bush. Late in his state term, Mr. Bush traveled to Israel and met with Prime Minister Benjamin Netanyahu, but many saw it as a political gambit to improve the governor's foreign relations résumé before his first presidential campaign. Last month, in his trip to Israel, Mr. Perry met with Prime Minister Ehud Olmert.
When the opportunities arose for Ms. Richards to take official trips out of the country, she turned them down, said former press secretary Bill Cryer.
"It came up once or twice for her to go to one or two exotic places, but she decided to turn it down as too politically unsavory and she knew that people would criticize her for it," Mr. Cryer said.
Former LBJ School of Public Affairs dean Max Sherman, who also served as a state senator and gubernatorial adviser, said international travel could be a pitfall for many politicians.
"My guess is that it is a new day, and you'll probably see governors and mayors doing more things from an international perspective, mainly because of business," he said.
"But politically, many people will not look favorably on it," he added. "They probably feel that there are enough problems here in the state that need to be dealt with, and the governor needs to be here."
Mr. Sherman also said it is often difficult to connect an international trip to real results in-state. And many voters will see it as a steppingstone to either another political office or a lucrative job afterward. Mr. Perry, who has not ruled out running for another term for governor in 2010, has been mentioned as a possible Republican vice presidential candidate or Cabinet secretary or ambassador in a GOP administration.
"Maybe it would lay a foundation for something on a national or global scale, either publicly or privately," Mr. Sherman said. "Showing you've been to hot spots around the world that are going to be major players with the U.S. and Texas would enhance the résumé."
Krista Moody, a spokeswoman for Mr. Perry, said the trips have brought real results for Texas. She pointed to the Toyota plant in San Antonio, a Samsung plant in Austin and the Nokia Corp. headquarters in Irving that are creating high-paying jobs.
"Governor Perry has been unabashedly pursuing economic opportunities throughout the state, throughout the country and over oceans," Ms. Moody said.
"By personally going, he puts a shine on deals by showing that the state's leaders would make a trip to meet with business leaders in different countries to personally make the case for why Texas is one of the best places in the world for them to do business," she said.
Mr. Perry has not been to South Korea, headquarters for Samsung, nor Finland, home to Nokia. He had planned an August 2005 trade trip to Japan, where Toyota is based, but he had to cancel because of a special session on school finance that he called. He instead sent his wife, Anita.
Mr. Perry has touted a weeklong trip to Italy in March 2004 to bring jobs to Texas by meeting with officials from Alenia Aeronautica, which is Vought Aircraft Industries' partner in the development of a new Boeing jet. He also met with oil and gas executives on the trip.
On the Italy trip, the Perrys stayed at the Grand Hotel Parco Dei Principi in Rome and at the Westin Excelsior in Florence, where currently, rooms cost no less than about $500 a night.
Ms. Moody said the governor has been conscientious and saved taxpayers "a tremendous amount of money" by paying for the trips either with political donations from his campaign account or through the Texas Economic Development Corp.A check of other states showed that Mr. Perry has set an aggressive pace for foreign travel. For instance, former New York Gov. George Pataki, over his 12 years in office, went to about 15 countries. And Pennsylvania Gov. Ed Rendell, who has been in office five years, made his first trade mission last month, visiting Spain and England.
In California, Gov. Arnold Schwarzenegger has recently been taking heat for allowing a similar foundation to pay for his international forays.
"Our guy gets criticized," said Schwarzenegger press secretary Aaron McLear.
Over the past three years, Mr. Schwarzenegger has been on 14 international trips – including four to Mexico and one in July 2004 to his home country of Austria, when he was part of the official U.S. delegation to attend the funeral of the Austrian president.
Mr. McLear said the California governor pays for most of his travel out of his personal bank account, while the rest comes from the California State Protocol Foundation, which is closely associated with the California Chamber of Commerce. Mr. Schwarzenegger has donated $8 million of his own money to the foundation.
And one country among the 14 that the former movie star has visited was not on Mr. Schwarzenegger's original itinerary. The governor was in Israel and the king of Jordan, having arranged transportation, asked him to pay a quick visit.
Said Mr. McLear: "His celebrity certainly helps him sell California."
Read more in the Dallas Morning News
AUSTIN – Gov. Rick Perry has crossed the deserts bare, man; breathed the mountain air, man; he's been everywhere – visiting at least 11 foreign countries in the past three years as an emissary for Texas.
Thus far this year, he has spent 18 days in five countries – Qatar, Israel, Turkey, United Arab Emirates and Jordan. The plane fare for him and an aide to Istanbul cost $13,586, a tab picked up by political donors. But taxpayers pay the bills for his Department of Public Safety security detail, which always travels with him. DPS declined to say what that costs, citing security concerns.
Mr. Perry's aides argue that with so many foreign companies doing business in Texas, the governor needs to promote the state for it to stay competitive in a global economy. But his penchant for international travel is unique among Texas governors, and Democrats have criticized the practice as special interest-financed vacations.
And whether on a trade mission or policy retreat or delivering speeches in foreign lands, Mr. Perry has traveled well, generally staying in five-star hotels, flying in private jets or being pampered in business class seats.
For instance, for a 2004 trip to the Bahamas to discuss public education funding with staff, supporters and conservative thinkers such as anti-tax guru Grover Norquist, three of Mr. Perry's political supporters donated the $40,400 in travel costs.
Mr. Perry's 12 international visits have included two to Mexico. A trip to Iraq and Afghanistan was financed largely through the Department of Defense. The rest have been paid for with political contributions and the Texas Economic Development Corp. – a nonprofit organization spearheaded by the governor that solicits and uses corporate donations to promote business in Texas.
International travel is new for Texas governors – Ann Richards went to Mexico for a presidential inauguration, as did George W. Bush. Late in his state term, Mr. Bush traveled to Israel and met with Prime Minister Benjamin Netanyahu, but many saw it as a political gambit to improve the governor's foreign relations résumé before his first presidential campaign. Last month, in his trip to Israel, Mr. Perry met with Prime Minister Ehud Olmert.
When the opportunities arose for Ms. Richards to take official trips out of the country, she turned them down, said former press secretary Bill Cryer.
"It came up once or twice for her to go to one or two exotic places, but she decided to turn it down as too politically unsavory and she knew that people would criticize her for it," Mr. Cryer said.
Former LBJ School of Public Affairs dean Max Sherman, who also served as a state senator and gubernatorial adviser, said international travel could be a pitfall for many politicians.
"My guess is that it is a new day, and you'll probably see governors and mayors doing more things from an international perspective, mainly because of business," he said.
"But politically, many people will not look favorably on it," he added. "They probably feel that there are enough problems here in the state that need to be dealt with, and the governor needs to be here."
Mr. Sherman also said it is often difficult to connect an international trip to real results in-state. And many voters will see it as a steppingstone to either another political office or a lucrative job afterward. Mr. Perry, who has not ruled out running for another term for governor in 2010, has been mentioned as a possible Republican vice presidential candidate or Cabinet secretary or ambassador in a GOP administration.
"Maybe it would lay a foundation for something on a national or global scale, either publicly or privately," Mr. Sherman said. "Showing you've been to hot spots around the world that are going to be major players with the U.S. and Texas would enhance the résumé."
Krista Moody, a spokeswoman for Mr. Perry, said the trips have brought real results for Texas. She pointed to the Toyota plant in San Antonio, a Samsung plant in Austin and the Nokia Corp. headquarters in Irving that are creating high-paying jobs.
"Governor Perry has been unabashedly pursuing economic opportunities throughout the state, throughout the country and over oceans," Ms. Moody said.
"By personally going, he puts a shine on deals by showing that the state's leaders would make a trip to meet with business leaders in different countries to personally make the case for why Texas is one of the best places in the world for them to do business," she said.
Mr. Perry has not been to South Korea, headquarters for Samsung, nor Finland, home to Nokia. He had planned an August 2005 trade trip to Japan, where Toyota is based, but he had to cancel because of a special session on school finance that he called. He instead sent his wife, Anita.
Mr. Perry has touted a weeklong trip to Italy in March 2004 to bring jobs to Texas by meeting with officials from Alenia Aeronautica, which is Vought Aircraft Industries' partner in the development of a new Boeing jet. He also met with oil and gas executives on the trip.
