Texas Department of Transportation Commission Meeting

University of Texas Center for Energy and Economic
Diversification Auditorium
1400 North FM 1788
Odessa, Texas

9:00 a.m., Thursday, July 31, 2003

COMMISSION MEMBERS:

MR. JOHN W. JOHNSON, Chairman
MR. ROBERT L. NICHOLS
MR. RIC WILLIAMSON

STAFF:

MIKE W. BEHRENS, Executive Director
RICHARD MONROE, General Counsel
TAMMY STONE, Executive Assistant to the Deputy Executive Director
Executive Director

MR. JOHNSON: Good morning. It is 9:11 a.m., and I would like to call this meeting of the our July meeting.

It is a pleasure to be in the Permian Basin and to have you join us. And the best laid plans, everything -- every now and then, there is a malfunction and we're short one microphone, so hopefully, everybody will be able to hear us. But if you cannot in the back of the room, would you let me know by some signal? We'll do the best we can.

We're going to borrow the microphone at the podium after the presentation is done. So please bear with us.

I will note for the record that public notice of this meeting containing all items of the agenda was filed with the Office of the Secretary of State at 2:07 p.m. on July 23, 2003.

It's great to be in Odessa. Personally for me, it's like a return to my second home, as much of my business enterprises and youth was spent here.

As you're probably aware, it's the Commission's practice to hold some of our monthly meetings outside of Austin at different locations around the state. And if our records are correct, we believe that this is the first time we have met in the city of Odessa, although to be perfectly accurate, I don't know if we're in the city of Odessa. I know we're in Midland County, but wherever we are, we're glad to be here. (GENERAL LAUGHTER)

MR. JOHNSON: The commission did meet in the year 1998 in Midland. We certainly benefit from meetings outside of Austin because it gives us the opportunity to hear from you and to acquaint us with the interests and the challenges and the people of the various regions of this great state.

I am hopeful that by the time our visit is over, we will be well informed. In fact, I am certain of that. And I'm also hopeful that you will get a sense of how we conduct business, at least in the transportation end of state government.

A few housekeeping duties before we get into the bulk of our meeting. If there is anyone in the audience who would like to address the commission, we would ask that you fill out a registration card at the table in the lobby and please identify the agenda item, if it is an agenda item that you wish to speak on, and for that, we would ask that you fill out a yellow card. If it is not an agenda item, we will take your comments during the open comment period at the end of the meeting, and for that, we would ask that you fill out a blue card.

Regardless of the color of the card, we would like to limit you, and please limit yourself to three minutes. And in that context, we don't have a timer, I don't believe -- in Austin, we do -- but I will be timing you, and if you see me give you a hand signal to speed it up or two minutes or three minutes, please bring to a conclusion your remarks, we would be most grateful if you would adhere to those.

I know that many of us just can't get along without our cell phones and pagers and we would ask that you put those in the silent position so that the meeting can move along very smoothly.

Traditionally, at our meetings, I ask my colleagues on the commission if they have any comments that they would like to make, and I would do so at this time. The recently appointed and reappointed Robert Nichols becomes sort of the freshman and the junior -- no, you're the senior, freshman and the senior. So Robert, I'm going to start with you.

MR. NICHOLS: Thank you. I like the junior better. It's good being back in the Midland-Odessa area. I think we did have our '98.

The transportation commission decided about 12 years ago that several times a year, we would go out into the state and hold our meetings, give the community and public an opportunity to participate a little more directly, a little more equal level, and it's a process we do because transportation affects all of you, all of us together so much.

Appreciate the hospitalities that have been extended to us since our stay. We had a great dinner with the employees, the district last night. I think there were about 300 employees that came from all around the district, some of them with their families. It was very nice just for all of us to meet them and them to meet us.

In fact, later, we had a reception at the Hurt's Grande, and a very nice fireworks display, hope we didn't mess up any fire ordinances or anything. But it was very nice.

Look forward to the comments from -- not only from the district, but from the other transportation in the area. Thank you for having us.

MR. JOHNSON: Are you our sophomore or junior?

MR. WILLIAMSON: Probably sophomoric, most of the time.

MR. JOHNSON: Mr. Ric Williamson, self-described as our sophomoric member of the commission.

(GENERAL LAUGHTER)

MR. JOHNSON: Any comments?

MR. WILLIAMSON: I associate myself, of course, my comments to the chairman and Mr. Nichols. I grew up in Abilene, Texas, am well familiar with Midland and Odessa and Andrews, and points beyond.

We are extremely happy to be here. One of the things I observed in my 12 years in the legislature and my two years on this commission is that governments that focus on those things that are common to the culture and upon which the culture depends are governments that create environments for everyone where they live to feel as important as the next person.

Certainly transportation is a focus of this government, and we recognize that transportation infrastructure in near West Texas and far West Texas is as important as Houston and Dallas and Austin, although maybe not as important as Weatherford, but close.

(GENERAL LAUGHTER)

MR. WILLIAMSON: And I would just also comment that it is an extreme pleasure to be in the hometown, home area of Speaker Craddick who has been an outstanding partner in giving the transportation system the tools we need to build for the future, and I can't tell the folks who live in this part of the world how important it was and the changes that were made in government from that man's leadership in the last six months. And I'm glad to be here as well. Thank you.

MR. JOHNSON: Thank you, Ric. I would like to introduce to you some of the TxDOT officers and the staff that have accompanied us and are so integral to the work of the department.

Of course, on my left is our Executive Director, Mike Behrens. But also we have two other members of the executive staff who have come with us from Austin, Deputy Executive Director Steve Simmons, and Assistant Executive Director for Engineering Operations, Amadeo Saenz.

So these are the people who oversee the day-to-day work of TxDOT which, as you can imagine, with 14,000 employees and about $5 billion annual budget, it's quite a task.

Also welcome for the first time, Tammy Stone, who is our new commission meeting coordinator. Tammy puts these things together and certainly when we go on the road, that's a yeoman's task. Tammy, it's great to have you here today.

With those preliminaries out of the way, we'll get down to the business of the day and our agenda. We will hear from quite a few people at this meeting, and as I mentioned in the origin, that's one of the pleasures and delights and a lot of take-on value of the commission.

They are scheduled or at least some elected officials and their representatives mentioned they would like to say a word, and so if they are here, I would like for -- to call them to the podium. Stephen Raines, who represents the speaker's office, who Commissioner Williamson mentioned, Tom Craddick, our speaker, has undertaken and done a terrific job of leadership in a very difficult time.

Stephen, are you here?

MR. RAINES: I am.

MR. JOHNSON: Would you like to take the podium? Welcome.

MR. RAINES: Thank you very much for coming here to the Midland-Odessa area, from Speaker Craddick, to take your time to come out to the area and hear the constituents of what the Midland and Odessa region have to say.

And also, thanks to the leaders that have to do this job and all of the work given, so thank you very much from us.

MR. JOHNSON: Thank you very much for being here yourself. Representative Pete Gallego, or someone from his office? Seeing no one.

Is Julie Williams here from Representative Buddy West's office? Jenny Welch from Congressman -- newly elected Congressman Randy Neugebauer's office? Would you like to --

MS. WELCH: I thank you for coming to our area.

MR. JOHNSON: Thank you so much. Thank you for being here.

MR. WILLIAMSON: We know him well. He's been a great, great friend of ours for years.

MR. JOHNSON: Well, moving past that phase, we will ask our Odessa district engineer, Lauren Garduno, if he will give us an overview of the district's activities.

Thank you for your great show last night, especially what we did at the district office. I will say that, at the reception, there was a fireworks show which will, without peer in my mind, and it was so impressive that I think the commission will probably go into executive session and award a lot more money to the Odessa district.

(GENERAL LAUGHTER AND APPLAUSE)

MR. JOHNSON: I would like the record to show that the chair was -- said that with a little bit of grin on his face.

(GENERAL LAUGHTER)

MR. GARDUNO: Chairman, I'll bet we could do that again if we have to. (GENERAL LAUGHTER)

MR. GARDUNO: Thank you, sir, for being here today, Chairman Johnson, and welcome to the Odessa district, along with your counterparts and peers, Commissioner Williamson, thank you for being here and Commissioner Nichols, and Mr. Behrens, we appreciate you taking time out of your schedule to spend time in the Midland-Odessa area.

And we're very delighted to have you and excited that you're here and the opportunity to share some of the things we're doing out here to showcase for you today.

Also, I would like to take the opportunity to welcome some distinguished guests we have in our audience. We're fortunate enough to have in my backyard, past chairman of the highway commission, and I'd like to recognize Ray Stoker at this time for his efforts and his support of the highway and transportation. And Ray, thank you for being here today, too. So appreciate it.

We also have two past executive directors in our audience today. We have with us, Mr. Arnold Oliver from the Wichita Falls area, executive director of TxDOT in the past, and Mr. Bill Burnett who spent some time in the Odessa district, I believe, and so we appreciate you gentlemen being here also.

I have some peers, some neighbors that I work with closely, and I appreciate their support and we work well together. I have two in particular that are here with us today, that are visiting with us today, Randy Hopmann, newly appointed district engineer in Lubbock, and Randy, thank you for being here. And Walter McCullough, I guess, after August, going to be the dean of our engineering staff, effective, I guess, the end of August. So we look forward to his wisdom and continue to oversee things out in West Texas.

We have a presentation for you today that includes not only a report on the district and what we're doing -- is this working -- we have a report that will come to you from the district and show you what we're doing in the district here in the Odessa area and also, I would like to recognize we have some other speakers that are going to give you a presentation, Mr. Kyle Womack with MOTRAN, represents MOTRAN, will give you the discussion on La Entrada Al Pacifico Corridor. And teaming with him is Mr. Buddy Sipes who will represent the LEAP Rural Rail District, La Entrada Al Pacifico Rural Rail District, and they'll have a short presentation also to give you an update on what we're doing there.

With that, I will go into my presentation today, and I guess I will be using this screen behind you. And we improved it earlier in the week, so I guess they say you can see it from there. I hope it's like an Omni, I guess, it's real big and right in your face, but we'll give you the opportunity to see what we're doing.

This is our presentation to the highway commission in the Odessa district. This is our report to you today. In 1999, I was asked by Mr. Wes Heald to come out to this area and take over. We had some tragedy, of course, you're all aware of. We had a tragic passing of the previous district engineer, Jose Morales, in 1999.

On July 1 of 1999, Wes Heald asked me to come out here from the Abilene area and take over in the operation of this district. We had a lot of good work that was done by Jose and, of course, we had a lot of, I guess you could say mending, healing that took place, and we had to spend some time doing that. Of course, it was a shock to the district then and the employees had to spend some time recovering from that.

But we feel like that we have done that, I hope, and we're moving forward and we're able to continue to move the transportation function on down the road.

We have a large district. I think it's the second largest, as far as geographical area in the State of Texas. We have 18,000 square miles to cover, and it goes all the way down, of course, to the Rio Grande, it covers another state, borders New Mexico, and it actually borders five other districts.

So you get an idea of the geographical location by that imprint there. We have -- impressively enough, I think we have 305 center line miles of interstate in this district. Steve Simmons and I had a discussion on the phone here a while back. He was actually kind of surprised that Odessa actually had that much center line miles of interstate, but we do, when you start adding the I-20 corridor and I-10 corridor throughout the district.

I realize, of course, it doesn't have the traffic volume of the I-35s and I-69s, but it's still a highway that needs to be maintained so we try to do the best we can to do that.

In order to do that, we rely upon the support of three very capable and very hard working area engineers. I have Mr. Doug Eichorst on the left, who is our Midland area engineer, and Mr. Dan Dalager, who is our Odessa area engineer, and Mr. Mohammed Moabed who is our Fort Stockton area engineer.

And these gentlemen cover an area, they cover the 18,000 square miles, you can kind of see by the coloring. Doug covers the area that's coded in yellow. Dan covers the area coded in brown, of course. And then, of course, we let Mo cover what we call the Big Blue, out west, west of the Pecos. Mr. Mohammed Moabed covers the rest of the Pecos area, which includes the cities of Fort Stockton and Pecos. A lot of area.

