Texas Department of Transportation Commission Meeting

Dewitt Greer Building
125 East 11th Street
Austin, Texas

7:30 a.m. Thursday, January 27, 2000 Staff Briefing

COMMISSION MEMBERS:

DAVID M. LANEY, Chair
ROBERT L. NICHOLS
JOHN W. JOHNSON
 

DEPARTMENT STAFF:

CHARLES W. HEALD, Executive Director
HELEN HELVEKA, Executive Assistant, Engineering Operations

P R O C E E D I N G S

MR. LANEY: This briefing session of the Texas Transportation Commission is called to order. The time is 7:35 a.m., January 27, and this meeting was appropriately posted with the Secretary of State’s Office on some specified date, unbeknownst to me at the moment.

(General laughter.)

MR. HEALD: Okay, Commissioners. We’ve got at least two items that we want to go over with you this morning, and one of them, Margot Massey will present to you. And I guess you can say it’s a good news/bad news story. Some really good things are happening in her division, and I think it’s a tribute to her that this is happening. And obviously you’re wondering what I’m talking about, but she’ll explain it to you. And then we have some sort of bad news, too, that she’ll want to go over with you.

And our second speaker will be John Campbell, and he’s going to explain to you some of the problems we’re having trying to keep our lettings on schedule. It has to do with adjustment of utilities; not a new situation, but something that we’ve been dealing with for a long time, but it’s becoming more critical because of the volume of work that we’re letting and trying to keep it on schedule.

And then we have our old issue of air quality, and we’re just here to answer any questions that you might have.

So we’ll start off with Margot Massey.

MS. MASSEY: For the record, my name is Margot Massey. I’m the Director of the Public Transportation Division, and as Mr. Heald said, it’s kind of a good news/not-so-good news sort of situation.

I will start with the fabulous news. We have an initiative that has started very quickly and is moving very quickly with the Health and Human Services Commission, and the Commission went through Sunset this last session and there was some language in their Sunset legislation -- it was actually one of our bills wound up over there, and then there was language relating to a memorandum of understanding between our agencies. We have a long history of working with them, because most of the Human Service programs have a transportation component to them.

Back when many of these programs were created in the '60s, they quickly realized that if you didn’t have a way to get people to those medical services, employment services, other government services, that the core service was not taken advantage of, so many of those programs wound up with a very distinct transportation component or transportation was an eligible item. And what we’ve seen over the intervening 30-plus years is a proliferation of transportation services. We’ll have one- and two-van operations; one going to the senior citizens center, one going to medical facilities. And then you have the public transportation systems that are sometimes operating in a very different service mode.

Obviously there’s some capacity issues where you have vehicles sitting idle during pieces of the day, and so we’ve been working with the Health and Human Services agencies for many years trying to make those systems work together -- the public and the HHS systems work together more efficiently and provide better service to the citizens, of course. And that was the gist of the language in the Sunset bill.

What happened was, I think largely because of Sunset and some of the other directives that the Health and Human Services Commission received, Commissioner Bob Gilbert is looking at how their agency does business and, I guess, their core functions. And his opinion today is that transportation is not one of their core functions -- that’s his hypothesis -- and that instead, there is a very large state agency with transportation in its name that might be a better home for some of those transportation programs. So he had approached my office and asked if we would be willing to talk about it, and I said, Absolutely.

The upshot of this is they would like to run a pilot with the Medicaid Transportation Program, which is the largest of the readily identifiable programs. It's about 45 million a year, thereabouts, which is -- I mean, that’s about roughly what our state public transportation budget is every year. They would like to try a pilot in a couple of regions of the state -- we haven’t settled on that completely -- but to, in effect, run this money through TxDOT and allow us to turn around and contract with the public transportation operators in those areas, who would then provide the service -- which many of them are already doing -- or contract it out, broker it to other service providers in the area for the pieces that they can’t do. That would include cab companies and other local agencies.

But it’s the flow of funds, running it through the public transportation infrastructure, that really starts pulling this together in developing some regional coherence. So we think it is an extraordinary opportunity, and it’s unprecedented. There is nowhere in the country that anything of this magnitude is being attempted.

The long-term goal of this, depending, of course, on the success of the pilots, is to do these pilots in a very short time frame, four to five months. If they are as successful as we hope, then to turn the entire Medicaid Transportation Program over to TxDOT on September 1 and roll it out statewide, again using the same contracting structure.

