Texas Department of Transportation Commission Meeting

Dewitt C. Greer Building
125 East 11th Street
Austin, Texas

Thursday, November 18, 2004

COMMISSION MEMBERS:

RIC WILLIAMSON, CHAIRMAN
JOHN W. JOHNSON (not present)
ROBERT L. NICHOLS
HOPE ANDRADE
TED HOUGHTON, JR.

STAFF:

MICHAEL W. BEHRENS, P.E., Executive Director
STEVE SIMMONS, Deputy Executive Director
RICHARD MONROE, General Counsel
ROGER POLSON, Executive Assistant to the Deputy Executive Director
DEE HERNANDEZ, Chief Minute Clerk

PROCEEDINGS

MR. WILLIAMSON: Good morning. It is 9:17 a.m., and I would like to call the November meeting of the Texas Transportation Commission to order.

It is a pleasure to have everyone here this morning and I appreciate you making the trip to Austin, Texas and taking the time to be with us.

Please note for the record that public notice of this meeting, containing all items on the agenda, was posted and filed with the Office of Secretary of State at 1:15 p.m. on November 10, 2004.

Before we begin today's meeting, as we always do, please take a moment, Ross, reach into your pocket, take out your cell phone or your PDA or whatever else you carry that might make noise, and take just a moment, as I'm going to do, to go to the silent mode.

Robert, did you change your phone?

MR. NICHOLS: I don't have one. We haven't got to wireless in east Texas yet.

(General laughter.)

MR. WILLIAMSON: I thank you for doing that.

As is our custom, we will open the meeting with comments from each commissioner, and we traditionally start with the commissioner from the far west stretch of our great state, Mr. Houghton. Ted?

MR. HOUGHTON: Thank you, Mr. Chairman, and welcome to all. Good morning, my fellow commission members. And first of all, a very happy Thanksgiving a week from today. I think we'll be out of here by then.

(General laughter.)

MR. HOUGHTON: And another historic day, we've got the Grand Parkway folks here and talking about another mobility project in the Statewide Mobility Program I hope we will pass -- and I assume we will -- and the Unified Transportation Program which will be historic in the size.

But I welcome you all and I look forward to the holiday season and sharing it with you all here. Thanks.

MS. ANDRADE: Good morning. I'd also like to welcome all of you to Austin and thank you for your interest in transportation.

Mr. Chairman, I'm looking forward to getting our business done and moving transportation forward in Texas. Thank you.

MR. NICHOLS: I'd also like to welcome everybody. Appreciate those who have driven a long ways to be here today, or maybe have flown.

There are several items -- one in particular I think is somewhat historical that's on the agenda today that we've been working on for a number of years, and I'm so glad to see it finally come together and glad you're going to be here to share it with us.

As we approach the holidays, drive careful. Thanks.

MR. WILLIAMSON: And again, thank you for being here as well, and thank you, commissioners, for your comments.

Let me remind everyone that if you wish to address the commission during today's meeting, I need for you to complete a speaker's card which you can find at the registration table to your right in the lobby.

If you're going to comment on a posted agenda item, I need for you to fill out a yellow card and identify the item on the card, please. If you're going to comment on something not an agenda item but simply offer comments in the open comment period, I need for you to fill out the blue card.

In any respect, I need for you to try to limit your notes to three minutes except for the Honorable Ms. Riddle which all members of the legislature are allowed to talk for as long as they wish in this commission, and we hope we'll be hearing from you at some point.

Normally I would say that the first item on our agenda is to approve the meeting minutes, but Mr. Monroe, would it be appropriate for me to do something else before I did that?

MR. MONROE: Yes, sir.

MR. WILLIAMSON: Mr. Simmons, donde esta? Steve Simmons?

Did you tell him, Mike? Did you give him an excuse not to be here?

MR. BEHRENS: No, I didn't tell him. He'll probably watch it on TV.

MR. WILLIAMSON: You know when they put the House proceedings on TV in 1992, the biggest concern of then Speaker Lewis was no one would ever go to the floor, they would just watch everything from their television, and I think that's probably also the case with state agencies.

Well, we may draft Mr. Fulton in Mr. Simmons' place. Can he carry a tune?

MR. BEHRENS: We'll try it.

MR. WILLIAMSON: You either tell me he can carry a tune or you're fixing to be the guy in the barrel.

(General laughter.)

MR. WILLIAMSON: Oh, there's Mr. Simmons.

Mr. Simmons, even though we are on nationwide TV and our every move is being catalogued by our friends at Corridor Watch, we're going to take a light moment and allow you to lead us in an early rendition of the birthday song for a colleague who is a great friend of all Texans and certainly a great friend of transportation.

MR. SIMMONS: Mr. Chairman, for the record, my name is Steve Simmons and I'm not a singer, so I will step away from the microphone to lead the group.

MR. WILLIAMSON: We're ready, go ahead.

MR. SIMMONS: Thank you.

(Singing birthday song to Robert Nichols and applause.)

MR. NICHOLS: Thank you very much. I think there's a violation of my personnel records that have been exposed here. I was born in 19 -- I forgot. It was a great year. I appreciate it, thank you.

MR. WILLIAMSON: Happy birthday.

(General laughter.)

MR. WILLIAMSON: Okay, the first item on the agenda is approval of the minutes of the October commission meeting. Do I have a motion?

MR. HOUGHTON: So moved.

MR. WILLIAMSON: Do I have a second?

MR. NICHOLS: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: The motion carries, the minutes are approved.

We will now receive the annual report from the Grand Parkway Association, the person who represents the Grand Parkway Association, Mr. David -- you know, I've always stumbled over this – is it Gornette or Gornet?

MR. GORNET: It's Gornet.

MR. WILLIAMSON: Thank you for clarifying that. David.

MR. GORNET: Thank you, commission members. I'm pleased to be here today. This marks the 20th anniversary of the Grand Parkway Association. The commission acted in October of 1984 to allow the formation of the association, and here we are today 20 years later still working hard on this project.

We have two new commissioners to brief today; I also have with us today State Representative Debbie Riddle through whose district part of the project is proposed to go, and she may take the opportunity to speak with you all further about the project and her support and concerns about it.

The project, as you know, is a loop around the metropolitan Houston area; it's been divided into various segments. Each of those segments I'll go through individually on the status.

The challenges we face is this 182 miles of new location highway: we have 20 miles that were open to traffic, those opened in 1994; 12 miles of which are under construction, about two miles over on the west side of town and ten miles on the east side in Segment I-2; 108 miles, Segments B, C, E, F-1, F-2 and G, are under study; 42 miles, Segments A, H and I-1, currently have no activity in them.

And to put this in perspective, this would be similar to proposing a new road and dealing with the challenges from Houston to San Antonio -- not quite 182 miles but further than Houston to Austin but closer to the Houston to San Antonio range, and how do you plan, execute, develop and build a new road of that magnitude.

Segment D is the portion that's open from US 59 to I-10. Some of the past activities, obviously the construction of that, we're continuing to meet with Harris County, with TxDOT -- part of this is in Harris County -- with TxDOT, Fort Bend County as they discuss the improvements to this facility through toll financing.

The state last year let a contract to construct two overpasses on the north end where we had frontage roads for safety purposes. There was significant traffic congestion and higher than state average accident rates in that area, and these two overpasses will help relieve that congestion and improve the safety of the facility.

For the future, we will look forward to completion of those mainlanes and continue discussions of using toll financing, either through the state or through one of the local entities to complete that piece of the project.

Segment I-2 over in Chambers County, the darker blue line there is what's under construction, the yellow line is a piece that was approved that follows Spur 55. The construction was let in August of last year and it's anticipated to be completed in the summer of 2006.

We will, after that's open, be looking at the yellow segment and as traffic volumes increase, propose improvements to that. We're also currently working with TxDOT to toll that segment when it opens. The construction was let without toll facilities planned in there. TxDOT and Harris County are both currently looking at how would you implement tolls on that and proposing the public involvement and also the detailed engineering that would go into that to facilitate toll collection when the facility opens.

MR. NICHOLS: Is that the piece of property that originally went through U.S. Steel's property?

MR. GORNET: Yes, sir.

MR. NICHOLS: Now, there were some critical dates in that original agreement that had to be met to still be able to obtain the right of way.

MR. GORNET: That right of way has been obtained; all those dates were met; it has been conveyed to the state.

Segment C in Fort Bend and Brazoria Counties, we've been working on this since 1998. The environmental statements have been on hold for approximately one year pending the outcome of some of the toll studies. Federal Highways has had concerns over how do you address tolling in this. The draft environmental impact statement said that it might be a toll road and now that we have more definitive actions, we are going to revise the FEIS before we issue it to more specifically state that this will be developed as a toll road.

The FEIS is scheduled for release in April of 2005, going forward to a record and decision this time next year, and then start construction as soon as possible.

Segments E, F-1, F-2, and G that go from on the west and north sides of the Houston metro area, started in 1999, they cross US 290, 249, 45 North, on up to 59 North. As you note from the information you have before you, there have been a number of public meetings as we've gone through the sifting process of looking at a very wide study area and narrowing that down to a corridor and then to specific alignment alternatives.

On Segment E we held our public hearing in 2003. The FEIS is being prepared right now, with more definitive discussions of tolling. Harris County Toll Road Authority has also been talking to TxDOT; there's been no definitive proposals made yet about developing this jointly between Harris County and TxDOT, but that is being looked at.

MR. NICHOLS: I think we may have some more questions after she speaks.

MS. RIDDLE: We can let him finish.

MR. NICHOLS: But on the F-2, I think that's where some questions may be coming up.

MR. GORNET: That's correct.

MR. NICHOLS: This indicates that we're still dealing with an area for a corridor as opposed to a specific location.

MR. GORNET: The draft environmental impact statement that was released in January of last year recommended a specific alignment which is the route that the public can see here in the purple line here.

We've held two public hearings; we've had tremendous amount of input from the citizens there in the area. We are going back and writing a focused supplemental environmental impact statement that will revise land use issues that were brought forward. It will also look at other alignment alternatives that have been proposed through part of the public involvement process.

MR. NICHOLS: So you still are open to alignment alternatives?

MR. GORNET: Yes, sir.

MR. NICHOLS: Okay.

MR. GORNET: The SEIS, we anticipate releasing that late in the spring of 2005. As soon as we got some clear weather in Houston in early October, they flew new aerial photography to put into these environmental documents. The stuff we had was two years old and because of the rapid growth, particularly in this F-2 area between 45 and State Highway 249, we're updating, at the request of the citizens, the aerial photograph so that they are assured that we have the most current information available to us.

Segment G is another segment just to the east of this, 45 to 59 North, and that segment connects. Where we've had the DEIS prepared on that, we're going back, because of the comments we've received on the F-2 segment, and updating this one, again including the new aerial photography and all the current land use to make sure that we take and we build on those comments and concerns that have been raised and address them proactively in this document, in the DEIS rather than have to go back and try to do an SEIS on that.

Segment B, another interesting segment down in the south side of Houston, going from 288 to 45 North. You can see there's still a relative spaghetti bowl of alignment alternatives that are being looked at. We have input from State Representative Bonnen, Brazoria County Commissioners Court, City of Alvin where they all have expressed support for a particular segment.

Currently our engineers are finalizing the input on that as well as the traffic numbers for both a toll and free road scenario. We fully anticipate it will be a toll road but the numbers are going to be in there because our current metropolitan plans and air quality conformity still model the Grand Parkway as a toll facility. When they're updated, we'll have the information there -- our model is a free facility; when they're updated, it will reflect the toll numbers that are in there.

Then Segments A, and H and I-1 -- A being the short segment over there from State Highway 146 to I-45 South in Galveston County, and H and I-1 that go from 59 North around, across 1960, US 90 and down to I-10, traversing Montgomery, Harris, Liberty and Chambers Counties -- they don't have any current activities on them.

That is an area that in my conversations with District Engineer Trietsch, he would like to see us do a tiered environmental impact statement on that so that we can avoid some of the issues that have come with the rapid growth in other areas of Houston.

The tiered environmental impact statement would allow you to go out and acquire the right of way today but it does not give clearance for the construction of the road. That way the right of way can be acquired, any development that does occur is complementary to this is where that facility is going to be, rather than us trying to snake our way around already existing development and intruding upon that development.

A summary of the activities we hope to have completed in 2005 is going to be the release of: the FEIS for Segment C, the FEIS for Segment E, the FEIS for Segment F-1; the SEIS, the supplemental environmental impact statement, for Segment F-2; the DEIS for Segment G, the DEIS for Segment B.

We will also be working with TxDOT and local authorities to complete the toll studies for Segments D and I-2 as to how do you implement toll collection on those facilities that are currently under construction; initiate the Tier 1 environmental impact study for Segments H and I-1, should the commission direct us to do so; and also initiate an environmental impact study for Segment A over in Galveston County that would at least have all the studies underway for the 182-mile project.

And that is the end of my presentation. If you have any questions, I'd be happy to address them.

MR. WILLIAMSON: Ted?

MR. HOUGHTON: There's the alignment issue on F-2 I think the state representative was going to address.

MR. GORNET: Yes, sir.

MR. HOUGHTON: And I think Robert talked about earlier, those are not set in stone yet as far as those alignments.

MR. GORNET: That's correct, they are not set in stone. We have a number of alternatives that are shown here. Some citizens have suggested some that would go even further north off of this map, further up into Montgomery County, and we are working with the citizen groups to look at these alternatives and all that will be discussed in the supplemental environmental impact statement that is being prepared.

Specifically, I believe -- I don't want to misquote Representative Riddle, but she would like to see routes analyzed that would go up and use FM 1488 in Montgomery County, maybe following the proposed route of the Grand Parkway to State Highway 249, then angle northwest along 249 through Tomball and up to Magnolia, and then follow 1488 or some other route modification of a route similar to that so that it can avoid impacts to this rapidly growing area of Harris County which she represents.

MR. HOUGHTON: Does that impact the other alignments on either side, the east and the west side?

MR. GORNET: It could have impacts, particularly on the east side over on Segment G, and it likely should have impacts.

We did look at those routes that are being proposed very early on in the study in our phase where we had the study areas. We discussed alternatives that would go further north and decided that those got out of what we refer to as the travel shed, the traffic demand areas that were using this.

The state currently has a study going on on FM 1488 and that being about ten miles north of where we are serves different traffic generators and users up there, and that the area that F-2 goes through serves another different set of users, and that it's appropriate to have both of those facilities.

MR. HOUGHTON: And when do you think all of this will be completed? Crystal ball.

MR. GORNET: Doing it as a toll road allows for this to be expedited, and given that we can get the environmental processes complete, I'd like to think that this could be open to traffic for the entire 180 miles in 2017.

MR. HOUGHTON: Okay. If not?

MR. GORNET: If not, it could be quite a while. I think a lot of it rests on the environmental process here, sir, and being able to find solutions that work with the citizen groups and address the regional needs.

MR. HOUGHTON: Okay. Thank you.

MS. ANDRADE: Mr. Gornet, I have two questions. On Segment F-2 you said that you had a large turnout at your public hearings.

MR. GORNET: Yes, ma'am.

MS. ANDRADE: What was voiced? What was their major concern?

MR. GORNET: The majority of the citizens there were voicing concerns that they don't want a highway near their homes. We had the spaghetti bowl of alternatives that were there, the route that was being recommended. Large subdivisions; were three-quarters of a mile away of existing homes; there are some new homes. Subdivisions have been platted right in the alignment that we're going through, and that the route that we proposed would obviously have a great impact on that now platted subdivision, the subdivision that didn't have homes in at the time that the route was proposed.

In general, they felt that they didn't need this type of transportation improvement in their community and that it would be there to serve others and not serve them.

MS. ANDRADE: After they learned what we were doing, did they feel better? I mean, were they walking out feeling like they had gotten the information they needed?

MR. GORNET: No, ma'am.

MS. ANDRADE: No? Okay.

And second is without considering the tolling, right now you're saying maybe 2017.

MR. GORNET: Without tolling, gosh, Mr. Behrens, I don't know when there might be funds available to address the needs without tolls.

MS. ANDRADE: It certainly has accelerated the project.

MR. GORNET: Yes, ma'am.

MS. ANDRADE: Okay. Thank you very much.

MR. NICHOLS: I was going to wait for my comments.

MR. WILLIAMSON: And I will wait until after the representative speaks, also, and plus Ted and Hope may have other questions after she speaks.

But I do have a question for you, David. I know for steady on three years now, in talking with you we have conveyed, I hope, two clear messages. One, we don't see how this gets built unless it's a toll asset.

MR. GORNET: Yes, sir.

MR. WILLIAMSON: Whether that's HCTRA or the TTA Division of our department or perhaps a joint venture with the private sector, we just don't see how it gets done.

Second, under any circumstance that one of the most expensive problems that the state faces every year is the legacy of having not been forward-thinking enough to require right of way for expansion. As the price of gasoline continues to stay high, more and more Texans will ask of their local and state leaders for a consumer-oriented public transit system. If we don't have the right of way to construct that system some day, we will have not done our jobs as public servants.

So I just urge, every time I see you, think bigger, not smaller for the right of way. You know, the crush of the now is always seemingly more painful than the howls of protest for the future, and no one ever wants to give up much of their land or have it taken away from them, and we understand that. But the requirements of the public sometimes override all of our individual wishes. And please tell all who participate in your venture that we need a right of way big enough to contain those 6 million Texans that will move to the southeast Texas area over the next 30 years.

MR. GORNET: Yes, sir. And I feel that we are responding to that.

MR. WILLIAMSON: And we don't take it lightly; we know that.

Well, would you like to step back then for the Honorable Ms. Riddle?

MR. GORNET: Yes, sir.

MR. WILLIAMSON: We haven't had a chance to get to know one another, but we appreciate your service to the state.

MS. RIDDLE: Well, thank you. Thank you very much for your service to the state, and thank you for allowing me to come before you today so that the voices of my constituents in District 150 can be heard.

First of all, I would like you to be aware that neither my constituents nor I am opposed to the Grand Parkway. The concerns of my constituents, however, are regarding the alignment that is proposed. There are several reasons for their concerns.

This is not simply a not-in-my-backyard concern. The people of my district are forward-thinking, and they too, Commissioner, would agree with you that we need to be forward-thinking and not backward-thinking in obtaining right of way. As a matter of fact, that is one of the primary things that they have stated is a tremendous amount of frustration that the State of Texas 20 years ago did not begin purchasing that right of way. Because of the tremendous growth in our area, so many lives, so many families and so many people are going to be disrupted.

Having said that, I would like you to be aware that the alignments -- and I have the map here -- do not just come within a matter of what was it, a quarter of a mile, did you say?

MR. GORNET: The existing subdivisions.

MS. RIDDLE: Of the existing subdivisions I would respectfully disagree with that. According to my map here -- and I could stand to be corrected, and come up here and correct me or show me, that's okay, we can be a little bit less formal -- there are several subdivisions, one in particular Mossy Oaks, it would come through that subdivision. That is not within a matter of a quarter of a mile or so much of a mile, it would come through it with one of the alignments.

With one of the alignments it would come through the property of a brand new Catholic school, a private school and their property, which is just slightly north -- it's right on 2920, just slightly north of 2920 in the F-2 segment.

There are people who have had their homes there for 30-35 years, they have built the community, and to have the Grand Parkway coming in such close proximity, and their concerns for the environment are real. It is not just simply an inconvenience, it is a true concern.

One of the concerns that they have is flooding, with all of the new building and with all of the new construction that is going on with new subdivisions.

I was sworn in, it will soon be three years ago, as state representative for District 150; this last session was my freshman session. During my campaign many of the areas that are now subdivisions, up and running and going as subdivisions, were pastures. It's a rapid growth.

And so some of the alignments that we now have or that is on my map that I have, they now are going either through or right next to subdivisions that didn't exist when this was done. I'm glad to find out that new aerial photos have been taken so that we can work with updated material, because one of the complaints of my constituents is that old information has been used and that old information is no longer accurate.

So the concerns regarding the flooding, the concerns regarding the environmental impact, and the concerns regarding just the cost of what it's going to take to come bulldozing straight through the middle of property that is now the property of the Catholic school. And I can show you on this map, I'd be happy to do so; I don't have the overhead that Mr. Gornet has, but I'd be happy to meet with you and show you.

The constituents are truly concerned, and this isn't just a lynch-mob mentality, these are well-educated people who have played a major part in building the community, and they're proud of their community. They're not backward-thinking, but they want this done with prudence and wisdom.

And that's why I'm here today, to say let's work together so that we can make the decisions together for not only the future of my district and for the future of my area -- I'm a native Houstonian, I want to see Houston continue to grow -- but also for the future of Texas.

My mother used to say that there's a solution to every problem. I may be naive but I believed my mother, I think there is a solution to every problem.

And the constituents that came in such mass that we actually had to postpone one of our meetings because there was not enough parking and there was not enough room, speaks to the fact that my constituents are activists, they're concerned, and they care, and they too want solutions, proper solutions, and solutions that are met with wisdom.

And so I request of you that we do continue to work together. And I want to, I want to continue working with the Grand Parkway Association, I want to continue working with Senator Lindsay, I want to continue working with David Gornet.

And I must compliment him because he has been most gracious. From the very get-go, whenever I had questions, whenever I needed information, he was Johnny-on-the-spot, coming to my office, bringing maps and able to sit down and explain. And I think that that is something that we can continue to do.