In addition to that, we have an urbanized area in Odessa and Midland region. It serves about 250,000 people, in this metropolitan boundary. Pretty good sized area when you combine the two, and so we are very, very excited, of course, about having that group of -- that population size to serve and work with, and we're very, very appreciative of the support that we get from those two communities also.

However, we do have rural areas in this district to cover. There is actually rural areas in Midland County and Ector County, in addition to some of the others. Loving, of course, has the distinction of being the least populated county in the State of Texas and carries that distinction.

I can remember working with Bill Burnett several years ago. He used to always tell us if we didn't straighten up in our work, he would send us to a design work station in Mentone. We always had to go look where Mentone was, but we found it in Loving County.

(GENERAL LAUGHTER)

MR. GARDUNO: Our presentation to you today is going to be based upon -- I think you'll recognize this. We're going to recognize the business objectives that you have outlined for us to start focusing on, and to simplify our processes for the public. We are identifying the plan it, build it, use it, maintain it, and manage it theme for this presentation, to try to show you what we're doing in this district to try to fit those business objectives.

And the course of this presentation will follow that pattern, we'll just go down step-by-step in those respective areas. You also have given us some objectives to try to meet as goals for this transportation department. We recognize the need for reliable mobility. We recognize the need to improve safety at all times. Of course, that is an important goal.

We also recognize the system preservation and how we have to maintain and improve our existing roads. We recognize that accelerated project delivery, I imagine there is a lot of discussion in the area of environmental streamlining, for example, it always comes up. And we're attempting to do what we can in our accelerated project delivery to move these projects along.

And finally, of course, you've given us a challenge to look at the economic vitality of this region, how we can attract businesses and improve prosperity for all of our West Texas citizens and communities out here in this region.

So our presentation will look at the plan it, build it, use it, maintain it, manage it, and within that presentation, of course, you will see some of the things we're doing to meet those objectives.

In the plan it area, I will not spend much time here because we're going to have a separate presentation from Kyle Womack on the La Entrada, but we do recognize that we have just a wonderful opportunity, as we look at this port down in Mexico, Topolobampo, to bring the traffic -- the business traffic up through this part of the state, maybe the opportunity to relieve pressure off of, for example, I-35, as you see that corridor, and even later, I-69.

We are seeing improvements at the border at Presidio ports and we're seeing a lot of movement and discussion on the I-10 connection to Fort Stockton, and of course, all the way up to Lubbock as we tie into the Ports to Plains, the Plains group.

Our focus here in the Odessa District, a little bit more of a strategic level for us, and by strategic, I guess this would be more of a focus of what we're trying to do immediately. We recognize that we need to build a connection between -- the north connection between Lubbock to the Midland-Odessa region. That connection includes a new reliever route, State Highway 349, out here north of Midland, the edge of town and parts of Martin County.

This is an opportunity for us to bring that traffic -- that potential truck traffic down through into our future Entrada Enterprise Park in the airport region, so we've been working tirelessly and I guess rather aggressively, as much as the resources we can put to trying to move this project along.

And I will also mention I appreciate the support we've had from our business leaders and from our communities, both the Midland community and Odessa community to help us move this project along. We've had some good meetings. We've had landowners that have been willing to donate right-of-way, and this thing is continuing to move, and we're very happy for that.

You can see a little more detail of what we're professing. They are proposing grade separations at several locations throughout that route, and hoping that these grade separations, of course, will tie into future master plans for the City of Midland, for example, Midland County and get over to the airport region, the community of Odessa, and the Enterprise Park.

You see the Holiday Hill extension, for example, we have been working with the City of Midland, Midland County, as far as looking at the Holiday Hill extension, identifying it on the city's master plan as they build that road out. And movements are currently under way for us to work with them and trying to look at a future of grade separation interchange at this particular location.

We have the Entrada Enterprise Park. We're very excited about that. We just recently had a press conference on identifying the research implementation project and look at Project 4083, for example, to spend some implementation research dollars on making this an inland port and we're excited about that and look at that from the planning perspective. There is a lot of attention that's been looking at that Midland airport area, including rail, including air facilities, including transportation.

Our goal will be, of course, to tie the rail and tie the highway network into that airport so we can make that a future full-blown Entrada Enterprise Park and realize its full potential.

In the Odessa region, the elected officials in the Odessa area have identified one of their major projects. It is the John Ben Shepperd Parkway overpasses. This is a combination of overpasses, both at the interstate and on Business Interstate 20. You can see those two locations identified there.

These projects, in my opinion, have taken on new significance, particularly from the inclusion of the Family Dollar distribution center that y'all talked about last night, for example, coming into this region. It is an incredible facility, looks like it's going to be able to bring quite a few jobs, like 500, is the indication on that, so we're excited about that.

That is going to put an impact on not only our interstate, but actually put an impact on how we get access to this industrial park in this part of the community.

We have a project on the books that includes an overpass at the interstate. It also includes an overpass on the BI-20. I've also identified, because of that, and because of the recent significance that this industrial park is starting to bring to this community, we realize that we have some needs to improve access up and down the business interstate corridor.

Just recently, I initiated a consultant study to look at the operational efficiency of Business 20 as we look at our connectivity to these particular major connections. Loop 338, John Ben Shepperd, Grandview, for example, are some of the facilities that we're connected to over in the Odessa area. So we're excited about this, and we have some design work that's proceeding on and moving on down the road with this project also.

My director of transportation planning, Mr. Gary Law, put together a study back in about 1999, I guess, it was completed about that time, looks at the Interstate 20 corridor.

If you drive through this community, either day or night, you'll notice that you have a wonderful rural interstate system that has very limited connections over to these two major cities. And at nighttime, especially, if you drive down the interstate at night, you can see the bright lights of the big city sitting over there to the right, as you're traveling west, or to the left, as you're traveling east. And it's just amazing that we really recognize that we're trying to improve the connectivity to these two major cities.

What we're attempting to do is take an I-20 rural corridor and make it a more urbanized corridor. You're going to see we have planning efforts underway, some schematic development, to look at the whole frontage road system, moving to a future one-way frontage, for example, as we see more businesses wanting to move out to the interstate and try to develop that corridor.

We actually have an illumination plan that is identified by business leaders in both communities. High map lighting, for example, in order to identify these major points of entries into these two major cities, and so we're moving on with that project. In fact, we actually have illumination going up as we speak in both cities, on Interstate 20 and also on Loop 250, on Business Interstate 20.

So we're excited about this plan. And in doing so, we were able to identify all of the access points up and down this corridor. We have federal highway approval for every one of our ramps, our proposed future ramps, as we look at another of this corridor, so a lot of planning has gone into place that is going to put us down the road to be available to start looking for future dollars as dollars become available.

Commissioner Williamson, I apologize, I was trying to remember your -- if you can vision it -- say it for me.

MR. WILLIAMSON: Think big?

MR. GARDUNO: That's it. "Think big".

MR. WILLIAMSON: Plan huge, execute large.

MR. GARDUNO: Plan huge, execute large. Let me get an idea about this. We recently put together a landscape committee made out of officials out of both our major cities, Odessa and Midland, and they came together, Laurie Williams, our district landscape architect, and we were able to develop what I consider a 10-year landscape management plan, both for our hardscape and our softscape in this part of the country.

And in doing so, you know, we didn't quite meet the qualifications for the green -- you know, the Houston pike, the green beltway and the green area, we were just under the threshold by individual cities, they both fall under that threshold population.

But we figured that we're big enough, with the two cities combined, that we really needed to have some kind of a plan in place. This particular structure does not exist. That particular structure there does not exist yet, but through the benefit of technology, we're able to visualize what we see possibly out in the airport region, the overpasses and the connectivity out in the airport region.

And with that kind of visualization and that kind of planning, we think we might be able to realize that future down the road and build this kind of stuff. We can see it first, and show the public what it looks like, and then later, come on down the road and build it.

So these are some of the ideas that we're kicking out in the Odessa district to try to further sell, market, promote the development of our landscape plan, our hardscape and softscape. But that structure doesn't exist yet, but some day, we look forward to it.

And with that, we have also in the Midland area, we have a need to complete the Loop 250 project that is started, as you drive over on the north side of Midland. This project is complete all the way over to Big Spring Street.

At that point in time, it plays down to just a frontage road, and we need, of course, to go ahead and complete that loop around on the east side of Midland, northeastern loop. This will provide connectivity around to the east side of Midland and also out in the community of Greenwood.

You can see the loop terminates out here, we have an I-20 termination that goes into County Road 1130 and that County Road 1130, of course, will provide us input into a rather growing community of Greenwood, it goes out here, it's a rural community about seven miles south out here east of Midland. It provides access for that group of individuals to come into the Midland area and take care of business and shop and do those types of things.

So we have Loop 250 also in the final stages, and the environmental is approved and we're ready to go through with the project there.

On our Interstate 20 corridor, you can see, as we look at these access points, not only to the City of Odessa like the John Ben Shepperd, but also the City of Midland. As you drive through the City of Midland, you have a Business Spur 158 that is rather convoluted. It's hard to navigate through. It's actually on our state system, and the goal here is that we would actually give the city some of this highway network opportunity to maybe reroute 158 over to the interstate, this Garfield extension here, it's kind of a trade. We're going to trade them some existing on-system highway for future proposed on-system highway here.

This works real well for us because it actually cleans up our business route that goes through town. It actually brings it to the interstate quicker. It provides a direct connect into the hospital district on the south from interstate, for our rural healthcare, and it also fits our master plan, if you take Garfield and extend it, you'll see the city master plan includes an extension of Garfield up to the proposed future reliever route here.

So we would actually then have that connection all the way through town on this Garfield extension. So that's another project that comes out in our planning area.

In the Odessa region, we have Wal-Mart on the west side of Loop 338 that is generating a lot of traffic. And we realize we've got issues over there. We are looking at operational efficiency of Loop 338, improving two particular structures on our FM system, looking at Loop 338, and we think we will be able to improve the access and operational efficiency on West Loop 338.

We also have two overpass structures identified on U.S. 385, both north and south side of the city of Odessa that need to be improved so that we can -- as we have this oil field traffic, for example, that moves through parts of the community, we need the proper clearances to be able to move this traffic unimpeded.

With that, of course, you'll see with all the planning efforts we're doing, we've got pretty big plates and got a lot going on, and one of the exciting things that I saw in '99 when I came out here was the compassion that the local officials and the citizens of these great communities have put into this transportation network.

It was very exciting to see everybody on board with transportation. Makes my job easier actually. People might argue that otherwise, but -- when you get competitive in some ways -- but in reality, it has made my job easier because everybody is real compassionate and positive about transportation, and we have a lot of good projects on the books because of that.

Standing on a shovel, I guess that's the only time that's allowed, is when we're breaking new ground for a landscape plan, so this is a donor community achievement award over in West Odessa, and we were breaking ground here for a wonderful project on the west side of Odessa, part of our landscape improvement on the whole business interstate corridor.

We were fortunate enough, of course, to have an enhancement project, you get a chance to see some of the work we're doing in this district on landscape management, utilizing everything from hardscaping to some painting, some staining, and xeriscape, we utilize that heavily around here because we recognize the -- we're just lush with water, this high rainfall we have, like the Houston area, just doesn't happen. But we make it work with a good theme, and it's worked effectively.

In fact, if you drive the interstate, over on Loop 250, you see that. That is a taste of some of the stuff we're doing in this area.

In the area of build it, been pretty aggressive on our railroad crossing signal program. Union Pacific is coming through here at 60 miles an hour now, and we were talking about this last night, we feel like we're down to just one or two crossings that are not signalized, for example. You can see some of the work we've been doing over the course of the last few years and we're very proud of that because we know the trains are coming, and they're coming faster. So we're trying to make it as safe as we can for the citizenry here in this particular region.