Based on the success of that, they would eventually like to give us all their transportation money, which it’s hard to get a firm fix on it, but it’s probably between $75 and $100 million a year. And there’s significant opportunities to make the service more accessible to the public, where they make one phone call to a local operator rather than having to call over town, depending on what kind of trip they’re making. So we see this as an extraordinary opportunity to do some grand things for the people of Texas.

MR. HEALD: It also sounds like quite a challenge, but the idea of coordinating the efforts, I think, is a great step.

MR. LANEY: Did I hear you say that there is some unused capacity in their system?

MS. MASSEY: I think what happens is, first of all, they estimate that on the Medicaid program they’re only serving between 25 and 30 percent of the eligible recipients, which is of great concern to the Department of Health which manages that program.

We also have the phenomenon, not as much in the public transit sector, but we have vehicles sitting idle during big chunks of the day, where a vehicle may take folks to a senior citizens center and then it waits there during the midday hours while they have a meal and social hour, and then it will take them home in mid-afternoon. But vehicles sit idle for big chunks of the day, whereas, if we consolidate those resources, we can have those vehicles providing other services -- delivery to other services during those downtimes.

MR. LANEY: In the public transit area or in the health and human services area?

MS. MASSEY: In all areas, just transportation stuff.

MR. LANEY: So we will have the usability of some of that excess capacity. Right?

MS. MASSEY: Yes.

MR. LANEY: That would be a benefit to us.

MS. MASSEY: Absolutely.

MR. LANEY: Is there any kind of burden to us at all?

MS. MASSEY: That could be one of the challenges. Most of these programs come with some rather extravagant reporting requirements, which we are hoping to build some fire walls. For example, Medicaid, they really like --

MR. LANEY: So that we don’t have to deal with that.

MS. MASSEY: So that we don’t have to deal with those pieces of data. Medicaid likes to know Social Security numbers of everybody who gets Medicaid services. And to us, a passenger on a bus is a person -- well, it counts as one trip and we don’t care who they are, or whatever. And that’s the direction we’re taking is trying to take the strengths of both programs and avoid some of the headaches, particularly on the human service reporting side. And I think we’ll give our federal partners an opportunity to perhaps eliminate some of those regulatory impediments.

MR. NICHOLS: A portion of these trips, health-related, are back and forth to hospitals for elderly, ill, or whatever. Are part of those also required to have ambulance-type transfers? I know in our community so often you have these people that are at home in that kind of a situation and they actually contract with the ambulance service to take them to the doctor for the check and then take them back, and they actually have to have an ambulance-type transfer.

MS. MASSEY: I think that’s a little bit different piece of this. It does happen, but generally those are separate contracts. What we’re talking about is more of the conventional, non-emergency, transportation. And sometimes those are not emergency trips; it’s an equipment need, that they have a particular assistive device or something else that dictates the use of an ambulance. And I know we’re going to run into some of those issues.

We’re also going to be dealing with airlines and that sort of situation, because the Health Department contracts with airlines to transfer people across state, so again, we’re going to be building some bridges, I think, between the public transportation sector and our colleagues in the airline industry, which will, again, be a tremendous benefit, I think, to our passenger transportation system.

MR. HEALD: Margot, would you give them your most recent thoughts pertaining to impact to FTEs out in the districts and your division, both?

MS. MASSEY: This is one of those -- again, it’s somewhat difficult to get a handle on. In many respects, it’s contracts, which is what we do already, and we will be dealing with the public transportation operators that we already deal with. You get to a point, though, where you can’t absorb an infinite amount of money without having to increase FTEs. What we have in the districts now, there are about five districts that have full-time public transportation people. All of the other districts have a person identified who handles our business, but they wear other hats. And what we see, this having the immediate impact on those districts that don’t have a full-time person, just the volume is going to increase to the extent that we’re really going to have to look at making all of those full-time slots, which pinches the districts considerably.

But there is the other issue of there will be a lot of attention focused on this initiative. There will be some folks who, frankly, don’t want it to succeed. They’re invested in the current system, and so that’s another reason that I think we -- and I’ve talked to the district engineers about -- is if they can find a way to make that full-time commitment across the board. Our contracting dollars are just going to mushroom, and there will be a lot of new partners that we’ve historically not dealt with, a lot of folks knocking on TxDOT’s door and needing answers and assistance.