But the F-2 segment is an area that does dramatically and potentially can detrimentally affect a lot of Texans, and that is something that I just hope that together we can avoid. And I believe that we do have answers and I think that together we can come to those solutions for the better.

I stand ready to answer any questions that you may have.

MR. WILLIAMSON: Okay, Ted.

MR. HOUGHTON: I'll ask David. Is there solutions that we do not disrupt private schools?

MR. GORNET: Any of the alternatives, the ones that we're looking at, the ones that have been suggested that go further north, all have disruptions associated with them. Obviously our attempt has been to minimize those disruptions.

We felt that the route that we proposed did minimize those disruptions, and she is correct when she pointed out that -- the large neighborhood that I was talking about, we're a quarter of a mile, three-quarters of a mile away from them; we do go through the Mossy Oaks community, which is a much older community and has very established homes.

But no, we do have impacts. I've not identified any. If we follow routes that are proposed that go further north, TxDOT is challenged on FM 1488, they're trying to get 180-foot right of way in there, and there's all kinds of schools and cemeteries and churches and businesses and homes along there. And to go to a wider, say a 400-foot footprint up there -- which is what we're proposing down in the Segment F-2 -- would exponentially increase those impacts.

Unfortunately, as she pointed out, this is an area that 20 years ago would have been appropriate to acquire the right of way and say -- again, just like we're going to try to do on the east side of town -- this is where the road is going to go, and then when it's needed, we have the right of way there to go out and build it.

But no, sir, I've not found anywhere that doesn't either go through homes or businesses or a school.

MS. RIDDLE: It's more than just one neighborhood that we're talking about. With this particular map, one of the alignments -- may I step to the dais just briefly to show you?

MR. WILLIAMSON: You're a House member, you can do whatever you want.

MR. HOUGHTON: She got re-elected too.

MS. RIDDLE: Thank you, sir. I'll give that message to the Speaker.

(General laughter.)

MR. NICHOLS: Would you like somebody to hold the map while you point at it?

MS. RIDDLE: Mossy Oaks is right about here, but this is not the only problem. As you can see -- let's start with this first alignment coming here -- as you see with this Alignment D coming this way, this was not originally proposed but this is now platted and up and running, this is the Bridgestone area, and these people were vehemently opposed.

The Save Our Springs organization was formed specifically to have the citizens' voices heard on this because of the tremendous concern at what it would do to Spring, Texas.

At any rate, this now is one of the considerations, and you can see what would happen here.

After that, another alternate route came this way and this is the Alignment D coming this way. Now, this is along Boudreaux Road. Right now a new subdivision is Miramar Estates here. Boudreaux Road, and if it comes up this alignment, it is not three-quarters of a mile away. This is the gate that goes into that subdivision; there are backyards that come right here. So we're not talking how much of a mile; we're talking a few feet. Okay?

This would just decimate the property value, and that may not be an issue here, but this would just decimate the people, their properties here to have to have this come on Boudreaux here.

This is another subdivision here, and as you can see, it comes right to Boudreaux. So this is one of the alignments coming right along this way; this is Kuykendahl.

Now, The Woodlands -- and you're familiar with The Woodlands -- The Woodlands is further north up here, and a large reason for the Grand Parkway, I understand -- and David, correct me if I'm wrong -- is to help alleviate the traffic from The Woodlands.

Well, what this is going to do is import traffic into my district. I am told that the purpose for this is to help alleviate the traffic. I do not understand, and neither do my constituents, how one can alleviate traffic and import traffic at the same time.

If the Grand Parkway comes along this alignment, The Woodlands people are going to be coming down Kuykendahl. It is slated in the future to widen Kuykendahl, but I'm not so sure why we have to have that coming down this way. It would seem like it would make much more sense to go around.

Now, you talked about the traffic shed. Is that correct? Was that the term?

Okay. The primary traffic -- and David, correct me if I'm wrong on this -- with all of the people in my district, the vast majority of trips that are taken per home, nine out of ten trips per home, are short-travel trips, they are not long-travel type trips. Is that correct?

MR. GORNET: Your district I've not studied, but in general, probably seven of the trips are short trips.

MS. RIDDLE: Okay. The vast majority of trips that are taken in my district are short trips, whether it's seven out of ten, eight out of ten, or nine out of ten. I can tell you most of them are going to the grocery store, most of them are going to the doctor, to soccer games, and that kind of thing. Those trips are done down Kuykendahl, Gosling and these are these arteries going in other ways.

Also, for subdivisions coming along Kuykendahl, that is their only access. If we create such a congestion on these streets here, it could pose a life-threatening problem for emergency access, and that is an issue that we'd need to look at as well.

Because if we are going to start importing traffic into this area -- and David was right saying that my constituents feel like that they're going to have to be the sacrificial lamb, they are going to have to be the ones who experience the pain, if you will, for the convenience of The Woodlands coming down, for a road that they are not only not going to use that much. There's not going to be that many on-ramps, not that many off-ramps, and most of their trips are short trips.

And so it would make far more sense to determine -- I drew kind of a little red thing here that could be an alternate. I don't like the idea of this in here, period, but I think that if we could have an idea working together with something of this sort, that could take it further away from the subdivisions.

It would not go through Mossy Oaks, it would not go right smack-dab in these people's front yard except for possibly right here and maybe we could dip down a little here, but you can see the distance between their very yards right here. So we're not talking a quarter of a mile. It would help this area here and it would avoid North Hamptom area here.

And I must say when I hold a town hall meeting -- and I would think that most state representatives would concur -- when you hold a town hall meeting, wouldn't you agree that you're real fortunate to get 20-25 people?

MR. WILLIAMSON: Be a sellout crowd.

MS. RIDDLE: It would be a sellout crowd, wouldn't it. I mean, you've got to really pump it just to get that.

Well, when I held a press conference -- and I didn't even advertise this -- I held a press conference so that I could give the correct information to my constituents. You know how rumors travel and you know how people get concerned. Well, I want my constituents to be working with truth, I want them to be working with accurate information, so I held a press conference, didn't publicize it. 155 of my constituents showed up at a press conference.

At two public hearings we had how many showed up?

MR. GORNET: We had 1,050 register at the first one, we had 650 at the second one.

MS. RIDDLE: 1,050 at the first one, and the second one was held 15 miles away at a place they didn't know where to find, and still 650 showed up. So this is a real concern.

And I want us to work together. We don't need to be the bad guys and the good guys here; I think we can all be the good guys.

Does this help?

MR. HOUGHTON: Yes. Thank you.

MS. RIDDLE: Thank you.

MR. WILLIAMSON: Ms. Riddle, don't run off.

What else, Ted?

MR. HOUGHTON: That's all.

MS. ANDRADE: I certainly think you represent your constituents very well. Congratulations.

MS. RIDDLE: Thank you.

MS. ANDRADE: And I certainly would encourage that the communication keep on.

I wanted to ask Mr. Gornet, are you continuing public hearings or were the two the only ones that you're going to have?

MR. GORNET: We will have another public hearing after we -- right now we're getting into the development of the alternatives, analyzing them for the impacts and all that might be associated with those. As we move further on in that development process and are ready to publish the document, I'm sure that we'll be meeting more with Representative Riddle and we will have another public hearing as part of that process.

I've got to identify an area large enough to hold everyone again.

MS. RIDDLE: The greatest challenge that we have with our public hearings is finding a facility large enough to hold everybody.

MS. ANDRADE: That's great that you've got interested residents, and it's unfortunate that we didn't look at this into the future and be able to do exactly what needed to get done, and someone is always going to get hurt for that.

But I would certainly encourage the communication, and I can't encourage you enough to keep up the public education as to what's going on because unless we have another solution, you know, Houston does have a congestion problem that we do have to work with.

MS. RIDDLE: Well, I concur completely. As a native Houstonian and one who has to drive in that traffic, I fully understand, and so do my constituents. And that is why I have made every effort to make sure that my constituents are working with correct information, not rumor, that we are working with reason and not shooting-from-the-hip kind of anger.

But I must say that people are usually willing to get out and fight for a cause sometimes or raise up in arms and defend their country; we understand that. But when people perceive that their very homes could be in harm's way, then yes, they are going to rise up and defend, and that's what my constituents feel like they must do now, and they want to have your ear. But I must also add that they want to work to come to a solution.

So I thank you.

MS. ANDRADE: Good. Thank you.

MS. RIDDLE: Yes, sir?

MR. WILLIAMSON: Go ahead, Robert.

MR. NICHOLS: First of all, thank you very much for coming here today. This has been very good. And I know when we were talking earlier, you were a little hesitant about kind of jumping into all this, but I'm really glad you did.

I guess, Mr. Gornet, my comment is I hope in your public hearings that we're not just having meetings to tell people where it's going to be, that we truly are considering all possible alignments and working to try to work out something that will minimize the objections and concerns, and I hope that we continue doing that.

We see a lot of broad issues and then we see specific issues. This is a specific issue but it relates to a much broader issue and I think this is important -- you may can help us, Representative Riddle, in that I remember a number of years ago as we were trying to advance this project, we knew that the rapid growth in that region was moving so fast that the sooner we could lock in a route, the less likely -- because all of the available space is disappearing before our eyes.

And at the time we began trying to find a corridor through that area, by the time we get one picked out and go through the very lengthy environmental process -- which you don't want to rush, you want to do it right -- a new subdivision has come in and our available land disappears while we're studying it.

And it's not just a Houston problem and it's not just a Grand Parkway problem; it is a statewide problem. In all of our areas where we have rapid growth, that is where we need the transportation capacity, so that's where the growth areas are is where the greatest areas of need for capacity are.

We have expressed for a number of years, as an agency, the need for advance acquisition. If we know that we've got to get through there -- in other words, if we moved north or if they found a place to wiggle through to the south, if they can go in there and buy some of that land before it gets developed, it would be cheaper for the state and less disruptive for everybody.

But our process, part of which is legislatively set, prohibits us from doing that.

MS. RIDDLE: May I work with you to change that?

MR. NICHOLS: That was a big hint I was throwing out there.

(General laughter.)

MR. NICHOLS: Yes, we would certainly encourage any support in that area that we can get.

MS. RIDDLE: We have a session coming up and I would be delighted to work with you on that. That is something that my constituents have been asking me, and I'm sure you've received those same questions as well, David, as to why wasn't the land purchased 20 years ago.

MR. NICHOLS: Because it's basically against the law.

MS. RIDDLE: Well, then we need to change the law, don't we.

MR. NICHOLS: Right.

MS. RIDDLE: So my office is always open to you, my door is always open to you, and let's work on that, because I think that we have now reached a point in our state where we need that kind of flexibility. I agree with you, sir.

MR. WILLIAMSON: I echo Robert's remarks, Representative Riddle, we thank you for taking time out of your day to be with us.

And Robert hit on one point and the other that commission staff might be by to visit with you about is the notion that we ought to be able to develop the ability to identify probable growth corridors and allow the counties themselves to plat those corridors out, as they do now, their five-acre or whatever it is, subdivisions with the water wells and the septic tanks and such. I don't think that's an onerous thing for the real estate industry.

In fact, a lot of real estate people might appreciate it if the county had the authority to go out and say: Some day TxDOT or we are going to build a road here, so we're going to plat it as a public corridor, now you guys can develop on both sides and get ready for it. That's another aspect of it that might be helpful.

MS. RIDDLE: Well, I think that that is certainly a consideration that is worth study. I was a realtor for 18 years and I was a realtor in my district for a very long time, and the toss of the dice mentality that we have to deal with is scary for folks coming in and either developing the land or purchasing homes.

MR. WILLIAMSON: And for good or bad, I don't know which it is, the reality is the Houston, Dallas-Fort Worth, and San Antonio-Austin, and Pharr-McAllen population is just exploding, and somebody has got to step out there and say we need to provide for these transportation assets before the people get there.

MS. RIDDLE: Well, I agree because if we could have planned in advance, we would have avoided so many of the problems that we're facing now. So I think in order to avoid problems in the future that we need to be able to do that, and I would gladly work with any of you in making that happen.

MR. WILLIAMSON: Well, thank you so much for being with us.

MS. RIDDLE: It's important for us to work together.

But I must say one of the reasons for the rapid growth is because I represent such a wonderful district and everybody wants to move to the district.

(General laughter.)

MS. RIDDLE: But thank you very much.

MR. WILLIAMSON: Thank you.

And David, do you have anything else you need to share with us?

MR. GORNET: No, sir. Thank you.

MR. WILLIAMSON: Okay. Well, we appreciate the report, we appreciate your remarks. We always weigh carefully what a sitting member of the House or Senate have to say, and we appreciate your time.

I was chuckling, Mike, whoever prepares my script for me, I've got to quote from this. I say, "Good morning, and welcome to Austin, David." And then I allow him time to report. And my next words are, "All right, thank you for the report."

(General laughter.)

MR. WILLIAMSON: We're also planning to take a short recess, but you know, I think that a couple of the commission members need to try to be away as soon as possible, and unless you object, I'm going to go ahead and keep rolling through the agenda for a little while before we take a break, if it's all right.

Mike, why don't we take up item 3 and see what happens.

MR. BEHRENS: Thank you, Mr. Chairman. We'll go to item 3, our Aviation item for the month of November, and Dave Fulton will present some airport improvement projects.

MR. FULTON: Thank you, Mike, commissioners. For the record, my name is David Fulton, director of the TxDOT Aviation Division.

Item 3 is a minute order containing a request for grant funding approval for eleven airport improvement projects. The total estimated cost of all requests, as shown on Exhibit A, is approximately $5.5 million: approximately $1.7 million federal, $3.3 million state, and approximately $600,000 in local funding.

A public hearing was held on October 22 of this year and no comments were received. We would recommend approval of this minute order.

MR. WILLIAMSON: Before we vote, Dave, to your knowledge would the distribution of these funds in any way directly benefit any members of the commission?

MR. FULTON: No, sir, not to my knowledge.

MR. WILLIAMSON: Not to your knowledge.

Questions, members?

(No response.)

MR. WILLIAMSON: Do I have a motion?

MR. NICHOLS: So moved.

MR. HOUGHTON: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries. Thank you, Dave. It's good to see you always.

MR. FULTON: Thank you.

MR. BEHRENS: Moving on to agenda item number 4, it's a discussion item. Something that we've been doing now for the last several months is discussing our legislative agenda for the upcoming session, and this will be led by Coby Chase, our Legislative Affairs director. Coby?

MR. CHASE: Good morning. My name is Coby Chase and I'm the department's director of Legislative Affairs. My appearance before you today will be brief.

MR. WILLIAMSON: Oh, no, there's no way.

(General laughter.)

MR. CHASE: Well, it's my intention to be brief, at any rate. I'll be here as long as you need.

I'm here to present you a draft report regarding the Transportation Commission's legislative priorities for the upcoming 79th Texas Legislature.

And now I have to do something a little personal. Since this is our first official broadcast on the web, I promised my wife I'd say hello to her because she was going to watch me and tell me just how much fatter I look on web TV.

MR. WILLIAMSON: Can we all say hello to Julie?

MR. CHASE: Yes, say hello to Julie.

MR. WILLIAMSON: Hey, Julie.

MR. NICHOLS: Hey, Julie.

MR. CHASE: Well, thank you very much. She'll appreciate that.

MR. WILLIAMSON: How's the baby?

MR. BEHRENS: How was your Las Vegas trip, Julie?

MR. WILLIAMSON: What happens in Vegas stays in Vegas?

MR. CHASE: I did pretty well, Mike, I'm glad you asked. Look at that, that was worth the whole trip, it really was. When you can get something like 50 of these for $10, you give them out to all your friends.

MR. WILLIAMSON: I hope you haven't got Jefferson wearing one of those.

MR. CHASE: Yep, I sure do.

MR. WILLIAMSON: The original Elvis.

(General laughter.)

MR. CHASE: We have gone through this before so I'll get right to the substance of the report and the recommendations. While I plan to move through these fairly quickly, you may slow me down at any point if you have questions. And this month I brought visuals so those in the viewing audience can at least follow along with the topics.

Let me start with the Significant Legislative Issues. First of all is House Bill 3588. As we have all been discussing for some time, the commission and the legislature needs to revisit some of the provisions in House Bill 3588. I'll touch on the larger ones; there are a few which are more technical in nature and I will not bring them up here today.

First there are four main financial issues.

The first is the statutory cap on toll equity should be repealed.

Second, it must be clarified that all toll revenue from TxDOT projects is to be deposited into the State Highway Fund, not just revenue from bonded projects.

Three, present laws governing the use of any surplus toll revenue from TxDOT projects should be expanded. Right now, any surplus revenue must be used on another turnpike project in the region. It would be beneficial to allow surplus toll revenue to be used on a non-turnpike project within the same geographical area, or for instance on rail.

Four, state law should be amended to allow TxDOT to enter into pass-through toll financing agreements where we build the project and local public or private entities repay us.

Next there are two rail issues, still within the context of House Bill 3588.

The present statutory cap of $12.5 million per year in expenditures for non Trans-Texas Corridor rail projects should be repealed. In addition, the present $25 million per year in expenditures for Trans-Texas Corridor rail projects should be eliminated.

Next there is a need to clarify TxDOT's contracting authority for rail. Current law requires the department to use the low bid process, nothing innovative in the delivery of rail projects. And we would like to see that changed into something that operates more like a CDA, or a comprehensive development agreement.

The third big area is toll conversion and toll conversion revenue. Toll conversion revenue for TxDOT or a county is currently limited for use on that converted segment or an extension of that segment. It should be beneficial to allow the revenue to be used on other transportation projects in the region in addition to the converted segment or extension.

Second, and this is important, the report contains no recommendation regarding the definition of toll conversion, none at all. It would seem -- and this is my opinion and the opinion of my staff, and we can do whatever you would like in this report because you'll ultimately adopt it is -- I don't know if drawing a clear line right now as to what would constitute a toll conversion, and what wouldn’t, would be productive. There are many stages in the process of a road: is it when somebody thinks about is when the first design dollars are applied to it, the first planning dollars applied to it, or when tires are actually moving across the road, what actually defines a toll conversion.

I think there's going to be some interest next session in that -- I know there is. There's been one bill filed to define toll conversion and really all it does is prohibit one specific road in the Houston area from being converted to a toll road.

And I think also, kind of standing from the 30,000 feet level and looking at everything, the process seems to have worked, in our opinion, no road has been converted to a toll road; the process as defined in House Bill 3588 is not broken.

So I think there's still a lot of discussion that needs to be had; however, if it's the commission's desire, we will attempt to put a definition in this report. So that's something we're going to have to tackle. My recommendation is wait and see at the moment.

Continuing on -- and you can stop me for questions at any time -- and still within the confines of House Bill 3588 are two recommendations on comprehensive development agreements.

First is CDAs presently may only be utilized for toll projects. The ability to use CDAs for other state projects would enable the department to obtain the most efficient means of developing projects, providing the best value to the department.

And second, the department's ability to use comprehensive development agreements expires in 2011; that Sunset provision should be eliminated.

The next issue, RMAs and transit. Regional mobility authorities should be allowed to provide all forms of public transportation services. This proposal would allow RMAs to integrate all of their region's strategies to improve mobility under the oversight of one authority on a voluntary basis. An RMA that wishes to provide transit services in an area already served by an existing provider would be able to enter into a voluntary agreement to do that -- again, the key word is "voluntary."

Advance acquisition.

MR. WILLIAMSON: Hang on a second, Coby.

MR. CHASE: Yes, sir.

MR. WILLIAMSON: Do we touch anywhere in the report on permissive legislation that would allow NTTA to convert to an RMA, for example?

MR. CHASE: Not directly, no. In my opinion, I don't know what the harm of that would be. It would make sense that if you ran a regional toll authority, you'd want as much flexibility as you can, and it seems like RMAs have that.

MR. WILLIAMSON: Well, I think we suggested it to some of the NTTA leaders during the last legislative session that it be on a permissive basis, and they still -- you know, all of us get emotionally different during legislative sessions, and the reaction wasn't favorable even though it was permissive.

I'm just wondering in the spirit of not hiding the ball, if we believe it's a good thing to lay the groundwork for NTTA and HCTRA, and indeed CTRMA and the Alamo RMA -- I named your RMA for you, Tom, the Alamo RMA -- and all the others that we have formed, well, those that fall within other toll authority statutes, it may be not a bad thing for us to recommend to the legislature that permissive language be passed making that transition easier.

Otherwise, we're all hearing the stories, our friends at NTTA want a monopoly on toll roads in their areas, and the judge in Collin County doesn't want the transit systems busted up, and all of these things that distract us. Maybe we need to advertise to our partners at the local and regional level that we don't want to make them do anything; we just think it's good to lay the groundwork to voluntarily do things, and if they choose to do it, fine, and if they choose not to, that's okay too.

MR. CHASE: Something that would allow them to convert.

MR. WILLIAMSON: What I don't want to do is create an atmosphere of adversarial nature with, particularly HCTRA and NTTA, DART, I want them to process that in our first legally authorized legislative recommendation that we're recommending permissive things and cooperative things and partnership things, doing things together as opposed to our way or the highway -- pardon the pun.

MR. CHASE: Yes, sir.

MR. NICHOLS: I didn't want to interrupt.

MR. WILLIAMSON: Please do.