We have some bridge work going on. You've given us a bridge initiative, trying to improve our bridges across the state. These are some of the projects we have recently completed, including Interstate 20, Moss Avenue, State Highway 18, Pecos River, Toyah Draw, we've done work on the BI-20 in Pecos, and also had work on BI-20 in Midland.

For these -- these types of projects allow us to look at mobility, to improve safety and of course, we look at economic vitality as you see some of the work we've been doing. There is a good shot of the BI-20 Midland bridge project as you look at the downtown area in Midland. Made a pretty bridge, actually.

We've been working with crumb rubber hot mix asphalt out of this district now for quite a while. I was talking to our district lab supervisor, K.C. Evans, and we have a project -- for example, Commissioner Williamson, you drove on yesterday coming in from the east, as you hit the Martin County line, it's been down since 1994, it's been down nearly nine years, and all it's had to have is a fog seal periodically to try to keep that pavement rejuvenated.

We've had two sections -- we had another section right down the road from that, that's been down since 1995. Received a lot of life with this particular product. We've had award-winning pavements on U.S. 385 between Odessa and Crane. We've been recognized for some of the work we've done with that, and also, we are working pretty extensively with a new product. I guess it's not new, but it's new to this region, it's called white topping or ultra thin concrete pavement. We use it as a maintenance rehabilitation product and we're using that in our major urban areas, particularly Midland and Odessa. You'll see some of that in our intersections throughout these cities.

We have a good partnering program with our contractors. You can see some of the construction letting we've been doing over the last few years. Of course, the dip in 2002, you recognize is due to the budget issues we had to work through, but we were able to get back on track in 2003 and get our letting back up to respectable letting for this district.

Our goal is always, of course, to get as much as we can. And we always look forward to letting as much as we can. We've set goals. For example, we target $50 million and if we get above that, we're excited and, of course, if we don't, we work towards it, but that's some of the goals we're trying to work towards to let a good construction program out here in the Odessa district.

We are very fortunate to have a lot of friends at TxDOT. We've had a lot of people to go to bat for us out here. It seems like -- I was telling somebody the other day, we're not only in the business of building roads, but I've been in the business of building buildings, and will be, for the next few years. And you can see a list of some of the enhancements that we have on our slate to work on.

We're currently in construction at the museum, wing of the Petroleum Museum. We have a nice landscape project on the BI-20 railroad corridor, we're going to try to do some planning and some hardscaping in the two cities and of course, going to try to remove some mesquite up and down that railroad corridor, make it more aesthetically pleasing all the way up and down there.

So Midland, of course, is some hike and bike trails. We have some Memorial Gardens works that we completed in Odessa, a beautiful facility if you get a chance to see that, it's a beautiful facility.

Of course, the South Orient Railroad Depot, the Wadley Baron Park trails, and of course, the Commemorative Air Force has a museum wing that we're going to be working with them out there. So big projects, excited. Got a lot of work in that area. We thank y'all for your consideration of us.

We have some project award winners in the build it area. Doug Eichorst, our engineer, has won some awards for design. Dan Dalager, of course, has won some awards for his hot mix, particularly in the crumb rubber area.

Glen Larem, our public information officer, in his work in design and partnering. We have some construction award winners, Mr. George Garcia and Rick Winter and Augustine Aguirre, of course, three of our talented inspectors in both the Midland and Odessa areas that have helped us produce some of these projects.

In the area of use it, that is fresh paint right there. That is the first picture coming off of the line of our new public transportation project out here in Midland and Odessa. We're very excited about this.

I can remember, talking about Dyess, when they were bringing those B-1s into Dyess, quite a while back, talking about trying to get a flyover with one of those B-1s and he flew in there, he was late, he was flying so fast that they said that the decals were actually peeling off of the jet as he was coming into the Abilene area. But I don't think we're going to drive it that fast, so there won't be any peeling of paint, we hope, as far as our new buses.

It does start October 1. We have 19 buses between the two communities that will be involved. We also have the -- the service is going to have 11 fixed routes, and I'd also like an opportunity to tell you about our rural public transportation.

We're going to try to -- we've been working the last year to try to get a one-call development of our rural public transportation and connect that into this urban area and trying to integrate the two and we've been putting some efforts there to work them together, so we're hoping we will be able to do that over time.

I also have a waitress example I'd like to tell you. I was eating dinner the other night after softball practice and the lady was visiting with us and she was real excited and, of course, my wife is sitting there six months pregnant and thinking she's not showing, but she may be showing just a little.

(GENERAL LAUGHTER)

MR. GARDUNO: And the girl was talking to her about it and said, you know, she has two young kids and she was real excited about kids and she was looking forward to going back to school, she wanted to improve her life, she had a plan.

But part of her life improvement, she mentioned specifically and included, she said, "I can't wait until we get this public transportation up and running because I cannot start school yet until I can have an opportunity -- a means of transportation to get to the institution I need to get to to do my schooling."

And that struck me, it really struck me. And I said, "Well, ma'am, if you'll wait until October 1, something will be up and running for you." And look forward to that.

And that's not the first time I've heard these types of stories in these communities. I've heard it in Odessa also, so we look forward to that.

In the area of use it, safetywise, we're also -- have rumble strips on our interstate, we're trying to upgrade our interstate system with that. We're utilizing the forced friction course on the interstate for a plant mix seal, because we feel like it improves, during wet weather conditions, we're able to move a lot of that spray and a lot of that film that comes up with water in the wet conditions, which we do get every once in a while. And when we do, we need people driving safely while they're out there.

In the area of maintain it, we're real excited about this. We realize that most of our work in the Odessa district, of course, involves maintaining and preserving the existing system. We have a lot of employees that focus on safety, system preservation, a wonderful group of people throughout this 18,000-square-mile area, they do a variety of jobs for us, a lot of skills, you get a chance to see some of the work they're doing.

We have a -- we're real proud of the ride quality we have out here. Mr. Williamson came in last night and said, "Our ride was good," but he said it in the vein that we didn't need money. He scared me. (GENERAL LAUGHTER)

MR. GARDUNO: Our ride is good. Of course, I realize you can compare it to the other parts of the state, it is good. My --

MR. WILLIAMSON: The point was didn't look to me like you needed much money for roads. You need a lot of money for railroads.

UNIDENTIFIED SPEAKER: Amen, brother. (GENERAL LAUGHTER)

MR. GARDUNO: What we do have, though, is we have a commitment to maintain a system to meet our goal. I think you've given us a rather exciting goal of trying to maintain ride quality out here, and I think we can.

Of course, we realize we have good road materials to build with, we have good subbase to build on. And you can see that our condition has done quite well over time. We rank the highest in the state, as far as our ride condition scores, that's what has been given to us. And we've actually been able to improve it, which I was given a challenge by Mr. Behrens to improve my ride and we're still trying to do that.

The way we're doing that is in the area of preservation. You can see some of the ways, mobility and safety, system preservation. We have a pretty aggressive seal coat program. I didn't start that here. I was the beneficiary of an excellent seal coat program for many years in the Odessa district. We've been using the seven-year seal coat cycle.

We put about eight and a half million dollars a year into our seal coat cycle, and we're able to keep that seal coat cycle in over seven years.

We have identified, though, however, recently, that we felt like we needed to put some preventative maintenance money on Interstate 10 and on Interstate 20. So we've dedicated, you can see, two million a year to Interstate 10, four million a year to Interstate 20.

That is a relatively new program for us. We're excited about -- identified and decided that we need to go ahead and do PM on our interstate also so that we could prolong that interstate and not have to get into full reconstruction down the road.

However, when the reconstruction does occur, we're prepared for that to some extent. You can see that we do have some money set aside for our reconstruction program.

Because of the combination of categories, we realize that we have to maintain operations, of course, and I've given Mr. Mike McAnally, our director of operations, two million a year to handle our striping, our luminaires, and all those other programs that need to be maintained throughout the district.

I give Laurie, of course, some money to continue work with our landscape, and we've won a lot of awards out here for our landscape, I'm very excited about that.

We actually set up a million dollars a year, not to say that we use it all the time, but we have set up a million dollars a year to identify our bridges, look at our bridges and see what kind of repairs they need so we can maintain that goal for you also. And here again, you can see some of the work we've been putting down.

On the combined maintenance level of service, based upon rutting, based upon cracking, based upon those kinds of categories, you can see the improvements we made in the fiscal year '02, fiscal year '03, if we get out of the red, we're better. Our goal is to get all of our red out of it, and of course, we were able to do that for '03. That's not to say it won't go back to red in the future, but we're going to continue to try to work hard to keep that combined level of maintenance as high as we can, and that's a goal we work towards, too.

We have a lot of equipment in the district that has to be taken care of, and we take pride in that. We have a real aggressive maintenance program on our equipment, trying to make sure that we make this stuff last and go down the road for us.

I'm very fortunate to have able leadership in my shop, Mr. Mark McCollum, who actually comes to us from the private industry and has some background in the private industry, and because of that background, he's able to keep us on track in purchasing and acquiring the equipment we need to do our job, and we're very grateful for that.

We completed our sign program, of course. You see some pictures of that. We were able to complete that. You can see some of the safety devices we were purchasing. We were up to speed on all of our crash attenuators that we're required to be up to speed with there.

Real proud of our district safety record, vehicle accidents. This district is very aggressive. That rate represents -- basically, you take your rate as a function of the accidents by -- multiplied by a million, divided by the amount of miles driven for the month. You get a rate for the month, and of course, the lower the rate, the better we are.

You can see that we were third in the state as far as our vehicle accident program in the year of 2000. We were first in 2001. We were second in 2002. And we were excited about that. Because that not only translates to keeping people safe, but also it's keeping your equipment protected, which translates to dollars saved also. You look at your insurance program and we feel like this is saving on our insurance program also.

We have a very good vehicle safety bonus program. We take that money, 200,000 in '99; 75 in '01, '02. We try to buy safety devices, better flags, better equipment that relates to safety, flashing arrow boards, speed trailers, those kinds of things, we utilize that safety money in that area.

We have a -- you see some economic development out there. We've got, of course, a lot of historic sites that we work with the local officials and they come to us periodically trying to promote and develop our sites, the Odessa Meteor Crater was one of them.

We completed the Moss Road overpass here recently, and that was dovetailed into some work that the county was doing at the Meteor Crater road out there.

In the area of management, we have employees that are continually submitting ideas on the employee incentive program. Gilbert Herrera and Hector Tarrango with their patching box. And Gilbert Gonzales, of course you can see he's been very aggressive, hinged signs for slow moving vehicles and mechanical broom waver replacement mount.

These are different ideas our employees come up with to try to improve operations at TxDOT and we're very proud of them and very proud of the work they've done.

Here are pictures of some of our retirees, they're going to be August 31. That's going to be affected by the bonus incentive program, and we're very sad to see them leave. We know, of course, they have some exciting things to do, but they represent the wealth of experience that's going out the door. We're going to miss that wealth of experience, and we're looking forward, of course, to letting you know we are out recruiting.

This is a recent career day we had last year in Andrews, Texas. Appreciate the work of the Andrews school system over there, brought out about 1800 kids, it was incredible, from all over this part of the state. So yeah, we're always looking for a good engineer or two around the place to see if they might be interested in working for us. So it was a good program to introduce them to what we do, and we also partnered with our local contractors, Jones Brothers and Reece Albert, some of those contractors, were able to partner with them in putting this career day together.

Of course, we wouldn't be a department without the help of a friend of TxDOT, and we have a good group of friends that have really helped us throughout the years. Betsy Triplett-Hurt, of course, was the winner of the Road Hand Award last year for her efforts in helping us.

Charles Perry, of course, was not only a Road Hand awardee, he was also the Russell H. Perry Award winner that you recognized this last winter at College Station.

We've had governors of Mexico coming in, which you see, Buddy West and Tom Craddick, of course, with him, in putting up the La Entrada Al Pacifico Corridor.