In terms of the division, it’s somewhat the same situation. I think we’re in relatively good shape today with 17 FTEs -- which we actually have all 17 on board now, and we’re very pleased about that -- but at some point, I think, as we get further beyond the pilot stage and we start seeing the major roll-out of programs over to us, then we’re going to be in the same situation of just not having the capacity to move that many dollars through the pipeline and keep the reporting data together. To me, that’s going to be probably 12 to 18 months down the road before we really hit the wall.

We have discussed with the Health and Human Services Commission, they have, I believe, three FTEs in the Office of Community Transportation who we work very closely with, and we’ve had some preliminary conversations about that, nothing real specific. From their standpoint, they are clearly looking to -- the folks that are working on transportation on their side of the house, they’re wanting to put them back into their core functions. So I don’t know that we have the opportunity at this point to stand to pick up FTEs from Health and Human Services. In some respects, I think we’ll be able to absorb this fairly well, but I know there’s going to be some pinches in the districts pretty immediately.

MR. LANEY: If you need three or four more FTEs, we’ve got some excess baggage on two. We can send it over with you.

(General laughter.)

MR. PICKETT: You know, Mr. Chairman, one of the things that concerns me -- we have talked about this; I discussed it with Margot – this is really sort of an order-of-magnitude change as far as what Margot’s division, and then you take this on a statewide basis, when we finally get into next September or whenever, going full blast.

I don’t think anybody argues that this is not an excellent concept; it’s going to work well through the state overall. And we’re really not getting hit, you know: You need another FTE here, it’s one of the things where they’re nibbling at us again; it’s going to be perhaps a partial FTE. But ultimately, on a statewide basis, we could end up really needing another 10 or 12, or ultimately maybe 25 people doing this.

MR. LANEY: Where? Scattered around the state in the districts?

MR. PICKETT: Yes. There will be one in each district, and actually, the areas that they’re talking about, as usual, don’t coincide with our districts, so one of the areas that HHS would be talking about may cover three or four of our districts.

MR. HEALD: The problem we have with -- you know, I was a little bit embarrassed at myself the other day, whining about not having FTEs when I testified over there, but you know, it’s like Kirby said, you just take on more and more and more, you’re doing more with less -- and we’re tired of hearing that term -- and yet when you look at the agency, we’re still 300 under what our allocation is. In every district, and I guess to some extent, some of the divisions, we’ve authorized them to go over their allocation by basically whatever they think they, you know, sort of can manage reasonably. But yet with the turnover and the salary problems we’re having and so forth -- especially in the urban areas; that’s not true in the rural areas -- we just cannot get up to our numbers.

Now, I think we’ve made major strides. We were like 500-and-something down, and we’re up to close to 300, maybe less than 300.

MR. PICKETT: I think we’re at about 260-something at this point.

MR. HEALD: So we’re working on it; we’re trying our best to get those numbers up there, especially before the session starts, but we’re just not there yet.

MR. NICHOLS: You said there was some good and some bad, so the program was the good and the FTEs is the bad?

MR. HEALD: No.

MS. MASSEY: No. It was my second item that’s the bad.

(General laughter.)

MR. NICHOLS: At the very outset, and since we’re kind of doing this on a pilot, and even when we go into others, we don’t expect a huge impact on that, but we’re only talking about this $45 million segment at the outset. And as Margot says, ultimately, if they turn the entire thing over to us, then we could be talking about double that. So you know, it’s another one of these things where we just kind of have to creep.

MR. PICKETT: We’ll handle it; we always do.

MR. HEALD: Let’s let Margot go ahead and finish her business.

MR. LANEY: Robert has made a motion that we’d like not to hear any bad. Can we have a second?

(General laughter.)

MS. MASSEY: Well, this is one of those challenges. Part of our state appropriation for public transportation this biennium, as last, was Oil Overcharge Funds, and the appropriation was based on estimated income, and whoever did the estimate was overly optimistic. We were targeted to get 13.8 million in Oil Overcharge Funds, roughly split equally between the two years. The first year money, 6.9, is there; the second year is not there.

MR. NICHOLS: You’re talking about second year is zero?

MS. MASSEY: Zero. We are short just over 6.9 million in our state appropriation, and we’re convinced, in talking to the Comptroller’s Office, that that is, in fact, true. This has a particularly serious impact on our urbanized systems, because a bigger chunk of their state funding comes from the Oil Overcharge Program. It’s about 30 percent of their money; money that they’ll stand to lose. In terms of options, you know, I think those are pretty self-evident. If anyone else has some money laying around within the agency, I’d certainly be amenable to taking it.

