Says the Houston Chronicle HERE
By Ben Wear, Austin Statesman
The Texas Transportation Commission, taking its cue from state leaders, today decided to borrow another $1.5 billion that would be paid back by future gas taxes.
That borrowing authority, granted on a unanimous vote of the five-member commission in a specially called meeting this morning, will allow TxDOT to issue more than $4 billion in contracts this year. At least $1.1 billion of that would be for maintenance projects. But the remainder, almost $3 billion, would allow much greater spending to expand the state road system than in the fiscal year now ending, a year when TxDOT had to shelve many road projects.
That 2008 crunch directly affected the Austin area, where local leaders had approved a $1.45 billion plan to build five more toll roads based on a promise of several hundred million dollars from TxDOT. Politicians here, particularly state Sen. Kirk Watson, were incensed when TxDOT reneged on that promise only a few weeks after a tough October 2007 vote on the toll roads.
TxDOT executive director Amadeo Saenz could not say with certainty today whether the move to issue the $1.5 billion in gas tax bonds will restore all of that funding to Austin.
“It could help Austin,” Saenz said. “We want to make sure we get projects that are ready to go in 2009.”
The Central Texas Regional Mobility Authority will be building the first of those five projects, an expansion of U.S. 290 from Northeast Austin to Manor that would include toll express lanes and improved frontage roads. However, officials with the authority this week indicated that environmental and engineering work likely will not be ready in time for construction to begin until late 2009. That would be beyond the state’s fiscal 2009 year, which begins Monday.
Saenz indicated that some of the $1.5 billion would be spent on engineering and right of way purchases, readying projects in anticipation of even more borrowing authority to come. TxDOT could borrow an additional $1.4 billion against the gas tax in the 2009-2010 fiscal year. Austin’s projects could see some of that engineering money, or some of the $1.4 billion if TxDOT follows through and takes on that debt as well.
And if the Legislature passes additional legislation next year, the agency could borrow up to $5 billion more that voters approved under the Proposition 12 constitutional amendment in November. Those bonds would be paid back by general state revenue, not gas taxes.
Read the whole story HERE.
UBS Cuts Its Macquarie Rating
By REBECCA THURLOW, The Wall Street Journal
SYDNEY -- Macquarie Group Ltd. shares fell 9.6%, touching a 3½-year low, after broker UBS AG cut its rating on the stock and warned the Australian investment bank's profit may be hit by asset write-downs.
UBS analysts cut their rating on Australia's biggest investment bank by revenue to "neutral" from "buy," slashing their price target to 48 Australian dollars (US$41.05) a share from A$60.
"With the global credit crunch and bear market entering its second year, and with little end in sight, we believe this is placing ongoing pressure on Macquarie's businesses and outlook," said UBS analysts Jonathan Mott, Chris Williams and Shu-Ling Liauw in a report.
Read the whole report HERE
by the Newspaper.com
Toll road operator Transurban posts a $140 million loss in the last year.
The financial outlook for tolling continues to be grim as one of the largest operators of toll roads in the United States and Australia announced today that it had suffered losses in excess of $292 million over the past two years. Despite charging Australian and American motorists $767 million in tolls and fees -- an increase of 34 percent -- in the year ended June 30, 2008, Transurban reported a loss of $140 million.
Read the whole story HERE.
Texas Toll Road Advocate Has Fierce Critic
by Jeff Robinson, KCPW News (Salt Lake City, UT)
Last week, Utah lawmakers took advice on highway funding from Texas Representative Mike Krusee, who strongly advocated for the creation of toll roads. Krusee told legislators that Utah drivers are getting away with paying only a small fraction of what it costs the state when they drive on highways. But the lawmaker has fierce critics in his own state. An Austin, Texas resident calls him a con artist.
"Most folks don't oppose toll roads, which have been separate from our public highways," said Sal Costello. "What Krusee's done in Texas over the past few years is create a scheme that diverts our tax dollars intended for freeways into these double-tax tollways."