On the Italy trip, the Perrys stayed at the Grand Hotel Parco Dei Principi in Rome and at the Westin Excelsior in Florence, where currently, rooms cost no less than about $500 a night.
Ms. Moody said the governor has been conscientious and saved taxpayers "a tremendous amount of money" by paying for the trips either with political donations from his campaign account or through the Texas Economic Development Corp.A check of other states showed that Mr. Perry has set an aggressive pace for foreign travel. For instance, former New York Gov. George Pataki, over his 12 years in office, went to about 15 countries. And Pennsylvania Gov. Ed Rendell, who has been in office five years, made his first trade mission last month, visiting Spain and England.
In California, Gov. Arnold Schwarzenegger has recently been taking heat for allowing a similar foundation to pay for his international forays.
"Our guy gets criticized," said Schwarzenegger press secretary Aaron McLear.
Over the past three years, Mr. Schwarzenegger has been on 14 international trips – including four to Mexico and one in July 2004 to his home country of Austria, when he was part of the official U.S. delegation to attend the funeral of the Austrian president.
Mr. McLear said the California governor pays for most of his travel out of his personal bank account, while the rest comes from the California State Protocol Foundation, which is closely associated with the California Chamber of Commerce. Mr. Schwarzenegger has donated $8 million of his own money to the foundation.
And one country among the 14 that the former movie star has visited was not on Mr. Schwarzenegger's original itinerary. The governor was in Israel and the king of Jordan, having arranged transportation, asked him to pay a quick visit.
Said Mr. McLear: "His celebrity certainly helps him sell California."
Read more in the Dallas Morning News
Tuesday, July 24, 2007
Double edged sword of private infrastructure financing
By Faith Chatham - July 24, 2007
Crossposted on EPLURIBUS MEDIA
Many lawmakers and local/regional governmental officals erupted in glee at the prospect of transferring financing of public infrastructure projects to private equity partners. The traditional group of public works hogs at the public money bins jumped cartwheels anticipating funding to flow more rapidly out of other pockets into theirs. Governor Rick Perry spent Texan's hard earned tax money to fly to Europe to court potential European and Australian partners. TxDOT repeated the same old lies: "There is no way to finance roads without tolls."
Crossposted on EPLURIBUS MEDIA
Many lawmakers and local/regional governmental officals erupted in glee at the prospect of transferring financing of public infrastructure projects to private equity partners. The traditional group of public works hogs at the public money bins jumped cartwheels anticipating funding to flow more rapidly out of other pockets into theirs. Governor Rick Perry spent Texan's hard earned tax money to fly to Europe to court potential European and Australian partners. TxDOT repeated the same old lies: "There is no way to finance roads without tolls."
To the public CDAs or Private Public Partnerships for toll roads is presented as being financed by private partners. When we look up close and get real personal and examine specific projects however, the facade doesn't hold up to scrunity. For example, Cintra, if awarded SH 121, would have invested about the same amount of money which Texas taxpayers have already invested in the project (state, federal dollars and local governments investment in right of way). The Federal Government would also loan the private partner additional fund and faciliate borrowing of billions of dollars of tax exempt money from other private lenders. A key phrase to note is tax exempt. That is another way of saying that the tax liabilty will be passed from these lenders to the rest of the taxpayers. Taxes never go away when they are "exempted". They are merely passed along to the next guy up (or more probably) down the ladder!
I've made a number of inquiries about these US government faciliated loans which the changes to U.S. Law allows to enable private equity partners to utilize on public works (highway toll roads) projects. I want to fully understand who holds the bag if the project fails and the "borrower" defaults on the loan. What happens if there isn't the anticipated traffic on a toll road? If the U.S. Government faciliates these tax exempt bonds for the private partner (such as Macquarie or Cintra), does the US Government (i.e. U.S. Taxpayer) stand behind the loan as is the case when a bank forecloses on an FHA home loan or a VA home loan or a Federal Guaranteed Student Loan?
I've asked this question to numerous engineers and officials at TxDOT and RTC meetings and to date have yet to have anyone show me in writing where the US Government isn't standing behind these loans. If a private partner is going to make the profit I think the private equity firm should take the risk. However, I am suspicious. There is a rush across the pond to court American lawmakers and acquire toll road deals. Is one of the edges of the sword that somewhere there are clauses buried in those mountains of fineprint and legalize which transfer the risk to the taxpayers?
Examining Australian sources, another edge to the sword emerges. Most of these equity firms are borrowing from retirement funds. The retirement accounts of working men and women and retirees from all over this nation are invested in bonds and stocks. John L. Goldberg, in "The Fatal Flaw in the Financing of Private Road Infrastructure in Australia" wrote a paper last year which analyzes the cash flow of four private public road infrastructure projects in Australia and probability of solvency/insolvency.
Goldman wrote:
The repayment of debt is clearly on the minds of the toll road owners and operators as revealed by the recent release of a draft prospectus for the so-called Sydney Roads Group (Macquarie Infrastructure Group, 2006). This group consists of three existing toll roads, the M4, M5 and Eastern Distributor. The financial arrangements are similar to those of the M2. In February 2009, the debt of the M4, currently at about $57.6 m must be paid. The method of doing this is said to involve the use of reserves and a securitization arrangement (Alles, 1999) involving the M4 and M5. This means that future cash flow receivables and/or the asset value of the M5 is to be used as collateral for a new financial structure for refinancing. It should be noted that the M5 has a debt of $515m which has to be repaid or refinanced by June 2010. But in the final prospectus, serious doubts have now been raised about the ability to repay the debt or refinance it on
favourable terms (MIG, 2006).
He concludes that the private investors are using various public private road projects as collateral for other projects, creating a " financial house of cards". Macquaire and Cintra are partners in many projects around the world and have bid on numerous projects in Texas and the DFW area. They are presented to citizens as private partners who will take the responsiblity for risk from the government and taxpayer in exchange for tolls. Citizens' protest that the cost for tolls is higher than those projected if citizens finance road construction with gas tax and public bond financing the old fashioned traditional way goes are unheeded by lawmakers and transportation policy gurus and state and US DOT bureaucrats.
Goldman analyzed their business methodology in Australia and reported:
The data in the financial models attempt to portray the best possible outcome for the consortiums promoting the projects using for example, unrealistic traffic projections, and creative accounting. Despite this attempt the probability of financial failure has been shown to be 100% in every case, in the sense that cash flow will be insufficient to amortize debt. Not only do the models specify unattainable rates of return to investors but the true financial position of the projects is being masked by financial engineering leading to increased debt out of which equity dividends are being paid. Such an approach is unlikely to be sustainable, but may nevertheless lead institutional investors and others to erroneously believe in the long term outcome portrayed by the promoters.
Why does this matter? It matters because citizens deserve to be able to trust the reliability of financial institutions. It matters because retirement accounts are being invested in bonds to finance private equity firms share of investment in public private partnerships for toll roads (and toll bridges and other infrastructure). If the cards begin to fall, and the toll road private investor public partnership CDA financial house crumbles, then as each card will take down an adjacent investor and that one will take down the next. If the model used to predict traffic, fees, maintenance costs for a 50 year toll road project are faulty and the private equity partner does not get the anticipated return on investment, everyone who loaned money on the project will lose. It is very likely that much of those loans will be held by retirement funds! Ouch! When you lose your retirement account, it is difficult for many people to recoup before they are out of the job market. I know. My 401K account dried up a few years ago when utility. telops stocks switched from reliable investments to swindles!
With retirement account investment in private public infrastructure equity partnership (toll roads) we may see scandals which reek of the hot sultry days of Enron investigations and energy sector manipulation which cost trusting investors and employees their life savings and retirement incomes. As the energy grid spread from state to state, we are watching a network of toll corridors spread throughout the North American continent, attracting international partners who are not totally without controversy in their home countries.
Possible remedies
Protection for retirees who invest in PPP/CDAs presents a classic catch-22. Private partnership who claim to remove the risk from taxpayers on infrastructure projects in return for receiving tolls (retrn on investment) should not have their loans guaranteed by the US Government. That is unfair to taxpayers!
Goldberg pointed out:
Recent statements about the use of securitization as a means of debt amortization are unconvincing. In the event of corporate collapse, and in the absence of government guarantees, the trust/company structure of these projects will be used to claim limited liability for the entire structure. But such a claim may be rejected by a court, leaving investors liable.