MR. NICHOLS: I was going to back up a step further related to toll conversion which has been a very confusing issue for the public. And we do know for sure that that's going to be an interesting topic that's going to be discussed and kicked around quite a bit at the legislature -- as it should be so it is totally clarified in everybody's mind.

But one of the confusing parts of that issue has to do with whether or not -- and I think that what we have been basically saying is that if you're currently driving on lanes that are non-tolled, what we have been working with pretty much across the state is that we've only been tolling the expanded lanes and the new capacity or new locations.

I'm a little concerned under your toll conversion revenue that in here is a suggestion that toll conversion revenue for TxDOT on that converted segment, if you ever did really have a true conversion by the definition we are using where you literally put toll booths across lanes and just tolled them, the current law says that you can use it to expand or extend -- in other words, it stays basically on that highway.

If we go in there and start trying to suggest or recommend that they expand that law so that if you do that it could be spent somewhere else, I think we're sending a confusing issue because basically what we're not doing is doing conversions. We're tolling new capacity and new locations, we're not tolling conversions, by our definition.

And if we go in there and ask for the revenue of conversions to be used on things other than that highway system, I think we're going to have a really confused number of members, because right now today in that big master plan that we've got for the whole state, there are no lanes currently that we are talking about going through a conversion on.

MR. WILLIAMSON: I understand what you're saying, but perhaps that problem is easily addressed by the suggestion two pages earlier where we just simply ask the legislature to define all revenues flowing to TxDOT are Fund 6 revenues and can be spent according to the constitution and the law.

MR. CHASE: And what we contemplated in this, as we were moving to this recommendation, was once you've converted a road to a toll road, a toll road is a toll road, and it should probably have the same flexibility as a new-start toll road, especially in the hands of TxDOT or the county. But I certainly understand.

MR. WILLIAMSON: All of us on the podium understand the intensity with which people have reacted to the conversion myths, but we've continued to believe it is valid to have that option out there for local governments and regional governments to turn to if that's all that's available to jumpstart a project.

In fact, the governor has made it clear to us he would never approve any conversions, but that's okay. And if that's his position and that's the way he feels, that's fine. That's no reason to take away tools from a community, from a county judge, a city council member or whatever.

What's interesting is in the conversations that have occurred about conversion -- Mr. Nichols makes a good point -- first, people are of the impression that we're out there converting lanes, which we're not.

And second, what's become crystal clear to me is the lack of true information many in the transportation world have about the relationship of tax payments to the cost and maintenance to a new road.

In fact, we've instructed Amadeo, I think, to prepare an extensive study on how much does a taxpayer really pay for a new road, what percentage of the cost ends up being allocated to the road.

Preliminary estimates -- in fact, I don't want to put words in his mouth. Amadeo, are you here today?

What's the preliminary estimate for the average road? I'm not talking about the ones that we know pay off like slot machines, Katy Freeway west of Houston, but for the average road. MoPac South is an example; that would be a good one that's current to the discussion.

MR. SAENZ: Some of the early numbers that we're looking at, they barely collect enough money to take care of the maintenance and operation.

MR. WILLIAMSON: So on a percentage basis, if you take the construction costs and the maintenance costs over a 40-year life, and you allocate the motor vehicle tax, the federal reimbursement, and the vehicle registration fee each year, based on the miles driven across that road, what percentage of total cash is recovered through taxes?

MR. SAENZ: About 50 percent.

MR. WILLIAMSON: So about 50 percent of taxes paid by Robert and I to use a new road built in our district cover the cost of building and maintaining the road on a 40-year life.

MR. SAENZ: Yes, sir. Those are some of the early numbers; we're still playing.

MR. WILLIAMSON: There are exceptions. Some roads, such as we know Interstate 10 west of Houston, because of the high traffic volume and the way it's built, taxes probably will recover its cost and maintenance.

MR. SAENZ: And of course we have roads that we need for connectivity that never collect any revenue to pay for themselves.

MR. WILLIAMSON: Yes, Robert?

MR. NICHOLS: I didn't disagree with anything you said, but one piece of that was that 50 percent of its cost was to maintain it over its lifetime -- the word "lifetime." When we did some lifetime studies, doing a 40-year lifetime of a new road, what it costs to preserve it, what it costs to build it, the thing that surprised me and most legislators that I've shown it to is that the preservation costs of a new highway over a 30- to 40-year period of time is actually several times the original construction cost. It costs more to preserve it over 30- to 40-years than it ever did to build it by several times.

MR. WILLIAMSON: Well, most of us that have been having to deal with this realize that something had to be occurring like this because you couldn't have this -- our construction of new capacity has gone to almost 5 percent in the last ten years, and so there had to be something to account for that, and the accounting for it is more and more of our cash has gone to maintenance of existing infrastructure.

Well, at any rate, my point, Coby -- and I didn't mean to digress to Amadeo's part of the world -- we've asked Amadeo to do an extensive study so that House members, Senate members, the governor, anyone else interested in transportation can kind of look at something and see the argument of you're taxing me twice to pay for the road just doesn't bear out in most cases.

That shouldn't change the fact that a conversion -- the point that Mr. Nichols brought up, a definition of conversion isn't appropriate. We just ought to be able to have the information for people to make good decisions about it.

MS. ANDRADE: Mr. Chairman, I have a question.

MR. WILLIAMSON: Please, Hope.

MS. ANDRADE: Not on toll conversion, but Coby, give me just a simple example on the RMA and transit. When you say an RMA that wishes to provide transit in an -- already served by an existing provider would be able to enter into a voluntary agreement with the governing body and transfer its operation to the RMA, I want to make sure that people understand that.

MR. CHASE: In the case of perhaps, I guess, Central Texas, if the Central Texas RMA and Cap Metro want to enter into a voluntary agreement to handle regional transportation, kind of the idea of an RMA, and the philosophy that the agency is going is regions handle their transportation as a region, and that's not just roadways, and if it makes sense -- I'm under the impression that, for instance, CTRMA and Cap Metro work very well together; that's bridged a lot by Representative Krusee who keeps that relationship strong and going. But there may be a discussion at some point, and I'm not saying that there is one here in the Austin area, I don't want anyone to believe that at this point -- is that it might make sense to have the RMA operate the bus system.

And it might make sense if the RMA is operating a toll road and financing -- using any profits, so to speak, to finance a transit system or the transportation project, it may just make sense to that community. But this wouldn't force anybody to do it.

MS. ANDRADE: So it would help the local transit companies if the RMA wanted to share their revenue or put their revenue to public transit, and it would strictly be voluntary?

MR. CHASE: Yes, ma'am, absolutely.

MS. ANDRADE: Thank you very much.

MR. WILLIAMSON: Continue, Coby.

MR. CHASE: As was just highlighted in the previous agenda item, advance acquisition, TxDOT should be granted the authority to acquire property from a willing seller in advance of the environmental work being completed. Again, this should only be from a willing seller; no condemnation authority is being recommended here.

And I think the discussion on the Grand Parkway highlighted the need for doing something like that.

I think, if you look back over the history of TxDOT, one of the things we wish -- if we could travel back in time and change was the ability to buy larger corridors, because there's nothing cheaper than the land you buy today.

Next is local transportation planning authority. Again, that was also discussed at the county level on the last agenda item. Local governments should be granted clear authority to regulate development in identified transportation corridors.

This is a two-stage process. First, TxDOT should be granted the authority to enter into agreements with local governments for the purposes of identifying the long-range transportation needs of the area and establishing future transportation corridors. Following that, local governments should be granted the express authority to regulate or control development within that corridor.

And I can't give you any better example than what just occurred with Representative Riddle.

Rail relocation. We currently may only provide for rail relocations on a very limited basis and only when necessary for a highway project.

TxDOT should be granted clear authority to enter into contracts for the relocation. In addition, the legislature should provide the funding to capitalize a rail relocation fund through which TxDOT may issue bonds for the state's cost of these relocations.

Please understand that a constitutional amendment is necessary in order to obligate the state to retire the debt from those types of bonds.

In a recently adopted legislative appropriations request, the department has asked for $200 million in General Revenue as startup capital for this fund.

MR. WILLIAMSON: Hang on a second. Did somebody start to say something down there?

MR. HOUGHTON: Yes, I did.

$200 million in General Revenue to look at moving rail before we have the authority, or in conjunction with the authority?

MR. CHASE: Well, they would have to move in parallel, definitely.

MR. HOUGHTON: And what do we estimate the cost of rail relocation around the state of Texas?

MR. CHASE: I can't do that off the top of my head, but I can tell you two things.

One, in the Austin area they are looking at moving the UP line off of MoPac and putting it east of town, and I could have this wrong, but I seem to recall that was at least $500 million.

And then right now in the city of Houston -- there is, I believe, a good story in the Houston Chronicle today about this -- the Greater Houston Area is looking at consolidating rail lines and moving them out of the port, kind of Alameda-Corridor style. And I would imagine that the state would want to be a partner in that, and that would cost -- I have no idea but it would cost a lot.

MR. HOUGHTON: So we would be the sole authority negotiating with the rail companies?

MR. CHASE: I don't know that. I would doubt it but I don't know that.

MR. HOUGHTON: Who would own the rights of way as they abandoned the rights of way?

MR. CHASE: I believe we would own them if we have a financial stake in it. But again, each deal is probably going to have to stand on its own, and a deal in one part of the state might look a little different than another.

MR. WILLIAMSON: I have some questions about this, but Robert, if you or Hope have anything you want to expand on.

MS. ANDRADE: No.

MR. NICHOLS: I do not.

MR. WILLIAMSON: First of all, Coby, I want to be sure your statement: Please understand a constitutional amendment is necessary in order to obligate the state to retire the debt. I think what you meant to say was to retire the debt related to strictly rebuilding a railroad as opposed to debt incurred to purchase UP's right of way, for example, and build a road on it, or both. Are we going to have to have a constitutional amendment either way?

Well, let me give you an example. Statutorily the legislature gives us $200 million from General Revenue and authorizes us to bond $10 billion against that to finance moving rail out of El Paso, Corpus Christi, San Antonio, Austin, Dallas, Fort Worth, Weatherford, Houston, big cities in the state. Why would we need a constitutional amendment to do that?

MR. CHASE: I think that the amendment has to do with the issuance of debt, the amendment doesn't have to do with the ability to go in and play in the rail game, so to speak.

MR. WILLIAMSON: And in your visiting with different members of the legislature and staff, particularly leadership, have you sensed a growing interest in the notion of taking rail out of urban Texas?

MR. CHASE: Absolutely, and it's been interesting and it's been fairly recent too, and it's, I think, in large part because of the discussions here in Austin and the starting discussions in the Houston area. And I think it's people are over time understanding more and more the beauty of the California experiment on the Alameda corridor, what they did, understand exactly what happened there, we can make it a much more efficient process in Texas for doing those things regularly.

And I think people are paying attention to it, and I think, in large part thanks to the media, we've gotten a lot of attention on this. And with things, unfortunately, in San Antonio with tanker cars spilling and some deaths resulting and things like that fresh on people's minds.

MR. NICHOLS: I was just going to comment that in trying to come up with numbers like you were talking about, I think we are doing a study to try to make an estimate of that statewide if you did a similar thing in each of the urbanized areas, and I can just tell you it's going to be up in the $5 billion plus kind of a range. So you would have to tackle it with assigning certain revenue source and bonding, something like this, to begin the process.

But it will take more than that. It will take a cooperative relationship with the railroads themselves as well as the communities, because those rails are in those communities in most cases to service the industries and businesses that are there which those communities want to protect and keep successful also. So it will only work if we can come up with, in addition to revenues, a good working relationship with the rail partners in this state, but there are good opportunities there.

MR. HOUGHTON: In my travels of the state, there's one common denominator and I haven't heard any negative issues regarding our initiatives to relocate rail. That is latched on or grabbed on by the broad base of people out there: get it out of my backyard, get it out from behind the school, we'd like to have that gone.

Now, that's the public. Of course, you want to protect industry that it does serve, but it's spanning the gamut, it really has.

MR. CHASE: Right, especially in the urban areas when you're moving lots of goods out of ports and you could get rid of all the at-grade crossings.

Again back to the California experience, it would take literally all day or just about all day for a train to leave the Port of Los Angeles to get to the other side of downtown -- and you can see downtown from the port -- because of all the grade crossings. They just dropped it underground and moved right ahead and then get through in 15 minutes or 20 minutes or something insane.

In that case it was financed through a dollar tax per car until the debt's paid off.

MR. WILLIAMSON: Hey, you know what we need to add to our list? I'm sorry to interrupt you.

MR. CHASE: That's okay.

MR. WILLIAMSON: Brainstorm. On our federal efforts -- and particularly with Dan back there listening, we can get him to help us -- we should see if we can get our advocates in the federal legislation to amend the law to authorize FHWA to take the money they would have reimbursed us for doing grade separations and permit us somehow to take that same money and do relocates.

In other words, don't we get reimbursed for a certain part of our grade separations, Mike?

MR. BEHRENS: Yes.

MR. WILLIAMSON: We ought to put that in our federal package, Coby.

MR. CHASE: I would only counsel that you think bigger than just the money related to grade; I don't know if, at the end of the day, that would be that big a pot; I don't know. I would suggest maybe argue for broader flexibility in being able to use your federal funding when it's decided in a community that rail relocation is necessary.

MR. WILLIAMSON: And I'm okay with that too, but if we can't win that battle, I don't want to wait six years for the little bit. And the little bit, Dan would probably support that, would be my guess. What does he care if it's the grade separation or the rail just gets out of Brownsville? Either way, for him, traffic is enhanced.

MR. CHASE: The clear authority would be great, because when I came onboard ten years ago we were wrestling with I believe it's a community called Manchester near the Port of Houston, I believe, and they would show you pictures that would just make you want to cry. These trains would park and just completely block in this community for hours on end. Ambulances couldn't get through, there were kids crawling underneath train cars to get to their school bus.

And Congressman Green, who was new to Congress at the time, was working like crazy to get money that we could spend so we could help alleviate that problem, and it's just been in recent years that we've actually been able to fix it. That kind of shows you the insanity of just staring at an obvious problem and a number of people can't do anything about it.

And so I would hope we would at least start by advocating for complete flexibility in these situations to move these things.

MR. WILLIAMSON: Now, I know that the commission is aware the governor and his staff are fashioning their transportation package separate and apart from these things, and a key component, I'm given to understand, that this package might have to do with rail.

We are not stepping on toes or overlapping. I mean, our agenda and his agenda, we need to move on ours irrespective of what he decides will be his policy for the next few years.

MR. CHASE: I would hope they're complementary; I would suspect that they are.

Moving on, loan programs, there are two we tackle in this draft report. The first one is the department should be authorized to establish a state-funded State Infrastructure Bank program that models the federal program to offer loans to eligible recipients for roadway projects and to bypass the tangle of federal strings that complicate the current State Infrastructure Bank.

Second is the establishment of a state-funded State Infrastructure Bank -- we have to find a new name for those, that's complex -- for loans to public transportation providers for capital investments. In the LAR we have asked for $40 million in General Revenue to capitalize this fund.

Next is the Texas Mobility Fund. The last significant issue pertains to the Texas Mobility Fund. The full promise of the fund may not be realized if all we can do is one $3 billion issuance over the next 15 years.

About $400 million in transportation-related funds which go into the state's General Revenue Funds should be dedicated to the Mobility Fund. Some examples are motor vehicle certificate of title fees, certain motor carrier permit fees, and personalized license plate fees. In addition, certain overweight truck fees and fees for taking a defensive driving class could be increased and those funds dedicated to the Mobility Fund. Increasing these fees could add another $15 million annually for the Mobility Fund.

I will now proceed to a discussion of those items of an operational nature which are included in the draft report before you.

Department-owned buildings. There's a definite need for the department to clarify its authority and responsibility regarding the construction of department-owned facilities. The department's authority in this regard has never been clearly spelled out in law and instead has rested mainly on attorney general opinions. The department should seek clear authority for us to construct, finance and manage our buildings.

Proceeds from the sale of department property. In a similar sense there have been interpretations of law which provided that when TxDOT sold its personal real property, the proceeds from that sale would be deposited back into the State Highway Fund. That was amended during the last session to put these proceeds into General Revenue. This needs to be reversed and apply not only to TxDOT but to the sale of Department of Public Safety property as well.

Concurrent jurisdiction for eminent domain cases. The number of courts authorized to hear eminent domain cases should be expanded. Because of the large number of public improvement projects that are underway or in development in our populated areas, it would be more efficient to allow state district courts, in addition to the county courts of law, to hear eminent domain cases.

Second lowest bidder. The agency has recommended that the department's authority regarding the awarding of contracts to the second lowest bidder be expanded from $100,000 to $300,000. This should speed up the issuance of small contracts.

Employee recruitment and retention. Finally, there are two employment-related issues contained in the report. The two are: paying a night and weekend differential for those employees who are required to work non-traditional hours; and then modify the statutory requirement that we post jobs above a B-13 pay grade outside the agency. This threshold should be raised to a B-17 in order to provide greater flexibility for reallocating and realigning the department's resources for effective management.

I would like to point out that the commission asked that we look into some bigger, broader issues and Cathy Williams has done that. Those are being worked through the State Agency Coordinating Council, and we will be a part of a larger agency group that tackles those issues. I just wanted you to know they're not in this report, but they are being handled in a separate venue.

MS. ANDRADE: Coby, will we know what they are?

MR. CHASE: Yes, I can get those to you. I can't recite them off the top of my head; I brought them up a few months ago. I'll get those to your office; I promise you that.

Are there any other issues that we seem to have missed that we would like in this report?

MR. WILLIAMSON: We'll begin with Ted. Additional issues?

MR. HOUGHTON: What is the amount of dollars going into GR on sale of personal property today?

MR. CHASE: I can't recall at the moment.

MR. HOUGHTON: And obviously the change in the law would be if you're going to buy advance purchase right of way and some day sell off what you don't use, you want it to come back to the agency, as an example.

MR. CHASE: Correct.

MR. HOUGHTON: Just curious on what it was.

MR. CHASE: On page 30 and 31 of the draft report, it goes through a set of numbers of between $2- and $3 million a year, plus or minus, I think, if I'm reading it correctly.

MR. HOUGHTON: Excess property, excess real estate?

MR. CHASE: Right.

MR. HOUGHTON: And if you get bigger footprints on advance right of way, it's going to be a larger number as you sell those pieces off.

MR. CHASE: Absolutely.

MR. HOUGHTON: That's all I have.

MS. ANDRADE: Coby, the only question I have is on rail relocation. In my travels throughout the state, I'm also hearing a lot of relief that we're addressing this problem. So my question to you is, is $200 million enough?

MR. CHASE: Well, you would bond against it, and that would give you a kick start.

MR. NICHOLS: That's $200 million a year.

MR. CHASE: I think it's $200 million over the biennium.

MR. NICHOLS: Biennium?

MS. ANDRADE: See, that's what I was wondering.

MR. CHASE: That would be $200 million over the biennium; $100 million per year, $200 million over the biennium.

MS. ANDRADE: So $100 million per year.

MR. CHASE: Right.

MS. ANDRADE: Okay. So you're okay with this?

MR. CHASE: Unless I'm told I'm not.

MR. WILLIAMSON: He's not necessarily okay, but he's telling us that's a beginning. What Mr. Nichols is telling us, the problem statewide is at least $5 billion, and I suspect it's higher than that.

MR. NICHOLS: Yes.

MR. WILLIAMSON: The flip side is we probably couldn't logistically move them all in one two-year cycle.

MS. ANDRADE: I guess the question is to Mr. Behrens, are we protecting ourselves. I mean, is that enough?

MR. BEHRENS: It's not enough, but it's a start, and you know, $100 million a year, we could draw down a billion dollars worth of bonds.

MR. HOUGHTON: I mean, does it appear to be enough for a two-year period?

MR. WILLIAMSON: I think the way this would, in theory, work, you know, we always talk about Austin and it's a bad situation, but let's pick San Antonio and talk about it.

In theory, what would probably work is we would have to reach some kind of long-term agreement with UP -- which I think Brother Nichols is working on -- that says we're going to commit to each other to study seriously how we'd relocate. In the end, what we're going to have to do or the State is going to have to do, is build railroads for UP and BNSF and Kansas City Southern to move and use in exchange for giving up their assets inside our urban areas.

We can try to slice and dice it and cut it any way we want to, and I think this is exactly what the governor is going to propose. But in the end, the railroads were here first, and they will tell you that, and as much as we don't like it or like it, that's the way it is, and there's no reason for them to move.

As we've talked about on this dais many times, there's really only three groups of people that have any value associated with that right of way: them, us, or local government in Bexar County. Nobody else has any interest in that stuff because it's narrow and it probably has some environmental problems.

But what would happen is we'd probably pick a project in San Antonio, negotiate with the UP, make our deal, and spend the next two years executing that deal, and then be back to he legislature for additional funds to take care of Houston or Austin, Fort Worth or Dallas.

So $2 billion is not enough, I think we all know that, to solve the complete problem, but it probably is a pretty significant step.

MR. CHASE: I think El Paso had kind of an ambitious plan at one point.

MR. HOUGHTON: It was $500 million -- it's study.

MR. WILLIAMSON: Next month when we discuss that we can use El Paso as the example. And then we can use Jacksonville and Weatherford, Robert.

MR. NICHOLS: We had a derailment.