Costello founded the People for Efficient Transportation political action committee and blogs frequently about toll roads. He says people are paying double to use Texas toll roads because drivers are charged the gas tax they pay at the pump, then charged again at the tollbooth. He says the gas tax is inappropriately being diverted to toll roads.
Furthermore, Costello says the toll roads pushed by Representative Krusee are built on public rights-of-way that had been set aside for public expressways.
"The public highway right-of-way has been shifted to tollways, so there's this monopoly and people are sort of forced to pay this double tax," said Costello.In 2005, the state's comptroller issued an extremely critical report about the Central Texas Regional Mobility Authority, which manages toll road creation in part of the state. It accused the agency of having no accountability.
Toll-road salaries top $1 million
by Patrick Driscoll, San Antonio Express-News
A local agency's salaries and benefits to plan and eventually operate toll roads will come to $1.2 million in the upcoming fiscal year, including two people yet to be hired.
|(Alamo Regional Mobility Authority)|
Alamo Regional Mobility Authority leader Terry Brechtel will pull the highest pay — with a $177,407 base and up to $23,527 to cover a cost of living increase and a performance bonus.
The $200,934 total isn't too far from the $206,000 she made in 2004 as San Antonio's city manager, when she oversaw a $1.5 billion budget and 12,000 employees. She quit that job after a run-in with then-mayor Ed Garza.Read the rest of the story HERE
By Paul Burka, Texas Monthly
I doubt whether Rick Perry, David Dewhurst, or Tom Craddick has ever heard of the Lane Cove Tunnel in Sidney, Australia. If they had, they might not be so eager to raid the teacher and state employee retirement funds to build toll roads.
On the day the Olympics opened (08/08/08), the Sidney Morning Herald carried the news that the tunnel “is rapidly turning into a bottomless pit for its financial backers….” Two credit rating agencies, Standard & Poor’s and Moody’s, have warned that the toll road could default on its $1.1 billion debt with a year. The tunnel has suffered three consecutive monthly dropoffs in traffic usage. The estimated usage before the road was built was 100,000 vehicles per day; actual numbers in June and July barely exceeded 50,000. A Standard & Poor’s analyst predicted that unless the project gets fresh capital (at least half a billion dollars), it will default within 10 to 16 months. Perhaps TxDOT, since it is such a believer in such projects, would like to invest.
The problem with the financial wheeling and dealing with retirees’ funds that Perry, Dewhurst, and Craddick have proposed is that toll road projects are risky investments. They are risky for two reasons. One is that they are subject to economic fluctuations that affect people’s driving habits, such as the price of gasoline or the pace of development.
The second reason is that, when government is involved, they are vulnerable to political pressure and favoritism. Google “toll road defaults” and you will find a trove of stories with unhappy endings. The Camino Columbia toll road in Laredo, which was rife with political intrigue over which landowners would benefit from having a road go through their property, opened in 2000 and defaulted in 2004. Cost: $90 million. Auctioned off for: $12 million. Tx-DOT bail out acquisition payment: $20 million. The Dulles Greenway toll road to Washington’s Dulles Airport defaulted on its bonds within a year of its opening in 1995. The private owner, Toll Road Investors Partnership II, have lost money every year since the road opened. When toll roads lose money, tolls go up–in this case, to $4.80 by 2012. That works out to an astronomical 35 cents per mile. There are similar stories in Orange County, California (where the state had to buy failing toll lanes), and along Florida’s west coast, and near Richmond, Virginia, where the 8.8-mile Pocohantas Parkway, financed with tax-free bonds, has suffered around a 50% shortfall in projected toll receipts; the state has had to maintain the road because the private owners don’t have the money. Bond ratings have been lowered to below investment grade. To pay off the bonds, the toll was increased by 50%.Read the rest of the article HERE.
From The Salt Lake Crawler:
Utah lawmakers were held spellbound by Texas Rep. Mike Krusee as he explained that toll roads provide solid and fair revenues for building highways. In a near swoon, business lobbyist-and-sometimes-Sen. Howie Stephenson purred:
Hearing you is a breath of fresh air. I just want to welcome you to the Socialist Republic of Utah.Apparently Krusee's breath wasn't so fresh to a Texas Highway Patrol trooper last spring.