We've had a couple from Teel Bivins on our career days, for example, came and spoke to our young people, and appreciate his support there. We've had actually the newly appointed and newly elected Randy Neugebauer come in from Lubbock and sit down with our folks and talk to us about transportation in this region.

And we were actually fortunate enough, of course, to have the governor come into our shop. That was a highlight for a lot of employees, we're excited about that, because you don't get that all the time, and we were very honored to have him at the time looking at the Trans-Texas Corridor, come into our shop.

And we have a few other famous people, maybe one or two. And of course, that is our presentation on the Odessa district, and I thank you for letting me do that.

At this time, I will turn it over to Kyle Womack. He has a presentation on the MOTRAN, I guess, and Buddy Sipes with the railroad. (APPLAUSE)

MR. WOMACK: Good morning. It's certainly my pleasure to meet with you this morning, and express our appreciation of joining us in Midland and Odessa to talk about transportation.

We have a short technical changeover that I will try and fill in for a few minutes while we make that change. I would say that we do still have some roads that need to be built in West Texas. And what better place to invest in our roadway system, and I use the word "invest" very sincerely, than a district that has such an excellent record of maintenance, of safety and of preserving the highways that we have.

We are indeed fortunate, I think, to have one of the premiere districts, and we have enjoyed greatly the relationship that we've had with the district office, Lauren and Gary and all of his staff. They truly are working with us. And the business community and the leaders of Midland and Odessa and this entire region, to make West Texas one of the premiere transportation highlights of the state, and we look forward to continuing that relationship and can't tell you enough how much we appreciate that.

Lauren hit briefly on several things that we're doing with La Entrada, and I know you're familiar with the project. We appreciate your past support.

Our top priority is the development of the La Entrada Al Pacifico Trade Corridor. Your support has been instrumental in naming that corridor in 1997 by the Texas legislature and then Governor George Bush, and our mission has been to develop an economically viable trade corridor in partnership with Mexico.

This is an alliance that we are continuing to build and grow to focus on the regional benefit, for not only Midland and Odessa, but the entire southwest part of Texas, the Panhandle, and on into the Dallas-Fort Worth metropolitan area.

One of the charges -- and I've been involved with MOTRAN since its inception, one of the early charges that we had was develop the relationships with Mexico. I think early on, one of the concerns was, well, we understand the importance of this corridor, but we're a little apprehensive as to what Mexico is going to do as far as partnering.

Through the efforts of many people over many years, we have developed some strong relationships with Mexico, especially in the states of Chihuahua and Sinaloa, to develop this international corridor, which connects Topolobampo, the western Pacific port in Mexico, to the inland port in Midland-Odessa and beyond.

And I want to share with you a little bit about what's happening in Mexico, because we're very excited about some of the things that are happening in Mexico.

One of the real stumbling blocks early on was the route initially south of Ojinaga on Mexico Highway 16. It was a very circuitous route through the mountains, not conducive to truck traffic. And in response to that, a key component of this whole corridor was the State of Chihuahua's commitment to build a bypass around the mountains.

And this is a map of that area that you see there. We are excited that they are building roads. This road is scheduled to be completed and opened by the end of this year. And we think we will see immediately -- immediate impact to the core truck traffic that will be seeking this route in the La Entrada corridor.

Also, if you look in the states of Sinaloa and further south in Chihuahua, the state of Sinaloa is improving their roads. They have improved many of their roads from Topolobampo up to Croix.

As you know, there are difficult engineering challenges crossing the Copper Canyon. We currently have rail access from Topolobampo to Chihuahua City.

We are also very excited that private development has seen the need of developing and connecting this highway. We are seeing road construction from private development through a mining facility in Chihuahua and Sinaloa that is working toward completing this connection. It's in association with a mining operation there, and they are -- they have chosen a little different route than was originally designated, but it accomplishes the same goal.

The route that they are looking at, from here, goes slightly towards the east and then up through and back around this direction. But they are actively working on completing that roadway even today.

Of course, Lauren mentioned, and one of the things I think continues to be a focus for both the Midland and Odessa community is to focus on our intermodal international concept of this area, being the economic center for transportation and a hub for intermodal transportation.

We are at the crossroads of not only one corridor, La Entrada Al Pacifico, but also, of course, the Plains corridor and have worked closely with Lubbock in continuing to develop those regional priorities.

We're trying to look at this from a region. It includes Amarillo, Lubbock, Big Spring, San Angelo, Midland, Odessa, this entire region, and the airport here can be a center for that.

It's the union of the Union Pacific railroad. We have an international airport. We have a foreign trade zone. Thanks to your support and help, now we are beginning to research this whole concept of an inland port facility. We think that mirrors exactly what our mission is, to develop this area as a regional center for economic development.

The airport is conceptually beginning to develop. The La Entrada Al Pacifico Corridor, that goes right by the airport, and the Entrada Business Park, do have a U.S. port of entry with on-site customs. As you know, we are the second largest MSA in the area. We continue to be one of the centers for oil production in the United States with 61 percent of the Texas oil production happening right here in the Permian Basin, and over 16 percent of the U.S. reserves.

What better location, especially with our orientation to Mexico, to look at international trade to focus and develop an inland port facility. We certainly appreciate your support in that regard.

As the commissioner indicated a while ago, we are also very excited about railroads, and in that regard, the counties of Midland and Ector County have formed a rural rail district. And chairman of that rail district, Mr. Buddy Sipes, I would like for him to interject and talk to you about what's happening in the area of rail. Buddy?

MR. SIPES: Thank you very much, Kyle. We're excited because the two-county rail district which was formed by Midland and Ector counties was formed to address infrastructure and business economic development opportunities related to rail.

We're not -- we're not connected north-south with rail at the present time. We are fortunate to have a transcontinental main line that runs through Midland-Odessa going east-west, but we've looked at the possibilities of rail in West Texas, and we understand that -- we applaud the efforts that TxDOT has made in rescuing, if you will, the South Orient Railroad and the way that it's being handled right now and the rehab that's going on. We definitely support that as a short-term goal.

As a long-term goal, our purpose is to develop a north-south crossroads to spur economic development in the Midland-Odessa area. It will leave the -- it would roughly parallel the La Entrada Corridor and will depart from the South Orient current route right now near McCamey, come into the Midland-Odessa area, and ultimately, we see it tying into the West Texas and Lubbock railroad to the north at Seagraves.

As you probably have heard, there is $1 million that has been put in the current appropriations bill in Washington to assist in the rehabilitation of this particular railroad. It's a disappointment to us that we're not going to have the perhaps $10 million that was -- that we had anticipated for this year, but we hope that in the future years, those numbers will increase. That will help things a whole lot.

What we want to do is continue to work with the Pecos County Rural Rail District and other rail districts as they are being formed by the counties along the South Orient Road, which includes Brewster County, Presidio County, Irion, Reagan, and Upton. We believe that with all of these counties, plus what we bring to the table in the way of interest and future plans, will help to spur this development along and the rehab.

What we would like to see in the near term is -- and which we support, is getting the South Orient Road fully operational and up to a 40-mile-an-hour level, and then at some point in the future, talk about building the road from near McCamey up to the Midland-Odessa area and then further, at a later date, tying in to the north.

Kyle?

MR. WOMACK: Thank you, Buddy.

One of the things that has continually been the focus of La Entrada is to look at not only development of new economic development opportunities but also to act as a potential relief for crowded facilities at both El Paso and Laredo and other areas.

As we continue discussions with states in Mexico and we see the congestion that's currently along the I-35 corridor, we're continually getting interests further and further south into Mexico clear into Durango that says, as La Entrada is developed, it will be shorter and quicker for even further south of Mexico to seek this route as a potential relief route off of I-35 corridor, and certainly the economic benefit of saving over 100 miles through La Entrada versus El Paso translates into real economic dollar savings for shippers and users of this route.

This is an economic benefit for not only Texas but for the Permian Basin as well. We're already seeing companies here. The example of Family Dollar, one of their primary goals was to say -- long-range plans is to distribute goods and products and open new stores in Mexico. Again, that's why they chose Midland and Odessa to be here.

In deference to Lawrence, I would tell you that MOTRAN, Lawrence Olson with Texas Good Roads, I will tell you that we are very supportive of the primary mission of working with the federal government to increase the percentage of money that we give back to Texas, and that's a primary mission that we applaud your efforts and we'll support in any way.

We also understand that with the current system, there are things called earmarked requests that continue to be included in legislation. And as long as that system is in place, we're going to continue to try and develop and strengthen our opportunities in that regard. We have worked very closely with Congressman Neugebauer, Congressman Stenholm, Congressman Bonilla in developing some specific earmarked requests that we feel will help and continue to develop the La Entrada Corridor.

Primarily, our number one concern is for the continued support and development of the federal designation of the La Entrada Corridor as a high priority corridor. I think second to that is we still have some study that needs to be done from Midland-Odessa to the south to work out environmental concerns, other concerns of how to find the best route.

We want to do that in conjunction with the development of this rail. We see this area as being an ideal opportunity to investigate and explore this whole concept of Trans-Texas Corridor, a vision created by Governor Perry. What better place to try this than in West Texas where we can do it economically and where we can plan it ahead and really look towards the future.

We have made several earmark requests, but those two I would highlight. The other one I would highlight, and I think this goes back to the whole regional idea, is we have continued to develop strong relationships to the north, including Lubbock.

The overlap and benefit of La Entrada with Ports to Plains corridor, two major corridors that intersect here in Midland-Odessa, both very important. We are certainly very supportive of the continued development, of course, of the Plains corridor.

One of those specific examples is that we feel like we could work together and have a more regional impact, to look specifically at trying to expedite the development of a Lamesa reliever route and development toward the northern part of 349.

What a better place than to develop two corridors, and even on a shorter-term vision, to complete a major link between the three economic corridors and economic regions in West Texas, Amarillo, Lubbock and Midland-Odessa.

We're continuing to build and develop relationships with Mexico. I think that's been crucial. One of the things that I would say that we are beginning to sense -- and we appreciate the support that TxDOT has provided us in the past -- but the reality of that is they're building roads. And we asked them 10 years ago to continue with that commitment.

"Let's see what you-all do before we react." They're building roads, and I think they're looking to Texas now to say it's time for us to start building roads.

The reliever route around Midland is the first step in that. We certainly need to see the continued development of this corridor as our highest priority and we'd appreciate your help in that.

To summarize, and I'll try to be very brief, we continue to see a great vision, a great opportunity for not only the Permian Basin and Texas, to develop this corridor, and that's our long-term goal. If we step back and say what can we do now or what are the shorter-term goals, I would summarize those as being your continued support at the federal level for the designation of our corridor as a high priority corridor; your assistance, if possible, in working with us to find additional study funds to really lock in the route from Midland-Odessa going south; continued funding for the rehab of the South Orient Rail lines as Buddy has explained to you; and working with our partners not only in this area but to the north and beginning construction of the Lamesa reliever route and its connection to State Highway 349.

Again, it's been our pleasure to meet with you. We cannot express sincerely enough our gratitude for the support that you've shown us in the past. We appreciate you being here and we're available to help you build roads and make roads. Thank you very much. (APPLAUSE)

MR. JOHNSON: I presume that concludes the presentation?

MR. GARDUNO: Yes, it does. Thank you.

MR. JOHNSON: Thank you. I know that there are probably a few of you that need to go back to commerce and industry who have been part of the presentation. We will take a brief recess so that you may do that, and we'll reconvene immediately. Thank you. (A recess was taken from 10:13 a.m. to 10:28 a.m.)

MR. JOHNSON: We will reconvene the meeting, and let me reiterate before we begin again that should you wish to address the commission, please fill out one of the appropriate cards in the lobby. That will help us out tremendously.

Before we begin with our basic agenda, we'll begin with the approval of the minutes of our June commission meeting.

MR. WILLIAMSON: Wait a minute, I'm the June --

MR. JOHNSON: You're the sophomoric --

MR. WILLIAMSON: I'm the sophomoric. So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carried. Thank you.