We also have received General Revenue funds as part of our appropriation. That’s an alternative that we talked about last session, when we found ourselves in roughly the same position, only it was less than a million dollars we were short.

Or the other piece of this is to tell the transit systems, The money is not coming; you need to cut back on your spending now -- which, at least, we have the advantage of knowing this fairly early in the biennium, but it will have a serious impact on them.

MR. LANEY: What kind of an impact? I’m sorry. Johnny, go ahead.

MR. JOHNSON: Well, I mean, my hip-shot reaction is that is the largest of the evils. Option three would be the one that I would least favor.

MR. LANEY: It may be the only available option. What’s the impact?

MS. MASSEY: It has a varying impact. Some of the transit operators have local resources that they can use to an extent; others are very dependent on the state funding, and we’ll see service cutbacks, layoffs of drivers, curtailment of service to varying extents. No system will shut down, but it will have a serious impact. And in some ways, the previous item, it helps to a certain extent, but it’s not going to fix that problem. Yes, we’re getting a lot of money, potentially, from Health and Human Services, but that comes with expectations on services to be delivered. So this comes at a bad time, when we have new potential partners and we have a hole in our budget.

MR. NICHOLS: About a year or so ago, when we talked about this before, when we saw a shoring up, that particular fee that came in through the legislature, I think all of those transit operators were told, This is supposed to be extra money; don’t count on it in the future. That’s what I recall. But instead, what they did was put it right into operational costs and became dependent on it, instead of it being extra money to fix things up and stuff.

MS. MASSEY: Well, yes. There’s always a lively -- I mean, it’s a curious history, as these discussions go on, that you may start with that and it quickly is transformed into a very different animal.

The transit operators are in much the same position as our agency is in terms of expectations and rising costs, growing populations to deal with, and so they may start with that expectation and find themselves quickly in a box where they really do need to plug this into operations.

MR. LANEY: Well, it sure is important to get this thing covered. This deals with a segment of our population that is under-served already, as far as I’m concerned, and this squeezes it tighter. So you’re working these three options, or at least the first option, to see if there’s something in the nooks and crannies.

And what is the approach if we turn to the Office of the Governor? Do they have money, contingency funds sitting around? I don’t understand how that works.

MS. MASSEY: Well, we have to make a pitch, and, I mean, other agencies are making similar pitches, and our agency is in a peculiar position because of our Fund 6. It becomes difficult sometimes to explain to those folks that, well, yes, we have a lot of money, but we cannot use it for this purpose.

MR. LANEY: Who do we explain it to? Albert Hawkins and his troop?

MS. MASSEY: Yes.

MR. LANEY: Okay.

MR. JOHNSON: Margot, is my understanding correct that, in essence, the funds are available to make it through this fiscal year, but next fiscal year, which starts September 1, there is basically zero?

MS. MASSEY: That’s correct.

MR. LANEY: Good luck.

MR. HEALD: Thank you, Margot.

John, do you want to come up?

MR. CAMPBELL: Good morning. For the record, I’m John Campbell, the Director of the Right of Way Division.

MR. HEALD: John, just a minute.

Are you having trouble picking us up, Penny?

THE REPORTER: Yes.

MR. HEALD: Okay. We might need to speak up a little bit more, I think, all of us.

MR. CAMPBELL: For the record, I have neither good nor bad news, a possible opportunity, and the bottom line comes down to opportunity of maybe expedite project progression versus the costs associated with it.

The fundamental issue is utility eligibility, eligibility for state cost participation in the costs of required utility adjustments by our projects. And I’ll real quickly give the background for the foundation for utility eligibility just so we can all start off from the same point.

Utilities are eligible for state cost participation based on property interests which they hold, and then TxDOT impacts with our projects. Similar to a property owner, where we make them whole by purchasing their property interest, we compensate the utilities for the adjustments so that we don’t have to buy their property, and therefore don't end up in the position of owning utility facilities and operating them. So it all comes back down to property interest.

The issue that I wanted to discuss today is an eligibility criteria which the FHWA recognizes as one that’s a potential for federal cost participation, but the state has not recognized, traditionally, and that’s the situation where you have publicly owned facilities which occupy publicly owned rights of way. The typical example would be a municipally owned and operated facility that occupies a city street.