Krusee, in fact, had passed up a court hearing on his drunken-driving arrest to be on Utah's Capitol hill.
Krusee’s attorney explained to the judge his client was unable to plead innocent in person because he was in Utah speaking to legislators. The trial is set for Nov. 17.
Krusee was arrested in April after a trooper saw Krusee’s car swerving down a highway near Austin. The Republican lawmaker, mug shot above, failed the field sobriety tests and refused a breath and blood test
Krusee is known in Texas for successfully sponsoring the “driver responsibility program” that includes surcharges for driving offenses, including $1,000 for a first conviction of driving while intoxicated.
Rep Mike Krusee has gone off to Utah to sell "freeway tolls". I just did an interview with a public radio reporter from Salt Lake City, Utah.
He saw my blog and wanted to know more about Krooked Krusee and his transportation "ideas". See my post below to get an idea of what I told him.
The story will be up on www.kcpw.org MONDAY.
to issue $1.5B in bonds
for new roads
By MICHAEL A. LINDENBERGER, Dallas Morning News
Gov. Rick Perry has joined leaders of the Texas Legislature in calling on the state transportation department to immediately issue about $1.5 billion in bonds to pay for more roads, a step the governor and department officials have resisted for months.
In a joint letter issued today by the governor's office, Mr. Perry, Lt. Gov. David Dewhurst and House Speaker Tom Craddick urged transportation chairman Deirdre Delisi to take steps to issue the additional debt by as soon as September.
The extra debt has been a priority for lawmakers for nearly a year, ever since TxDOT began reining in spending as it confronted a long list of financial worries – from the growing construction costs, a soaring maintenance burden associated with Texas' aging roads, and a flat gas tax rate that hasn't been upped since 1991.
Despite those costs, and their own opposition to raising revenues, many lawmakers, including Mr. Dewhurst, accused TxDOT of painting an overly dire picture of its finances. The worry was that the poor-mouthing was aimed at weakening the legislature's opposition to toll roads as a new session looms in 2009.
For proof, many looked at the department's refusal to include in its financial plan the availability of the bonds, and to exclude another $5 billion in bonds made available by a constitutional amendment approved by voters last fall.
As TxDOT trimmed its spending, road projects got delayed across Texas, though in Dallas most of the impact was muted by the availability of money from the North Texas Tollway Authority.
Ms. Delisi, Mr. Perry's former chief of staff, insisted as recently as earlier this summer that issuing the extra debt without what she called a long-term solution would be irresponsible. TxDOT CFO James Bass warned that the bonds would cost so much interest over the next 20 years that their long-term effect would be negligible.
Gov. Perry, in an Austin speech in April, flatly refused to heed calls from Lt. Gov. Dewhurst and others to borrow more.
But Thursday's announcement changes all that, a spokesman for Gov. Perry said.
"The governor is tremendously pleased. We wanted a long-term solution," said spokeswoman Allison Castle.
Read the whole article HERE.
Most people don't oppose toll roads as they have been created in the US with toll roads supplementing our public highways.
What Rep. Mike Krusee has ushered in, in Texas is a scheme that diverts tax dollars intended for freeways into double tax freeways. Even worse, Krusee's new transportation scheme creates monopolistic tollways where freeways should be — as already taxpayer funded right of way (that were always promised as a public expressways) get converted into an unaccountable daily double tax (Says the Texas Comptroller's report) for drivers.
Krusee is a con artist with no college degree, and the yearly shifting source of income he states within public records is highly questionable. See my formal complaint to the Texas Ethics Commission about Krusee's source of income.
Read Texas Lawmaker Talks Toll Roads with Utah Legislature.
By Roger Baker
The ability to build and maintain roads is down nationwide. US travel volumes for June 2008 are down about 4% nationwide, year over year.