The entire issue of us doing the studies and being involved, to me, if we kind of back up and look at the broader picture, it was only in very recent years, the last few years that the legislature established TxDOT to be an agency to have rail not regulatory but true rail involvement.

I know there's another agency that has the word "railroad" in it but they don't really do a lot with rail. I would never propose to change the name but it may come up one of these days.

Anyway, the legislature established for us to be the transportation-related entity to work with the railroads, so as we begin working in those things, that's why we are now really in-depth studying the issues. The communities themselves have had these issues.

If we try to go for too much money until something has been proven that we can do a successful job with it, I think it would be unrealistic. But if we can get a beginning amount of money as a revenue source to begin the process of working with the communities and the rail companies and show good progress, then I think that the legislature may be more responsive to taking a bigger picture at a later date.

MR. WILLIAMSON: Coby, I was reading -- I'm sorry, Hope, was there anything else?

MS. ANDRADE: No. Thank you very much.

MR. WILLIAMSON: Robert?

MR. NICHOLS: First of all, just to re-emphasize we don't want to cause confusion on this conversion thing. I know it's going to be an issue so just as a reminder on taking that other piece as a separate thing, I think it's going to be confusing.

On fees, you were looking at some miscellaneous fees, and I know there's a list and I've seen a list floated around that kind of stand out, but there is another fee you might want to identify and at least see how much money you're talking about.

About four years ago, the legislature, in trying to resolve a property tax collection problem in cities and counties related to mobile homes, wanted some entity to certify that taxes were paid before mobile homes were moved.

MR. CHASE: Right.

MR. NICHOLS: So they assigned TxDOT, of all people.

MR. CHASE: Oh, that's right.

MR. NICHOLS: Because the mobile home had to move on the highway.

So we got the assignment any time somebody wants to move a mobile home in the state of Texas, we had to assign employees to check with the counties and school districts and things like that.

Now, the legislature did realize there was a cost to that, so they attached a $20 fee to cover the cost of getting that. Instead of TxDOT getting the $20 fee, we only get 30 cents of it which doesn't even come close to covering it, and the rest goes to General Revenue.

MR. WILLIAMSON: Sounds pretty typical.

MR. CHASE: Yes, it sounds like a repeated pattern of abuse.

MR. NICHOLS: Sounds like somebody in appropriations.

(General laughter.)

MR. NICHOLS: Anyway, you might take a look at that.

MR. CHASE: Okay.

MR. NICHOLS: I think the fee was there to cover the cost which was the intent, but in effect, we ended up having to divert other resources to cover that cost, and it would be logical to include that in the fee.

MR. CHASE: Okay.

MR. WILLIAMSON: I think I've commented on most everything I wanted to, Coby. Go ahead.

MR. NICHOLS: I had one other item. For the last couple of months I've said something about contracting practices. I know that was an issue. I still want you to continue to look and see if there may be some opportunities.

MR. CHASE: Okay.

MR. WILLIAMSON: Particularly in context of what the Fed does and I think what other states do, we'd be interested in that.

The one thing that's come to me since you started this that I might like you to do some work on before next meeting so that the other members could see the results, I was reading an article in one of the multiple journals we all get about transportation and vehicles and things of that nature, and there was a pretty interesting article in one of these trade journals about the Arizona method of temporary license plates.

And the reason it caught my eye was I recently had an experience with an employee who had purchased a vehicle and kept the temporary plate on perhaps a little bit longer than he should have, and I realized that we still have cardboard plates that dealers put on cars when they're taken off the lot. Have we ever done any research on whether that's an efficient system, is it cost effective?

In the Arizona article I read, the director of motor vehicles out there alleged that the state ended up saving or recapturing around $20 million a year of escaped registration fees at the county and state level because of the old system that they replaced.

MR. CHASE: I know our Motor Vehicle Division has looked into this. The temporary tag you get when you buy a car, the dealer issues it -- I'm sure our Motor Vehicle Division could provide you a sample one -- they are insanely easy to counterfeit. Not only is it a revenue issue, these plates are used in the commission of crimes, they're used so you don't have to pay a registration fee, and all you need is a scanner and a printer at home and you can make your own.

And if I remember correctly, the Arizona system -- and I could be wrong -- is just so simple that there's no reason why you wouldn't do it.

Those temporary tags, all they do is they put a date, it expires on this date, and it doesn't say this is attached to a 2004 Dodge. You sign down at the bottom and an officer has to get up close and it's a huge problem to figure out if that plate belongs to that car.

In Arizona what they do is the dealer prints -- if I remember correctly -- prints out the plate right there, it's hooked into the motor vehicle system, prints it out right there. It says "This belongs to a 2004 Dodge"; it has a unique number like a license plate; it kicks out the serial number and a clear expiration date. And it's just printed out on a piece of paper and it's stuck in a plastic envelope and screwed onto the license plate cover, and so the officer can see from a distance that that's the right plate and can call in that number to see if it's legitimate.

And what they realized is they feel 100 percent compliance, that it cut down on people not registering their cars, they're collecting the revenues they deserved or that they were entitled to, and it created not just a bump but a sustained level of revenue for them. And the other side of this is, again, these are used quite frequently, from what I understand at any rate, in the commission of crime, and you could drive all the way to Canada with one of these with a dirty bomb in the trunk or whatever you want to do. They're just not that sophisticated.

MR. WILLIAMSON: Take a look at that and be prepared to educate the commission on some recommendations.

MR. CHASE: Okay.

MR. WILLIAMSON: I want to thank you for your hard work. I know this has been laborious for you and Jefferson and the staff, but I say one more time, the Socratic Method, we don't want any secrets. We want our world to know what's coming in and what we believe in and don't believe in so that we can have a proper dialogue and perhaps not be fighting with each other.

Members, I think it's appropriate at this time to take a six-minute-and-three-second potty break, so we'll come back in six minutes and three seconds.

(Whereupon, a brief recess was taken.)

MR. WILLIAMSON: Let me announce for the benefit of all listening or all present, to assist you in your planning, we're not going to take a lunch break today. If we go longer than is tolerable, the commission members will order out sandwiches and one at a time they'll take care of their lunch, but we're going to press on today. We have reasons to need to be through earlier rather than later.

Mike, I think we were at number 5.

MR. BEHRENS: That's correct. We'll go to agenda item number 5, Transportation Planning, and Jim Randall will present three items, the first being to authorize the 2005 Statewide Mobility Program which is a part of the 2005 Unified Transportation Program. Jim?

MR. RANDALL: Yes, sir.

Good morning, commissioners, Mr. Behrens, and Julie. My name is Jim Randall with the Transportation Planning and Programming Division.

Item 5(a), the minute order we bring before you today approves the 2005 Statewide Mobility Program of the Unified Transportation Program, or the UTP. The UTP 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 strategic plan, the department has divided the UTP into two documents: the Statewide Preservation Program known as the SPP, and the Statewide Mobility Program known as the SMP. The SMP is part of the BUILD IT budget strategy and contains all the department's categories which enhance the transportation system.

Additionally, the 2005-2007 Aviation Capital Improvement Program, as recommended by the Aviation Advisory Committee at its August 20, 2004 meeting, is being submitted for your consideration.

Also included in the SMP are public transportation project listings and program information for 2005 through 2008. Actual transit program allocations and grant recipients will be approved by future minute orders.

A 30-day comment period regarding the draft 2005 SMP ended October 29, 2004 with one comment received. Staff has reviewed the comment and recommends a project substitution in Category 3, Urban Area Corridor Projects, for the Pharr District.

As a result of the Texas Metropolitan Mobility Plan, the metropolitan planning organizations and TxDOT's districts representing the eight largest metropolitan areas prioritized projects within a fiscally constrained program. Category 2 of the Statewide Mobility Program was a result of this coordination.

The entire 2005 UTP is the culmination of at least four years of work and restructuring the UTP in coordination with the MPOs, regional planning authorities, county judges and TxDOT staff.

With approval of this minute order, the department may continue project planning and development for fiscal year 2005 and beyond. Staff recommends approval of this minute order.

MR. WILLIAMSON: Members, we, surprisingly enough, have no witnesses, so the floor is open for your questions and dialogue with Jim. Take a moment to absorb.

I know we have a variety of handouts and they will explain the information as we talk about it here this morning, but just to emphasize the way we've approached this is to understand what we're doing here, we've said had the governor and the legislature not acted, had the people not amended the constitution, and had the commission not moved forward on new mobility, new construction in the metro areas, on these items we would have spent around $6-1/2 billion?

MR. RANDALL: About $6.8 billion, yes, sir.

MR. WILLIAMSON: Which would have been out of our normal cash flow of state gas tax, federal gas tax reimbursement, and our share of vehicle registration fees.

MR. RANDALL: Yes, sir.

MR. WILLIAMSON: As a result of the Mobility Fund and the Safety Fund, thus far, and we haven't used the Ogden-Pickett Bonds to their fullest, but as a result thus far, coupled with the tremendous effort that's been made or put forth by Austin, Dallas, San Antonio, and Houston, and a good effort by the others, the total amount of new construction we should be able to achieve is going to be something on the order of $14 billion?

MR. RANDALL: $15.4 million -- billion. I'm sorry.

MR. BEHRENS: With a "B."

MR. WILLIAMSON: So over the next ten years is it an accurate statement that the amount of congestion relief dollars flowing to the metro areas will better than double as a result of the plans and the actions we take today?

MR. RANDALL: Yes, sir, and the leveraging that they're doing with these projects.

MR. WILLIAMSON: And all of the projects that were identified or would be identified and placed into the ten-year plan, of all the projects, 90 percent of those will be accelerated to begin 50 percent faster.

MR. RANDALL: Yes, sir.

MR. WILLIAMSON: As a result of that, projects that lay out at 12 and 15 and 16 years, in theory will now move into these six- to 12-year cycles.

MR. RANDALL: That's correct.

MR. WILLIAMSON: So this would be the single largest step this state has ever taken to address congestion in the metro areas of the state.

MR. RANDALL: It's a good day to be a Texan.

MR. WILLIAMSON: I would say we're moving forward with this one.

Ted?

MR. HOUGHTON: Well, you kind of covered everything I had to say. Do we get a button that says "90-50"?

MR. RANDALL: No, sir.

MR. HOUGHTON: That would be a nice shirt: "Don't Mess With Texas 90-50."

Tremendous work that the regions have done to accelerate these programs to use the tools that were provided during the last session. I congratulate all the MPOs and I call them the champions in the state that have rallied around these new tools.

Like I said, a historic day today. I look forward to it.

MS. ANDRADE: Jim, it certainly is a great time in Texas.

I would like to thank you and your staff for meeting with me and helping me understand this since it's my first time around. And I agree with Ted, everybody should be congratulated on being visionary and creative, and we did, we took advantage of every tool that's been given to us. So now let's make it work.

MR. RANDALL: Yes, ma'am.

MS. ANDRADE: Thank you very much.

MR. NICHOLS: I certainly didn't have any questions but the comments I was going to make, when we opened the meeting and the chair asked for comments, I said there were going to be some historic things today, and this is it. I mean, it is really huge, it is what we call a big deal.

And it's a number of things that have all come together that everybody has been working with for a number of years, all the way back to reducing the categories of funding, simplifying the process, going to an allocation basis on new construction or expanding capacity in the urbanized areas.

It incorporates the local input, having the MPO working with the district, them selecting the projects and rearranging the schedule of the projects, true local control, local input.

It incorporates the tolling which just a very few years ago we were prohibited from using state funds on toll projects. It incorporates the Texas Mobility Fund, it incorporates the proposition bonds. It has taken all of this stuff over a several-year transition and that which has passed, put them together, and a lot of people worked very hard, a lot of people have had real visions on this, and the result is as defined by the chair: we're going to do more than twice as much in true congestion relief in urbanized areas and we're going to do it in half the time. That's almost like a multiple of four that otherwise would not have been done.

So hats off. It's a great day for Texas.

MR. WILLIAMSON: Let me exercise the prerogative of the chair and take a moment to use you, Jim, as a way of speaking to our greater audience across the state and to those in the room involved in transportation every day.

This process started in particular when the local toll component began. There were several communities in Texas, I think we referred to it earlier in the year as having engaged in an intense conversation about transportation in their communities, and it wasn't without pain, it wasn't without some perhaps yelling and screaming.

We took no joy in seeing the roughness in El Paso; we took no joy in seeing what leaders in Austin had to go through as CAMPO worked through their plan; a little lesser extent in north Texas, I think that Michael had done a good job of preparing the region; almost no roughness in Houston other than the State Highway 249 conversion topic because they're used to toll roads; perhaps some angst in San Antonio, but not a lot; I think Corpus Christi went fine and I don't think there was much problem elsewhere in the state.

But we were urged by many people in the transportation world at the local level and by some politicians either directly or indirectly through their press releases and off-the-cuff statements about tolls, to insert ourselves into that local process.

The guy we work for made it very clear that he believes in regional planning and local execution and he would stand with us and take the criticism until this process was over because he has faith in city council persons and county commissioners and transportation planners and citizens who participate in this process.

And just as Governor Perry predicted, the worst parts of every plan that people spoke of were ultimately removed in the local process. We stayed out of it, as he instructed us; he stayed out of it. The result was a pretty robust and forward-thinking plan for each of the metro areas that combines local commitment, state resources to create a partnership to address these problems.

And I think the commission and hopefully the legislature, and I know the governor take great pride in the work we've done and the work our local leaders have done to address our problems ourselves. We're not waiting for the "Federal Road Fairy" to show up, we're not waiting for the miraculous change in this state's philosophy in the passage of a huge gasoline tax. We are moving forward to fix our own problems, a true Texas tradition, and I think we should all be proud of that.

MR. RANDALL: Yes, sir.

MR. WILLIAMSON: Thank you for your work. Do I have a motion?

MR. NICHOLS: So moved.

MR. HOUGHTON: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries. Congratulations, Texas.

MR. RANDALL: Okay, sir. Item 5(b), this minute order authorizes the executive director to develop an agreement with the U.S. Army Corps of Engineers with the City of Austin for a slope stabilization project on US 183 at Boggy Creek.

Extensive stream bank erosion has occurred along the creek in the vicinity of the US 183 crossing. Immediate mitigation steps are necessary to prevent further damage from undermining of the channel lining at the end of the Corps flood control project completed in the 1980s.

Erosion has exposed a 48-inch wastewater collector and the pier system and abutment slope protection of the US 183 bridge structure.

The city will be the project sponsor and has coordinated with the Corps to identify federal cost-share funding opportunities and an acceptable stabilization approach. The Corps will provide up to $1 million in funding and will manage the design and construction phases.

The total cost of the project is $2.2 million. The Corps will provide up to $1 million. The department will provide an amount not to exceed $600,000 in Category 11 Austin District Discretionary Funds for the portion of the project associated with the bridge structure. The city will be responsible for the remaining $600,000 in addition to any cost overruns.

This minute order will expedite the agreement process by authorizing TxDOT to develop an agreement involving the city and the Corps. No new TxDOT funding is being authorized. Once the governor executes an agreement, the executive director may proceed with the city and the Corps for further development of the project.

We recommend approval of this minute order.

MR. WILLIAMSON: Members, questions or comments?

(No response.)

MR. WILLIAMSON: Do I have a motion.

MR. HOUGHTON: So moved.

MS. ANDRADE: Second.

MR. WILLIAMSON: I have a motion and a second. All in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. RANDALL: Item 5(c). On June 29, 2000, the Texas Transportation Commission approved Minute Order 108241 to establish governing procedures for the approval of construction cost estimate increases as compared to program amounts prior to letting.

Due to the restructuring of the Unified Transportation Program and the corresponding reduction in the number of construction categories from 34 to 12, it is necessary to revise these procedures.

With your approval of this minute order, approval limits will be increased for the three mobility categories, Categories 2, 3 and 4, and the structures category, Category 6, to address the increased size and cost of projects.

The existing approval limits of $1 million for the division director and $10 million for the executive director were originally authorized in 1994. The proposed approval limits for Categories 2, 3, 4 and 6 are $2.5 million for the division director and $25 million for the executive director. The commission will consider all increases greater than $25 million.

This minute order replaces the previous minute order, addresses the new categories established in the 2004 UTP, and increases executive director and division director approval thresholds. Staff recommends approval of this minute order.

MR. WILLIAMSON: Questions or comments, members?

MR. NICHOLS: So moved.

MR. HOUGHTON: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. RANDALL: Thank you.

MR. WILLIAMSON: Thank you, Jim.

MR. BEHRENS: We'll now go to agenda item number 6, and first we'll have our rules for proposed adoption. Agenda item 6(a)(1) will be rules concerning the use of state highway right of way. 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 proposes changes to the department's rules for road closures and for film or video productions on the state highway system. These amendments are designed to provide maximum flexibility to the districts while maintaining the safety and convenience to the traveling public.

Four of the more significant changes are: one, the district engineer may grant an exception to the current requirement that requests be submitted 30 days in advance; two, traffic control plans submitted in association with these requests must adhere to the Texas Manual on Uniform Traffic Control Devices; three, the district engineer may waive the requirement for a traffic control plan if the plan would require only law enforcement personnel and public safety is not in question; and four, the district may enter into multi-year agreements of up to five years if the event stays the same from year to year.

We recommend approval of this minute order.

MR. WILLIAMSON: Now, if we approve this minute order, are you going to get a cameo role in some movie?

MR. LOPEZ: Most likely not.

MR. WILLIAMSON: I like the optimism in that: most likely not.

(General laughter.)

MR. WILLIAMSON: Questions or comments, members?

MR. NICHOLS: So moved.

MR. HOUGHTON: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion, signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. LOPEZ: Thank you, commissioners.

MR. BEHRENS: Agenda item 6(a)(2) is proposed rules under the Turnpike Projects, to define the use of turnpike projects by military vehicles. Phil?

MR. RUSSELL: Thank you, Mr. Behrens. Good morning, commissioners. For the record, I'm Phillip Russell, director of the Turnpike Division.

Under the Transportation Code, the Texas Transportation Commission is required to adopt rules allowing a military vehicle to use turnpike projects without payment of a toll or a fare. The proposed rules before you would define what turnpike projects and which vehicles would have the ability for the free use of these facilities and also what the method would be to grant that use in each type of lane.

The comments would be due back into the office five o'clock on January 3, 2005. I'd be happy to address any comments you might have.

MR. WILLIAMSON: Questions or comments, members?

(No response.)

MR. WILLIAMSON: Do I have a motion?

MR. HOUGHTON: So moved.

MS. ANDRADE: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion, signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. BEHRENS: Agenda item 6(b)(1), this will be rules for final adoption, the first being rules concerning Donations. Richard?

MR. MONROE: Good morning. For the record, my name is Richard Monroe; I'm general counsel for the department.

If you approve this minute order, you will be approving some updated and hopefully more efficient rules concerning this department's acceptance of donations.

The rules have been published as they were initially approved by the commission in the Texas Register. No comments were received, so everything is exactly as it was before. My recommendation would be that the minute order be approved.

MR. WILLIAMSON: Questions or comments, members?

MR. HOUGHTON: Move to approve.

MS. ANDRADE: Second.

MR. WILLIAMSON: A motion and a second. All those in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. MONROE: Thank you.

MR. WILLIAMSON: Thank you, Mr. Monroe.

MR. BEHRENS: Agenda item 6(b)(2) will be rules for final adoption concerning environmental review and public involvement for transportation projects. Dianna?

MS. NOBLE: Good morning, commissioners, Mr. Behrens, Roger. For the record, my name is Dianna Noble and I'm the director of Environmental Affairs for TxDOT.

Item 6(b)(2) is for the adoption of new 2.40 through 2.50 concerning environmental review and public involvement for transportation projects.

The proposed rules were published in the Texas Register on August 13, 2004. A public hearing concerning the proposed rules was conducted on August 30, 2004; no one attended the meeting.

The comment period closed on September 13, 2004. Comments were received from two members of the public. Comments received were related to condemnation authority for the Trans-Texas Corridor, the construction of weigh stations, specifically referencing compliance with other laws, early and advance acquisition. The comments also included to distinguish between right of way and property and they questioned consistency with the Coastal Management Program.

The rules were not revised as related to these comments; however, proposed text changes were made by staff to address minor corrections and further improve clarification.

We recommend approval of this minute order. I'll be glad to answer any questions.

MR. WILLIAMSON: How is your son?

MS. NOBLE: He's doing very well, Commissioner. He has his last MRI this month.

MR. WILLIAMSON: That's good. We shall continue to pray.

MS. NOBLE: Thank you.

MS. ANDRADE: I have a question.

MR. WILLIAMSON: Yes, ma'am.

MS. ANDRADE: Dianna, when we say that we disagree with their comment, do we let them know and why? I mean, do we respond?

MS. NOBLE: In this instance we did not -- well, traditionally we do not, we just publish the responses as part of the notice when we publish the rules.

MS. ANDRADE: So we have no procedure in responding when they disagree with us on anything?

MS. NOBLE: No, Commissioner, but if you would like, I could do that.

MS. ANDRADE: Well, I guess it just makes it sound like at least we're responding to them and helping them understand. You know, I don't want us to go through a whole process of undue paperwork, but I'm just concerned that somebody disagrees with us and we just don't even acknowledge the disagreement and let them know why.

MR. WILLIAMSON: You know, the commissioner brings up a good point -- not to focus on you, Dianna, but the whole department -- because we're entering a period over the next year where we're going to have multiple disagreeing comments from the public.