That brings me back to my original quest. Are there guarantees written into these volumes of contracts, bills, agreements, which transfers the risk from the private partner to the U.S. taxpayer? If you know where the guarantee is that the US Government will not back the tax exempt bonds they faciliate for private partners in public infrastructure projects, please share that with me. I need to see it in writing and be able to verify the source. There are too many inconsistencies in what transportation engineers and TxDOT and regional transporation policy boys have told me about toll roads, CDAs and the benefit to the public for me to really rely on what they tell me without being able to evaluate it and verify it. This is an instance when if it isn't on paper, published in government documents within the public domain then it is probably more urban legend than reality.
Additional articles on these topics are posted on Grassroots News U Can Use
Friday, July 20, 2007
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.
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
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
Sunday, July 8, 2007
Follow the money - campaign contributions and policy
By Faith Chatham - July 8, 2007
DFW REGIONAL CONCERNED CITIZENS TRACED ZACHRY FAMILY CAMPAIGN CONTRIBUTIONS IN TEXAS and published them during the 2006 State Election Cyle. Sal Costello of The Austin Toll Party published Top Ten Toller's Contributions to Rick Perry last year on THE MUDRAKER.
As a refresher course, we're republishing them here.
January 30, 2006, Sal Costello said...
DFW RCC's research on the financiers behind the Texas Democratic Party was published on Grassroots News U Can Use
Titled: RECLAIMING TEXAS FOR WHOM?
By Faith Chatham - Friday, September 15, 2006
July 31, 2006 on Daily Kos we (DFW RCC bloggers - TXSHARON and FAITH CHATHAM examined the link between Zachry donations to Texas Incumbents and voting patterns). When we tabulated Zachry donations we identified the Zachry donors as:
I haven't cross referenced the folks who are members of the Zachry pac to see how much they have given individually to candidates. When we do that, I'm sure the amount donated by Zachry related folks will go to at least a million in the past 5 1/2 years to Texas officials.
I've only concentrated on Texas rather than Federal officials.
Here's what I was looking for campaign contributions from Zachry Construction, from Zachry family members, Zachary corporations and or their PAC.
We did not identify officers of the Corporation with other surnames. When those are included, the contributions are much higher. Looking at Zachry influence in the process, it was impossible to ignore the generous contributions of Zachry to his alma mater, Texas A&M University.
Texas High Speed Rail Corporation, NASCO CORRIDOR and other non-profit (seeded by generous corporate donors) 501s became the incubator for the "vision" to retool Texas and USA transportation.
We traced how the TTC / CDA proponents used non-profit 501s to sell their vision and push for passage of freight friendly legislation and private public partnerships in Texas infrastructure public works projects:
Texas High Speed Rail Transportation Corporation:
The website describes members as "representing some of Texas' most densely-populated and economically vibrant areas." THSRTC website states: "Our growing membership and their designated representatives include the Cities of
College Station
Hillsboro
Houston
Irving
Killeen
Temple
Also members are:
Brazos County
Dallas County
Harris County
Tarrant County
the Port of Houston Authority
American Airlines
Continental Airlines,
Scott & White Hospital
Texas Southern University and the Texas Transportation Institute (TTI located at Texas A&M) serve as significant resource agencies to THSRTC.
The Bush School of Public Affairs at Texas A & M University recently completed a major Capstone Project for the Corporation.
These players along with Kansas City Southern Railroad de Mexico (owning 100% interest in TFM -Mexico Rail), H.B. Zachry Construction Corporation and Citras (a Spanish Corporation which operates toll roads in Canada) are the major players backing the TTC. There are probably (not proven) strong ties between some of KCS RR's Mexican partners and Cintras.
Since 1992 Kansas Southern has acquired transportation corridor rights, and or rail lines, and or major contracts which gives it major control tracks spanning from both coasts of Southern Mexico through the USA to the Pacific Rim of Canada.
In January 2006 a conference (The Second Annual Southern Central High Speed Rail Symposium) was held at the Hyatt Regency DFW in Dallas. The VP of Kansas City Southern Railroad was the dinner speaker and opened the seminar with a presentation showing the milestones the KCS RR has achieved in reaching their goal: To Concentrate and coordinate investments in capacity, facilities, locomotives to capture long-haul business grown between US, Mexico & Pacific-rim markets. They labeled their slides as "KCS The NAFTA RAILROAD" .
This powerpoint presentation is available on line.
It clearly shows that the REASON FOR THE TTC is to ship goods from Mexico straight though Texas to a terminal/hub in Kansas City Mo to Canada. They include slides showing that "Kansas City Southern has now earned its new name: Kansas City Southern de Mexico."
It shows the importance of the STRAIGHT THROUGH TEXAS line. They are currently shipping through Texas but route up to Bloomington IL and the TTC route would give them a straight shot north instead of winding around. Construction of the TTC rail/toll corridor would allow KCS de Mexico to ship directly from ports in Mexico straight through Texas non-stop to a depot in Kansas City, Missouri.
The first person who alerted me that the plan was to ship through Texas to a hub in Kansas City was Hank Gilbert. He's been up to speed on the TTC for some time. He's been traveling and alerting folks that the purpose of taking all this acreage to build this corridor is not to meet the transportation needs of Texans. It's to cut back on the expenses of entities seeking to ship goods from Mexican ports through Texas to Kansas City, Mo where it will be channeled to to points along Kansas City Southern's distribution network. KCS's goal is to dominate transportation in the US, Mexico and Canada.
In Harris County, Judge Robert Eckles who presides over the Harris County Commissioner's Court is chair of the Texas High Speed Rail Transportation Corporation. http://www.judgeeckels.org/high_speed_rail.asp
We looked at Toller's use of Academic Institutions to promote their reenginnering vision for Texas/USA Transportation:
One particular adcademic institution which was utilized by Zachry was Texas A& M.
In Tarrant, County Commissioner Glen Whitley (County Judge elect), serves as Secretary of the Texas High Speed Rail Transportation Corporation.
In Dallas, Texas Senator John Carona serves as Chairman of the Senate Committee on Transportation and Homeland Security.
From FAST FORWARD, The Monthly Newsletter for the Texas High Speed Rail and Transportation Corporation, March 2006 Newletter:
In February of this year, Senator Carona was appointed Joint Chair of the Study on Transportation Financing by the 79th Legislature. "The members I have appointed are all strong leaders representing diverse parts of the state," Lieutenant Governor Dewhurst aid. "I look forward to working with each of them as we pepare for future transportation funding needs."
The committee will reveiw the state motor fuel tax, the current sources for funding rail transportation projects, adn all other financing options for all modes of transportation. The appointment will give Senator Carona the opportuntiy to influence transportation and homeland security policy throughout the state while ensuring the approach is fair, equitable, and capable of taking Texas safely and securely into the future.
Another Dallas County Leader is Commissioner Maurine Dickey:
THSRTC MILESTONES
The March Issue of Fast Forward lists:
CONGRESSIONAL SUPPORTERS: Senators Hutchinson and Cornyn
House Members: Brady, Burgess, Carter, Cueller, Edwards, Gonzalez, Green, Hall, Jackson Lee, Johnson, Marchant, McCaul, Neugebauer, Ortiz, Poe, Sessions In the January 2006 Issue of Fast Forward:
Several articles -- some rather tongue in cheek were published last year on Grassroots News U Can Use. We expressed concerned over the lack of transparency in the TxDOT bidding process which prevented examination of potential ties between Zachry academic donations and resulting state contracts.
The QUESTION THAT WAS ASKED WAS when does the endowments influence the research outcome? Faith Chatham questioned the impact large corporate donations to academic institutions have on researchers.
By Faith Chatham - Sunday, July 31, 2006 Daily Kos
That same day Faith Chatham pointed out:
TTI does a lot of things , Faith Chatham wrote on Daily Kos on July 30, 2006:
We don't know that there is anything amiss there. However, there is a rule of ETHICS in Government. We are to AVOID the APPEARANCE OF A CONFLICT OF INTEREST. This may merely be that a good thing (endowment) came at the same time that the endower got considered by TTI's major client (TDoT) for the biggest construction project in this century.
We have to have a dialogue in academic and governmental circles to see WHAT IS THE BEST WAY to protect the integrity of the research by institutions who are endowed.