Mike Behrens, I'll turn this over to you.

MR. BEHRENS: Thank you, Mr. Chairman. We'll go to agenda Item 2, public transportation, which will be a minute order to authorize state funds for public transportation provided for FY 2004-2005. Wayne Dennis will be talking.

MR. DENNIS: Good morning, Mr. Chairman, Commissioners. My name is Wayne Dennis. I am the interim director of public transportation for the Texas Transportation Commission.

The minute order presented for your consideration today authorizes the allocation of state funds to public transit providers for the FY 2004-2005 biennium. These funds were appropriated by the 78th Legislature, Regular Session, specifically for nonurbanized and small urban public transportation systems.

The 78th Legislature appropriated $57,482,135 --

THE REPORTER: Can you repeat that? Excuse me. Would it be possible for him to turn that lectern back, because with his back to me, I'm having a lot of trouble hearing him? I'm sorry to interrupt.

MR. DENNIS: The 78th Legislature appropriated $57,482,135 for these public transportation systems.

At the beginning of the FY 2004-2005 biennium, there will be 32 small urban and 40 nonurbanized transportation systems eligible for state funding.

In FY 2004, individual transit system allocations will be based on the formulas in Chapter 456 of the Transportation Code. In FY 2005, the formulas are eliminated from statute and become the responsibility of the commission, subject to the Appropriations Act.

Staff recommends that half of the FY 2004-2005 appropriation in an amount of two -- $28,741,068 be awarded in FY 2004. The balance of $28,741,067, and any unobligated funds, will be available for distribution in FY 2005.

Funding at this level in FY 2004 will assure allocations to all rural and small transit -- rural and small urban transit systems that received funding last biennium will receive an allocation greater than or equal to the annualized Fiscal Year 2002-2003 base state allocation.

Staff recommends approval of this minute order.

MR. JOHNSON: We have someone who is requesting to address the Commission on this issue. Michael Plaster, the executive director of the Texas Transit Association from Austin.

Michael, we're glad that you're here.

MR. PLASTER: Thank you, Mr. Chairman. Good to see you all, Commissioners.

Regarding the proposed minute order, I just want to state that I understand that I think it's the desire of the commission to kind of take the '02 and '03 funding level and extend it into '04 at about the current level. I think that's what it is.

If I'm not -- like I say, if I'm not mistaken, and then move the balance into '05 for the new formula.

The only thing we're concerned about is having it level for a three-year period. We would like to see something more in line, on the baseline part of that formula, with what the legislature had appropriated for the entire biennium, that's 5.6 percent, on the baseline, understanding that discretion indeed could move into the future year.

And I say that because we know what the economy is like right now, and even with the -- local government contributions are rather tight that a lot of these agencies rely on. Also, the cost of doing business, I think as businessmen you are aware, cost of doing business hasn't really slowed down, as health insurance, the cost of all fueled vehicles.

So anything that we can do to move it up somewhat to get a little bit more than what we've been getting the last two years, I think, would be greatly appreciated by the transit districts.

And just to go on for a minute on the second subject: Contracts have just been forwarded to the operators for the FY '04 state funds, with the amounts to be filled in, subsequent to the action of today's commission meeting.

One thing that has prompted a number of comments from the transit districts, including if it's still possible to take that contract that's out there for state funds and have it also apply to FY '04 federal funds, even though that won't be acted on by the Congress or the President until later in the year, if we could begin the process of consolidating contracts, that would be good.

It may be too late now, I don't know, but in the future, if we could work with the commission and the staff, we would like to see a consolidated contract, sort of a master contract approach.

MR. NICHOLS: Are you talking about federal and state?

MR. PLASTER: Federal and state. And I think, not just -- we have now some agencies -- we'll have to manage throughout the year, three, four, five, sometimes even six contracts, and even with the same contract but from a district, different TxDOT district, I think they're -- I'm not sure how to work that part out, but I think consolidating contracting could help everybody, because when it comes to numbers being filled in later in the year, it would just be a simple one-page amendment to those contracts. You know, subject to funds availability as it were.

And we ought to start looking at maybe then a three-, four-, five-year master contract, just on that basis. I think it would help with the paperwork --

MR. JOHNSON: How can we enter a contract that's longer than the appropriations --

MR. PLASTER: For the two-year appropriation, you might be right on that. I'm not sure what the legal is, we would have to talk to legal. But let's just say it's for two years. That would, I think, at least help on that basis.

It would give everybody a little bit better planning and less paperwork, and I think once the division had went through it the first time, I think it would probably be less paperwork for them as well.

And you would have more staff to dedicate to certainly other things like the HHS service operation, which by the way, any time y'all are ready to go to work on that with us, we're there with you. We want to see this thing go to fruition and be very successful because it's going to benefit a whole lot of folks.

So that's really all I have to say, unless there are any further questions or comments.

MR. JOHNSON: Robert, did you have any?

MR. NICHOLS: Yeah, I had a number of comments, not really questions.

MR. JOHNSON: Of Mike or of the --

MR. NICHOLS: Really, some comments to you, but I guess some also --

MR. JOHNSON: Continue. I'm sorry.

(GENERAL LAUGHTER)

MR. NICHOLS: Related to the subject, I think what we're going to be working toward doing is over the next year, get to the point where we are looking at the federal funds and the state funds by provider at the same time.

So it certainly would open up the opportunity for -- to combine contractors, I think would qualify, I think would work real good, pretty close to what you're saying.

I think right at this point, we probably would have difficulty doing a multi-unit contract because with the legislation that just passed, I think the intent over the next 12 months is to try to keep the providers intact with the funds that they're used to spending as closely as we can to meet statutory requirements in the proportion that they currently get.

And I think as he said, that we're going to shoot for no one getting less than they got for the -- like the last two years. But instead of locking in the two-year period, we'll lock in a one-year period. And I think there is roughly a million dollars more of state funds in there, so it's slightly above what it was the previous period.

But we're going to use, over a period of time, we believe there are very possibly some balances in there. There are some areas that have needs that are not being met. There are no provisions for efficiency or incentives for these type of things, and rather than going in the process with the predisposed, pre-determined formula in our heads, what we're going to be utilizing over the next year is intensive meetings in different areas of the states with the transit providers and the community to try to arrive at a statewide set of criteria for small urban and rural providers that make sense that everybody can support, or at least as close as we can, and then one year from now, if we can get all of that worked out during the year, lock in both the federal funds and the state funds on that criteria, apply it for probably a year and see how it works and then make some adjustments if we need to do that.

So I particularly see for the next couple of years, do one-year things, and then maybe on the next full two-year appropriation process, we might do two-year.

MR. PLASTER: I understand. Yeah, especially with regards to the contract consolidation and HHS integration, that certainly needs, if there is any way that that can happen by the next biennium, then we can have these consolidated contracts, I think that will work very well.

Of course, we don't know, probably y'all don't either, as to how all of this is going to occur or what kind of forum it's going to take, but anything that we can do -- you know, a number of our providers have been very experienced for 15, 20 years on the HHS side, and have seen it, the management, good or bad, previously, like for the Medicaid program, and anything we can do to help advise the commission on avoiding those pitfalls because, like I say, we want this thing to succeed.

It will be the major effort, I think, in the country, especially for a size of a state like Texas, to do the HHS integration as we think it could happen, as has been proposed basically by the legislature, to consolidate some of this stuff.

This is -- this could be the watermark, I think, for large states in the U.S., so we certainly want to be there with you on that to help you. I can see those possible pitfalls.

MR. NICHOLS: Yeah, I can assure you you will be. We're going to make every effort over the next nine months to have the entire industry and the community all working together to try to bring resolve to this.

We think the potential is great also in combining the services, simplify for the citizens, not just us or the providers, but more importantly for the citizens. Because it is so confusing, and I've heard so many horror stories where they have to have one provider to do this and a different provider to do that, and this one can't go by -- this line is marked on the map, so another provider that is to pick them up and carry them to the next mile or so, so we try to give it the best shot to do that.

And the legislature has given us the opportunity to do that. Thank you.

MR. WILLIAMSON: I just have a couple of questions with regard to the minute order that's before us, Mr. Plaster.

Is it the case that three organizations that were previously classified as rural are now small urban?

MR. PLASTER: Not insomuch -- if you're thinking about the census? What happens is you may have an area -- geographic area, let's say multiple counties --

MR. WILLIAMSON: Let me cut to the chase. Midland-Odessa is -- used to be what kind of provider, Mr. Garduno?

MR. GARDUNO: What we have is a rural program. We don't have metro, but we are getting metro.

MR. WILLIAMSON: And now that organization is going to become what? Small urban.

MR. GARDUNO: Small urban, yeah.

MR. WILLIAMSON: In the funding formula, staff recommends we approve. Are there any allocation of funds out of the small urban category to Midland-Odessa and the other two new ones?

MR. DENNIS: There -- it would be an allocation to the Midland-Odessa area; however, there are three new small urbanized areas.

Midland-Odessa was getting -- they received some of your commission-selected projects last biennium. They were eligible for it then.

Under the current statutory formula, then they would be receiving funds out of this next allocation.

MR. WILLIAMSON: Okay. Did you say there are three providers that are new?

MR. DENNIS: The new ones would not be eligible for funds under the current statutory formula.

MR. WILLIAMSON: For this year?

MR. DENNIS: No, sir.

MR. WILLIAMSON: And those three are located where?

MR. DENNIS: They're in McKinney, The Woodlands, and Lake Jackson/Arlington area -- actually, Angleton, pardon me.

MR. JOHNSON: Who was the third one?

MR. DENNIS: The Woodlands, Lake Jackson/Angleton, and McKinney.

MR. WILLIAMSON: Are they members of the Transit Association, Mr. Plaster?

MR. PLASTER: The urban -- well, they're all served currently by rural transit districts who are members, and I think what you're asking about maybe is how do you allocate between the two now that there is changing in the census.

I believe that what normally happens is that the division makes an estimate of how much should be carved out of the rural area that is now urbanized that would normally then go into the urban pot, because that is -- the rural area has less of a service area to provide, once an area -- a portion of its area goes urban.

MR. WILLIAMSON: Is that what happened, Wayne?

MR. DENNIS: Well, the money is set aside for the small urbans, but again, that formula is based on last year's or last biennium's expenditures.

MR. WILLIAMSON: So what assistance from the State of Texas or federal government through TxDOT will these three organizations receive under this next year's formula?

MR. DENNIS: Under federal assistance, they will be receiving federal assistance in some form, and that amount, I'm not -- I don't know what that amount would be. They would be eligible to receive commission-selected funds which we -- we're currently budgeting at 500,000 for Fiscal Year '03,'04.

MR. WILLIAMSON: Between all three of them?

MR. DENNIS: Yes, sir.

MR. WILLIAMSON: And the small urbans who were in the system last year, they're going to receive roughly the same percentage of funds they received last year?

MR. DENNIS: We've assured that we have enough allocation moved into Fiscal Year 2004 that each of those urbanized areas will receive, at a minimum, their base allocation, so --

MR. WILLIAMSON: So if there were inconsistencies and disparities and inefficiencies in the old system, we're going to do that one more year.

MR. DENNIS: Unfortunately, we will be carrying that through for Fiscal Year 2004.

MR. WILLIAMSON: And at the same time, we won't be sending anything more than a split-up 500,000 to the three new ones?

MR. DENNIS: Unfortunately, that's all that we have available.

MR. NICHOLS: That's just on the state funds. On the federal funds, they could get it again.

MR. WILLIAMSON: And that's because of statute?

MR. DENNIS: Yes, sir.

MR. WILLIAMSON: Rider or statute?

MR. DENNIS: Well, the rider set aside $20 million that was not subject to the statute -- or I'm sorry, not subject to a certain amount of split of money.

Of that 20 million, we would still have to follow the statutory formula of giving 50 percent to urban areas, 50 percent to rural areas, and 90 percent of it would have to be moved through the formula, which would only allow 10 percent of it, i.e., $1 million for small urban, and $1 million for the rural for the biennium.

