Governor Rick Perry appoints the five un-elected Transportation Commissioners, and they have been dutiful foot soldiers in implementing Perry’s proliferation of toll roads and even handing over control of public roads to private toll corporations using public-private partnerships (P3s).
By Terri Hall | November 13, 2013
When a local San Antonio TV reporter goes on a rant over a toll lane proposal, you know the Texas Department of Transportation (TxDOT) has hit a nerve. TxDOT is proposing to add two elevated toll lanes on Interstate 35 each direction from Loop 410 in Bexar County to Schertz in Comal County, approximately 15 miles.
News 4’s Randy Beamer struck at the core of the problem that’s been brewing in Texas, as it is in states across America, where the legislative squandering of the taxpayers’ money results in double and triple taxation from excessive tolling. “But isn’t it state lawmakers up I-35 in Austin who for years siphoned off the gas tax money meant to pay for transportation and then used it for other stuff so they can say they’re not raising taxes?” the TV reporter asked.
The insanity doesn’t stop there.
Transportation Commission Chairman Ted Houghton, self-proclaimed “most arrogant commissioner of the most arrogant state agency in the state of Texas,” announced at a recent commission hearing that it wants to convert ALL existing free lanes on I-35 through Austin into toll lanes, and turn the failing State Highway 130 tollway into a freeway. The move would force those who can’t afford tolls into driving approximately 30-35 miles out of their way to get on SH 130 to travel north-south, not to mention Austinites and anyone who needs to travel I-35 for local travel would be double taxed and possibly priced off their own previously free highway in perpetuity.
State Highway 130, an alternative route that runs parallel to I-35, has not been attracting enough toll traffic to cover the debt service payments, on either the northern segments run by TxDOT or the southern segments operated by the Spanish firm, Cintra. Cintra’s portion has just been downgraded to junk bond status. The state could terminate the agreement or otherwise takeover the asset for pennies on the dollar if the private operator goes bankrupt.
However, it’s unclear how TxDOT would repay its own debt on the northern segments of SH 130 if it were to be converted to a freeway, and it’s also unclear how it plans to convert the southern segment into a freeway when it signed a 50-year public-private partnership (P3) concession agreement with Cintra in 2007. It may seek to bailout the failing toll road by buying it out rather than let the asset fail and take it over at a vastly reduced price. Considering the close ties of Cintra to Governor Rick Perry’s office, it’s quite possible Cintra is working a backroom deal for a bailout since it knows what Moody’s has already declared publicly – the tollway is headed for bankruptcy. Either way, federal taxpayers are on the hook for a $430 million federal TIFIA loan on Cintra’s tollway.
Illegal lobbying?
Tolling existing Interstates is supposed to be illegal. However, the federal ban that Kay Bailey Hutchison put in place expired in September, and the state ban is riddled with loopholes. Houghton signaled the agency will inquire as to the legality of such a move and would seek changes to the law if it’s truly illegal. Texans Uniting for Reform and Freedom (TURF) sued the agency in 2008 for using state money to lobby, including lobbying to buyback existing Interstates for the purpose of tolling them. As a result, TxDOT backed off hiring outside contractors to engage in lobbying, but it sneakily continued its taxpayer funded lobbying by having its own employees do the lobbying – still equally illegal. TxDOT then sought and got changes in state law to allow them to lobby the federal government using state money. Looks like the Department is at it again. Considering Attorney General Greg Abbott is running for governor, now would be a good time to demonstrate to voters that he’s serious about enforcing the law so taxpayers don’t have to go to court to do the state’s job.
New tax would crash commerce
Knowing TxDOT’s history of lobbying for tolls, does anyone honestly think the freeway-to-tollway conversion of I-35 will stop in Austin?
Imagine the damage this will do to commerce in Texas. With 11.3 million of Texas’ 26 million residents living in counties along the I-35 corridor, more than forty percent of Texas’ population is effected by what happens on I-35. Any impediment to freedom to travel and freedom to engage in commerce will negatively impact the Texas economy.
In fact, TxDOT’s own I-35 Advisory Committee Report released in August 2011 touts the importance of I-35 to not only the Texas economy but the international economy as well: “Because Texas is located in the heart of national and international trade routes, the state of the Texas transportation system has a direct impact on the Texas, national and international economy.”
Any elected official worth their salt would run and not walk to Perry’s office and vehemently defend Texas from any such economic apocalypse as tolling existing free lanes on the state’s most vital artery of commerce. Perry appoints the five un-elected Transportation Commissioners, and they have been dutiful foot soldiers in implementing Perry’s proliferation of toll roads and even handing control of public roads to private toll corporations using P3s.
Anti-toll sentiment in San Antonio
Bexar County residents have long opposed adding toll lanes to I-35 since the idea was first adopted by the local Metropolitan Planning Organization (MPO) in 2004. The current MPO plan designates the I-35 toll project as a P3, known as Comprehensive Development Agreements (CDAs) in Texas. This means punitively higher toll rates (75 cents a mile or more) for the traveling public, the loss of state sovereignty over public infrastructure, non-compete agreements that prohibit or penalize the expansion of free routes surrounding the tollway, taxpayer subsidies, and other taxpayer bailouts and guarantees – all of which are wholeheartedly opposed by most Texans.
In fact, legal authority for such contracts expired in 2009 due to the backlash, with less than two dozen authorized to move forward on a project-by-projects basis ever since. Those 23 projects being explored are still being met with stiff public resistance.
Elevated toll lanes bring with it a whole set of negative impacts that at-grade improvements do not – noise, air pollution (dirt falls on homes, businesses, autos, and people beneath it), negative health impacts (aggravates respiratory problems like asthma), limited access, restricted access by emergency services, and the like. Plus, toll lanes do not solve congestion, but merely displace traffic elsewhere, most often our neighborhood streets not designed to handle high speed, long-distance thru traffic or heavyweight trucks.
The financial burden of paying tolls is an extra tax on top of the gas tax and other fees Texans already pay for roads. It poses a disincentive to using the added capacity due to the increased tax burden and limits the access of those unable to afford tolls. Therefore, adding free lanes instead of toll lanes will handle a greater capacity than toll lanes and better meets the traffic needs than toll lanes.
MPO documents show the I-35 toll project will require tax subsidies exacerbating double taxation with triple taxation. Any road built with tax money should be a free road, not a toll road.
Plan to bypass I-35
TxDOT is also floating a separate bypass proposal that relates to its Minute Order passed by the Texas Transportation Commission in September of 2011 to dual designate parts of I-410, I-10, and I-35 in Bexar County as SH 130 in order to drive more traffic to the failing privately-operated tollway.
Such a move is designed to incentivize people to bypass I-35 and get people out I-10 in Seguin with no way north but Cintra’s expensive tollway. The state is in a revenue sharing agreement with Cintra on these segments, so the state has a profit motive for directing traffic to a tollway where it will see an increase in its own revenues, as well as for a private foreign company for having done so.
Officials have a fiduciary duty to protect the public interest and the needs of the traveling public, not manipulate people into paying higher taxes and having to drive longer distances in order to head north from San Antonio. Texans need to strongly urge decision makers to add free capacity to I-35, not toll lanes, as well as to keep their hands off the existing free lanes of I-35. Texans have spoken loud and clear on the subject since Perry steered the state into toll road proliferation – keep Texas freeways free.