Our assessment:
By Faith Chatham - Daily Kos - July 30, 2006
We hit our basic chord - Ethics and Conflict of Interest:
<
We pointed out:
There's more than one kind of prairie fire
1. Between elected officials and them that "brung 'em to the dance."
1. Aggie Engineers and Aggie Farmers and Ranchers
3. Historians and Legislators
4. Environmentalists and Legislators and Contractors
5. Grassroots Democrats who are looking at turn-coat money grubbing Democrats in office who are voting with big money interests on the TTX and who received donations from Zachry.
6. Grassroots Republicans who are looking at incumbent Republicans who they helped elect who are supporting TTC and who took money from toll road special interests.
7. Local governments and regional transportation planning entities who are endorsing the TTC and local voters who are mad because their officals are endorsing it without listening to the people.
We had devastating grass fires in much of this state which left thousands of acres of farm/ranch land charred. Much of rural Texas was declared a National Disaster. The TTC is the defining insulting swipe at those same peole. When it is an act of nature (or even arson which got further out of hand) it is devastating. However, the TTC is something that governmental officals are deliberately DOING to the Ranchers/Farmers/ homeowners and tax payers of Texas.
"Remember the Alamo" will be mild compared to the battle cry of "REMEMBER TTTC" before this is over.
On Texas Independence Day in March 2007, Hank Gilbert made good on his campaign promise to organize a march on the State Capitol.
TTC and CDAs are the same issue. Thousands of Texans showed up and testified at the Senate Committee on Homeland Security and Transportation TTC Hearing. They brought their tractors, livestock, families and neighbors and rallied on the State Capitol during this two day march on the State Capitol. They spoke out against the TTC land grab and against mandatory animal computer chip ID (NAIS).
Now the battle front has moved from Austin to local and regional governments. Citizens across Texas are monitoring RTC meetings, sitting in on rail relocation meetings at Council of Governments, phoning local elected officials and urging them to be proactive in protecting citizens from land grabs for private development and awarding highway contracts which will cost the citizens much more to use the infrastructure than is necessary.
Diligency, transparency, ethics, and watching who takes the money and how they repay the donors is an ongoing battle. We cannot afford to sleep. Citizens must be informed, weigh the sources of information, and act.
DFW REGIONAL CONCERNED CITIZENS TRACED ZACHRY FAMILY CAMPAIGN CONTRIBUTIONS IN TEXAS and published them during the 2006 State Election Cyle. Sal Costello of The Austin Toll Party published Top Ten Toller's Contributions to Rick Perry last year on THE MUDRAKER.
As a refresher course, we're republishing them here.
January 30, 2006, Sal Costello said...
Texans For Rick Perry: Contributions by employees and PACs of ONLY the top 10 TxDOT Bidders (up to 5/05 - Total $457,500)
7/25/02 Gafford Ronald Austin Industries $1,000
1/4/04 Teufel Carol Bracewell & Patterson $25
6/3/02 Bracewell & Patterson - PAC $10,000
11/4/03 Bracewell & Patterson - PAC $10,000
12/8/04 Bracewell & Patterson - PAC $10,000
6/28/01 Bracewell & Patterson - PAC $5,000
6/28/01 Bracewell & Patterson - PAC $2,000
6/28/01 Bracewell & Patterson - PAC $1,000
10/20/04 Yerby Philip Chiang Patel & Yerby Inc. $750
12/11/02 Yerby Philip Chiang Patel & Yerby Inc. $500
11/5/03 Yerby Philip Chiang Patel & Yerby Inc. $500
6/14/02 Fluor Corporation California Pac $12,500
6/14/02 Fluor Public Affairs Committee $12,500
9/16/04 Sweet Chad Goldman Sachs & Co. $5,000
6/13/02 Sweet Chad Goldman Sachs & Co. $1,000
4/14/04 Sweet Chad Goldman Sachs & Co. $25
3/13/02 Weisman John & Anne Hunter Industries $10,000
3/13/02 Abrams Jon F J.D. Abrams L.P. $5,000
9/3/02 Abrams Jon F J.D. Abrams L.P. $5,000
11/4/04 Abrams Jace J.D. Abrams L.P. $1,000
11/4/04 Abrams Jon F J.D. Abrams L.P. $1,000
12/11/02 Lockwood, Andrews & Newnam, Inc. PAC$1,000
11/5/03 Lockwood, Andrews & Newnam, Inc. PAC $500
10/20/04 Pate Gerry E. Pate Engineers $1,000
12/11/02 Pate Gerry E. Pate Engineers $1,000
11/5/03 Pate Gerry E. Pate Engineers $500
12/11/04 Davis Kenneth Pate Engineers Inc. $500
2/4/04 Thuss Michael Pate Engineers Inc. $500
10/2/01 Royer James Turner Collie & Braden $5,000
10/20/04 Royer James Turner Collie & Braden $1,000
6/13/02 Vinson & Elkins Texas PAC $35,000
11/17/04 Vinson & Elkins Texas Pac $25,000
11/5/03 Vinson & Elkins Texas Pac $25,000
12/12/02 Vinson & Elkins Texas Pac $10,000
10/2/01 Vinson & Elkins Texas Pac $5,000
3/13/02 Webber Wayne W. W. Webber Inc. $2,500
3/24/04 Webber Wayne W. W. Webber Inc. $2,500
5/24/02 Pitcock James D Williams Brothers Construction $35,000
2/15/02 Pitcock James D Williams Brothers Construction $25,000
3/13/02 Pitcock James D Williams Brothers Construction $25,000
5/30/01 Pitcock James D Williams Brothers Construction $25,000
12/13/02 Pitcock James D Williams Brothers Construction $25,000
6/28/04 Pitcock James D Williams Brothers Construction $25,000
6/20/02 Pitcock Roy Williams Brothers Construction $1,500
11/3/03 Zachry H.B. Zachry Construction Company $25,000
9/19/01 Zachry H.B. Zachry Construction Company $10,000
4/6/04 Zachry H.B. Zachry Construction Company $10,000
7/7/04 Zachry H.B. Zachry Construction Company $10,000
10/7/02 Zachry H.B. Zachry Construction Company $5,000
2/27/04 Zachry H.B. Zachry Construction Company $5,000
10/1/01 Zachry John Zachry Construction Company $5,000
9/19/01 Zachry Jamse Zachry Construction Company $2,500
10/29/03 Zachry David Zachry Construction Company $2,200
11/4/03 Zachry James Zachry Construction Company $2,000
9/25/01 Green Cathy Zachry Construction Company $1,000
7/30/01 Zachry H.B. Zachry Construction Company $1,000
11/4/02 Zachry David Zachry Construction Company $1,000
9/19/01 Zachry John Zachry Construction Company $1,000
11/4/03 Zachry John Zachry Construction Company $1,000
11/14/03 Zachry David Zachry Construction Company $1,000
10/7/02 Zachry John Zachry Construction Company $1,000
11/4/03 Zachry Construction Company - PAC$2,500
DFW RCC's research on the financiers behind the Texas Democratic Party was published on Grassroots News U Can Use
Titled: RECLAIMING TEXAS FOR WHOM?
By Faith Chatham - Friday, September 15, 2006
July 31, 2006 on Daily Kos we (DFW RCC bloggers - TXSHARON and FAITH CHATHAM examined the link between Zachry donations to Texas Incumbents and voting patterns). When we tabulated Zachry donations we identified the Zachry donors as:
John
H.B.
H.B. Jr.
David
H.B. Zachry Construction Co.
Tower Life Insurance
Zachry PAC
The Zachry Foundation endowed Texas A&M but I don't think they give money to political candidates.
Maybe this will help.
In 2006, although support of TTC is a strong issue in the Governor and Lt. Governor's races, some of Texas's "downticket Democratic challengers" are the heavy-hitters who are driving home the TTC sword which is proving to be the defining litmus test this year in Texas.
Rick Perry received over $146,000.00 in the past 5 1/2 yaers from Zachry family members, corporations amd PAC. Lt. Governor David Dewhurst accepted $51,000.00 last year from the same donors. Dewhurst was instrumental in smoothing the journey of TTC Toll Road Privatization of Texas Highways legislation through the Senate. Independent Governor Candidate Carole Keeton Stayhorn is assulting Perry's reconrd and support of Toll Roads, and is getting lots of applause from attendees at TxDOT Public Trans Texas Corridor Hearings, yet refuses to return the $13,000.00 she acccepted from Zachry family members and related interests when she ran for her current postion of Comptroller during the last (2004) election cycle.