The latest for in compare June 2008 with June 2007:
Texas traffic volumes on Rural Arterial Roads: DOWN 4.2%
Texas traffic volumes on Urban Arterial Roads: DOWN 3.1%
Texas traffic volume changes on All Estimated Roads: DOWN 4.2%
But TxDOT remains in denial.
They probably want to believe that the recent reduction in can continue. The reality is that world oil production has been stagnant for about three years now and price has gone down only because of reduced demand due to the depressed state of the economy.
Oil must continue to become less affordable, independent of its price, because less and less oil is being produced per capita worldwide and there is no inexpensive substitute.
After 40 comments in July, and a request to repost for more comments here in August, I give you this repost. Join in on the comments!
A new AP report on Sen. Carona and others who have ethical conflicts HERE.
The report fails to mention the worst Central Texas toller of them all, in my opinion, Sen. Kirk Watson. Watson will run for a state office soon...watch out for this crook, warn your family and friends ahead of time.
State senator involved in controversy over condos in danger of collapse.
By Lee McGuir, KHOU-TV (Houston)
For three years Dan Seluk and his wife Andrea have paid maintenance fees to the Park Memorial Condominiums. The same complex city inspectors now warn is in imminent danger of collapse.
The city says the parking garage might simply fall apart and take the dozens of condos that sit above the garage down with them.
But the condo’s management teams had been collecting those maintenance fees for years.“So you’re probably talking in three years about $15,000 in maintenance fees,” said condo resident Dan Seluk.The issue even had Houston’s mayor Wednesday wondering what had gone wrong.“The whole situation seems odd to me,” said Mayor Bill White.But he wasn’t the only one having doubts.“There’s a big question. Where have all our maintenance fees gone. Where have they gone?” said Andrew Seluk.
For a long time the money went to a company called Prime Site which was later absorbed by Associa Principal Management Group. In April that company ended its management agreement and copied at the bottom of the letter the company’s CEO, John Carona.
Carona is a state senator, but his day job is CEO of one of the largest property management companies in the nation. Until this summer his group managed the now-hazardous condominiums. He also wrote the Texas Residential Property Owners Protection Act.
“To think that someone in public office is running these companies and is perhaps making a lot of money. And the service of these companies is so terrible and the homeowner’s hands are tied.” said Dan Seluk.
Read the whole article HERE.
Newsroom KLBJ News Radio
People who use U.S. 290 east of U.S. 183 and west of the SH-130 toll road got to see an elaborate set of plans to upgrade the highway and add a toll road to it.
CLICK TO HEAR KLBJ'S JARROD ALLEN'S EXTENDED REPORT
This takes care of the worst of the bottlenecks. The toll facility ends up paying for the non-toll facility. All folks win in this deal," says Mike Heiligenstein, Executive Director of the Central Texas Regional Mobility Authority, which already oversees the 183-A toll road in Cedar Park.
He says the status of the highway makes little difference in the long run to east-side commuters. "Whether or not it's a toll road or it's not a toll road is inconsequential. Over the next twenty years, you're going to see development more than double."
But Dewy Brooks, the president of a homeowners' association in a subdivision right along U.S. 290, doesn't see it that way. "To take an existing road that's already there and turn it into a toll road and say it's an improvement, I have some issues with that," he says.
Heiligenstein says his agency has worked around Senator Kay Bailey-Hutchison's amendment banning current free roads from being turned into toll roads by keeping the frontage roads free of charge. In the past, the Texas Department of Transportation, a separate entity from the CTRMA, handling the 290 project, has taken a lot of heat from the public about plans to turn parts of Central Texas' highway system into toll roads.
Read the rest of the story HERE.
Read about Scumbag Mike Heiligenstein HERE.
By ANDY HOGUE, Gainesville Daily Register
Though stalled in the water for now, discussion on the Trans-Texas Corridor 35 project continues, according to a report from Cooke County’s representative on the project.
Sheila Cox, who was a vocal opponent to the multi-modal toll road project when first presented to the public, was appointed to a regional corridor advisory committee last year. Cox submitted a summary of the advisory committee’s actions from July 23 in Austin, in which she said the project is far from being “dead.”