And maybe, Mike, we ought to take a step back and get Mr. Monroe perhaps to look at the notion of when someone disagrees with one of our published rules, whether we change our rules or not based on their comment. Maybe we ought to prepare a letter to them and say, "We've read what you said; we understand what you're saying; we disagree and here's why." I don't think that would be a bad thing.

I know, Amadeo, in the last 60 days we've changed a lot of people's minds about the corridor, toll roads, and policies just by giving them the proper information. You know, the one guy that came up here and thought we were fixing to toll every road in Austin, Texas based on what someone had told him is a good example of that.

MS. NOBLE: I will prepare a letter.

MS. ANDRADE: I just want it to be known that we encourage public comment so that we can always better serve the public, but I don't want the public to think that we just don't do anything with it.

MS. NOBLE: I understand.

MR. BEHRENS: And when we do have our public meetings on projects and public hearings, we have a lot of written correspondence, and I know historically we do answer those letters and respond to them about their issues. Sometimes we even respond positively that we can react to their comments; of course sometimes we can't and we explain the reason why.

MS. ANDRADE: Thank you.

MR. NICHOLS: Obviously any time you communicate with the public, it's good practice. I know from experience back when I was like city council and mayor, going to some public hearings of TxDOT, everybody was nice, we'd have the public hearings. We would make comments or concerns about a rule change that TxDOT was doing and then we would have to wait and see what happened on the rule.

I used to come out here and we just didn't know what they were going to do, and then after the decision was made, about the only way we could get these was sometimes they would just give them to us if we asked, but we would read this document where here's a comment and here's the reason. So we had to go through a process just to get that information -- everybody was nice.

But I think if people sign up and make oral comments or concerns, or if they sometimes send in written comments, I understand that you can't necessarily respond until after the commission takes an action because the commission may disagree, but once the commission has taken action, I think it would be an outstanding idea, whenever possible, to send a letter that basically goes through this.

MR. WILLIAMSON: I could kind of see the procedure going something like this: we get the comment, we incorporate it, we have this hearing, and then as you go through and explain what you're doing, you say and we will send a letter to the Sierra Club, Save Our Springs, Corridor Watch, David Stahl, whomever, and this is what we will say. I don't think that's a bad thing.

Ted, do you have any instinct about it?

MR. HOUGHTON: Marketing 101, communicate, communicate and communicate.

MR. WILLIAMSON: And it may be Mr. Monroe will tell us later on there's some legal issues we've got to be careful about because frequently our rules are implemented and then challenged and some of the comments are made for that purpose.

MR. HOUGHTON: I think people think if they do send something in or if they make a comment in writing, it goes into a deep dark hole and we don't care. And that would result in, I think, a positive, sending something back.

MR. WILLIAMSON: Let's work on that, Mike. I think that would be a good idea, be good public relations.

Anything else, members?

(No response.)

MR. WILLIAMSON: Do I have a motion?

MR. NICHOLS: So moved.

MR. HOUGHTON: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion, signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MS. NOBLE: Thank you.

MR. WILLIAMSON: Thank you, Dianna.

MR. BEHRENS: Agenda item 6(b)(3), final adoption of rules concerning hardship financing for utility adjustments and relocations and removals.

MR. WILLIAMSON: I need some of that. Do you have some hardship financing for your commissioners?

MR. BEHRENS: Repeal of those rules.

MR. BASS: You may have about five minutes to get that in.

For the record, this is James Bass, director of the Finance Division at TxDOT.

This minute order would repeal the sections in the Texas Administrative Code dealing with hardship financing for utility adjustments.

This program was established in 1997 to enable the department to loan money for the movement of utilities in order to avoid delaying work on projects. However, in statute the terms of that loan are set and to date we have had no one apply for assistance under this program. Perhaps this is due to the fact that the State Infrastructure Bank was also established in 1997 and that particular program allows the commission more flexibility in setting those terms.

The proposed repeal of these sections was published in the Texas Register and no comments were received. Staff would recommend your approval of this minute order.

MR. WILLIAMSON: Questions or comments for Fast Jimmy Bass?

MR. HOUGHTON: So moved.

MR. NICHOLS: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. BASS: Thank you.

MR. BEHRENS: Agenda item 6(b)(4) final adoption of rules concerning our Historically Underutilized Business Program. J.D. Dossett will present this.

MR. WILLIAMSON: And this isn't your first time with us, is it?

MR. DOSSETT: Yes, sir.

MR. WILLIAMSON: Have you been warned?

MR. DOSSETT: No, sir.

(General laughter.)

MR. DOSSETT: Good morning, commissioners, Mr. Behrens.

This minute order adopts amendments to 9.51 and 9.54 concerning Business Opportunity Programs, specifically the Historically Underutilized Business Program, to be consistent with the recently adopted new rules by the Texas Building and Procurement Commission.

The commission, by Minute Order 109758, dated August 26, 2004, proposed these amendments, and these rules were published in the September 10 issue of the Texas Register and we received no comments.

We recommend the adoption of this minute order.

MR. WILLIAMSON: J.D.?

MR. DOSSETT: Yes, sir.

MR. WILLIAMSON: What does HUB mean?

MR. DOSSETT: Historically Underutilized Business.

MR. WILLIAMSON: Is that a guy that never gets any work, he just needs some help?

MR. DOSSETT: That is a guy who traditionally has not been included in the process, not had an opportunity to participate in the process -- or a lady.

MR. WILLIAMSON: Is this a TxDOT only thing or does this apply to all government?

MR. DOSSETT: This applies to all state agencies.

MR. WILLIAMSON: J.D., you're being entirely too serious; I'm trying to get you to laugh.

MR. DOSSETT: (Laughter.) Is that better?

(General laughter.)

MR. WILLIAMSON: Ted, have you got any questions or comments for J.D.? We can't let him off this easy, we always rake everybody else through.

MS. ANDRADE: So this is for all state agencies, not just us.

MR. DOSSETT: All state agencies, yes, ma'am.

MR. WILLIAMSON: Robert?

MR. NICHOLS: I didn't have a question about this; I support this.

But I was just going to ask you -- it's good to see you again -- are you still going out into the field and visiting with communities and getting together with some of these small businesses and encouraging them to participate?

MR. DOSSETT: Yes, sir. As a matter of fact, we had some people just down in San Antonio just yesterday, I believe.

We hold regional meetings across the state, regional liaison meetings, and what we try to do is to provide and share information about TxDOT's procurement programs, specifically in the construction, professional services, and goods and services area, and we do this all during the course of the fiscal year.

MR. NICHOLS: But we don't just do it like in Austin and San Antonio; we go east Texas, west Texas, north Texas.

MR. DOSSETT: We go all over the state. We go to a lot of the smaller areas that we normally don't traditionally --

MR. NICHOLS: Do you do that like a couple of times a year?

MR. DOSSETT: We probably do it about ten times a year.

MR. NICHOLS: Great. I so move.

MR. WILLIAMSON: Wait a minute. I want to play with him a little longer.

A little bit seriously, though, J.D., and you may not be familiar with this, and if you're not, that's okay. In fact, maybe I'll address the question to Mike.

I noticed that Senator Barrientos asked a series of questions in our last Senate Finance hearing about our HUB and DBE programs, and we made a few suggestions to him legislatively, so in the letter to Senator Ogden that's being prepared, we are going to make some suggestions.

I'm assuming that the best strategy might be to send the letter to Chairman Ogden in response to Senator Barrientos' questions and then perhaps send J.D. and crew over and actually work through with Barrientos' staff exactly what we're getting at. Because it looked to me like the suggestions were all good to address the need for us to get that last percent and a half to our goal.

MR. BEHRENS: Yes, I think that would be a good idea. And of course, J.D. went with us several times to meet with some of the representatives and senators and we've visited with Senator West several times and outlined programs and went through some of his concerns, and we can surely do that with others.

MR. WILLIAMSON: That would be my favorite senator of south Dallas, Royce West.

MR. BEHRENS: Correct.

MS. ANDRADE: Mr. Chairman, I don't have a question; I have a comment.

Commissioner Nichols, you asked about how involved we are, and I have to say that I've been involved with this office at several business conferences that we've held throughout the state and it's incredible. I've been very pleased with the way we reach out, and when small businesses call to do business with them, I've gotten very positive feedback on how proactive we are.

So thank you very much. You do an outstanding job.

MR. DOSSETT: Thank you, Commissioner Andrade.

MR. WILLIAMSON: J.D., I'd play with you some more but you weren't on the original schedule. I had all of my cutups for Tom and he sent you in his place, so I wasn't really ready for you. I'll catch you next time.

MR. DOSSETT: All right.

MR. WILLIAMSON: Okay, do I have a motion?

MR. HOUGHTON: So moved.

MS. ANDRADE: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion will indicate by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, say no.

(No response.)

MR. WILLIAMSON: Motion carries.

Thank you, J.D.

MR. DOSSETT: Thank you.

MR. BEHRENS: Agenda item 6(b)(5) rules for final adoption on right of way, there will be two of them presented by John Campbell.

MR. CAMPBELL: Thank you, Mr. Behrens. Good morning, commissioners.

For the record, my name is John Campbell, director of the Right of Way Division, and I'd like to present for your consideration minute order item 6(b)(5)(a) which provides for the final adoption of amendments to 43 TAC, Section 21.4 and Section 21.6.

These amendments are necessary to resolve a challenge to the timely acquisition of right of way in the more rural areas of the state.

The historic department practice has been to refuse to participate in the administrative costs associated with getting title insurance -- these are the costs beyond the standard title insurance premium. This works as a disincentive to the title companies in regard to the decision whether or not to accept TxDOT work.

Additionally, the amendment to Section 21.6 authorizes the department to contract with any qualified title examiner to provide a run sheet or a title report only in lieu of a title insurance policy.

This minute order was presented for proposed adoption at the August 26, 2004 commission meeting. The comment period concluded on October 11 of 2004 with no comments received.

Staff recommends your approval.

MR. WILLIAMSON: Questions or comments for John?

MR. HOUGHTON: We're going to pay a fee now to expedite the process?

MR. CAMPBELL: Yes, sir.

MR. HOUGHTON: Okay.

MR. NICHOLS: So you feel quite confident this will speed up the process of right of way acquisition and it is an efficient way to do business?

MR. CAMPBELL: Yes, sir.

MR. HOUGHTON: Move to approve.

MR. NICHOLS: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. CAMPBELL: Thank you. To continue with item 6(b)(5)(b), this provides for the final adoption of an amendment to 43 TAC, Section 21.160 relating to the relocation of outdoor advertising signs along interstate and primary highways.

This amendment is necessary to clarify current department policy. Section 21.160 provides that those sign owners whose structures are in conflict with highway improvement projects may relocate those signs to another location. This section sets the criteria for those alternative locations for relocated signs.

Additionally, this clarifies language in the rules which implies that the department will consider sign structures to be real property. A current department policy prefers the default position that considers outdoor advertising signs to be personal property, and this is based upon their tax status, their ability to be removed from the property and from the underlying types of leases that are typical that they reside on.

This current section as it is can be misleading to sign owners that wish to avail themselves of relocation assistance benefits because those are conditioned upon it being just applicable to personal property.

The minute order was presented for proposed adoption at the August 26, 2004 commission meeting. The comment period concluded on 10/11/2004 with no comments received.

Staff recommends your approval.

MR. WILLIAMSON: Questions or comments, members?

MR. NICHOLS: The only comment I've got is that as touchy as the issue of billboards is that no one made a comment.

MR. CAMPBELL: Very interesting.

MR. WILLIAMSON: That's because we've battered them into submission.

(General laughter.)

MR. WILLIAMSON: I should say battered us into submission since I'm the sole proponent of billboards on this commission.

MR. NICHOLS: Not necessarily.

MR. CAMPBELL: Most of these sections, Commissioner Nichols, are clarifications and they're things that should be seen as beneficial.

MR. NICHOLS: I know you've got the pro-billboard and the anti-billboard, but both parties understood.

MR. CAMPBELL: Yes, sir.

MR. NICHOLS: Thanks.

MR. HOUGHTON: So moved.

MS. ANDRADE: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor --

MR. HOUGHTON: Would you like a torch or a chainsaw, how do you want to handle this?

(General laughter.)

MR. WILLIAMSON: I just think, for the nineteenth time people have to hear this sermon, I think if a board is on my real estate that I'm paying my taxes on, it's my private property and I ought to be able to do with it what I please.

MR. HOUGHTON: I agree.

MR. NICHOLS: That's not what this is about, though.

MR. WILLIAMSON: I know. It's billboards, though.

I have a motion and a second. All those in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. CAMPBELL: Thank you.

MR. BEHRENS: Agenda item 6(b)(6), under Traffic Operations concerning speed zones. Carlos?

MR. LOPEZ: Good morning again, commissioners. My name is Carlos Lopez, I'm director of the Traffic Operations Division.

The rules before you make changes to the department's procedures for establishing speed zones and also bring the rules into conformity with House Bill 1365 of the last legislative session.

The proposed rules clarify that no new environmental speed limits may be created on the state highway system; clarify language relating to the abilities of regional mobility authorities and regional toll authorities to establish speed zones; require that a commission minute order or city ordinance be passed prior to establishing an interim speed limit that's lower than the state maximum on a new or reconstructed roadway; and allow the use of buffer zones that operate during the same time period that a school speed zone operates on roadways with a speed limit that's greater than 55 miles per hour.

These rules were published in the September 10 edition of the Texas Register and no comments were received. We recommend approval.

MR. WILLIAMSON: Representative Bonnen didn't comment on his own law?

MR. LOPEZ: It does what he wants.

MR. WILLIAMSON: Questions or comments, members?

MR. NICHOLS: So moved.

MR. HOUGHTON: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed?

(No response.)

MR. WILLIAMSON: Motion carries.

MR. LOPEZ: Thank you, commissioners.

MR. BEHRENS: Agenda item 6(c) is our rule review for this month concerning the Aviation rules and Public Transportation rules.

MR. MONROE: Good morning again, commissioners.

MR. WILLIAMSON: You notice we don't play with lawyers, Mr. Monroe; we've very businesslike with lawyers.

(General laughter.)

MR. MONROE: I'm disappointed.

There is a program provided for in the Government Code by which each agency has to file a listing of its rules for review with the secretary of state. According to that schedule, we published in the Texas Register of August 27, 2004 our rules concerning our Aviation and Public Transportation function for the public to make any comment if they wanted to.

No comments were received. Hopefully we're going to keep an Aviation function and a Public Transportation function, and therefore the need for these rules continues.

By approving this minute order, you would readopt the subject rules. I would recommend approval of the minute order.

MR. WILLIAMSON: Members, you've heard the motion. Questions or comments?

MR. HOUGHTON: So moved.

MS. ANDRADE: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. MONROE: J.D. wouldn't tell you but I will. At the last short course, his program received an award for its excellence from what organization again? AASHTO.

MR. WILLIAMSON: AASHTO. Wonderful.

MR. MONROE: So he's an award-winner and so is his program.

MR. WILLIAMSON: That's great. Thanks for telling us that.

MR. BEHRENS: Agenda item 7 under Public Transportation is a minute order authorizing the department to lease a building to Nolan County. Sue?

MS. BRYANT: Good morning, commissioners, Mr. Behrens and Roger.

On April 11, 2003, the Texas Department of Transportation terminated a grant agreement with People for Progress, Inc., a rural transit district providing public transportation services in Mitchell, Nolan and Taylor Counties. After the termination, PPI ceased providing service and transferred a building in Sweetwater that had been built with department funding to the department.

This minute order will authorize the department to enter into any necessary agreements to lease the building now to the Central Texas Rural Transit District which is now providing the public transportation services in these areas. That is why we recommend and would very much appreciate approval of this minute order.

MR. WILLIAMSON: Questions or comments for Sue?

MR. NICHOLS: Is there any litigation currently related to this?

MS. BRYANT: There is some criminal litigation related to PPI.

MR. NICHOLS: But that doesn't affect our action?

MS. BRYANT: No, sir, it does not.

MR. HOUGHTON: So moved.

MR. NICHOLS: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MS. BRYANT: Thank you.

MR. WILLIAMSON: Let me ask you something, Sue, now that the motion is passed. How did an organization in west central Texas, the heart of the Big Country, decide to name themselves Central Texas?

MS. BRYANT: I wish I could answer that, and I can't.

MR. NICHOLS: The center of Texas is out in the middle of what a lot of people call west Texas.

MR. WILLIAMSON: No. The center of Texas is in Brady which is 97 miles south of Sweetwater.

MR. NICHOLS: The mayor of Brownwood told me that Brownwood was in west Texas and I told him it was in northeast Texas because he was northeast of Brady. So there definitely are differences of opinion.

MR. WILLIAMSON: But that really is kind of strange. For those of us from the great area around Abilene, that's pretty interesting. That should be west central Texas, not central.

(General laughter.)

MR. WILLIAMSON: Thank you.

MS. BRYANT: Thank you.

MR. BEHRENS: Agenda item number 8 will be a discussion item led by Phil Russell to discuss TTC-35, the proposals that we have and what they mean and what our next steps are. Phil?

MR. RUSSELL: So I don't have to stand on my tiptoes like Carlos and J.D. did, let me go ahead and lower this a little bit.

(General laughter.)

MR. RUSSELL: Again for the record, I'm Phillip Russell, director of the Turnpike Division.

As Mr. Behrens indicated, this is a status report on the TTC-35 procurement process. I've got a short power point presentation and we'll kick off with that.

If I can take just a few minutes and provide a bit of a backdrop, a little bit of a history of public-private partnerships in TxDOT.

Way back in September of '97, the division was given an EDA authority, Exclusive Development Agreement authority. And to kind of take you through that chronologically, in November of '01 the department was limited to four EDAs, and another significant event, of course, was January of '02 when the governor unveiled his concept of the Trans-Texas Corridor with the mission to come back, analyze it and report back.

We did that -- Mr. Simmons, of course, headed up that effort -- and in June of '02 the department completed our review or our analysis of the plan and Governor Perry accepted it, of course, at that time.

Now, simultaneously with that, also in June of '02 TxDOT executed our very first EDA. Mr. Behrens executed that contract in June on State Highway 130.

MR. NICHOLS: Just for clarification, for those that may not be aware, an EDA, the name was now changed to a CDA.

MR. RUSSELL: That's correct.

MR. NICHOLS: So in the beginning of this it talks about EDAs and at the end of it they talk about CDAs, and the only difference is the name, basically.

MR. RUSSELL: Absolutely perfect transition, because in June of '03 House Bill 3588 became effective and one of those elements was changing the name to Comprehensive Development Agreement, and in all honesty, it probably put a little bit more emphasis on private equity and certainly the concession philosophy. So that name was changed to Comprehensive Development Agreement.

Now, if we can kind of drill down and talk about some of the specific milestones in the 35 procurement. About that same time we had received an unsolicited proposal from the Fluor Group to develop that entire corridor, I-35 from the Dallas-Fort Worth area down to the Valley.

We couldn't really act upon that until we had really specific authority. We achieved that, again, through House Bill 3588. So the commission authorized us to go out for competing proposals which we did, and again, July 25 of '03 that request for proposers' qualifications was issued.

We received qualification statements from three developers in September. All three of those were short-listed and we began the process of putting together, and the industry review process, I guess, of those documents themselves with those three firms.

In April of this year we issued our request for detailed proposals from those three groups, and again, we gave them about four months to develop their proposals and get back to us which they did, all three teams, in August of '04.

Of course, where we are now, we have a vast number of TxDOT employees that are evaluating all three of those proposals. We hope to complete that evaluation at the end of this month.

From there forward, of course, we would be bringing this back to you on December 16, the December commission meeting, with our recommendation of who the apparent best value would be to the state. And within that time frame during that next 30 to 60 days, in the January-February time frame, we would hope to execute that CDA.

Now again, just to step back and kind of look at this, what would be the purpose of the CDA. Obviously we're trying to attract the private sector as our strategic partners, and there are many advantages, I think, that we see to this, but probably the two primary areas are the ability to attract equity, private equity to help us with some of our transportation projects, and of course, to bring some of that private sector innovation into that same overall transportation network.

Now, the CDA that we'll be hopefully entering into will provide the umbrella framework for that long-term partnership, that long-term relationship.

If I can drill down now just a bit and take you through the process that we think will be unveiling in front of us. Again, if the commission awards that CDA in December, probably over the next 30 to 60 days we'll be negotiating specific CDA terms, and that will be before we do the initial scope of work.

Assuming that that contract is executed, signed, then the department will enter into that initial scope of work and that's about a year, year-and-a-half planning effort where we start honing in on different elements of their plans.

It's capped at about a $3-1/2 million effort, not at about, at exactly, or not to exceed $3-1/2 million, and we hope to start defining specific facilities, i.e., projects that will start popping out on that entire corridor.

The initial scope of work we'll also be refining the master development plan; i.e., the plan that the developer sees from an engineering standpoint which projects, which elements come to fruition first, their financial plan, how they hope to develop the corridor, and of course their management plans.

Now, the master development plan, we've subdivided it into three areas: the near term, the mid term and the long term. And again, just as a bit of a reminder, we can go out to a 50-year concession agreement, so we're looking certainly at some short-term relief to the congestion on 35 but we're also trying to analyze what would be the projected relief long term, mid term as well as long term.