I haven't cross referenced the folks who are members of the Zachry pac to see how much they have given individually to candidates. When we do that, I'm sure the amount donated by Zachry related folks will go to at least a million in the past 5 1/2 years to Texas officials.
I've only concentrated on Texas rather than Federal officials.
Here's what I was looking for campaign contributions from Zachry Construction, from Zachry family members, Zachary corporations and or their PAC.
We did not identify officers of the Corporation with other surnames. When those are included, the contributions are much higher. Looking at Zachry influence in the process, it was impossible to ignore the generous contributions of Zachry to his alma mater, Texas A&M University.
Texas High Speed Rail Corporation, NASCO CORRIDOR and other non-profit (seeded by generous corporate donors) 501s became the incubator for the "vision" to retool Texas and USA transportation.
I posted this because I've been trying to trace what is the common denominator between the local governmental officials who have been showing up at TTC hearings and bringing signed letters from their city councils and county commissioners endorsing the Trans Texas Corridor "if they incorporate our regional transportation plan." . In Fort Worth we witnessed official after official stand and endorse the TTC with the stipulation that TDOT adopt their local plan. Mayor Mike Moncrief, City of Fort Worth, Kathryn Wilomon representing the City of Arlington, Glen Whitley, Tarrant County Commissioner and County Judge elect who serves as Secretary of the THSRTC were joined by repesentatives from the City of North Richland Hills and others. Citizens were appalled to hear their local elected officials endorse the TTC. There is obviously a VAST DIVIDE between where many of the local officials are and where the people are on this issue. (Note: In Tarrant County representatives for State Rep. Mark Veasey and State Rep. Lon Burnam spoke in opposition to the TTC).
So what was the vehicle(s) which brought these local governmental leaders together?
It appears that participation in local RMA's and in organizations such as the THSRTC and seminars such as the Second Annual Southern Central High Speed Rail Symposium at DFW Hyatt Regency in January 2006 {and NASCO CORRIDOR) seems to be the common meeting ground for many of the local government reps who endorsed the TTC "with the recommendation that TDOT adopt the transportation corridors of the local planners."
In Dallas, there was less unity among local leaders in endorsing the TTC than in Tarrant County.
We traced how the TTC / CDA proponents used non-profit 501s to sell their vision and push for passage of freight friendly legislation and private public partnerships in Texas infrastructure public works projects:
Texas High Speed Rail Transportation Corporation:
The website describes members as "representing some of Texas' most densely-populated and economically vibrant areas." THSRTC website states: "Our growing membership and their designated representatives include the Cities of
College Station
Hillsboro
Houston
Irving
Killeen
Temple
Also members are:
Brazos County
Dallas County
Harris County
Tarrant County
the Port of Houston Authority
American Airlines
Continental Airlines,
Scott & White Hospital
Texas Southern University and the Texas Transportation Institute (TTI located at Texas A&M) serve as significant resource agencies to THSRTC.
The Bush School of Public Affairs at Texas A & M University recently completed a major Capstone Project for the Corporation.
These players along with Kansas City Southern Railroad de Mexico (owning 100% interest in TFM -Mexico Rail), H.B. Zachry Construction Corporation and Citras (a Spanish Corporation which operates toll roads in Canada) are the major players backing the TTC. There are probably (not proven) strong ties between some of KCS RR's Mexican partners and Cintras.
Since 1992 Kansas Southern has acquired transportation corridor rights, and or rail lines, and or major contracts which gives it major control tracks spanning from both coasts of Southern Mexico through the USA to the Pacific Rim of Canada.
In January 2006 a conference (The Second Annual Southern Central High Speed Rail Symposium) was held at the Hyatt Regency DFW in Dallas. The VP of Kansas City Southern Railroad was the dinner speaker and opened the seminar with a presentation showing the milestones the KCS RR has achieved in reaching their goal: To Concentrate and coordinate investments in capacity, facilities, locomotives to capture long-haul business grown between US, Mexico & Pacific-rim markets. They labeled their slides as "KCS The NAFTA RAILROAD" .
This powerpoint presentation is available on line.
It clearly shows that the REASON FOR THE TTC is to ship goods from Mexico straight though Texas to a terminal/hub in Kansas City Mo to Canada. They include slides showing that "Kansas City Southern has now earned its new name: Kansas City Southern de Mexico."
It shows the importance of the STRAIGHT THROUGH TEXAS line. They are currently shipping through Texas but route up to Bloomington IL and the TTC route would give them a straight shot north instead of winding around. Construction of the TTC rail/toll corridor would allow KCS de Mexico to ship directly from ports in Mexico straight through Texas non-stop to a depot in Kansas City, Missouri.
The first person who alerted me that the plan was to ship through Texas to a hub in Kansas City was Hank Gilbert. He's been up to speed on the TTC for some time. He's been traveling and alerting folks that the purpose of taking all this acreage to build this corridor is not to meet the transportation needs of Texans. It's to cut back on the expenses of entities seeking to ship goods from Mexican ports through Texas to Kansas City, Mo where it will be channeled to to points along Kansas City Southern's distribution network. KCS's goal is to dominate transportation in the US, Mexico and Canada.
In Harris County, Judge Robert Eckles who presides over the Harris County Commissioner's Court is chair of the Texas High Speed Rail Transportation Corporation. http://www.judgeeckels.org/high_speed_rail.asp
We looked at Toller's use of Academic Institutions to promote their reenginnering vision for Texas/USA Transportation:
One particular adcademic institution which was utilized by Zachry was Texas A& M.
In Tarrant, County Commissioner Glen Whitley (County Judge elect), serves as Secretary of the Texas High Speed Rail Transportation Corporation.
In Dallas, Texas Senator John Carona serves as Chairman of the Senate Committee on Transportation and Homeland Security.
From FAST FORWARD, The Monthly Newsletter for the Texas High Speed Rail and Transportation Corporation, March 2006 Newletter:
In February of this year, Senator Carona was appointed Joint Chair of the Study on Transportation Financing by the 79th Legislature. "The members I have appointed are all strong leaders representing diverse parts of the state," Lieutenant Governor Dewhurst aid. "I look forward to working with each of them as we pepare for future transportation funding needs."
The committee will reveiw the state motor fuel tax, the current sources for funding rail transportation projects, adn all other financing options for all modes of transportation. The appointment will give Senator Carona the opportuntiy to influence transportation and homeland security policy throughout the state while ensuring the approach is fair, equitable, and capable of taking Texas safely and securely into the future.
Another Dallas County Leader is Commissioner Maurine Dickey:
From the same issue of Fast Forward:
Dallas County Commissioner Maurine Dickey is a pr-active voice and member of the Texas High Speed Rail Transportation Corporation."
THSRTC MILESTONES
2002: THSRTC was created and officially incorporated by Secretary of State Gwen Shea, with Harris County, College Station, Houston and the Port of Houston as its founding members. By the end of the year the Corporation alerady had one new member, the City of Killeen. IN addition, the Corporation quickly earned the support of the Garrision Commander at Fort Hood, the largest military installation in the United States.
2003: Cities and counties continued joining THSRTC.
..Following the first executive committee meeting, a letter requesting an extension of the South Central Corridor in the reauthorization of TEA-21 was signed. A few months later TxDOT Executive Director Michael Behrens submitted an application for the extension of the South Central Corridor to USDOT Secretary Norman Mineta. A second executive committee meeting took place at the 6th Annual Texas Transportation Summit in Irving. Shortly thereafter a letter was submitted to USDOT Secretary Norman Mineta requesting the selection of the Texas T-Bone as the model for high-speed rail.
2004: 2004 was a great yaer for the Texas High Speed Rial and Transportation Corporation: the Texas T-Bone received key endorsements from the Dallas Morning News and Fort Worth Star Telegram and the U.S. House of Representatives' TEA-LU bill included the extension of the South Central Corridor. By the end of the yar the Corporation passed a resolution allowing universities to join at half the membership cost.
2005: As THSRTC and the Texas T-Bone gained recognition, several educatational institutions offered to conduct research on several high-speed rail related aspects including demographic and environmental impact studies and public policy issues. The list of resource agencies assisting THSRTC includes the George Bush School of Public Policy at A&M University, the Barbara Jordan-Mickey Leland School of Public Affairs at Texas Southern University and the Texas Transportation Institute. 2005 also saw the additon of several new members including Scott & White Hospital and the City of Hillsboro.