In the situation, which might be more typical in the trunk system initiatives, where we would come in and replace an existing city street or probably a county road with a facility on the state system, we would traditionally not look at their holding of that public right of way as a legitimate interest that’s compensable, the same way that when we take over a facility for a state highway purposes, we don’t compensate the municipality for transferring that public use to the state highways. So we haven’t, in the past, ever compensated for the relocation of those utilities.

Our previous administration started to be confronted with more and more of these, where you had these small municipalities that really weren’t vested in our project, and they were suddenly imposed with the necessity to relocate their facilities and bear the costs of doing that. And so we were looking at these things on a case-by-case basis and granting some exceptions to go ahead and recognize that as a compensable interest.

The issue very quickly becomes one of being consistent in our policy and recognizing all of these as either compensable or not compensable, and then exercising it consistently across the state.

The financial downside of it is that in projects, particularly in large municipalities where we’ll be coming in and doing a similar kind of conversion to a state system, we could have some extreme costs if we consider all those types of installations compensable.

The most notable example right now is in the Lubbock District with our East-West Freeway. They’ve estimated that the cost of the required utility adjustments will be in the order of about $15 million, so making a policy decision to either recognize or not recognize this as a property interest does have some significant potential fiscal impacts.

It’s very difficult to try to characterize what those potential costs would be, because we most frequently find these facilities and the nature of the facilities on a case-by-case basis, when a project does go through and then we discover that, well, a main water trunk system or the sanitary sewer transmission facility is right down the middle of the existing roadway. And that would be the typical situation that we would encounter.

Conversely, the burden that we put on a local municipality to bear these costs has frequently prevented them from being able to even consider the project or a participation in the project. So we’ve got a basic dilemma. And really, we’re at the point of making a decision to change what our traditional approach has been to consideration of these as compensable interests or on the financial side of things, not bearing the additional cost.

I’ve tried to make a number of assumptions to characterize what the potential fiscal impact could be, and they are based on a number of assumptions, but currently eligible utilities represent about 10 percent of the total utilities that we relocate caused by our construction projects, and the cost of that 10 percent of eligible facilities has averaged about 20 million a year to TxDOT, state cost, for the past five years.

If we would assume that maybe one or two additional utilities on a project would, through this type of interpretation, become eligible, we’re probably looking at doubling the state cost yearly for utilities for these types of installations. So we would project somewhere between $15- and $20 million additional state funds expended for utility adjustments.

MR. LANEY: Additional or total?

MR. CAMPBELL: Additional. So we’d probably be more in the neighborhood of $40- to $50 million a year, state costs.

The upside to this, as I'd mentioned briefly at the beginning, is that FHWA does recognize these types of interests as compensable interests, and they would participate their proportional share, based upon the category of the project for reimbursing those state costs.

MR. LANEY: Which is how much percent?

MR. CAMPBELL: It’s typically going to be 80; it’s going to be 20 state, 80 federal.

MR. NICHOLS: But you think it would speed up right-of-way acquisition on some of these projects --

MR. CAMPBELL: Yes, sir.

MR. NICHOLS: -- in some of these areas. That’s the reason you’re considering it?

MR. CAMPBELL: Yes.

MR. NICHOLS: Must be a pretty dramatic problem in potential speedup if you’re talking about considering something like that.

MR. CAMPBELL: Well, what it does is it relieves those local municipalities that don’t have the financial wherewithal to accommodate the relocations that we require. It suddenly brings them to the table and able to get those facilities moved to a location that complies with our utility accommodation policy.

One of the additional consequences of confronting these things has been that we’ve had to make exceptions to the policy and allow utility facilities to remain in place against our utility accommodation policy which is, you know, you take repeated hits on the policy and then it becomes very difficult to maintain any sort of integrity.

And my early experience before the Department was as a utility construction contractor and as a utility design engineer, and I have a bias against putting utilities under highway facilities just because of all the inherent risks to the structures and so forth, and a fairly firm conviction that all utilities either leak or infiltrate or somehow or another negatively impact highway structures.

But that’s another consequence of having confronted these things and the local not being able to incur the cost is that we've had to make exceptions to allow some of these old, potentially leaky facilities to remain under a newly developed highway project.

MR. NICHOLS: Wes, have y'all formed an opinion?