The master plan will be essentially a living document. That plan will be updated by the department and the developer on an ongoing basis throughout the life of the project.

The CDA will require that we have individual facility agreements for each one of those projects that pop out. We'll be approving those, of course, and they'll outline the specific contractual terms and obligations, and as always, they'll be consistent with the environmental process that the department is currently engaged in.

Obviously this is a new endeavor for the department. It's fairly complex and so hopefully this will be of some help. We've attempted to try to put these relationships together on a single slide. Obviously what we're talking about now is the private sector partner, the yellow box which would be the umbrella CDA.

Now, out of that, as we start refining that master development plan, individual facilities will start popping out in any one of those six areas: toll roads, truck toll roads, freight rail, commuter rail, high speed rail, and utility. And so the idea is as those individual elements become ripe, we'll develop individual facility agreements. It might be a toll road project, Project 1, Project 2, Project 3; it could be a freight rail relocation or a freight rail construction project, 1, 2, 3, whatever the case may be.

And then we'll have a menu of options to deliver those projects. It might be a traditional TxDOT type delivery system, design-bid-build; it could be something more analogous to State Highway 130, design-build-maintain. The last box, the design-build-finance-operate, what typically in the industry is referred to as DBFO, that's more in line with the true concession --

MR. NICHOLS: Wait a minute. Would you explain that to the public?

MR. RUSSELL: DBFO, design-build-finance-operate.

MR. NICHOLS: I just want to make sure everybody else understands.

MR. RUSSELL: Right. And in our vernacular, I guess, it would be more like a true concession agreement where we're hoping those guys will bring in not only design-build construction expertise and innovation, but financing options as well.

And on our present procurement, as I said earlier, the Fluor Corporation came in with the unsolicited proposal that really initiated this process, and I'm sure there are many participants out in the field. And I should point out that each one of these teams has a vast list of partners, of team members, and so without going through all of those members -- and hopefully we're not slighting any of those members -- we've tried to divide this up into just the equity owner as well as those major participants.

Of course in the Fluor area we've got Fluor Enterprises, Parsons Brinckerhoff as one of the major participants. The second team is the Trans-Texas Express, T-TEX; equity owner Skanska. My understanding is they are the largest, if not one of the largest worldwide construction companies.

Telvent, another large Spanish concessionaire; Hensel Phelps, Chiang, Patel and Yerby are good domestic firms that have great deal of experience in this area. And then you can see some of the major participants: Skanska again, Turner Collie & Braden, DMJM, Corgan, Morgan Stanley.

The third team, the Cintra team, the equity owners are teamed up between Cintra, a Spanish concessionaire, Zachry Construction Group, and the major participants Ferrovial Agroman which again is an offshoot of Cintra, as well as Earth Tech, Price Waterhouse, J.P. Morgan. And again many, many, many other team members are involved in this.

Let me try to wrap this up by giving you a sense of the schedule. And I should point out that there are two concurrent processes that are underway, and obviously it's a complex process, but there's a lot of misinformation, misunderstandings out there.

The process that I've tried to go through in the last few minutes, the CDA process, is the top part of the graph. We're obviously right now trying to select that strategic long-term partner for the department. We'll go out with that initial scope of work, 30 to 60 days, and then we'll start hammering out individual facility development agreements.

And again it could be project 1 that might be a toll road, project 2 that might be a rail, it might be vice versa, whatever the case may be. And those individual projects will be guided by that individual facility agreement.

Now, concurrently with that, our group, the Turnpike Division is spearheading an effort to achieve environmental clearance on this corridor, and again, that is solely a TxDOT process. We are in the midst of a second series of public meetings. The best I remember, we probably had 15 or 20 public meetings in the February-March time frame, and this week I think is the culmination of our second series of public meetings.

So as we complete that, what we call the Tier 1 -- essentially it's the first phase of the environmental process -- then we'll start dropping down and getting those individual what we call Tier 2 projects, the second phase, and it will be a specific project that's identified. Project 1, again, might be a toll road or it could be a rail section; Project 2 might be a commuter rail. Whatever the case may be, we'll be moving into the more traditional environmental approach and achieving environmental clearance on those individual segments.

So again, two processes that are going on concurrently but the department is in the driver's seat on both of those processes.

I think that's my last slide. Any questions you might have, commissioners?

MR. WILLIAMSON: Members, I know I have questions I need to ask and I'll wait till the last, and each of you have questions or comments you wish to offer about this important process we're going through, but I'm going to ask Mr. Monroe to pay even more attention than he always does, and I caution you to think about your statements or your questions in the context of we don't want to violate any rules or regulations or statutes in discussing or asking Phil to disclose information that's shielded by the law, but I don't want to inhibit you from a frank and open conversation with our staff because they kind of need to know individually where we all feel like we need to head in this process.

So having said that, I know I'm going to have some questions for Amadeo, so please stay close. Did Steve decide to stay after he led us in birthday, or did he exit? Steve, would you stay close, please.

Okay, the floor is open, members, for questions and comments.

MR. HOUGHTON: The only comment I have is we had a historic day today with the mobility plan statewide, $15 billion. On the heels of that next month will come TTC-35, which will be another huge, huge thing. So within two months in the same year, we've made that huge transition, 180 degrees, I think it's complete except for the rail components that we were talking about earlier today.

And I think I'll leave it at that, Mr. Chair.

MS. ANDRADE: Phil, do our contractors have to adhere to the same process of public input?

MR. RUSSELL: As far as members that are on those three individual teams, or other contractors?

MS. ANDRADE: I mean who we select, the ones that are selected, they have to adhere to the same public input process. In other words, we'll still hold them accountable for hearing what the public has to say and there's a process?

MR. RUSSELL: Oh, yes, ma'am. Again, two concurrent processes: we're trying to select that developer, we have those teams that I illustrated, but from the environmental standpoint, this is a department environmental process.

We're not shirking our duty, our environmental duty to oversee, along with the Federal Highway Administration, oversee the environmental process. So they'll have input into the process but it's still ultimately our process and the Federal Highway Administration has to sign off on it.

MS. ANDRADE: Thank you.

MR. NICHOLS: My comments probably are going to be through you but maybe directed more to the public, and that is what we're trying to do is identify the Trans-Texas Corridor, this particular leg that would somewhat parallel Interstate 35, is not only a critical need for the state, in our opinion, we've just got to do something like this.

And this is a very unusual process -- not process but proposal to tackle such a monster needed project. And the parties that have proposed, you have evaluated, and I know you have already determined through that process each of these proposers is very qualified and has ability to actually do this. And that now that you are looking at proposals, and evaluating how these people would tackle this monster project, would you say that the proposals appear realistic?

MR. RUSSELL: Yes, sir.

MR. NICHOLS: So we are getting very realistic?

MR. RUSSELL: I would say so.

MR. NICHOLS: Without trying to bankrupt the state by bringing in private capital.

MR. RUSSELL: Yes, sir.

MR. NICHOLS: Okay. That's great.

MR. WILLIAMSON: Members, I suspect the questions I have to ask, and perhaps the answers, might trigger some other thoughts in your mind, so feel free at any time to jump in and say wait a minute.

Where to start. Let's go back to the beginning slide, Phil.

MR. RUSSELL: This one?

MR. WILLIAMSON: Go forward to the next one. I want to focus in on this for a moment because I detect in some of the public's mind and perhaps even some of the local leadership up and down the I-35 corridor some confusion about what it is we hope to accomplish.

And I look at this slide and I want to reinforce the whole point the governor was making when he laid this out almost four years ago -- and he was proved to be right -- we have transportation infrastructure needs in this state which cost so much money that it's not possible to address congestion in urban Texas as we've done this morning and simultaneously prepare for connectivity between those urban areas in about the 12 to 15 year time period out that we know the real impact of 40 million Texans will have on our major cross-state corridors.

Therefore, our proposal to attract equity from the private sector to invest in that infrastructure that the citizens of the state could not otherwise afford. Is that what we mean by equity?

MR. RUSSELL: Yes, sir.

MR. WILLIAMSON: In other words, if we could do this out of our cash flow, we would do it.

MR. RUSSELL: Certainly.

MR. WILLIAMSON: And that leads back to the question of, well, why don't you just take your cash flow and continue to make Interstate 35 bigger as opposed to moving somewhere to the east or west and building new. And the answer is we can't afford to make 35 bigger than what we currently plan which is the addition of lanes up and down the section as population and cash flow permits.

And in any event, we don't see how the citizens of the state would allow us to toll those existing lanes on 35 to generate the cash flow to expand 35, but we do believe using the process we're using that we can attract the private sector to build a toll facility away from that footprint that the citizens can afford.

Would that be correct?

MR. RUSSELL: Yes, sir.

MR. WILLIAMSON: So a shorter way of getting to the point I'm making is the purpose of the CDA is to attract equity to build an asset the state needs that it would not otherwise be able to build out of cash flow.

MR. RUSSELL: That is correct.

MR. WILLIAMSON: And the second purpose of doing the CDA process is our belief that by partnering with a developer for the entire corridor project that partner will bring innovative finance, design, construct, and operate concepts that we either can't under state law or would not be able to take advantage of under state law. That's what we mean when we say innovation.

MR. RUSSELL: I think that's a fair statement, yes, sir.

MR. WILLIAMSON: As to the matter of road and rail, several local leaders in our state have aggressively promoted the notion of a rail link between Dallas-Fort Worth, Austin-San Antonio, Laredo-Brownsville, Houston and back to Dallas, but we conclude that the cost of building that rail by itself and not in consort with building a traditional road would be unaffordable by the state and probably not attractive to the private sector because on one has figure out how to build a rail that will make money by itself.

Is that correct?

MR. RUSSELL: Yes, sir.

MR. WILLIAMSON: Would you go to the next slide, please?

The structure of the Comprehensive Development Agreement is known right now to all three of the proposers. Is that correct?

MR. RUSSELL: Yes, sir.

MR. WILLIAMSON: And should you bring us a recommendation in December, the only detail to be negotiated at that point could be characterized as minor or timing details and not major.

MR. RUSSELL: I would think so, yes.

MR. WILLIAMSON: So if you select only one proposer, the other two cannot honestly say that the contract is open-ended and whoever gets picked gets to further manipulate the contract to their advantage.

MR. RUSSELL: No, sir, I don't think they could.

MR. WILLIAMSON: And the public will see that when all of the documents are available.

MR. RUSSELL: Yes, sir.

MR. WILLIAMSON: Recently we received a few letters -- not nearly as much as I think were attempted to generate -- from some cities and leaders up and down the corridor that say something like this: We've been informed that the commission will choose a developer on December 16 and we think it's premature to do that until a Tier 1 environmental impact study is done. Attempting to confuse the matter of choosing a developer partner with the matter of getting environmental clearance.

You've clearly shown in your documents that we have two separate processes. Have we, going all the way back to almost a year ago, done a good job of informing the public, and in particular all of the communities up and down the 35 footprint, that we were beginning the environmental process?

MR. RUSSELL: Well, Chairman, we could always improve the process but we've had a multitude of public meetings all up and down that corridor, from the Dallas-Fort Worth area all the way down to the Valley.

MR. WILLIAMSON: So for example, it should not come as a surprise to one Russell Devorsky of Waco, Texas, that we are holding public hearings on the environmental impact of some kind of corridor.

MR. RUSSELL: Public meetings, yes, sir.

MR. WILLIAMSON: Now, let's assume for a moment that we had the money to build a parallel ourselves without an equity partner. Would we have followed the same environmental process we are following now to build that road?

MR. RUSSELL: Absolutely.

MR. WILLIAMSON: So there's nothing different about the environmental process we're following now in relation to the governor and the legislature's decision to allow us to attract private sectors to build this road.

MR. RUSSELL: Chairman, it's the same other than the fact that we're using that tiering process, Tier 1, Tier 2, but it's the same sort of process we'd use on I-69 or any of those others. So the answer is yes, it's the same TxDOT process.

MR. WILLIAMSON: And Phillip, has the federal government -- at least are they aware of what we're doing?

MR. RUSSELL: Yes, sir, they're closely involved.

MR. WILLIAMSON: Have they observed any of our grading processes?

MR. RUSSELL: They are involved in the procurement process as well as the environmental process.

MR. WILLIAMSON: Dan, are you still here? Would you mind just for a moment? I don't want to put you on the spot, I'm aware of protocol, but it's important for me -- I mean, like I said, we're live worldwide so people are watching -- it's important for me to know or to be able to assure the taxpayers of the state.

Has FHWA had a presence as we've gone through this process?

MR. REAGAN: Yes, sir, at every step.

MR. WILLIAMSON: And are we complying with all the laws and rules and regulations as far as you know?

MR. REAGAN: Yes, sir.

MR. WILLIAMSON: Is there anything that we should have done differently so far that you're ready to say to us, or is my team doing what they should do?

MR. REAGAN: As far as I can tell, yes, sir, they are.

MR. WILLIAMSON: Members, do you have anything you'd like to converse with Mr. Reagan about?

MR. NICHOLS: I would just like to publicly thank you for the great working relationship that we've had with the FHWA. I mean, we have for the past few years, particularly last three years, gone through some incredible innovative -- I know you're laughing, you're probably on TV too -- and you know, you could have been an obstacle, you could have been disruptive, but the feds -- I know a lot of people say back things up, but you have done a great job of working with us and all doing it altogether, making sure we do it the right way.

I just wanted to publicly thank you.

MR. REAGAN: Thank you, sir.

MR. WILLIAMSON: And I also thank you, Dan. You know, we've said it many times and we'll say it again, the federal government is not our enemy, we're all in the same business trying to reach the same goals.

Thank you, I appreciate it.

Okay, Phillip, let's go to the next slide, please. And I'm sure I'm making it be repetitive, I had to step out for a moment, but I want to be sure that we're clear about this.

MR. NICHOLS: It's complex.

MR. WILLIAMSON: The steps are we choose, based on as objective criteria as we could develop before this process started, who we think is the best partner-developer for us, for the State of Texas in developing this corridor.

MR. RUSSELL: Yes, sir.

MR. WILLIAMSON: And right now the corridor swath is wide, the potential routes within the study we're making is very wide. Does the corridor swath go all the way over to the edge of, for example, the city of Waco?

MR. RUSSELL: Yes, sir, east and west, I believe.

MR. WILLIAMSON: And the edge of the city of Temple?

MR. RUSSELL: Yes, sir.

MR. WILLIAMSON: And the edge of the city of Dallas? So if I had a Dallas City Council member such as Sandy Grayson alleging that the corridor will divert traffic away from Dallas, that would be an inaccurate statement?

MR. RUSSELL: The decision hasn't been made yet, the alignment is being selected.

MR. WILLIAMSON: The route could be right up to Senator Royce West's backyard.

MR. RUSSELL: Yes, sir, it could.

MR. WILLIAMSON: And it could be right through Senator Kip Averitt's farm, and it could be right at the edge of the city of Temple, and it could be no further than State Highway 130 is to Austin right now.

MR. RUSSELL: The only preclusions, Chairman, that we've gotten so far, there are certain environmental issues that we've considered to be hands-off, and so if you look at the second iteration that we're going out in public meetings now, you can see that the potential corridors have been snaked through there to miss certain environmentally sensitive issues.

But beyond that, pretty much everything is still on the table.

MR. WILLIAMSON: So an allegation at this point in time that this corridor is going to divert trade away from the traditional, and I see it's now become historic, NAFTA trade route, might be a bit of a stretch.

MR. RUSSELL: Premature.

MR. WILLIAMSON: Might be premature.

MR. RUSSELL: Yes, sir.

MR. WILLIAMSON: And when we select this proposer, if we do, if that's what you recommend -- let's be sure the public is aware, this process is: the staff sets up criteria; the private sector proposes; anonymous letters or numbers are given to each proposer; the staff is broken up into teams and the proposal is analyzed by number or letter, not by individual.

MR. RUSSELL: That's correct.

MR. WILLIAMSON: The staff not knowing who the company is; the commission does not participate in the grading.

MR. RUSSELL: That's correct.

MR. WILLIAMSON: Staff decides if there's one proposal acceptable to the transportation world of Texas, they advance that proposer to us in December, and at that time we find out who those people are and not before then.

MR. RUSSELL: Yes, sir.

MR. WILLIAMSON: And the decision is to select the partner with whom you will spend the next up to two years negotiating the details of the development and not individual projects themselves.

MR. RUSSELL: Well, during that initial scope of work, that first year to year-and-a-half, we probably will, as we refine that master development agreement and refine that financial, start looking at some of those individual facilities that appear ripe for development, based on the environmental process or whatever the case may be, those that appear ripe to be developed first, whether it's road or rail.

MR. WILLIAMSON: One of the criticisms that's often leveled by either those uninformed or those with their own personal or political agendas, is that the developer that we choose will suddenly have preferential right to build all these highways without the pressure of competitive forces.

Let's assume for a moment that we reach agreement on major things such as buyback, at what point do we buy a facility back from anyone who builds one, or toll rates, or rail cargo tare rates, whatever it might be. Can we at every point in the process as a facility is identified, can we elect to not include that facility in the development, keep it ourselves and build it in the traditional way?

MR. RUSSELL: Absolutely.

MR. WILLIAMSON: So it's theoretically possible for us to have a developer -- this will make all three of them faint when I ask this question -- it's theoretically possible to have a developer and never let them build anything.

MR. RUSSELL: Potentially.

MR. WILLIAMSON: All they would be doing is lending their expertise to locating the financial partner or partners for us, as opposed to -- in fact, let me be specific. Let's say that a facility is identified from Denison -- let's even be more specific, connecting to the Grayson County RMA, moving east around Dallas, and terminating at Hillsboro with a loop to the existing 35 footprint, and the NTTA pops up and says: Wait a minute, TxDOT, you do it with us, you don't need to do it with your development agreement, we're interested in that.

We could turn to our developer and say we have elected to retain that facility, and under our agreement that's posted and out there for everyone to see, the developer would have no choice but to say: That's your decision, TxDOT, that's fine.

MR. RUSSELL: We have that flexibility, and not speaking for those three developer teams, I think they realize that.

MR. WILLIAMSON: Let's go to the next slide. And to reinforce, each facility agreement must be approved by us.

MR. RUSSELL: Correct.

MR. WILLIAMSON: Next slide. Steve Simmons, please.

Are you familiar with an organization known as the River of Trade Coalition?

MR. SIMMONS: I've seen some correspondence utilizing that term, yes, sir.

MR. WILLIAMSON: Who is that, or to paraphrase that famous line in the Butch Cassidy film, who are those guys?

MR. SIMMONS: Well, I believe it's headed up by the City of Dallas at the time with some help from, I believe, David Dean or Dean International.

MR. WILLIAMSON: David Dean.

MR. SIMMONS: I believe that is correct.

MR. WILLIAMSON: That's the fellow that spearheads the TEX-21 organization?

MR. SIMMONS: Yes, sir.

MR. WILLIAMSON: Did he use to be associated with the Historically Underutilized I-35 NAFTA Trade Route Coalition, or whatever they were called?

MR. SIMMONS: I believe so, yes, sir.

MR. WILLIAMSON: Whatever happened to that group?

MR. SIMMONS: I think they're still in existence.

MR. WILLIAMSON: Does he still represent them?

MR. SIMMONS: I do not think so; I don't believe that he does.

MR. WILLIAMSON: And what seems to be their point?

MR. SIMMONS: Well, the issue at hand is they're concerned that the industry and businesses along the existing I-35 corridor will be impacted severely with a new alignment away from I-35.

MR. WILLIAMSON: That's reason enough to not choose a developer and move along, is that their argument?

MR. SIMMONS: I think that they believe that the first option should be to consider expanding I-35 and that the corridor should come second.

MR. WILLIAMSON: Now, is Dean the same guy that also promotes that railroad, the T-Bone, the high speed rail?

MR. SIMMONS: The high speed rail, yes, sir.

MR. WILLIAMSON: How many different hats does he wear in distributing the public's money?

MR. SIMMONS: I'm not aware of everything that Dean International is involved in.

MR. WILLIAMSON: Do we participate financially in TEX-21?

MR. SIMMONS: No, sir.

MR. WILLIAMSON: We just go to all their meetings?

MR. SIMMONS: We are resources for them to provide information about issues that are pertinent to the department and transportation in particular.

MR. WILLIAMSON: I've seen some awful -- I don't want to say inflammatory but certainly misleading statements originating from those folks, and I'm a little bit concerned.

Is there anyone else besides the City of Dallas?

MR. SIMMONS: Well, they're attempting to bring the issue up to all the cities and counties along the I-35 corridor, so I'm sure that there will be others that will be coming along.

MR. WILLIAMSON: But no other members that we know of besides the City of Dallas?

MR. SIMMONS: Not that I'm aware of, no, sir.

MR. WILLIAMSON: Well, I know that you're the person in the department that arranges for things such as TEX-21 and our participation and such. I've got to tell you, and I only speak for myself in this matter, the other commissioners can certainly overrule me, but I'm a little bit hesitant to spend any more time with those guys if they're headed up by the same guy that's in the business of organizing cities to stand firmly opposed to the alternative route, because every city along the traditional -- which has now become traditional historic NAFTA trade corridor has invested millions in their own commerce.

And I don't see anything in here about trucks running over people on I-35, I don't see anything in here about developing a rail system to divert traffic off our highways; they just seem to be concerned about, I guess, their gas stations.