2006: 2006 has had an excellent start for THSRTC. The Corporation's Quarterly Meeting on February 17 at Hill College in Hillsboro was a tremendous success with over 50 attendees including 100% of THSRTC membership, representatives from U.S> Congressman Chet Edwards, Texas Senator Kip Averitt and Texas House Representative Jim Pitts. In addition, DFW Airport, Baylor University, HOTCOG, and many others were present. A fact finding mission to France to see the... TGV system is also in the works for Summer 2006.
The March Issue of Fast Forward lists:
CONGRESSIONAL SUPPORTERS: Senators Hutchinson and Cornyn
House Members: Brady, Burgess, Carter, Cueller, Edwards, Gonzalez, Green, Hall, Jackson Lee, Johnson, Marchant, McCaul, Neugebauer, Ortiz, Poe, Sessions In the January 2006 Issue of Fast Forward:
Profile: United States Congressman Henry Cueller
Representing the people of the 28th Congressional District of Texas since November 2004, Congressman Cuellar is a strong supporter of transportation improvements and high-speed rial in Texas. Durng his short time in the U.S. House of Representatives, Congressman Cuellar has already been able to secure $14 million dollars of transportation projects for his district, which goes from San Marcos all the way down to Laredo.
As a U.S. representative, Congressman Cuellar has been remarkably successful in advancing several amendments to new legislation that will protect individual property rights adn will increase security, technology and manpower at the US-Mexico, among others. He has also created a National Gang Intelligency center at the Federal Bureau of Investigation, and is a leader among Democrats, being the first in his party to support the Central American Free Trade Agreement (CAFTA). This trade agreement will have a big economic impact on the 28th District, as millions of dollars in new trade will come through Laredo and the I-35 Corridor.
Representative Cuellar currently serves on bothe the House Budget Committee and the House Agriculture Committee.
...
Prior to serving in the U.S. House of Representatives, Cuellar served as Secretary of State for the State of Texas and was a member of the Texas Legislature for 14 years.
The 28th Congressional District of Texas serves San Antonio, one of the largest cities.
Several articles -- some rather tongue in cheek were published last year on Grassroots News U Can Use. We expressed concerned over the lack of transparency in the TxDOT bidding process which prevented examination of potential ties between Zachry academic donations and resulting state contracts.
The QUESTION THAT WAS ASKED WAS when does the endowments influence the research outcome? Faith Chatham questioned the impact large corporate donations to academic institutions have on researchers.
By Faith Chatham - Sunday, July 31, 2006 Daily Kos
Does it? Even when you have very valid straight as an arrow procedures, if the Company who underwrites a large part of your department/university's budget -- and I think anyone who loses $10million from their department's budget would sqawk loudly enough about it to make that particular endowment qualify as a significant endowment --- when the endower is a candidate for contracts with the agency which decides who gets the contracts ---
Well I think it is important to throw out that question to University officials IN ALL UNIVERSITIES. When does the private endowments jeporadize the perception of the academic community and the general public about the whether the research is truly INDEPENDENT and UNBIASED.
I've worked on a number of research projects in my day. When you put heart and soul in a project, you want folks to take is seriously. If anyone WONDERS if it is less than INDEPENDENT of financial influence, you are putting the kiss of death on that institute. Right now TTI and Texas A&M need to step back and evaluate how things which are probably occuring independent of each other can raise eyebrows. ESPECIALLY SINCE TDoT IS CONDUCTING THEIR VETTING and NEGOTIATIONS IN THE DARK, NOT COMPLYING WITH PUBLIC MEETING LAWS.
That same day Faith Chatham pointed out:
TOO MUCH MONEY form sources who contract with TTIs major client (TxDOT) CAN BRING THE INDEPENDENCE of the research by TTI into question, even if there is nothing amiss in their research methodology or ethics. Becasue TxDOT is vetting proposals from potential vendors/private partners who are to be on the "short list" for the Trans Texas Corridor project in closed door meetings and rules have been passed exempting these records from discovery or disclosure even by court order and subpoena, there is less opportunity for the public to EXAMINE the records to see what kinds of influence has been exerted by whom (if any) to get Zachry to the top of the short list. When questions arise which cannot be answered easily by examination of the records, it hurts the innocent as well as the guilty.
TTI does a lot of things , Faith Chatham wrote on Daily Kos on July 30, 2006:
We don't know that there is anything amiss there. However, there is a rule of ETHICS in Government. We are to AVOID the APPEARANCE OF A CONFLICT OF INTEREST. This may merely be that a good thing (endowment) came at the same time that the endower got considered by TTI's major client (TDoT) for the biggest construction project in this century.
We have to have a dialogue in academic and governmental circles to see WHAT IS THE BEST WAY to protect the integrity of the research by institutions who are endowed.
Our assessment:
By Faith Chatham - Daily Kos - July 30, 2006
It appears that TTI has a role in selling the concept of multi modal transportation to members of the THSRTC. That organization has at least two officers who are County Judges in major urban centers. TTI was a major player in that organization. THSRTC is also closely linked to TxDOT. So it is interesting to see how this organization has influenced support for the TTC initiative.
In reengineering we are trained to identify the barriers, to identify the sponsors, to identify change agents, to identify stockholders. It appears that TTI and other organizations which promote rail within the governmental and cogs function in part as a reengineering lobby organization using education and symposiums to bring major players who can "buy into the intiative" and endorse and support it.
THSRTC also has strong ties to legislative leaders who can influence funding and change necessary parts of the transportation code. So influence with TxDOT is not the only way that TTI and the Bush School of Public Affairs can influence change to the advantage of A&M's generous corporate endower.
We hit our basic chord - Ethics and Conflict of Interest:
<
blockquote>THAT IS MORE REASON FOR EXAMINATION OF THE APPEARANCE OF CONFLICT OF INTEREST by the endowment which was accepted by the University.
The researchers don't deserve to come under any UNDESERVED CLOUD.
Right now, with the close relationship between TTI (Texas Transportation Institute), local and regional traffic planning entities who are endorsing the TTC (while most of the citizens of those communities are speaking out against it) and the relationship TTI has with the agency making the decisions about letting contributions with the major endower of the University! The point is that it is NECESSARY TO EXAMINE HOW IT LOOKS.
In ethics, we are told that it is IMPORTANT to avoid the APPEARANCE OF A CONFICT OF INTEREST. There is enough here for the APPEARANCE OF A CONFLICT OF INTEREST to do harm to the University unless the University examines it immediately and sets up guidelines to insure that the researchers remain indenpendent from influence from the endowers.
It is important that TTI not recommend a contractor to TxDOT in one way of the other. If they recommend or influence, they have violated ethical standards in this particular instance because the institution where they work benefits financially from at least one contractor who does business with TxDOT, TTI's number one client.
We pointed out:
There's more than one kind of prairie fire
1. Between elected officials and them that "brung 'em to the dance."
1. Aggie Engineers and Aggie Farmers and Ranchers
3. Historians and Legislators
4. Environmentalists and Legislators and Contractors
5. Grassroots Democrats who are looking at turn-coat money grubbing Democrats in office who are voting with big money interests on the TTX and who received donations from Zachry.
6. Grassroots Republicans who are looking at incumbent Republicans who they helped elect who are supporting TTC and who took money from toll road special interests.
7. Local governments and regional transportation planning entities who are endorsing the TTC and local voters who are mad because their officals are endorsing it without listening to the people.
We had devastating grass fires in much of this state which left thousands of acres of farm/ranch land charred. Much of rural Texas was declared a National Disaster. The TTC is the defining insulting swipe at those same peole. When it is an act of nature (or even arson which got further out of hand) it is devastating. However, the TTC is something that governmental officals are deliberately DOING to the Ranchers/Farmers/ homeowners and tax payers of Texas.
"Remember the Alamo" will be mild compared to the battle cry of "REMEMBER TTTC" before this is over.
On Texas Independence Day in March 2007, Hank Gilbert made good on his campaign promise to organize a march on the State Capitol.
TTC and CDAs are the same issue. Thousands of Texans showed up and testified at the Senate Committee on Homeland Security and Transportation TTC Hearing. They brought their tractors, livestock, families and neighbors and rallied on the State Capitol during this two day march on the State Capitol. They spoke out against the TTC land grab and against mandatory animal computer chip ID (NAIS).
