TxDOT CDA Event Sells Texas for Profit. (Corporate Welfare)


TxDOT CDA Event Sells Texas.

On Tuesday, January 17th, TxDOT held an industry workshop to launch Comprehensive Development Agreement projects (CDA's). CDA’s are road and land development projects that combine the powers of the state with private interests. CDA's can be very lucrative deals for private corporations that will last 70 years, but there are public issues and questions, specifically posed by those who don’t believe it’s fair to privatize and toll our public highways or take private land for corporate profits.

IN A TELLING MOMENT TODAY, AT THE CDA CONFERENCE, Phillip Russell, Director of TxDOT's Turnpike division (512.936.0903), told the audience full of only private corporations, “CDA’s will reduce the cost
that you all - will have to bear”.

According to Phillip Russell's speech today, the CDA’s can include design, build, financing, operations and maintenance of the toll roads. Some say the public good has suddenly come up for sale. Opponents cite other concerns about public disclosure, public debate, legislative oversight, open and transparent government, double taxation and local control.

On May 31, 2005, the Texas Attorney General’s office ruled that TxDOT must release hundreds of pages of the Comprehensive Development Agreement (CDA) kept secret in the TxDOT/Cintra Zachry deal to develop Trans Texas Corridor TTC-35. The portions of the CDA not yet publicly released include the conceptual development and financial plans. In June, 2005 Cintra Zachry filed a lawsuit against the Texas AG to keep the CDA details a secret. The CDA has yet to be released.

"It should raise red flags to everyone that TxDOT offers NO written guidelines or criteria for what projects should or should not be a CDA project. Then when they make the deal, we can't see it. That is not open government Texans deserve." said Sal Costello, founder of People for Efficient Transportation. "Vendors propose projects to which TxDOT feels it must respond and thereby commit state road funds to private development projects."

"Gov. Rick Perry, the chief planning officer for the state of Texas, has directed his appointed Texas Transportation Commission, who governs TxDOT, to move forward with CDA's and what Perry calls 'innovative financing'. This fancy name means they’ll use our tax dollars and publicly funded right of ways to build toll roads, and charge us again for driving on them. The CDA's are one of the tools they use to keep the details of the highway robbery a secret." added Costello.

"in your lifetime most existing roads will have tolls.”
– Transportation Commission's chair Ric Williamson,
appointed by Gov. Rick Perry to govern TxDOT

Costello points to a December 2004 TIME magazine article, "The next wave in super highways or a Big, Fat Texas Boondoggle?" that shows how Gov. Perry has gained contributions from the same corporations that can profit off CDA deals and the privatizing of public highways. "Since 1997, Perry has received more than $1 million from highway interests, according to reports filed with the Texas ethics commission."

1 comment:

Anonymous said...

I believe one major unexplored angle is that the letting of the contract to CINTRA was not a truly objective "arms length" open competive bidding process. Someone sent me this list of links today about Gov. Perry's top aide having worked for CINTRA just prior to employment for Perry and to the letting of the CINTRA contract.

This deserves illumination.

Someone wrote me and told me to "dig deeper into the Dan Shelley - Cintra - Gov. Perry relationship." Read about this huge smoking gun here...


Is there any Texas agency that will honestly investigate the CINTRA contract. I do not think there is. Rampant Texas government scandals and corruption are at an all-time high right now.

My friend, Phyllis Spivey, who wrote "Internationalizing U.S. Roads" did a national Internet radio show about corridors. A man called in and cited three U.S. Supreme Court cases where it was ruled that states may not let contracts to foreign country companies. I wrote to the radio station to see if I could get a tape of the show so I could transcribe that man's words and send it to you, but I did not hear back from him.

I have pasted in an interesting article about Connecticuts DOT being busted for corruption. That needs to happen in Texas because these same kinds of things are certainly going on.



Bids, Bribes And Lies
Five DOT Workers And A State Contractor Charged
January 11, 2006
By DAVE ALTIMARI, Courant Staff Writer

State Department of Transportation employees lied about receiving free trips and baseball tickets from a company awarded a contract to patch roads while one of their bosses tailored a bid document to favor the contractor, records supporting the Tuesday arrests of five state workers said.

The workers, and contractor Robert Marino, were arrested by the chief state's attorney's office on charges ranging from bid-rigging and perjury to forgery. Marino and his company, Marino Brothers of New England Inc., which has offices in Middletown, were charged with bid-rigging and bribery.

Two of the DOT employees lied about getting free trips, including at least one to Las Vegas for a wedding celebration of another DOT employee, all paid for by Marino Brothers. Two others lied about getting tickets to a Red Sox game, authorities said.

Joseph Misbach, 54, of Wallingford, was charged with bid-rigging, attempted bid-rigging, conspiracy and perjury. The other four DOT employees - Robert Mongillo, 48, of Southington; Joseph Czarnecki, 56 of Naugatuck; Mark Lalla, 41, of Burlington; and John Marchese, 54, of Middletown - face perjury charges.

Mongillo is the DOT's maintenance administrator. He makes $129,205 a year, state records show. Misbach and Czarnecki make at least $112,000, state records show.