Why don't you check with me before we agree to participate in any more of their stuff. It looks like we might operate at cross purposes.

MR. SIMMONS: Yes, sir. I understand your intentions.

MR. WILLIAMSON: Thank you, sir.

Amadeo?

MR. SAENZ: Maybe I should ask Phil this but I'm going to ask you. Our first experience with the CDA process, design-build and different ways of doing business really is State Highway 130 and the two connectors that are associated with it.

MR. SAENZ: Yes, sir, that's correct, 130 was our first design-build project.

MR. WILLIAMSON: Based on what we know now, are we going to finish that entire project under budget?

MR. SAENZ: Right now the portion of the project that was funded is currently under budget; we think we will be able to finish it under budget, and really faster than what was earlier intended.

MR. WILLIAMSON: With regard to the under budget component, is it our belief that we're under budget precisely because it was a design-build project?

MR. SAENZ: I would probably say yes. I think that because we're able to do various functions at the same time, we're able to get the entire project going much faster, we're able to capitalize on costs and stuff.

MR. WILLIAMSON: And will we be able to finish sooner?

MR. SAENZ: Yes. I think right now the tentative schedule is somewhere around six months to a year. For the overall project which includes both 45, Loop 1 and 130, about a year ahead of schedule.

MR. WILLIAMSON: So we're going to be ahead of schedule and under budget on our first, and it was only a quasi design-build, it wasn't a full-blown partnership.

MR. SAENZ: Right. Part of that project was let under the traditional method, but it's all a system.

MR. WILLIAMSON: So based on what you know about the 130 experience -- which Mr. Nichols can probably tell more about it than all of us -- but based on what you know, the stated goals of the TTC-35 CDA which is equity and innovation should be at least as good, if not better, than what we saw on 130.

MR. SAENZ: Probably a little bit better because I think the 130, even though it was design-build, we went through and we had cleared and we had a lot of control already in place, and you go this way, that way, and you build this and that. The TTC-35, since we'll be working together, will give us a lot more opportunity for innovation.

MR. WILLIAMSON: One of the arguments that my buddies with the River of Trade Coalition advance is that we should concentrate on expanding the footprint of 35. Would that mean we would be shutting down lanes in between, say, Hillsboro and Waco while we expanded 35?

MR. SAENZ: As we expand 35, just as we expand all our current construction -- I think you see it in New Braunfels and in San Marcos we just finished -- you've got to do it under traffic, so you have to divert traffic and you have to move them over and utilize the shoulders. Sometimes you have to close down lanes; a lot of times you have to do work at night that will allow you to let traffic continue to go. So you wind up reducing the footprint that you have available on a day-to-day basis.

MR. WILLIAMSON: And the opportunity to expand the footprint inside Dallas, inside Fort Worth, inside Waco, Temple, Belton, Georgetown -- well, Georgetown, I guess 130 is going to divert traffic -- but into San Antonio, the opportunity to expand the footprint is good? Is there no buildings in the way, are we going to be able to avoid tearing down the basketball stadium?

MR. SAENZ: Well, take 35, you either tear down Memorial Stadium or you tear down Disch-Falk Field. We don't want to tear down either one of them even though we'd like to have a new baseball stadium.

MR. RUSSELL: At least not till after Thanksgiving.

MR. SAENZ: At least not till after Thanksgiving. Thank you, Phil.

(General laughter.)

MR. SAENZ: But really all along, the development has basically come up all the way to the right away, so to be able to expand the facility -- and I think some of the studies that have been done through the years show that the number of lanes within the metropolitan areas have to be increased considerably -- well, that's going to require more right of way so you, in essence, have to tear down everything that is adjacent to be able to expand.

MR. WILLIAMSON: Okay, thank you.

Phillip, one more question for you.

MR. RUSSELL: Yes, sir.

MR. WILLIAMSON: If we can't agree in the next two years while the environmental is going on, if we can't agree with the person we select, do we have to proceed or can we just say this didn't work and we can't agree and that's the way life is and we move on?

MR. RUSSELL: We can move on.

MR. WILLIAMSON: So we're not irrevocably committing billions and billions of dollars to the partnership.

MR. RUSSELL: No, sir, not at all.

MR. WILLIAMSON: Members, I've asked all the questions I want to ask. Any follow-up?

MR. NICHOLS: I was going to do a follow-up comment and it goes more directly to your comments on the coalitions like the River of Trade -- I think there's two different groups and they're coming together and basically from what I've seen, just like you have seen, is they're working up and down the I-35 corridor trying to get county and city resolutions to oppose, in effect, building something like this, throwing out the fear that everything is going to leave and businesses are going to dry up and so on.

And to that point, one of the most interesting -- and the Chair talked quite a bit about this but I was going to take a little different approach -- someone gave me a 1952 state map a few years ago for my birthday, one of the other birthdays, and it was neat, it had some neat pictures of the governor on a horse and all that kind of stuff.

But when you opened it up and looked at the state highway system, all the towns were basically where the towns are now, Dallas was where Dallas is, and Houston, as you would expect. And as you look at the map, you see something real strange, and what is strange was there was no interstate system, it wasn't there, and there was no farm-to-market system, it wasn't there.

But they built it, that was the period when they began building the interstate system, and the idea was to connect and flow people and goods throughout the state, as well as the nation, and it did. And those towns did not dry up because of that, they flourished because of an efficient transportation system.

So those communities -- and I know some of them are actually in this room or watching -- who are going out trying to create fear in these communities and oppose this, should actually be working hard to make sure it happens. Just like the construction of State Highway 130 that's under construction is not going to harm Austin and eventually San Antonio and that kind of stuff; actually everybody is going to benefit, and that's the simplest thing to look at.

With the arguments that the River of Trade -- if that's the name of it -- is having, you could have gone out and made the same arguments against the interstate system was my point. It's the same thing, you know. If you drive and build an Interstate 35 or 30 or 20 in the Dallas area, you're going to take all that business off of US 75, Central Expressway and some of these other places that are just plugged.

MR. RUSSELL: I guess, Commissioner, on two of those points that you touched base on, Mike and I especially were very involved about five years ago with some businesses in the Round Rock area -- I'm thinking of Dell Computers specifically -- and kind of the story we heard is just the opposite. Congestion is so bad that if you don't provide some sort of congestion relief we're going to go elsewhere in another state -- which is what happened -- and I think now 130, 45 and Loop 1 is to try to keep that business there, to keep that lifeblood flowing.

On the other comment about your 1952 map, I wasn't there, for the record, but I can only assume when that version of Phil Russell came through those communities and started talking about something called an interstate, that wasn't built on a 60-foot farm road section or an 80-foot right of way section, but it might be 300 or 400 feet wide, I can only imagine the bewilderment and fear of the unknown that all those communities had at the time. But now when you look back, where would we be without the interstate system.

I think it's human nature that you have a bit of that fear of the unknown, but this is a logical step forward.

MR. NICHOLS: That's the point I wanted to make.

MS. ANDRADE: I have a question, and I wonder if Commissioner Nichols gave it away by saying 1952 map. Was that the reason, that that was the year you were born?

MR. NICHOLS: I wish that was the year I was born.

MS. ANDRADE: I'm glad to hear that because otherwise it would sadden me to think that I wasn't the youngest member on the commission.

(General laughter.)

MS. ANDRADE: Phil -- and we've had this discussion -- from everything that you've learned, heard, mistakes that other states have made and that other countries have made, do you feel comfortable that we've got enough, I guess, in writing that protects us?

One instance was in San Antonio they did a news special in California where they couldn't expand. I mean, are we protected against those mistakes that they made, do you feel?

MR. RUSSELL: Yes, ma'am, we are. And as the chairman said, as we start looking at those individual facility agreements, we'll have good language in there. And those issues are always out there. We've looked very closely at that SR-91 example in California, and we'll be in good shape. We're certainly going to be looking out for the interests of the state.

MS. ANDRADE: Okay, thank you.

MR. HOUGHTON: Economic development is the centerpiece of, as Chairman Williamson said, our boss's initiatives, and transportation is right at the epicenter of economic development.

Recently, I think "Relocation Magazine" has designated Texas as the number one choice for relocation of corporate America, surpassing California and other states. And to be designated that is because of the environment now that we have in the state of Texas across the board -- transportation is one of them -- and this corridor -- we are going to have to build not only this corridor but the next corridor which I think will probably be TTC-69, formerly known as I-69.

But all you have to do is for some people to go out to Los Angeles County and go look at that and see what their choices are, and the choices are not very many, to mitigate the congestion.

So I look forward to the TTC-35 and moving ahead with it, and maintaining the number one designated relocation by "Relocation Magazine." We've got to provide this growing state jobs and people opportunities, and that's what this is all about.

MR. RUSSELL: I think, Commissioner, if you polled any of those people up and down the 35 corridor, congestion is their number one issue.

MR. HOUGHTON: Absolutely.

MR. RUSSELL: There's a lot of traffic there and they want to know when we're going to improve it, and then with the data that you're suggesting, it's only going to get worse unless we take some very bold steps.

MR. HOUGHTON: There's good news and bad news to being number one. You're going to have to now plan for it and take care of it.

MR. WILLIAMSON: Phillip and Steve and Amadeo, and for all those who watch, I don't want to confuse my direct words about these groups.

It is legitimate to say I'm opposed to building a highway in green space, because it takes taxable land off the tax rolls;, that's a legitimate argument, and a discussion and a debate we should have. It's legitimate to say I don't want to build any more highways over the Edwards Aquifer because I believe runoff is damaging the recharge; that's a legitimate argument and an argument and a debate Texans should have.

It's a legitimate argument to say I believe the price of oil and gas will drive us away from the internal combustion machine in the next 20 years, you'll never pay the debt off, don't make the decision; that's a legitimate argument to have.

This governor and the legislature and this commission, we are not fearful of having legitimate discussions, debate and arguments about decisions that have to be made. And as I've said many times before, we've actually learned some things from some of the anti-corridor folks. And we've gone back and kind of re-thought how big the corridor needs to be, and maybe it's not going to be as big as we once thought.

I distinguish, Steve, that from deliberate misinformation, deliberate opposition to advance someone else's political agenda and keep them protected. That's completely different and there's no room for that in this. We have some important and difficult decisions that have to be made about the future of this state. Their arguments should be about things that are truly in the realm of public policy.

And that's what I want all three of you to convey to those folks. I don't have any patience for ad hoc, spur of the moment, last minute groups that spring up for no reason other than we've got to find a way to make a buck and scare people. I don't have any patience for that, and I don't have any patience for people who participate in that.

Well, we look forwards to either a no recommendation next month, Phil, or a recommendation. Whatever it is, you guys make a professional decision and we'll accept whatever that is. And if it's no recommendation, that's fine, we'll back up, reload and move forward.

Okay, Mike, let's continue.

Thank you, Phil.

MR. RUSSELL: Thank you, commissioners.

MR. BEHRENS: Our next agenda item is number 9 under Turnpike Projects, and those will be presented by Phil. He'll have three items.

MR. RUSSELL: Thank you, Mike.

Just a bit of background. Of course, Harris County, as you know, owns and operates the Sam Houston Tollway on significant segments of the Beltway 8 facility there in Houston. The department owns and operates those non-tolled frontage roads along Beltway 8.

There is a little piece, however, in the northeast quadrant of Beltway 8, about a 12-mile piece, roughly between old Humble Road and US 90, that the frontage roads are built but the mainlanes are not. And so there have been some informal discussions that I think are occurring between the Harris County Toll Authority and the district about what would be the best avenue to move forward and go ahead and complete those mainlane sections.

It could be a continuation where Harris County Tollway developed and operated those, it could be TxDOT could come in there, I guess, that could develop and operate those, or some mix in between where we provide some equity and put the Harris County Toll Authority in the position of developing that.

So what this minute order really does, it would authorize that the department continue to support the county's development of those mainlanes, that that discussion become more formalized, and to work with the county to identify what the appropriate development scenario would be, both from an effectiveness standpoint and the idea of expeditiously getting those lanes on the ground.

And so at this time I would suggest your approval of this minute order, and I'll be happy to address any questions you might have.

MR. WILLIAMSON: Questions or comments, members?

MR. HOUGHTON: When you talk about equity and development, that's to be worked out as to our role, as to Harris County's role and the participation?

MR. RUSSELL: I think, Commissioner Houghton, that's really what this minute order is all about and would formalize that process, give Mr. Trietsch and Mike Strech at the Harris County Toll Authority really the impetus to move forward, kind of galvanize that support and let's move forward and figure out what the most appropriate solution is.

MR. HOUGHTON: Do we have any kind of idea where we want to go?

MR. RUSSELL: Personally, I really don't. I think from a logical standpoint, Harris County has already developed significant portion of the Sam Houston Tollway; I would think that would be the most appropriate to allow them to move forward. But that's yet to be determined, that's something that would have to be discussed.

MR. NICHOLS: I've said for years that needs to be developed, needs to be developed as a toll road by somebody. We've been consistently saying that if we're going to do a toll road local mobility project in an urbanized area that already has a toll authority, we're going to try to work with them in some manner, if they want to.

So what we're saying is we're going to more formalize the fact that we're going to continue working and just try to work out some kind of a deal to get the thing done.

MR. RUSSELL: Right.

MR. NICHOLS: And I support that.

MR. WILLIAMSON: Do I have a motion?

MR. HOUGHTON: So moved.

MR. NICHOLS: Second.

MR. WILLIAMSON: I have a motion and a second. All in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. BEHRENS: Go ahead, Phil.

MR. RUSSELL: The next agenda item is 9(b). As you know, commissioners, back in October of 2002, the commission authorized the creation of the CTRMA, and further it provided that the initial project that would be developed by the CTRMA would be the proposed 183-A Turnpike project.

Now, the Transportation Code also provides that a regional mobility authority may not begin construction of a transportation project that will ultimately connect to the state highway system unless they first seek and gain the approval of the commission.

This minute order before you would, in fact, approve the construction and the connection of 183-A to the state highway system project, and it would also authorize Mr. Behrens to enter into any agreements with CTRMA that would be necessary for the ultimate construction of the 183-A Turnpike project.

We recommend approval of this minute order and I'd be happy to address any question you might have.

MR. WILLIAMSON: Members, we have one witness, Mr. Tesch, who is the chair of the Central Texas RMA. I think if we might, we'll hear him first and then we can ask Phillip questions in a bit.

Mr. Tesch?

MR. TESCH: Mr. Chairman, commissioners, good morning -- good afternoon now. I'll be brief, given our time.

For the record, I'm Bob Tesch, chairman of the Central Texas Regional Mobility Authority. I'm here today with a number of our team members, our financial people, our legal counsel, and so forth, and we appreciate the commission's consideration of these two CTRMA items on the agenda today.

The CTRMA, working closely with your staff, is continuing to take significant steps toward breaking ground on Texas' first turnpike project built by an RMA, US 183-A.

Perhaps the best news, other than the news that we hope to get from you today, is that the secretary of Transportation has recently approved our TIFIA loan for $66 million. Our team is in Washington this week negotiating the terms and conditions of the loan documents, and we're very excited and pleased about the positive response that the CTRMA has had in Washington.

I think you also know that we have selected our developer for this project based upon a CDA process. This has resulted in the selection of a developer that we believe will deliver the best value for central Texans and the CDA process played a significant part in that. And we're now very close to signing the CDA with that developer and breaking ground on this important project.

The toll equity application that we're requesting your preliminary approval of today is very important to this project. It marks another first in terms of activity by an RMA and another step in the strong partnership between this RMA and TxDOT. Having this in place, along with the TIFIA loan, will complete our financial structure for this project and will allow us to sell bonds soon after the first of the year.

So once again, your staff has been great to work with, not only on this project but through the creation of our agency. Amadeo Saenz, Phil Russell, Bob Daigh, and others have been very supportive and we appreciate that and we look forward to inviting you to a groundbreaking soon after the first of the year.

MR. WILLIAMSON: Questions or comments directed to Mr. Tesch?

MR. NICHOLS: Congratulations on your TIFIA loan.

MR. TESCH: Thank you, sir.

MR. NICHOLS: Did you get the same kind of the terms so you can do bank anticipation notes, or is it a similar arrangement with the TIFIA that we got on our 130 project?

MR. TESCH: The final terms and conditions, they've agreed to it in principle.

MR. NICHOLS: James is saying yes, that you did.

MR. TESCH: I'm not sure.

MR. NICHOLS: That's great. You have done some amazing stuff in a very interesting process here in Austin. Thank you for volunteering to do that.

I wanted to point out -- this is approval of the project literally to connect to the state and do that kind of stuff -- that when we began construction of the 130 project, in our bond covenants we stated as a commission that this project will be built, so we're locked into that, so this is the step that formalizes that that we've already previously committed to.

MR. TESCH: That's correct. I think you had an obligation to build it by 2011.

MR. NICHOLS: We're going to beat that.

MR. TESCH: And we're going to beat that. Correct.

MR. NICHOLS: Anyway, that's all I had. So moved.

MR. HOUGHTON: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. TESCH: Thank you very much.

MR. WILLIAMSON: Stand by. You're up here on the second one.

MR. RUSSELL: Okay, commissioners. As we just noted from the RMA, their first project is the 183-A project. Now, as Chairman Tesch indicated, they are moving forward with both the financing and the actual construction of it. They do have their TIFIA loan secured, they have their CDA developer onboard as well, perhaps have not executed the contract but have selected them.

So I guess the next logical step was in accordance with Section 27.53 of our Toll Equity rules, the authority has submitted a request for up to $65 million in financing for the purpose of funding the development, the design and the construction of the 183-A Turnpike project.

The financing would be used for the initial phase of the project, consisting of tolled mainlanes from State Highway 45 to north of 1431, as well as some segments of frontage roads all the way to the San Gabriel River there at 183. The financial assistance right now would be in the form of a grant.

Now, the requested financial assistance includes $50 million from Category 2 of the Statewide Mobility Program that's been allocated by the Capital Area Metropolitan Planning Organization. It's also contemplated that the remaining $15 million would be funded from Category 11, District Discretionary Funds.

The Category 2 funding is appropriated to the State Highway Fund and must be expended by the department, although the MPO allocates the funds for specific projects. Accordingly, Category 2 money to be expended on the proposed 183-A project must be approved by the commission under the Toll Equity rules.

Again, I'll be happy to address any questions you might have. By approving this minute order, you would essentially fire the gun and would allow my group, James Bass, the district to get into the specifics, start hammering out the specifics of the agreement. It is a two-step process; this is preliminary approval and we'd be bringing it back for a secondary final approval.

MR. WILLIAMSON: And again, members, we have Mr. Tesch as our only witness. Bob?

MR. TESCH: Yes, sir?

MR. NICHOLS: Were you going to make a comment?

MR. WILLIAMSON: You're allowed to comment any more than you want to; you signed up for 9(b) and (c).

MR. TESCH: That's right. I was really speaking to both of those at once, but if there are any questions at all about the request, I'd be happy to answer those or attempt to respond to those.

MR. NICHOLS: I have a question which probably would be more to Phil than it would be to you related to this.

MR. WILLIAMSON: Any further questions for Mr. Tesch?

MR. HOUGHTON: Well, I can -- go ahead, Robert. Mine is on an equity issue.

MR. NICHOLS: Mine has to do with on the $65-, as I had gone over this over the past few days, it was my understanding that the MPO approved $50-.

MR. TESCH: Yes, sir.

MR. NICHOLS: We allocate funds to the Austin area by the document we approved earlier, and that the MPO know they've got a certain amount of money to work with, and they establish what they think are their priorities, trying to figure out where they want their funds, which projects, and they approved $50-.

MR. RUSSELL: Yes, sir.

MR. NICHOLS: That takes care of the $50-. Then we get to the $15-, it was my understanding, from what I was told the last couple of days, that the $15- was coming out of the District Discretionary.

MR. RUSSELL: Yes, sir.

MR. NICHOLS: What you stated on the record was that it was Strategic Priority money.

MR. RUSSELL: Oh, let me correct that then. Yes, it should be out of the district's Category 11 funds, their Discretionary funds. I apologize.

MR. NICHOLS: And if it's the district's funds, well, then that's something Bob Daigh and the district does prioritizing projects on their funding source.

MR. RUSSELL: I misspoke. District Discretionary.

So in effect, what we are just confirming what the MPO already approved on the $50- and backing up the district in their own District Discretionary, but as I understand it, they've got to have some type of formal action from us before we can -- because first I even questioned why we had to approve anything, but as I understand it, if we're going to have equity, using state money into a project like that, that we as a commission have to approve it.

So in effect, we're approving the equity that can be used for equity much more than we are approving what the MPO is going to spend their money on or the district. Is that correct?

MR. RUSSELL: That would be correct.

MR. NICHOLS: All right, got it.

MR. HOUGHTON: Mine is, Phil, in the spirit of the equity issue. We've been talking about come up with creative ideas to reduce the amount of equity by the department, by the MPOs -- well, department, MPO and to the RMA. We've been talking about this. Have we seen the financial plan, do we know the financial plan for this 183-A?

MR. RUSSELL: They submitted the preliminary financial plan showing a basic sources and uses table. I think that's probably what we'd endeavor to do the next 30 days is really hammer into some of the specifics on how the plan is going to work.

MR. HOUGHTON: Our people have not seen that yet?