Now the battle front has moved from Austin to local and regional governments. Citizens across Texas are monitoring RTC meetings, sitting in on rail relocation meetings at Council of Governments, phoning local elected officials and urging them to be proactive in protecting citizens from land grabs for private development and awarding highway contracts which will cost the citizens much more to use the infrastructure than is necessary.
Diligency, transparency, ethics, and watching who takes the money and how they repay the donors is an ongoing battle. We cannot afford to sleep. Citizens must be informed, weigh the sources of information, and act.
Friday, June 22, 2007
NTTA Takes $5 Billion Tollway From Cintra - NCTCOG regret at not mentioning that Price Waterhouse Cooper worked for Cintra on TTC Bid
"Eastland said that he regretted that he had not mentioned that Price Waterhouse Cooper had worked for Cintra on the Trans-Texas Corridor."
by Richard Williamson - The Bond Buyer - June 19, 2007 Copyright 2007
DALLAS — In a dramatic reversal, the North Texas Regional Transportation Council yesterday handed a $5 billion toll project to the North Texas Tollway Authority less than four months after it originally selected private development team Cintra/ JPMorgan.
The vote must be seconded by the Texas Transportation Commission, which had already approved Cintra’s bid in February — before the competition with the NTTA.
Despite the NTTA’s late-entry to the bidding, top officials said the authority could quickly catch up to Cintra’s plans for completion of the road by 2010.
“We’ve already commenced work to ensure on-time delivery,” said NTTA executive director Jerry Hiebert. “We’re certain NTTA will be on time for the financial close.”
The battle between the NTTA and Cintra was set up in March, just days after the 23-mile tollway in Denton and Collin counties north of Dallas was awarded to Cintra. Cintra emerged as the favored bidder after three years of developing its proposal.
By contrast, the NTTA developed its 800-page proposal in less than a month after state Sen. John Carona, R-Dallas, persuaded the RTC and Texas Department of Transportation to reopen the bidding to the toll authority, a division of the state.
While the NTTA proposal appeared to trump Cintra’s bid by about $100 million, analysis by TxDOT and the auditing firm of Price Waterhouse Coopers showed that Cintra’s proposal netted out as the better value due to a variety of factors.
In its presentation to the RTC board Thursday, NTTA board chairman Paul Wageman and Hiebert sweetened their original offer of $2.5 billion in an up-front payment and $833 million over the life of the project. At the board’s request, the NTTA would make the entire $3.3 billion payment for the project up-front, they said.
The authority, which operates 64 miles of toll roads in the Dallas-Fort Worth area, has complained of unfair treatment of its proposal and of conflicts of interest involving Price Waterhouse Coopers. After PWC issued its report favoring Cintra, it was revealed that the firm was working as auditor for Cintra, the Spanish developer whose full name is Cintra, Concessiones Infraestructuras de Transporte.
PWC and Cintra claimed that there was no conflict because the PWC auditors in Spain were a separate team from those who conducted the analysis for the RTC.
But Wageman disagreed, pointing to the fact that PWC also worked with Cintra and its partner Zachary Construction of San Antonio on development of the Trans-Texas Corridor, a proposed network of tollways in Central Texas whose final cost could reach $150 billion.
“How can Price Waterhouse Coopers possibly be unbiased and fair in evaluating its partner’s proposal against a competitor’s?” Wageman asked.
The NTTA originally passed up the SH 121 project when the 23-mile toll project was under discussion for financing in 2004, according to TxDOT. Cintra was one of the private developers that responded to financing proposals.
The NTTA has acknowledged comments from the three rating agencies that its credit rating will likely fall as it more than doubles its debt to build SH 121. But officials say they can stay within an A-range.
“We’re going to see a decrease in our credit rating,” Hiebert said. “But the inverse of that would be to just take our money and sit on it.”
Under a protocol agreement with TxDOT and Cintra last year, the NTTA was designated the toll collector and operator for the SH 121 project while Cintra was in charge of construction and financing.
Asked at Thursday’s RTC meeting why the authority earlier had ceded the project to Cintra, Wageman pointed to legislation favoring comprehensive development agreements with private developers in order to preserve bonding authority for government entities. That position was reversed last week with Gov. Rick Perry’s signing of SB 792, which gives toll authorities first shot at projects in their regions.
“We thought the better part of valor was to step back and accept a process that SB 792 has now extinguished,” Wageman said. “This has been an imperfect process.”
Mike Eastland, executive director of the RTC, said at yesterday’s meeting that PWC was the only viable contender to accomplish the analysis of the bidders in a short period time.
Eastland said that he regretted that he had not mentioned that PWC had worked for Cintra on the Trans-Texas Corridor. “We made a mistake,” he said. “We admit the mistake, but I do not think it is material.
© 2007 The Bond Buyer:
by Richard Williamson - The Bond Buyer - June 19, 2007 Copyright 2007
DALLAS — In a dramatic reversal, the North Texas Regional Transportation Council yesterday handed a $5 billion toll project to the North Texas Tollway Authority less than four months after it originally selected private development team Cintra/ JPMorgan.
The vote must be seconded by the Texas Transportation Commission, which had already approved Cintra’s bid in February — before the competition with the NTTA.
Despite the NTTA’s late-entry to the bidding, top officials said the authority could quickly catch up to Cintra’s plans for completion of the road by 2010.
“We’ve already commenced work to ensure on-time delivery,” said NTTA executive director Jerry Hiebert. “We’re certain NTTA will be on time for the financial close.”
The battle between the NTTA and Cintra was set up in March, just days after the 23-mile tollway in Denton and Collin counties north of Dallas was awarded to Cintra. Cintra emerged as the favored bidder after three years of developing its proposal.
By contrast, the NTTA developed its 800-page proposal in less than a month after state Sen. John Carona, R-Dallas, persuaded the RTC and Texas Department of Transportation to reopen the bidding to the toll authority, a division of the state.
While the NTTA proposal appeared to trump Cintra’s bid by about $100 million, analysis by TxDOT and the auditing firm of Price Waterhouse Coopers showed that Cintra’s proposal netted out as the better value due to a variety of factors.
In its presentation to the RTC board Thursday, NTTA board chairman Paul Wageman and Hiebert sweetened their original offer of $2.5 billion in an up-front payment and $833 million over the life of the project. At the board’s request, the NTTA would make the entire $3.3 billion payment for the project up-front, they said.
The authority, which operates 64 miles of toll roads in the Dallas-Fort Worth area, has complained of unfair treatment of its proposal and of conflicts of interest involving Price Waterhouse Coopers. After PWC issued its report favoring Cintra, it was revealed that the firm was working as auditor for Cintra, the Spanish developer whose full name is Cintra, Concessiones Infraestructuras de Transporte.
PWC and Cintra claimed that there was no conflict because the PWC auditors in Spain were a separate team from those who conducted the analysis for the RTC.
But Wageman disagreed, pointing to the fact that PWC also worked with Cintra and its partner Zachary Construction of San Antonio on development of the Trans-Texas Corridor, a proposed network of tollways in Central Texas whose final cost could reach $150 billion.
“How can Price Waterhouse Coopers possibly be unbiased and fair in evaluating its partner’s proposal against a competitor’s?” Wageman asked.
The NTTA originally passed up the SH 121 project when the 23-mile toll project was under discussion for financing in 2004, according to TxDOT. Cintra was one of the private developers that responded to financing proposals.
The NTTA has acknowledged comments from the three rating agencies that its credit rating will likely fall as it more than doubles its debt to build SH 121. But officials say they can stay within an A-range.
“We’re going to see a decrease in our credit rating,” Hiebert said. “But the inverse of that would be to just take our money and sit on it.”
Under a protocol agreement with TxDOT and Cintra last year, the NTTA was designated the toll collector and operator for the SH 121 project while Cintra was in charge of construction and financing.
Asked at Thursday’s RTC meeting why the authority earlier had ceded the project to Cintra, Wageman pointed to legislation favoring comprehensive development agreements with private developers in order to preserve bonding authority for government entities. That position was reversed last week with Gov. Rick Perry’s signing of SB 792, which gives toll authorities first shot at projects in their regions.
“We thought the better part of valor was to step back and accept a process that SB 792 has now extinguished,” Wageman said. “This has been an imperfect process.”