MR. WILLIAMSON: Thank you.

MR. JOHNSON: Any other questions or comments? Entertain a motion on the minute order.

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries. Thank you, Wayne.

MR. BEHRENS: Item Number 3, we have two rules for proposed adoption. The first will be in relation to vehicle titles and registration. Jerry?

MR. WILLIAMSON: Stop. Now, I was unfriendly to you earlier because I knew this moment would come. Are you ready?

MR. DIKE: No, sir.

(GENERAL LAUGHTER)

MR. WILLIAMSON: The legislature, Chairman, made it very comfortable for men and women of TxDOT and other state agencies to retire. In fact, enticed, if you were in a certain category, enticed them.

When I was in the legislature, I used to always vote against that stuff because I believe it's bad policy to bribe good wisdom to leave. I believe government runs better when it has people with wisdom at the top. It makes it almost impossible for most men and women to say no, and as Mike reminds me a lot, when it's time to leave, you know it, and people leave.

But I want to take this moment to recognize that this man could have taken that route and taken instant monetary benefit, but instead elected to stay and help us do all of these new things we're going to be doing for the next few years. And for that, hats off. (APPLAUSE)

MR. WILLIAMSON: That's why I wasn't too friendly to you a while ago.

MR. DIKE: Thank you, Commissioner, and it's been my privilege to work at TxDOT over 30 years, and I love our business and title and registration.

My name is Jerry Dike. I'm division director of the vehicle titles and registration division.

And Commissioners, this minute order proposes the adoption of amendments to Rule 17.10 concerning the motor vehicle -- actually, the title fee.

This past 78th Legislature passed House Bill 1365 which increased vehicle application fee from $13.00 to $33.00 in 41 counties. They're called effective counties which are defined in the Health and Safety Code. And increased it from 13 to $28.00 in the other 213 counties.

The information in our rules is no longer correct, of course, with the $13.00 fee, and the Governor was working on the weekend and signed this bill on June 22nd. And this portion of the bill went into effect immediately.

So it put a significant burden on 254 county tax collectors the next morning at 8:00 o'clock. On that Monday morning, the county tax collectors around the state needed to tell all their customers and their dealers and all of the companies that deal with them that title fees had increased over 100 percent.

The 254 tax collectors -- and there are two wonderful tax collectors here, Lee Taylor and Kathy Reeves, in these two counties. They did an incredible job, and that next week, they collected 38,000 additional fees from the citizens and dealers in Texas.

Of course, all of the information had not gone out to everyone, and two weeks ago, they're up to about 80,000. So they're up to about 90 percent of all of the title fee collections. We, of course, did not have time to reprogram the registration and titling system, and it does take a little additional time for the tax collector for each title customer, so they did an exemplary job for the state of Texas.

And last week, about $1.6 million additional went into the TERP fund, which is the Texas Emission Reduction Plan. And these rules will codify that title fee increase. That's the first minute order.

Commissioners, the second minute order proposes the adoption of amendments to Rule 17.52 concerning the Vehicle Emissions Enforcement Program. The 78th Legislature also passed Senate Bill 1159 to provide "early action compact," quote, unquote, counties, the option of participating in this motor vehicle inspection and maintenance program.

The actual definition of an "early action compact" county is defined in the Health and Safety Code. And we correct our rules to allow for that titling.

Staff recommends the adoption of these two minute orders.

MR. JOHNSON: Any questions?

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. DIKE: Thank you.

MR. JOHNSON: Thank you, Jerry.

MR. BEHRENS: The next item is part number 2, proposed repeal of our air navigation rules.

MR. MONROE: Good morning, Commissioners. My name is Richard Monroe. I'm general counsel of the department. If the commission approves the minute order now before you, we will actually reduce our supply of rules by knocking out 43 TAC, 30.301 through 30.308. Inasmuch as the most recent legislature repealed the statute which gave rise to these rules, there is no need to have these on the books.

By execution of the minute or approval of the minute order, you would then remove these rules from the Texas Administrative Code. I would urge that the minute order be approved.

MR. WILLIAMSON: How quick can I second that one?

MR. JOHNSON: Your role is to make a motion.

MR. WILLIAMSON: I thought you moved.

MR. JOHNSON: I have not moved.

MR. WILLIAMSON: Oh, so move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carried. Thank you.

MR. BEHRENS: We have as Item 3b, one rule for final adoption. Refers to school zones and increases the safety around school zones. Carlos?

MR. LOPEZ: Good morning, Commissioners. My name is Carlos Lopez and I'm the director of the traffic operations division. The minute order before you provides for final adoption of the changes in the department's rules covering the operation of school zone flashing beacons on the state highway system.

This change allows TxDOT and municipalities of 50,000 population or greater, to expand the hours of operation for school zone flashing beacons for certain school-related activities.

Under our current rules, school zone flashers can only be operated for school events that occur immediately after the end of the normal school day. This amendment would allow for the expanded use of the flasher during school events that occur at those times, such as evening athletic events.

This item was published in the June 13 edition of the Texas Register, and no written comments were received. We recommend the approval of the minute order.

MR. JOHNSON: Any questions?

MR. NICHOLS: Just a couple of comments. I think this is great. For people in the audience who are not aware of what we're talking about is flashing school speed limit lights normally are only at schools in the morning and while school is going on.

But Representative Luna in the Corpus area, Corpus Christi area, brought to our attention and worked very hard to -- in her area, give us a knowledge that there are a lot of other school activities and functions where kids sometimes get hurt crossing streets where drivers are now going 55 because it's not a normal school time.

And it gives us, working with the community and school, the opportunity or the option of activating those lights and signals on the state system to protect the children. So I think it's great. Commend you for coming up here, and offer encouragement.

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. BEHRENS: Number 4, minute order under Agenda Item Number 4, transportation planning and programing, Archer and Wichita Counties.

MR. SAENZ: Good morning, Commissioners, Mr. Behrens. For the record, I am Amadeo Saenz, Jr., assistant executive director for engineering operations.

Item 4a, this minute order before you tenders a proposal to Archer County and Wichita County for acquisition of right-of-way needed to construct a local access road.

To maintain local access and mobility, a one-mile-long access road is proposed for Business 277 to east of the Archer County line as part of the US 82, US 277 bypass in Archer and Wichita Counties, in Wichita Falls district.

Constructing the access road will improve the mobility on US 82/277 by minimizing local use of the thoroughfare, the through highway for safety and efficiency of the overall design of the state highway facility, to maintain local circulation, and to minimize the local use.

The department recommends the construction and acquisition of right-of-way necessary to provide the local access road. Staff recommends approval of this minute order.

MR. JOHNSON: Questions?

MR. WILLIAMSON: Amadeo, is this the same thing we heard two years ago where the school and the city and everyone was fighting over this piece of property? Is this the same piece of property?

MR. SAENZ: No, this is a different one. This is part of the developing 277, we have a bypass around Holliday. This will allow -- we have -- one of the connections we have some development, this will allow continued access from the development.

MR. WILLIAMSON: Not related to that disagreement they tried to drag us into a couple of years ago?

MR. SAENZ: No, sir.

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. SAENZ: Item 4b is very similar in nature. The minute order before you approves a proposal to Johnson County and the City of Burleson for the acquisition of right-of-way needed to construct at various locations access roads or right-of-ways required to realign existing local roads severed by the new location construction of SH 121.

To maintain local access and mobility, eight new segments of either new location access roads or realignments of existing local roads are proposed in Johnson County from the Tarrant County line, southward to US 67 in Cleburne.

Constructing these access roads will restore the functionality of the local road system, improve mobility on SH 121 by limiting local access, and minimize damages to property that would otherwise be landlocked.

For the safety and efficiency of the overall design for this state highway facility, to maintain local circulation, to minimize local use of the through highway, and to minimize damages to properties, the department recommends the construction and acquisition of right-of-way necessary to provide the local access roads and also the realignments.

Staff recommends the approval of this minute order.

MR. JOHNSON: Any questions?

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carried.

MR. SAENZ: Thank you. Item 4C, the minute order we bring before you today approves the 2004 Statewide Preservation Program of the Unified Transportation Program or UTP.

The UTP, which is updated annually, is the basic transportation planning document that guides and controls project development for the department.

In order to align the UTP with the simplified budget strategies outlined in the 2003-2007 strategic plan, the department has divided the UTP into two documents: The Statewide Preservation Program, known as the SPP, and the Statewide Mobility Program, or the SMP.

The SPP is part of the "maintain it" budget strategy, while the SMP is part of the "build it" strategy.

The SPP is a document representing commission and department goals to preserve existing highway network and to protect the state's previous investments through authorization of annual program amounts for Category 1, Preventive Maintenance and Rehabilitation.

The SPP also contains specific Category 6 projects that address Structure Replacement and Rehabilitation and Railroad Grade Separations.

The exhibits are outlined as follows: Exhibit A in the plan contains the Highway Construction Program Policies and Restrictions. Exhibit B contains information pertaining to Category 1, which is the Preventive Maintenance and Rehabilitation Allocation Program Amounts. These amounts are based on allocation formula outlined in Exhibit A.

Exhibit C through F contains specific project listings pertaining to Category 6, Structure Replacement and Rehabilitation, Railroad Grade Separations, and their respective listing of projects remaining to be let to contract. The ranking criteria for evaluating these projects is also contained in Exhibit A.

Exhibit G contains information on Maintenance Budget Distributions. A 25-day comment period regarding the draft 2004 SPP ended on July 1, 2003, with three comments received.

Staff has reviewed these comments and has submitted copies to the commission and administration. Based on these comments, staff recommends no revisions. With approval of this minute order, the department may continue project planning and development for fiscal year 2004 and beyond.

Staff recommends approval of this minute order.

MR. JOHNSON: Any questions?

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. SAENZ: Thank you. For Item 4d, the minute order authorizes Priority 2, or Develop authority, for five bridges requiring pier protection in Harris, Jefferson, Nueces and Cameron counties.

The Bridge Division recently completed a statewide vessel impact risk assessment for all bridges crossing waterways that have documented barge or cargo vessel traffic.

The following bridges have been identified for pier protection work: Harris County, Interstate 10 over the San Jacinto River; Jefferson County, State Highway 87 over the Gulf Intracoastal Waterway, or GIWW; Nueces County, Park Road 22, also over the GIWW; Nueces County, State Highway 361, again over the GIWW; and Cameron County, PR 100 over the GIWW.

The total estimated construction cost to perform the pier protection work for all five bridges is $18 million, and is to be authorized in Priority 2, Develop, under Category 16, Miscellaneous, of the 2002 UTP.

This will allow our districts to begin the planning process and project development process to get these projects underway.

Staff recommends approval of this minute order.

MR. JOHNSON: Questions? Observations?

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. WILLIAMSON: I want to ask one, one quick question. Amadeo, when you were reading and making your delivery, when you referenced Priority 2, you would say Develop, Priority 2.

MR. SAENZ: I used Priority 2 in developing because the projects that we're adding for the pier protection are part of the current UTP, so as we get into the 2004 UTP process, all of that has been changed. We're adding it to the UTP --

MR. WILLIAMSON: You anticipated my question. My question is going to be, at what time will those of us who are a little less familiar with engineering and TxDOT terms be hearing "Develop" as opposed to "Priorities."

MR. SAENZ: We begin to hear it now as we complete -- we just completed the 2004 and just adopted it, and that has all developed as we moved forward with the mobility portion of the 2004 UTP. Priority 1 and Priority 2 disappeared, and Develop and Construct take over.

MR. WILLIAMSON: So it's possible that a couple of years from now, in going through this, what we'll hear you say is you recommend Develop Category 14?

MR. SAENZ: Yes.

MR. WILLIAMSON: Excellent. Excellent.

MR. JOHNSON: Amadeo, I have a question of your comments and answers to the comments of Commissioner Williamson's, questions brought to mind.