MR. RUSSELL: Not the specifics, I haven't, other than that general sources and uses table.

For instance, on the TIFIA loan, I know they've just kind of put that together, so we haven't bored down into the specifics of it yet, no, sir.

MR. HOUGHTON: And the underlying question is, is there an opportunity to reduce our equity into this project even further and stretch those dollars out through the RMA, the CAMPO, those type of opportunities? Have we looked at that yet?

MR. RUSSELL: Well, I think that's what we would, and James and Bob certainly have some bright staff, and we could sit down with the CTRMA and start hammering through some of those details to see if there are any other options that are out there.

The RMA, as Chairman Tesch has indicated, has a financial advisor onboard and they certainly have looked at the different permutations, but I think this will be an opportunity for us to sit down with their FA and their staff to kind of sort out some of those issues.

MR. HOUGHTON: Are we locked in at $65 million?

MR. RUSSELL: No, sir. I think it's up to $65 million, and again, this is just the preliminary approval, so I think if we come back in December with that final approval, we'll have that ability to adjust it.

Richard, unless you disagree?

Bottom line, yes, we have the ability to adjust it.

MR. HOUGHTON: Come back. Okay.

MR. WILLIAMSON: Do I have a motion?

MS. ANDRADE: So moved.

MR. NICHOLS: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor, signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MS. ANDRADE: Mr. Chairman, the only thing I'd like to say is Bob, thank you so much for your leadership.

MR. NICHOLS: Thank you also.

I was just going to comment -- and I should have said it before -- as you evolve in your plan, because I know a lot has been in motion, I think a number of us saw preliminary dollars and preliminary estimates and all that kind of stuff as of months ago and there's been a lot of changes and you're evolving that plan. I think it would be a good idea, and I would just recommend, that periodically -- we're not talking about getting involved in your plan, but since you're going to be coming to us for equity on some of these things, it would be good to update us every once in a while, not necessarily even in a formal manner, just informal.

MR. HOUGHTON: It would be nice to know about the financial plan.

MR. TESCH: Certainly. We certainly have an open attitude, just as you do, and I will pass that on to our people and encourage that we do that more frequently than we have, perhaps.

And thank you very much.

MR. WILLIAMSON: I add my remarks to the other members', we appreciate your tremendous service. We are blessed with, so far, a great core of RMA leaders across the state.

MR. TESCH: Thank you, Mr. Chairman. It's been a pleasure working with your team, it really has.

MR. BEHRENS: Agenda item number 10 under Finance, first will be agenda item 10(a) concerning the lease of some property as part of the right of way of the Central Texas Turnpike System. James?

MR. BASS: Good afternoon. For the record, I'm James Bass, director of Finance.

As Mr. Behrens stated, this agenda item is in compliance with the indenture associated with the Central Texas Turnpike System. We've come across an opportunity where we can lease some right of way that is not needed at the current time, and over the interim basis we can lease it to one of the adjacent property owners.

The district has elected to do so and in accordance with the indenture, this minute order would represent the determination by the commission that the lease of this property would not adversely affect the revenues of the system.

And staff would recommend your approval.

MR. WILLIAMSON: Questions or comments for Mr. Bass?

MR. HOUGHTON: So moved.

MR. NICHOLS: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor, signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. BEHRENS: Item 10(b) concerns the Grayson County Regional Mobility Authority.

MR. BASS: This seeks authorization to begin negotiations with the Grayson County RMA on a pass-through toll agreement. The RMA has submitted a pass-through toll proposal providing for the 12-mile extension of State Highway 289.

Your approval today would in no way be an agreement to any specific terms but would allow the department to begin negotiations with the RMA to hopefully arrive at mutually beneficial terms to then bring back to the commission at a later date for final approval.

And staff would recommend your approval of this minute order.

MR. WILLIAMSON: Members, we have one witness -- I think we don't call them witness in the commission world; that's my legislative word -- but we have one person to hear comment from, Mr. Jerdy Gary, who is the chairman of the Grayson County RMA. And he's the either third or fourth or fifth -- I lose count now, which is a good thing -- in a long line of great RMA chairmen.

MR. GARY: Thank you, Mr. Chairman, members of the commission. It's a pleasure for me to be here today and convey our support, and I'm pleased to have join me the County Judge Tim McGraw, of Grayson County, County Commissioner Gene Short who is the liaison from the county to our RMA and also serves as the chair of the MPO for the Sherman-Denison area.

And I would just like to share with the commission that this project is supported throughout our county, not only publicly and on record by Grayson County, but also every city and community and every chamber of commerce and every organized transportation committee throughout our county are on record in support of this project.

It's a project, as I think most of you have already seen, that will relieve congestion on Highway 75; it will shorten the time from the Metroplex up to Lake Texoma, but one of the big items, it's going to open up economic development to our Grayson County Airport that's going to be enormous.

So we are here to convey the support of all of our folks back home and appreciate very much this opportunity to appear before you. I'd be happy to respond to any questions.

MR. NICHOLS: I'd like to thank you for coming down. You have done a great job, that's a good project up there. I think that's going to be the future Alliance up there, I know that's what you're working toward, and I think you're going to get there. So hats off.

I was kind of curious -- and I'm supportive of going however you want to go -- you want to negotiate as a pass-through toll?

MR. GARY: Yes, sir.

MR. NICHOLS: As opposed to a conventional toll that would generate revenues and surplus revenues. Was there a particular reason why you chose the pass-through as opposed to a conventional one that might give you surplus revenues?

MR. GARY: Commissioner, on the basis of the conceptual feasibility study that we had at the time, it was only one segment of it would really support conventional tolling at this time based on those numbers. We felt like to start out it was best to go ahead and go with a pass-through tolling request and at a later date we may go back and toll a portion of this project.

MR. HOUGHTON: Is that called a conversion?

MR. NICHOLS: Well, that kind of led up to where I was heading next. Once you do it one way and it opens up and the public drives on it, it's much more difficult to come back and it's a much harder step, I would say, to come back and apply surface tolls, I guess, conventional tolls, if that's what you decided later.

MR. GARY: Commissioner, the migration from the Metroplex up the 289 corridor is rapid and the Dallas Turnpike Authority is moving very fast up to, I understand, the 380 at this time, and our Grayson County border goes on south of where we're going to start this project from at SH 56, but the small segment from SH 56 up to US 82 is what I was referring to, and we're acquiring the right of way to go ahead and make that four-lane.

MR. WILLIAMSON: Stand by just a second, Jerdy, if you would.

MR. GARY: Yes, sir.

MR. WILLIAMSON: Amadeo? We've recently had some education from FHWA about conversions. The way this project is envisioned, are we going to have trouble converting it -- will the RMA have trouble converting it to a cash toll from a pass-through toll when they so choose?

MR. SAENZ: For the record, Amadeo Saenz, assistant executive director for Engineering.

We're going to be up there next week on the 6th to visit with the Grayson County RMA to kind of start looking at the project. Looking at it, if they build it and then open it up and then later on want to apply tolls to it, what we've gotten from FHWA lately, unless they do something to that project as an expansion, they will not be able to simply convert it.

What may be able to happen is if they go out there and build and say build frontage roads or access roads or a smaller footprint, then when they expand it, then they can expand and toll the additional capacity.

So these are things that we will be sitting down with them and kind of discussing the different options that will be available to them.

MR. WILLIAMSON: The reason I asked you that question is so that we can communicate to Jerdy and also the good judge and the good commissioner -- who all three are friends of the department -- a lot of thought needs to be put into the environmental process and the initial design, and we're not telling you you should go spend your money to do this, we're in effect saying we're kind of willing to spend our money to make sure you do this.

Because I think the day will come when you're going to want to toll this for your own purposes -- which helps the state down the road -- and it would be better to do the environmental and design it that way and put a big old sign up there that says, you know: Spring of 2010 -- or whatever it is -- electronic tolls will be collected on this road.

MR. SAENZ: We'll be visiting with FHWA to discuss that option also.

MR. WILLIAMSON: I think we're learning a little bit from our semi toll conversion experiences that --

MR. NICHOLS: We haven't had any semi toll conversions.

(General laughter.)

MR. SAENZ: The whole key is to clear the project in the environmental process and let everybody know that at some time this project will be a toll project.

MR. WILLIAMSON: Well, you could say: Toll road but the State of Texas is paying your toll today.

MR. SAENZ: Free pass today.

MR. WILLIAMSON: All right, thank you.

Other questions for Amadeo, members?

(No response.)

MR. WILLIAMSON: Okay, Jerdy, you're back up. And by the way, we do appreciate you coming up and we appreciate you coming up early knowing you were late in the agenda because what that tells us you want to watch and see what goes on here and carry that back to extreme north Texas, and we do appreciate that more than you know.

But the governor's admonition to us about not interfering with regional planning and local execution, we take seriously, so we wouldn't tell you what you had to do, we just think it makes good sense to be thinking that way for the long haul.

MR. GARY: Mr. Chairman, we appreciate all the help we can get, and we really appreciate and look forward to Russell and Amadeo coming up the first week in December and giving us that guidance that we just heard a little of right now because we don't want to make a mistake. We want to build a road in a hurry.

MR. WILLIAMSON: They're good guys and we're good partners.

MR. GARY: Thank you, sir. Any other questions.

MR. WILLIAMSON: Okay, members?

MR. NICHOLS: So moved.

MR. HOUGHTON: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries. Congratulations, gentlemen.

MR. BEHRENS: Agenda item number 11, we'll have a contested case presented by Mr. Monroe.

MR. MONROE: Once again for the record, my name is Richard Monroe; I'm general counsel for the department. And the battering into submission of the billboard industry has been greatly exaggerated.

(General laughter.)

MR. MONROE: Here we have a case involving a billboard and the facts are set out in the cover page.

What happened here, there are certain laws and rules about the maintenance of a billboard, and for obvious reasons, the department does not want you to maintain a billboard from the highway. To have people out there doing this kind of maintenance from our right of way can be quite dangerous.

So that was exactly what was being done, maintenance was being done on a billboard from our right of way. The weather was lousy, had been lousy, and therefore the people maintaining the billboard felt that they just couldn't approach it from the private property, so they had to do it from the road.

Our local people, who are not supposed to act like they're Supreme Court justices -- they're there to enforce the rules -- I think did what was appropriate under the conditions, they said, "Your permit is revoked."

The case went to SOAH, the State Office of Administrative Hearings, and to boil it on down, the administrative law judge said, I think that's a little harsh, given the circumstances, nobody got hurt, nobody got killed; and therefore, I think their permit ought to be continued.

Now it becomes incumbent on the commission to decide which way to go. You can either uphold the ALJ, which seems to be, in many respects, the just thing to do, or you can overrule the ALJ and stick with the permit being yanked.

I will stop right there. I'll be free to comment further if any member of the commission would like me to or to answer any questions you may have with the hope I'll be able to answer them.

MR. WILLIAMSON: Members, as always, any of us are free to comment or ask as we're so moved to do. I would just respectfully admonish each of us, including myself, to be circumspect about a matter of litigation.

MR. HOUGHTON: Did we act accordingly?

MR. MONROE: Did the people in the district act strictly according to our rules and our procedures, yes, sir.

MR. HOUGHTON: Matter of the law, spirit of the law?

MR. MONROE: One of the functions of this commission is to try to do the right thing. I don't think it would be appropriate for our people who do patrol the highways and try to do the best job they can, to have the same attitude toward these matters as I think is quite appropriate for the commission to have.

And I will repeat a story I think I've told the commission before. I used to work for someone who had made his original money as a lawyer and then he went into business, and I was counsel to his company and sometimes I would say things and he would say, Richard, if I had your job, I would probably be saying the same thing, but there are business reasons why we're not going to do that. And it doesn't hurt my feelings a bit.

MR. NICHOLS: We have two choices here. Is that correct?

MR. MONROE: Yes, sir.

MR. NICHOLS: I'd like to hear from our executive director on what his recommendation is. You've got a legal matter and you've got an operational matter.

MR. MONROE: Yes, sir.

MR. BEHRENS: Looking at all of the information on this particular case, it's my recommendation that you go along with the findings of the administrative law judge.

MR. HOUGHTON: So moved.

MS. ANDRADE: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion, signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries. Thank you.

MR. MONROE: Thank you.

MR. BEHRENS: Agenda item number 12 is our Contracts for the month of November, that would be 12(a)(1) and (2). Elizabeth Boswell will present these.

MR. WILLIAMSON: Well, Tommy Bohuslav just got out of the whole deal today.

MS. BOSWELL: You have been too hard on him.

(General laughter.)

MS. BOSWELL: Good afternoon. For the record, my name is Elizabeth Boswell; I am the director of the Construction Section within the Construction Division.

Concerning agenda item 12(a)(1), authorization of this minute order provides for the award of highway maintenance contracts let on November 9 and 10, 2004 whose engineers' estimated costs are $300,000 or more.

Staff recommends award of all projects as shown in Exhibit A.

MR. WILLIAMSON: Except for the recommended rejections.

MS. BOSWELL: On the maintenance contracts, I think they're all recommended for award.

MR. HOUGHTON: So moved.

MR. NICHOLS: Second.

MR. WILLIAMSON: I have a motion and a second. All in favor, signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MS. BOSWELL: Concerning agenda item 12(a)(2), authorization of this minute order provides for the award or rejection of highway construction and building contracts let on November 9 and 10, 2004, as shown in Exhibit A. Staff recommends rejection of the following three projects.

The first project recommended for rejection is located in Galveston County and provided for the restoration of a railroad depot in the city of Dickinson. The low bid was approximately $56,000 over the engineer's estimated cost for this project. At this time the City of Dickinson does not have the additional funds necessary to finance this overrun and it's working on a redesign of this project to reduce the overall cost with plans to re-let at a future date.

The second project recommended for rejection is located on FM 758 in Guadalupe County and provided for the reconstruction of an existing portion of this highway. Subsequent to letting, an error was discovered in the PS&E. Due to the nature of this error, the district has opted to correct the PS&E and re-let this project at a future date.

The third project recommended for rejection is located on State Highway 34 in Hunt County and provided for the installation of a traffic signal. The apparent low bidder, Tahari Enterprises, alleged a bidding error in the unit bid price for one of the bid items.

Staff has reviewed the contractor's claim using the bid error procedures as outlined in Title 43 of the Texas Administrative Code. After a thorough examination of the documentation provided, staff was able to substantiate the intended unit bid price and concluded that the contractor did exercise ordinary care in the preparation of their bid.

Staff recommends award of all remaining contracts as shown in Exhibit A.

MR. WILLIAMSON: We have some cost overruns this month, members. Any questions about those?  Not cost overruns, proposals over estimate. Excuse me.

MR. HOUGHTON: What's the basis of them?

MS. BOSWELL: Well, through our letters that we received from the districts, a lot was attributed to increased fuel costs, some was attributed to increased steel costs. There's a variety of reasons that the districts go through and they justify, but you see those hit a lot in their justifications.

MR. HOUGHTON: Thirty percent is a big number on some of them.

MR. NICHOLS: I was going -- it's not really a question, it's just a comment for anybody in the public that may be listening.

Our overall overrun was about 6 percent this month, and I know for a few years there we were consistently getting underruns because the economy was in a recession, prices got cheap, people were really hungry, and so we were getting some very attractive bids coming in.

And now the worm has turned. The price of steel has gone up, the price of oil is ridiculous, and things like that, and so it's going the other way, it's been going the other way for six, eight months, something like that. The point I was trying to make was that the $16 million in what we call a percent overrun is primarily due to inflation.

MS. BOSWELL: Yes, sir.

MR. NICHOLS: But that $16 million this particular month is probably -- it's just like losing $16 million in revenues. I think Thomas at the last meeting said that the actual index, Construction Cost Index of Materials or something, had increased 15 percent in the past 12 months.

MS. BOSWELL: Yes, the index has been increasing in the past 12 months and basically due to inflation. The cost of steel, the cost of fuel, it has caused the index to increase.

MR. NICHOLS: While we've kind of got that fresh on our mind, I think it would be good to figure out a way to graphically display that.

MS. BOSWELL: Okay.

MR. NICHOLS: Because we've got a legislative session coming up in a month or so, and as we get into needs and costs and those kind of questions, it might be good to show them as that curve goes up, what we can build and preserve goes down the same amount of money.

That's all I had.

MR. WILLIAMSON: Further questions or comments, members? Before I take a motion, I just wanted to be sure that everybody's questions are fully answered about the differences in bid and estimates.

(No response.)

MR. WILLIAMSON: Okay, I'll take a motion.

MR. HOUGHTON: So moved.

MS. ANDRADE: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MS. BOSWELL: Thank you.

MR. BEHRENS: Agenda item 12(b), Amadeo will present several engineering contracts for approval.

MR. WILLIAMSON: Where is he?

MR. SAENZ: He said he was here in spirit.

MR. WILLIAMSON: That shows you how much respect he has for us.

MR. NICHOLS: We're going to Brownwood next year, I think.

(General laughter.)

MR. SAENZ: For the record, Amadeo Saenz, assistant executive director for Engineering.

Just a comment on the prior item. We review all of our contracts that overrun to find out why, and this month one of the things is our seal coat program, we have to let with plenty of advanced time because the contractors have to acquire materials, the aggregate has to be crushed and the aggregate has to be delivered, and there's a lot of vulnerability right now in the asphalt prices. Three of our seal coat projects contributed to most of our overruns.

Item number 12(b). Thank you, Mr. Behrens. Good afternoon, commissioners. For the record, I'm Amadeo Saenz, assistant executive director for Engineering.

Item 12(b), the minute order before you approves one surveying contract and four engineering contracts between the Texas Department of Transportation and Halff Associates, Inc.

Halff Associates, Inc., employs Charles W. Heald, our former executive director with the Texas Department of Transportation. Government Code 669.003 requires that in order to enter into a contract with a company that employs a former executive director -- in this case, Mr. Heald -- within the first four years after he has served in that position, the Texas Transportation Commission must also approve all contracts in an open meeting.

The department advertised for surveying and engineering services, and Halff was chosen to be a provider in accordance with the competitive selection process and negotiation procedures that are set forth in the Government Code and Administrative Code.

The $400,000 survey contract and the $750,000 engineering contract are for services to be performed in the Houston District, we have a $250,000 contract and a $500,000 engineering contract to be done in the Fort Worth District, and a $2 million engineering contract to be performed in the Dallas District.

Staff recommends approval of this minute order.

MR. NICHOLS: So if I go down to Houston, I might see Wes dragging a gunner's chain measuring a roadway or something?

MR. SAENZ: You might.

MR. WILLIAMSON: I thought the last time this came up we gave very clear instructions the next time that we had a Halff proposal --

MR. SAENZ: Steve handled this item for me last month and he passed it on to me. I saw Mr. Heald during that time and I invited him, and he said he was going to try to be here but I guess he decided to be here in spirit.

MR. WILLIAMSON: So are we due to have a commission meeting in Brownwood sometime soon?

MR. SAENZ: Sir, I believe we're going to be in Brownwood next year, next July.

MR. WILLIAMSON: Would approval of this document wait until then?

MR. SAENZ: I think we would like to do the work, but I'm sure there may be more.

MR. WILLIAMSON: Well, you and Steve now can approach Wes and tell him that the commission really wants to hear from him next time. We want him to come present the minute order.

MR. SAENZ: We will do that.

MR. WILLIAMSON: Okay, members, questions or comments?

MR. NICHOLS: So moved.

MR. HOUGHTON: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion, signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. BEHRENS: Agenda item number 13 is our Routine Minute Orders. They were duly posted as required; they're all listed. If you want me to go through any of them individually, I can.

I would comment that we have 13(b) is the Alcoa donation where they're relocating that road, there was a question last month.

MR. WILLIAMSON: And is that the one that we've asked you to go ahead and remove from this month's calendar? Do we want to think about it one more month?

(General laughter.)

MR. BEHRENS: I would recommend approval of all the minute orders.

MR. WILLIAMSON: Including Alcoa?

MR. BEHRENS: Including Alcoa.

MR. HOUGHTON: So moved.

MS. ANDRADE: Second.

MR. WILLIAMSON: I've got a motion and a second. All those in favor, signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: The motion is carried.

MR. BEHRENS: That concludes any business that we have. I don't see a need for an executive session, unless you do, Mr. Chairman.

MR. WILLIAMSON: Okay, the record finished for the last six months.

MR. BEHRENS: Don't have anyone for open comment signed up.

MR. WILLIAMSON: Members, I want to thank you for staying steady on so we could get out in time for all of us to get some other places. We did marvelous work today because we've got a marvelous staff. You guys did a great job on that Metro Plan and we appreciate it.

The most privileged motion is in order.

MR. NICHOLS: I move we adjourn.

MR. HOUGHTON: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

Please note for the record it is 1:26 p.m. and this meeting stands adjourned.

(Whereupon, at 1:26 p.m., the meeting was concluded.)

C E R T I F I C A T E

MEETING OF: Texas Transportation Commission
LOCATION: Austin, Texas
DATE: November 18, 2004

I do hereby certify that the foregoing pages, numbers 1 through 210, inclusive, are the true, accurate, and complete transcript prepared from the verbal recording made by electronic recording by Penny Bynum before the Texas Department of Transportation.

__________11/22/2004
(Transcriber) (Date)
On the Record Reporting, Inc.
3307 Northland, Suite 315
Austin, Texas 78731