“... The TTC is still very much alive and continues as a threat to all Texans,” she said in her summary, which appeared in its entirety in the July 25 Register.
Read the rest of the article HERE.
Did you all see that the Sunset Review Commission has revised its schedule for acting on the TxDOT sunset review?
Apparently last month they pushed the decision date back for TxDOT 3 months! The meetings have been changed from September 23/24 to December 16/17. This also coincides with when the 2030 Committee reports back to the TxDOT commission in December on a re-estimation of transportation “needs”.
By CHRISTOPHER CONKEY, Wall Street Journal
WASHINGTON -- The Bush administration unveiled a plan to impose new tolls on freeways and encourage more private investment to finance road and mass-transit projects, a move aimed at stirring debate as lawmakers prepare for a major overhaul of transportation policy.
Read the whole story HERE.
and Chano Falcon, one of three TxDOT employees being
investigated by the FBI for bribery charges.
Well, it turns out that the AP missed the fact that Amadeo Saenz, TxDOT Executive Director, not only knows the three TxDOT employees who were indicted, but they are all “best friends”, according to an inside reelable source.
Expect “Saenz to resign” after Chano Falcon flips on him for his bribes, says source.
The quote Amadeo Saenz gave the AP would give the impression that he doesn't even know the three, who are now accused of bribery in an FBI case:
"Any allegation of wrong-doing by a member of the TxDOT family is saddening, but this incident renews my commitment to transparency and integrity in all that we do. I will continue to monitor this investigation and if necessary, will take the appropriate disciplinary action," said Amadeo Saenz, TxDOT executive director.This latest investigation by the FBI and the Texas Rangers is just scratching the surface of the real corruption in TxDOT.
One of the three indicted, Cresenciano "Chano" Falcon, maintenance administrator of Pharr District, “will do just about anything”, including bribes, back door deals and even flipping on his pal Amadeo Saenz, who is at the heart of the TxDOT corruption — just to get a better deal with the FBI, says my source. Chano Falcon, Amadeo Saenz, and Ray Llanes hang out and go to bar-b-ques and other parties together says source.
As I’ve been saying for years, the TxDOT culture is poisoned with insider deals and bribes, and the folks at the top like Amadeo Saenz are the worst. This culture of fraud and waste is one of the reasons TxDOT wants a whole new source of revenue, they get directly — the toll tax for driving on tax funded freeways.
UPDATE: Saenz joined TxDOT in the Pharr District in 1978. He was the Pharr district engineer from 1993 to 2001. From 2001 to 2007, Saenz was TxDOT's assistant executive director, until he became the executive director on October 1, 2007.
Government Accountability Office testimony warns of need to better assess the true cost of privately operated toll roads.
The Government Accountability Office last week questioned the wisdom of using public-private partnerships to build and maintain toll roads. GAO's Director of Physical Infrastructure issues, Jay Etta Z. Hecker, summarized the congressional watchdog agency's work in testimony before a US Senate Finance subcommittee hearing on Thursday that focused on the cost to the public of privately operated toll road leasing arrangements.
Broadly speaking, these arrangements allow private companies to lease existing roads in return for the ability to collect toll revenue for a fixed term that can last up to 99 years. In some cases, these companies will offer local politicians billions of dollars in up-front cash payments for leasing rights. The private company would then be responsible for maintaining the road. In other cases, the private company would build and own entirely new roads, delivering significant new highway capacity to the public in return for significant profit potential.
While acknowledging potential public benefits of private participation in these deals, Hecker said that GAO's extensive study of this funding approach identified a number of fundamental problems.
"There is no 'free' money in public-private partnerships," GAO's report stated. "They are potentially more costly to the public and it is likely that tolls on a privately operated highway will increase to a greater extent than they would on a publicly operated toll road. There is also the risk of tolls being set that exceed the costs of the facility, including a reasonable rate of return, should a private concessionaire gain market power because of the lack of viable travel alternatives."
Read the rest of the article HERE