The arrests come as a grand juror in New Haven, who has secretly been hearing evidence for more than a year, issued an interim report describing how mid-level DOT managers, most of whom work for the Bureau of Highways and Operations, made sure that Marino's company won a road sealant contract in April 2004.

Since 2001, Marino has received more than $3 million from the state for his "cold patch" sealant. The DOT's own internal tests done in 2000 showed that the product made the roads slippery.

The most serious allegations are against Marino, saying that he bribed DOT workers with either baseball tickets or airplane tickets and that he conspired with Misbach, a DOT maintenance manager, to rig the bid by writing specifications that excluded everyone but Marino's company.

But at least one former DOT employee, whom the grand juror, Judge Joseph Licari Jr., identified as forging documents to help Marino get business in other states, was not arrested Tuesday.

Licari wrote that there was enough evidence to charge Louis Malerba, the former maintenance administrator, with forgery for taking a study about the cold patch process that was intended for DOT use only and putting a new cover sheet with an official seal of the state of Connecticut on it - to make it appear to be an official state document. Marino and Malerba then used that document to get Marino business in other states, including Rhode Island and Virginia, the grand jury report said.

Chief State's Attorney Christopher Morano would not comment Tuesday on why Malerba was not arrested, but he did say that the investigation is continuing.

"We have seen in the past that corruption has been rooted out of the higher levels of government and we are now at the point of looking into the nooks and crannies of these agencies to root out corruption," Morano said.

Sources said that when Malerba was married a couple of years ago to a DOT employee, several co-workers went on a post-wedding trip to Las Vegas that was at least partially paid for by Marino. Both Marchese and Mongillo lied to the grand jury about receiving airline tickets or travel expenses from Marino, according to the report.

Sources familiar with the investigation said that several other higher-ranking DOT employees, including former Commissioner James Byrnes, went on the trip. Byrnes has testified before the grand jury, sources said.

The grand jury investigation was approved in November of 2004 after the public integrity unit of Morano's office received an allegation that DOT employees had steered a road sealant contract to Marino in exchange for gifts, including at least one free trip to the Foxy Lady, a strip club in Providence.

Sources said that investigators also videotaped free golf outings and several free meals that DOT employees received from Marino while the road sealant contract was still out to bid in 2004. Sources said that the baseball tickets also were provided during that time frame. Lalla and Czarnecki were arrested and accused of lying to the grand juror about getting the baseball tickets, sources said.

The grand jury report shows that Misbach designated that the contract go only to companies on the Small Business Enterprise list maintained by the DOT. Marino Brothers was the only potential bidder for the sealant contract on that list.

When some other companies complained to Attorney General Richard Blumenthal, the DOT decided to take the designation off and rebid the contract. Three companies bid on it: Marino Brothers, the Felix A. Marino Co. and Costello Industries.

Marino Brothers, whose headquarters is in Peabody, Mass., was the high bidder. Marino Brothers and Felix A. Marino are separate companies, both originally from Massachusetts and owned by feuding brothers.

The three bids were reviewed by employees of the DOT's Office of Maintenance and Highway Operations, which determined that the Felix A. Marino Co. equipment did not meet the specifications designed by the DOT workers. Costello Industries was eliminated because it was going to lease the equipment from the Felix A. Marino Co.

The only company whose equipment met DOT requirements was Marino Brothers. Sources said the DOT employees knew that the bid specifications they were placing on the equipment could only be met by Marino Brothers.

All five DOT employees and Marino are scheduled to appear Jan. 18 at Superior Court in New Britain. Each charge carries a possible five-year prison sentence.

DOT Commissioner Stephen E. Korta II said Tuesday that all the DOT employees were placed on administrative leave.

"These charges are disturbing," Korta said. "These allegations date back to 1997. Over the last 18 months, DOT's leadership team has made contract standards and ethical conduct a focus throughout the agency."

When The Courant first wrote about the road sealant contract in 2004, Gov. M. Jodi Rell ordered DOT to devise a new method of handing out contracts. Rell issued a statement Tuesday expressing her disappointment in yet another corruption case within a state department.

"The Department of Transportation is entrusted with billions of dollars in taxpayer money, and there simply is no room for irregularities or mismanagement of contracts with private companies doing business with the state," Rell said.

"If the charges are proven true, these workers have betrayed their fellow state employees - the overwhelming majority of whom are hard-working, dedicated men and women - and must face the consequences of their actions," the governor said.

The $250,000 contract with Marino Brothers of New England was rescinded in 2004.

The Felix A. Marino Co. filed a bid protest with the state and a complaint with Blumenthal's office. The state Department of Administrative Services held a hearing and took the unusual step of rescinding the contract based also on Blumenthal's charge that the bid specifications were written specifically for Marino Brothers.

DOT officials did not put the contract back out to bid because they said they had concerns about the safety and performance of the cold sealing process.

These concerns were first raised by their own tests, done in 2000, in which skid tests on the road-patching product produced by Marino Brothers showed that it actually made roads more slippery.