Texan wooed Europe contractors

01-29-2004

W. Gardner Selby

AUSTIN — State plans to lay a vast network of roads, rails and pipelines across Texas could be flavored by help from Europe, where major contractors were wooed by a pivotal state official and his entourage in a trip last year that cost Texas taxpayers more than $63,000.

Phillip Russell, director of the Texas Turnpike Authority, went to London, Paris, Rome and the Spanish cities of Madrid and Barcelona over 17 days to tout the Trans-Texas Corridor, the ambitious vision unveiled by Gov. Rick Perry in 2002.

Russell's journey from Sept. 16 through Oct. 2 cost nearly $8,000, records show, and was likely the most expensive trip by a TxDOT employee in agency history.

An agency spokeswoman estimated the additional cost for an outside lawyer who accompanied Russell exceeded $55,000, counting pre-trip preparation time and billable hours during the trip.

An outside engineer on the trip has not billed the agency, but could do so. A third consultant traveled without any promise of state reimbursement.

Russell said Wednesday the payoff will come from international expertise added to projects, including proposals under review to build a new corridor of roads and infrastructure from North Texas to Mexico, financed by a mix of bonds, tolls and private financing.

"The bottom line is probably better competition" among contractors "and better prices for the taxpayer," Russell said, adding he has not had second thoughts about the trip. "Would we do it again? Absolutely yes."

Glenn Gadbois of Just Transportation Alliances, a consumer group founded by Texas Citizen Action, said he appreciates the benefits of competition.

"But why are we paying for someone to travel there instead of (contractors) paying for someone to travel here?" Gadbois said.

Asked if European companies might otherwise have been alerted to corridor projects by e-mail or telephone, Russell said "the reality" is such organizations do not scout the Web to identify state transportation projects.

"This was a grand opportunity to bring this to their doorstep," Russell said. "It's helpful to sit across the table and take the measure of a man."

Rep. Mike Krusee, R-Round Rock, chairman of the House Transportation Committee, had no objections.

"Some of the biggest construction and engineering firms in the world with toll roads and private financing of roads are in Europe," Krusee said. "I can see it would be worthwhile to go over there."

He added: "I would imagine if you're asking a private-sector company to invest billions of dollars, an e-mail is not going to be sufficient."

The Associated General Contractors, with members including contractors responsible for building some 90 percent of existing Texas highways, declined to critique the transatlantic outreach.

Thomas Graham, spokesman for the California-based Fluor Corp., which has a pending proposal to design and build a corridor from Denison to the Rio Grande Valley, said: "We understand the value of reaching out to other markets to attempt to get the best expertise to be competitive. But as one of the largest engineering and construction employers in Texas, we believe strongly in the need to use local contractors and local suppliers to realize the greatest benefit to taxpayers."

Since Russell's trip, two delegations have visited TxDOT and a four-day visit by representatives from Spain is slated next month, including the U.S. ambassador to Spain. The visit will include a tour of a turnpike project under construction around Austin and stops in Houston and Dallas.

Perry's plan envisions a 4,000-mile network of projects that include separate highway lanes for passenger vehicles and trucks, high-speed passenger rail, high-speed freight rail, commuter rail and a dedicated utility zone.

Four corridors have been identified as priority segments. The corridors parallel Interstate 35, I-37 and proposed I-69 legs from Denison to the Rio Grande Valley and from Texarkana to Houston to Laredo. Another corridor parallels I-45 from Dallas-Fort Worth to Houston and I-10 from El Paso to Orange.

TxDOT estimates a cost of $145 billion to $183 billion.

In his trip, Russell talked to more than 300 people in more than 20 meetings, including events at U.S. embassies in France, Spain and Italy.

According to a post-trip memo, Russell spoke personally with 12 contractors, three finance-related groups, a law firm and Standard & Poors.

Russell also visited French highway projects, studied tunneling in England and Spain, and attended the International Bridge, Tunnel and Turnpike Association conference.

"European contractors may be willing to take more construction risk than U.S. contractor counterparts, perhaps because of greater potential profit from private financing and long-term operation," Russell wrote after the trip.

The trip had won approval from Transportation Commission Chairman John Johnson of Houston. An agency spokeswoman said the decision satisfied a law that requires state commissions to approve travel abroad, except to Canada and Mexico.

"You don't enter a decision like this lightly," Johnson said, predicting international companies would reduce costs and apply the best practices.

gselby@express-news.net