We had had a discussion at a previous to utilize a fixed point or the average of three years. Does this program that we have adopted take that into consideration? Is that a -- or is it the next program?

MR. SAENZ: It will be the next program. The program that we adopted today is combining the 34 categories and bringing them down to the 12 categories, and so we're using the original formulas. All we're doing is paring them down.

As we get into the 2005 process, the working groups, and they're now in the public comment phase, based on what the working group submitted, that's what we will be using.

MR. JOHNSON: This is the first step, and that will be the second, an overall, if you will, of the UTP?

MR. SAENZ: That is correct.

MR. JOHNSON: Thank you.

MR. BEHRENS: Item Number 5 is finance and remit orders -- (inaudible).

MR. MUNOZ: Good morning. For the record, my name is John Munoz, Deputy Director of the Finance Division. I seek agency's approval of the quarterly investment report for the quarter ending May 31, 2003.

This quarter, the book value of investments decreased by approximately $53 million. This $53 million decrease primarily represents the difference in payments to contractors and investment income.

Staff recommends your approval, and I would be glad to answer any questions you have.

MR. JOHNSON: Any questions?

MR. WILLIAMSON: I have one. We don't see Fast Jimmy Bass much more, John.

MR. MUNOZ: He's on vacation this week. He's studying his charts and trying to come up with a way to maximize that return on your investment.

MR. WILLIAMSON: I'm just trying to determine, are we going to be seeing more and more of you, because I need to kind of get your nickname ready.

MR. MUNOZ: Actually, James should be back next month. (GENERAL LAUGHTER)

MR. MUNOZ: With a little luck from my part.

MR. WILLIAMSON: One more question: Can we blame Mr. Nichols for all that loss? Is it Robert's fault? That's what Steve said.

So move.

MR. NICHOLS: Well, that's a heck of a way to lead a motion. (GENERAL LAUGHTER)

MR. NICHOLS: I'll second it.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. MUNOZ: Item 5b requests authorization for designated department officials to take action to extend the bond purchase agreement related to revenue bonds issued for the Central Texas Turnpike Project.

The bond purchase agreement provides for the Bank of Nova Scotia to purchase the variable rate bonds should a market for those bonds not exist.

Staff recommends your approval and I will be glad to answer any questions you have.

MR. JOHNSON: Any questions?

MR. WILIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. MUNOZ: Item 5c requests for the revisions -- for revisions to the investment policy and strategy. Modifications of substance submitted for approval to the policy and strategy are as follows: the probability of market default risk is to be completed as needed rather than quarterly in order to provide for an efficient and cost effective approach in keeping the default risk at a reasonable level.

Secondly, there is a clarification made to the marketability section of the Type 2 funds in the investment strategy to more precisely describe current investment practices, just a clarification.

And third, there are six financial institutions which added to the pool of qualified financial institutions in order to maintain a pool of capable investors to optimize competition for all of the competent services we will need in the future.

Staff recommends your approval, and I would be glad to answer any questions you have.

MR. NICHOLS: I have a question. You said six new institutions are added to the pool. How many are -- does the pool consist of now?

MR. MUNOZ: Currently, approximately 30, just eyeballing it.

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. BEHRENS: Item Number 6 will be our request for a loan from our city, for the City of Cameron.

MR. MUNOZ: Item 6 requests preliminary approval of an application submitted by the City of Cameron, requesting a loan of $510,000.00 to relocate water and sewer lines along State Highway 36 in order to extend the road from a two-lane to a four-lane facility.

This road is on the state highway system and part of the Texas Trunk System. Staff recommends your approval, and I'll be glad to answer any questions you have.

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. BEHRENS: Item Number 7 is our contracts to be awarded for the month of July, both our maintenance contracts and our highway and building construction.

MR. BOHUSLAV: Good morning, commissioners, Mr. Behrens. My name is Thomas Bohuslav, director of the construction division.

Item 7a(2) is the consideration of award or rejection of highway -- excuse me, Item 7a(1) is consideration of award or rejection of highway maintenance contracts let on July 1st and 2nd, 2003.

The engineer's estimated cost is $300,000.00 or more. We had 13 projects with an average of 3.15 bidders per project.

Staff recommends the award of all projects.

MR. JOHNSON: Any questions?

MR. NICHOLS: No.

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. BOHUSLAV: Item 7a(2) is the consideration of award or rejection of highway construction and building contracts let on July 1st and 2nd, 2003. Had 49 projects relating to low bid letting of $500 million.

We have one project we recommend for rejection. It's in Nueces County, it's Project Number 3018. That project was 38 percent over a half a million dollars for construction of some bridges over I-37 in Corpus.

The funding is 100 percent funded by the Corpus Christi Regional Transit Authority, and they did not have the sufficient funds to cover that overrun. We would like to go back and work with them to do some, maybe, realignment on the project.

Staff recommends award of all of the projects with the exception of that.

MR. JOHNSON: Any questions?

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. WILLIAMSON: I'm going to ask a question, Thomas, to get you to be thinking about something, and not by way of being critical.

Has the department ever made use of dummy bids or invitations to bid, to propose a dummy bid to use as a comparison to actual bids in the department's own internal estimates of costs?

And I know in the pipeline laying business, often, if a company is not sure, or if a company is not going to ask for bids, not real sure of the ground they're on, they will frequently contract with a pipeline contractor to submit a dummy bid and pay them for it.

Just say, we will pay you for your time and material to submit a blind bid for this project. You're not going to be awarded, but we would like to see what you would bid under competitive bids. Have you ever used that process?

MR. BOHUSLAV: We have not done that.

MR. WILLIAMSON: Does anybody do that in our DOT business in the country?

MR. BOHUSLAV: There are some federal restrictions on how we do our bidding, so we have to review that with the Feds. The state statute is pretty clear regarding how we do things.

Whether or not that contract could participate might be a question, but it would be something we could look at. I'm not aware of that ever being done in any other state.

MR. WILLIAMSON: Like I said, I don't ask the question for any reason other than asking, let's start thinking about the concepts like that. Just think about it.

MR. BOHUSLAV: Okay. I will.

MR. WILLIAMSON: Thank you.

MR. BEHRENS: Item 7b will be a contract claim that will be presented by Amadeo.

MR. SAENZ: Again, good morning, commissioners. For the record, I'm Amadeo Saenz, Jr., Assistant Executive Director for Engineering Operations and also chairman of the Contract Claim Committee.

The minute order before you approves a claim settlement for a contract by Tommy L. Johnson, Inc. for Project MG 2002(689) in Cooke County of the Wichita Falls District.

On July 10, TxDOT Contract Claim Committee considered this claim and made a recommendation for settlement to the contractor and the contractor has accepted.

The committee considers this to be a fair and reasonable settlement of the claim and recommends your approval.

MR. JOHNSON: Questions?

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. SAENZ: Thank you.

MR. BEHRENS: Item Number 8, our general counsel will present a contested case for your consideration.

MR. MONROE: Once again, for the record, my name is Richard Monroe. I'm general counsel for the Texas Department of Transportation.

Once again, we had an application made for a salvage dealer license. One of the lesser known activities of this department is that we issue such licenses. However, one of the requirements is that you not have been either convicted of or discharged from a felony within the last three years.

This gentleman was good enough to answer honestly on his application, but he did not fulfill that requirement. His permit for application was denied.

He appealed that to the State Office of Administrative Hearings whereas, of course, it was deduced that the facts were that he did not qualify. The hearing officer so ruled, and by approving this minute order, you will adopt that finding of the sole hearing officer in favor of the Texas Department of Transportation. I would suggest that the minute order be approved.

MR. JOHNSON: Any questions?

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

MR. BEHRENS: Commissioners, you have for approval, Item Number 9, routine minute orders. They are in your briefing booklet as existing on our posted agenda. I would like, though, to point out that Agenda Item 9c(4) which is the redesignation of State Highway 349 here in the Midland-Odessa area, certainly 349 comes in on the south of Midland and proceeds through Midland and goes out to the north.

Its redesignation will turn it, when it hits Interstate 20, take it to the west to the intersection of FM 1788, and then will go on 1788 until you hit the proposed reliever route location just to the north of 191, that proceeds over and then junctions with the existing 349.

This minute order is necessary to designate that new reliever route so the funding can be awarded. I think we're looking at an August, 2005, letting to start doing something on that new reliever route. So just wanted to point that out since we're here in Midland-Odessa, that that is part of our routine minute orders.

Other than that, I recommend approval of that order.

MR. JOHNSON: Any questions?

MR. WILLIAMSON: So move.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: Motion carries.

This brings us to the open comment portion of the meeting. Do we have any speakers signed up for open comment?

MR. WILLIAMSON: While we're waiting for people to be organized, could I ask Mr. Saenz something about pending business?

MR. JOHNSON: Certainly.

MR. WILLIAMSON: Amadeo, I notice we're in the Texas Register on the Trans-Texas Corridor, I-35's East, first leg. Correct?

MR. SAENZ: Yes, sir, that's correct.

MR. WILLIAMSON: And although nothing formal has been said, just in the movement of the department, I understand that some who might purport to be vendors or responders to that proposal are indicating that we're not giving enough time to the proposal.

MR. SAENZ: That has been presented, yes.

MR. WILLIAMSON: I just want to say on the record, for this commissioner and for the Governor, that proposal has been out there in some form for over a year and a half.

Those who wish more time or those who didn't invest their time wisely a year and a half ago and prepare for this -- and I myself have no interest in waiting beyond the time period you've laid out.

Every day we wait, Interstate 35 becomes more congested, it deteriorates faster, it's far more expensive to repair and impedes economic development in the center of the State of Texas. And I just want to be strong on the record of: I don't care about those guys that are whining. That's their problem, not the State's problem. We need to get on down the road.

MR. SAENZ: It was posted on the 25th, which was last Friday, and 60 days for notice of receiving proposals. And look forward to getting them.

MR. WILLIAMSON: Not like you're fixing to let the contract. This is the qualifying time.

MR. SAENZ: This would be the request for competitive accepted proposals where we evaluate the team and the financial and a couple of others.

MR. WILLIAMSON: Thank you.

MR. JOHNSON: We have five people who have asked to address the commission. I would like to remind you once again of the three-minute limit. We have a stop light that should be very visible in terms of timing.

(GENERAL LAUGHTER)

MR. WILLIAMSON: I thought you were going to give us some kind of demonstration of that goofy stop light problem we had a year ago. We need to put this at world headquarters.

MR. JOHNSON: So please be observant. The green light will get you to what period of time? Two and a half minutes, there will be a yellow light for about 30 seconds, and then the red light will come on after the three-minute period. So please be observant of that.

Frank Knotts from here in Ector County, Odessa, is our first speaker. Frank, we're glad that you took the time to come before the Commission.

MR. KNOTTS: Thank you very much. My name is Frank Knotts. I live at 16560 South Highway 385 in Odessa, Texas. I'm a real estate broker and have been for 35 years, licensed in two states, testified in court as an expert realty expert on realty affairs. I'm also elected to the Texas Silver-Haired Legislature to represent Ector County.

This overpass will have a very adverse effect on the businesses and surrounding residential areas. There is no legitimate reason to build this overpass other than to increase the profits of the owners of the land south of the tracks.

Planners should never divert industrial traffic into retail and residential areas. Loop 338 was built to divert the truck traffic around the city.

It is my understanding that the City of Odessa assured everyone in '75 that they would not build an overpass at this location. The city may be liable to all property owners along the Parkway who relied on this information. This project will divert truck traffic through the city.

I can visualize Family Dollar trucks and other industrial trucks heading up the Parkway to the Panhandle and Mexico and Oklahoma. The Parkway is already too busy, especially from University to 42nd Street.

It is very dangerous entering the Parkway from the east side, and vice versa in this area and attempting to go north. If this overpass is built, the problem will be magnified.

This is the major retail area in Ector County. Family Dollar and the surrounding properties already have a ready access from Loop 338, Grandview and Route 385.