Mike Eastland, executive director of the RTC, said at yesterday’s meeting that PWC was the only viable contender to accomplish the analysis of the bidders in a short period time.
Eastland said that he regretted that he had not mentioned that PWC had worked for Cintra on the Trans-Texas Corridor. “We made a mistake,” he said. “We admit the mistake, but I do not think it is material.
© 2007 The Bond Buyer:
Tuesday, June 12, 2007
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
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 thatRead more
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?"
Wednesday, June 6, 2007
Eminent domain letter is delayed
By ANNA M. TINSLEY - Star-Telegram Staff Writer - Wed, Jun. 06, 2007
Read Linda Lancaster's address to the County Commissioners
Tarrant County commissioners must wait to send a letter to Gov. Rick Perry asking him to veto an eminent domain bill, because the full court must approve such a move, and one member wasn't present at Tuesday's meeting.
Even so, Arlington property owner Linda Lancaster spoke to the Commissioners Court, urging them to instead send a letter supporting the bill.
"Why on earth would elected officials think citizens want less protection from eminent domain?" she asked. "We depend on you for protection and representation."
The issue: House Bill 2006 would give landowners more rights when governments take property through eminent domain, a controversial practice in which local governments appropriate land for public projects. The bill would ensure that landowners receive good-faith offers, be compensated for damage done to adjoining property, and have a chance to buy back their land -- at the same price they received -- if it isn't needed in 10 years for the development.
The cost: Officials have said the measure could cost the state an extra $1 billion a year in transportation projects.
The status: Perry has until June 17 to sign or veto bills. Commissioners say they hope to vote on sending a letter asking for a veto Tuesday.[Tuesday, June 12th at 10:30 a.m.]
Roll call: Commissioner Gary Fickes was not present Tuesday, preventing the vote.
Read Linda Lancaster's address to the County Commissioners
Monday, June 4, 2007
AARP and TXU make moves
By R.A. DYER - Star-Telegram Staff Writer - Wed, May. 30, 2007
AUSTIN -- In almost simultaneous actions, a major consumer group urged Gov. Rick Perry on Tuesday to call a special session to fix "the deregulation mess in Texas" and TXU pledged to provide more rate cuts to more than a million customers.
Both actions came a day after lawmakers ended the 80th Texas Legislature without adopting legislation to protect ratepayers. Many lawmakers had promised such legislation, and consumer groups like AARP had made it a top priority.
TXU announced plans Tuesday to provide an additional rate cut of 5 percent, to complement a 10 percent reduction already announced by the company and the private investors set to buy it. TXU said in a release that the full reduction will mean about $395 a year in savings for a typical customer.
A spokesman for the private investors said the final 5 percent reduction will go into effect when the transaction closes and will remain in place through December 2008.
The price reductions are for customers who have never switched service.
Michael MacDougall, a partner with Fort Worth-based TPG, which, along with Kohlberg Kravis Roberts & Co., is in the process of buying TXU, connected the decision to the legislation that failed.
"This issue was debated during the 80th session of the Texas Legislature that ended yesterday. We listened closely, and we understand that the driving force behind the legislation was the desire of elected officials to lower prices for residential customers," MacDougall said.
At almost the same time that TXU and the private-equity firms announced the rate cuts, AARP Texas issued a letter to Perry, urging him to call lawmakers back to Austin.
"Specifically, we ask you to instruct legislators to provide a 20 percent rate discount that does not have loopholes, create new disconnection protections for vulnerable customers, reform the wholesale pricing system that inflates rates across the board and take strong actions to prevent big electricity companies from dominating the market," AARP Texas Director Robert Jackson wrote in his letter to the governor.
Jackson said the cuts announced by TXU on Tuesday do not change the need for a special session, because ratepayers in other parts of the state won't see any benefit and because the company's commitments do nothing to address problems with the deregulated power market.
Sunday, June 3, 2007
Tarrant County Commissioners urged by Glen Whitley to urge Gov. to veto Eminent Domain HB 2006
Anna Tinsley of the Fort Worth Star-Telegram alerts citizens that an agenda item on Tuesday, Tarrant County Commmissioner's Court meeting is the Commissioners signing a letter to Governor Perry urging him to veto the bill which restores some rights to citizens against having property lost to private developers through eminent domain.
Judge Glen Whitley is the major advocate of vetoing the bill. A member of the NASCO Board of Directors, a Dallas based international organization which has promoted massive changes to the Texas and Federal Transportation Code during the past 6 years, enabling private companies to acquire property rights to develop infrastructure using eminent domain, Whitley serves on the NCTCOG Executive Board, the RTC, and is in his first year as Tarrant County Judge.
We urge citizens to speak out to Tarrant County Commissioner, urging them not to sign the letter to Governor Perry urging him to veto this legislation. Read this excellent article by Anna Tinsley. She lists the Amendments which will be on the ballot in November in Texas at the end of this informative article.
Judge Glen Whitley is the major advocate of vetoing the bill. A member of the NASCO Board of Directors, a Dallas based international organization which has promoted massive changes to the Texas and Federal Transportation Code during the past 6 years, enabling private companies to acquire property rights to develop infrastructure using eminent domain, Whitley serves on the NCTCOG Executive Board, the RTC, and is in his first year as Tarrant County Judge.
We urge citizens to speak out to Tarrant County Commissioner, urging them not to sign the letter to Governor Perry urging him to veto this legislation. Read this excellent article by Anna Tinsley. She lists the Amendments which will be on the ballot in November in Texas at the end of this informative article.
Saturday, June 2, 2007
Perry addresses secrete Bilderberg Conference in Turkey
He'll speak about federalism at elite global conference
By CHRISTY HOPPE - The Dallas Morning News - Thursday, May 31, 2007
Read more
By CHRISTY HOPPE - The Dallas Morning News - Thursday, May 31, 2007
AUSTIN – Gov. Rick Perry is flying to Istanbul, Turkey, today to speak at the super-secret Bilderberg Conference, a meeting of about 130 international leaders in business, media and politics.
The invitation-only conference was started in 1954 and named for the Dutch hotel where the conference was first held. Those who attend promise not to reveal what was discussed, security is tight, and the press and public are barred.
The conference has been the subject of conspiracy theorists and even Christian groups who wonder about its influence.
Robert Black, the governor's press secretary, said the governor was invited to attend and speak about state-federal relations. Mr. Black dismissed the conspiracy theories.
"He's looking forward to learning the secret handshake," Mr. Black joked.
He said that Mr. Perry is paying for the trip and host hotel, usually among the top in the world, out of campaign contributions from his Texans for Rick Perry committee.
Previous speakers at the conference have included such GOP stalwarts as outgoing World Bank chief Paul Wolfowitz and former U.S. Defense Secretary Donald Rumsfeld.
Last year, the conference was held in Ottawa, and the Toronto Star reported that it had received an unsigned press release saying that the 2006 group included David Rockefeller, Henry Kissinger, Queen Beatrix of Holland, New York Gov. George Pataki, media moguls, high-level officials from Spain and Greece, and the heads of Coca-Cola, Credit Suisse and the Royal Bank of Canada.
Bilderberg chairman Etienne Davignon, a former Belgian diplomat, granted the British Broadcasting Corp. a rare interview two years ago in which he brushed aside myths surrounding the organization.
"When people say this is a secret government of the world, I say that if we were a secret government of the world, we should be bloody ashamed of ourselves," Mr. Davignon said.
Mr. Black said that the governor was going because he was invited. "He looks forward to talking to them about the system of federalism here in the United States," he said.
Read more
Tuesday, May 15, 2007
Spanish company picked for SH 121 toll contract
By Brandi Hart and Penny Rathbun, The Frisco Star
Friday, March 2, 2007 4:28 PM
Friday, March 2, 2007 4:28 PM
Gov. Rick Perry announced Tuesday that Cintra Concesiones de Infraestructuras de Transporte, the Spanish company that is half of the partnership the state contract for the Trans-Texas Corridor, won the bid to build, operate, and maintain State Highway 121 toll lanes in Collin and Denton counties.Read more
Perry joined officials from Collin and Denton counties on Tuesday to announce the award. On Wednesday, Texas Department of Transportation recommended that the Texas Transportation Commission grant conditional award of the CDA to Cintra - who partnered with Zachary Construction Company of San Antonio for the Trans-Texas Corridor contract - based upon the TxDOT staff review and scoring of the proposals.
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