Eminent domain allows the government to take private land for public good with just compensation. Governments have been abusing this right for a long time. Cities have tried to use this law to take private property for private use. The courts have ruled against a number of cities in recent years. New Orleans is one that comes to mind.

I do not think this overpass is for the public good. I think it's for private use. If this project goes forward, the City of Odessa will have, in addition to the cost of the overpass, millions of dollars to be paid to the taxpayers of Odessa, after the courts get through with awarding additional payments for the taking of the land by condemnation and also by inverse condemnation, and that's damages that will be paid -- the court will order paid after the taking to abutting, adjoining, adjacent businesses and residential landowners in the area.

And I want to thank you very much, and looks like I made my three minutes. Anybody that wants a copy of this, there are some back on the folder back there.

MR. JOHNSON: Thank you. Any questions of Mr. Knotts?

MR. WILLIAMSON: Thanks for staying the whole time. You've been here the whole time.

MR. KNOTTS: Thank you. Welcome to Odessa.

MR. WILLIAMSON: Thank you very much.

MR. JOHNSON: Mittie Snooks from here in Odessa.

MS. SNOOKS: Good morning. I, too, have been here all morning. The proposed JBS interchange is a not-needed project. It will be a duplication of access already in place.

Seven-tenths of a mile east of the proposed interchange, TxDOT has agreed to build a diamond interchange to specifically accommodate the industrial park. There is no need whatsoever to connect an industrial park to a residential area.

Smart planners indeed avoid connecting two such areas. Such an intrusion as the overpass will negatively impact an established neighborhood of 841 properties, collectively valued at approximately $112 million.

Residents on the west side of JBS Parkway have no access or exit to their homes except via JBS Parkway. That means in the future that two or three more traffic lights will be required to afford approximately 50 homes on the west side of JBS Parkway access onto Parkway.

The project is not wanted by a margin of almost two to one taxpayers in Odessa. Opponents presented 1700 signatures to the city officials. The proponents presented 900 signatures in favor.

The city refuses to put this to a vote. The city cannot afford this project. Lobbying for federal funds to augment the state's 5.7 million allocated to the interchange construction still means that "John Q. Public Taxpayer" is footing the bill for a not-needed and not-wanted project.

We believe that the appropriation of any public moneys should include cost effectiveness and payout as a Number 1 priority. We're informed by local TxDOT officials that the hearing officer will not consider cost effectiveness when presented to Austin.

Odessa will never attract industrial manufacturing due to our limited groundwater supply. Economic development will occur without an overpass. The access to restaurants, entertainment, and the major retail district already exist seven-tenths of a mile from this proposed interchange.

It's ludicrous to connect an industrial park with a residential area. It's a gross misappropriation of public funds and it makes no sense. Please use your influence to stop this waste of government money. Thank you.

MR. NICHOLS: Whoa, we want to ask you something. In your statements, you talked about the signatures on both sides. But you also made a statement, if I heard it correctly, that the citizens of Odessa oppose it at a ratio of two to one?

MS. SNOOKS: Almost 1700 to 900.

MR. NICHOLS: That's based on signatures?

MS. SNOOKS: On petitions to the city officials.

MR. NICHOLS: That was not like a city-wide survey?

MS. SNOOKS: Correct.

MR. NICHOLS: Okay. That's all I wanted to know. Thank you.

MR. WILLIAMSON: Ms. Snooks, I would have said to the man that appeared before you, and I'll say to you, we appreciate you taking the time to give your opinion, and we do listen.

One of the problems is we don't referee local arguments. We pay attention to what people say, we try to use our best judgment. But in the end, this is a great big state with a lot of cities and counties and MPO's, and if we were to assert ourselves into every local disagreement, we wouldn't get anything done.

So we have to depend on our district engineer to tell us his viewpoint, or her viewpoint. We have to depend on mayors or city councilpersons and county judges and county commissioners. Less so on chambers of commerce and industrial leaders than the public would think. I mean, they are partners and we need them, but the truth is, we look to local government for a lot of our advice.

So I think the commission would feel real comfortable if you would continue to hammer that local government and we'll continue to listen.

MS. SNOOKS: There has been an ongoing dialogue between some of the opponents to this, the Governor's office, Mr. Behrens, and Lauren Garduno, so we are -- and even the commissioner, so I appreciate that. Thank you for hearing us.

MR. WILLIAMSON: Thanks for being here.

MR. JOHNSON: The next speaker is Edward J. Snooks. Mr. Snooks, I notice that your address is the same as the previous speaker.

MR. SNOOKS: Yes. We have about the same views. That happens after 43 years.

(GENERAL LAUGHTER)

MR. SNOOKS: My name is Edward Snooks, and I live in Odessa. And the local TxDOT organization has been very professional, and I'm really proud of them.

The MPO is made up of two representatives from Midland, one Odessa city council, one Ector County representative, and one TxDOT representative. This group decided Odessa needed an overpass across the railroad and BI-20 and service roads at JBS Parkway.

An Odessa consul on the MPO voted to recommend the interchange project. I believe if you're on the committee that proposes a project, then you should not be allowed to approve it.

A member of the 20-member transportation committee in 1999 was recently elected to the city council and voted to approve the interchange. This committee in 1999 recommended a study was needed for the interchange of Parkway and BI-20. I believe if you are on the committee to propose a project, you should not be allowed to approve it.

The project was approved three to two by the Odessa city council with two out of the three voters for the interchange having been on the committee that proposed the overpass.

The TxDOT hearing officer for the impact studies for the overpass was a member of the transportation committee that concluded a need for the interchange. The hearing officer was also on a subcommittee of the MPO that made the proposal. I believe the hearing officer should be a neutral party and not a member of either the transportation committee or the subcommittee of the MPO.

Odessa and Midland will both have local bus services for Odessa citizens. We were asked in a non-binding vote if they felt this service was needed. The vote was in favor. The JBS Parkway Overpass could have been handled in a similar manner.

Another point was just recently, Highway 191 was repaved at 42nd and Dixie, and it was a good job. This intersection floods every time it rains. Why can't drainage be considered when doing a paving job? The railroad underpass at U.S. Highway 385 just south of downtown has a drainage system that keeps water from standing. What will it take to install a similar system at 42nd and Dixie?

MR. JOHNSON: Any questions of Mr. Snooks?

MR. NICHOLS: No.

MR. WILLIAMSON: Thank you.

MR. JOHNSON: Next speaker is Rick Skillern.

MR. SKILLERN: Thank you for scheduling your meetings out here in Midland and Odessa. Of course, I'm a businessman here in Odessa and Midland, and I'm speaking in favor of the JBS interchange.

These two interchanges have been on the city's master transportation plan since the late 1960's. There is only two seven-lane thoroughfares in Odessa. One is 42nd Street which runs east and west that turns into Highway 302 on the west side, and 191 on the east side. And the other thoroughfare that runs north and south is JBS Parkway.

The city has tied it into Loop 338 on the northeast side of town and it runs into Highway 80 and stops there at a railroad track on the south end, and then starts up again on the south end of the railroad track and runs to I-20.

When those -- when the south part of JBS was built here just a few years ago, the city required that street be made to the same specifications as the north side of JBS there so when and if we get this overpass, that the -- that would facilitate the ease of JBS going all the way to Interstate 20.

The city council, just this past spring, a few months ago, had a hearing on this, public hearing, and heard arguments to and for these interchanges, and it's interesting that the councilperson from the area where these people are talking against it voted for these interchanges.

This is the Number 1 priority for the Odessa Chamber -- transportation priority for the Chamber of Commerce for the City of Odessa, and also the Number 1 transportation issue for the City of Odessa, and this is badly needed for our economic development. Appreciate your time.

MR. JOHNSON: Thank you, Mr. Skillern. Any questions?

Lisa Crenshaw-Estes. She's the chair-elect of the Odessa Chamber of Commerce. Thank you for being here.

MS. CRENSHAW-ESTES: Thank you for being here. We appreciate it. I am speaking today in favor of the JBS Parkway interchange for the Chamber of Commerce as the chair-elect, and also personally as president of Crenshaw Carpet Company of Odessa.

I believe the additional access to and from the interstate will help to promote tourism and visitors by providing a direct link to Odessa's largest shopping mall, U.T.P.B., a cluster of hotels and restaurants, office complexes, retail and service businesses. This will also provide direct access to Odessa's newest industrial park where our community enticed Family Dollar to locate a 907,000 square foot distribution facility.

I will welcome these two interchanges which I believe are extremely important to the future economic development of Odessa. Thank you.

MR. JOHNSON: Thank you very much. Any questions of Mrs. Estes? Are there any others who have asked to speak?

MR. WILLIAMSON: I have a question for Lauren. The first question that pops up in my mind, Lauren, as the neighbors who are against this all said uniformly, you would be routing industrial traffic through a residential area. Is that just because JBS would be used more as an industrial route?

We don't want it to turn out that we're sticking trucks through peoples' houses.

MR. GARDUNO: No, sir. We wouldn't do that. The concern is they were anticipating that a lot of the traffic, the generated -- truck traffic generated through the industrial park, currently industrial park, trying to connect into the downtown Odessa area.

In reality, though, the City of Odessa has the opportunity, and they have ordinances limiting truckload limits on that particular stretch of road, you know, from BI-20 on to the north on John Ben Shepperd.

My anticipation is that when we finish our consultant study on the BI-20 corridor, we will be able to better determine the connectivity between I-20 and BI-20. I anticipate you'll see truck traffic. We still want to see our truck traffic use Loop 338, for example, to get out of here, to go north up through Andrews and those communities to the north.

We will want that to be the road of choice for our trucks that way, but again, as the industrial park is developed north of the railroad -- excuse me, south of the railroad, then the anticipation would be that we are providing access for our citizens of Odessa to utilize this overpass to get to the industrial park, to do their work, to do their business in the industrial park.

Family Dollar, for example, the interchange out on the interstate for us has to be developed because they're going to see a need for our frontage road -- it's going to be destroyed rather quickly, we realize, if we don't get this interchange built, we've got to get this Family Dollar traffic out on our interstate system. So we anticipate that truck traffic going to the interstate and moving that way.

MR. WILLIAMSON: My feeling is you've got significant additional public involvement before a decision is made?

MR. GARDUNO: Yes, we do. We're in the design phase of the particular overpass systems we're concerned about. We're in the design phase, the environmental phase of this project, and we're trying to mitigate some of the concerns our citizens have in that particular residential neighborhood north of BI-20.

MR. WILLIAMSON: Thank you, Lauren.

MR. JOHNSON: Is there any other business to come before the commission?

Once again, thanks to each and every one of you for being here this morning, and in particular, thank you for all of the hospitality that the TxDOT Odessa District and MOTRAN and La Entrada Al Pacifico, which I believe has the acronym LEAP, have provided the commission and people from the TxDOT world headquarters, as Commissioner Williamson refers to it in Austin.

It is reinforced in my mind that West Texas is without peer rank when it comes to hospitality, and thank you for all that you have done to make this a very memorable stay for us.

And if there is no other business to come before the commission, I will entertain a motion to adjourn.

MR. WILLIAMSON: So moved.

MR. NICHOLS: Second.

MR. JOHNSON: There is a motion and a second. All in favor, signify by saying aye. (A CHORUS OF AYES)

MR. JOHNSON: For the record, please note that the motion carried, and it is 11:42 a.m.

(MEETING ADJOURNED)

CERTIFICATE

MEETING OF: TEXAS TRANSPORTATION COMMISSION
LOCATION: ODESSA, TEXAS
DATE: JULY 31, 2003

I, Susan N. Lilly, Certified Shorthand Reporter Number 3628 for The State of Texas, do hereby certify that the foregoing pages were reported in computerized stenotype shorthand by me, and that the above and foregoing pages contain a computer-assisted transcription of my computerized stenotype shorthand notes taken on said occasion.

Witness my hand this 5th day of September, 2003. Susan N. Lilly CSR No. 3628 - Expires 12-31-04 Permian Court Reporters, Inc.
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