MR. HEALD: No. We just wanted to lay it out today, I guess, and we’d be glad to come up with something. To add to it -- and I know Kirby and Mike can probably tell their own horror stories -- but, you know, all district engineers have this problem. And, you know, if you get into the bigger cities, you’ve got bigger waterlines, you’ve got bigger sewer lines, so it’s kind of proportionate to the size of the city.

You know, some of the difficulties, like, for instance, the old waterlines, many years ago were what they called cast iron pipe leaded joints, and they’ve been laying under there and they’ve been subjected to all the drying and shrinking and movement of the soil conditions. And then we go in there, and if we leave those under there -- in many cases, we’ve sort of had to, you know; a district engineer just kind of had to do this to get a project off dead center and make it happen. If you leave those under there, and then you put a vibratory rotor on top of it, trying to compact your road, well, you can imagine how you aggravate that situation.

It’s just the most undesirable thing in the world to be caught in a situation where the city cannot participate and you have to leave those utility lines under there.

John has pretty well stated it very well, but you know, there’s no secrets out there the way the cities network. Once we come up with a policy, we’re going to have to kind of stick to it. I would also tell you that the biggest successes we have, as far as keeping projects on schedule, is where we make that utility adjustment a part of the prime contract. And that is, in the past, those cities that have the funds, you know, they would actually transfer that money to us, and we would have it set up to where the prime contractor does that work. Actually, what he does is hire a sub that’s knowledgeable in utility construction. But that way, you put that responsibility on that prime contractor, and then he keeps that project on schedule, and consequently, doesn’t come back and sue you or come back and file a claim against the Department because the utilities are not out of the way in time.

So just one option would be that we pick up a cost share, like 50 percent, maybe, if the city would be willing to let us make that a part of the prime contract. I would assume that Mike and Kirby have their own ideas, you know, of what we might could lay out as a policy.

MR. NICHOLS: He’s certainly bringing up an area -- I’d like to see y'all come up with a consensus of what y'all think and then come up with a recommendation to us.

MR. PICKETT: One comment on this. One of the places we’re beginning to run into this is the trunk system. And I know -- and again, go to different districts and they have different specific examples. But on Highway 6, south of Waco, we were going through the little town of Riesel. Riesel does not have the money -- we were moving the road over -- and so effectively, they pretty well were bought, because they didn’t want the road in the first place. The road is meant to get people from Waco to Houston, and it really wasn’t going to benefit Riesel. So we finally did get that worked out, but it required some innovative interpretation of the thing, and it didn’t get finished until I left.

But even the feds kind of recognize this, because the one exception to not doing utilities was the interstate program. And to expedite that, interstates were covered, when we were doing interstate, 100 percent. And I think their idea was: Hey, if we don’t do this, it’s just going to drag out forever. So when we did the initial interstate construction 30 years ago, 20 years ago, or whatever, the utilities were just covered, period.

MR. LANEY: The concern I’ve got, a little bit, is the converse of that. And I agree with you there’s a way to expedite it and there’s a need, but there’s also, as you say, the networking. And then in any city who can afford to do it realizes they don’t have to, they're signing up for that program. And I sure think it’s important to somehow or other figure out what the policy is to keep them at the table, a little bit like the disadvantaged county stuff, or whatever.

MR. HEALD: Yes. We’re opening the door here, there’s no question about it.

Mike, have you got any thoughts?

MR. BEHRENS: Well, I’m thinking on your lines about those cities that will be looking, similar to the example that John cited. There’s got to be a way that we might even want to consider that cost in the ranking of the project, where on those particular projects where they don’t rank in a particular category and they’re looking for funding, say, out of strategic priority or something, that cost be included, and then we’d be looking for leverage to overcome some of that in those cases where we have a high dollar amount.

And I guess I’m like Kirby and Wes as far as the smaller towns and things like that are really where we have the most problems, and maybe we could come up with some kind of a different criteria.

MR. JOHNSON: Do we have the latitude of making policy conform to a population base?

MR. BEHRENS: That could be one criteria.

MR. PICKETT: I think the thing we almost have to do is -- as John mentioned earlier -- though, if we’re not consistent, whatever kind of rules we come up with, it’s going to kill us, because they do network, just as you mentioned.

MR. HEALD: And I don’t know, we’re probably not prepared to give you any numbers now, but we could probably furnish you some information on how many contractor claims we have as a result of, you know, them at least claiming that they were late starting because of the utilities not being adjusted. And obviously, we shouldn’t be letting jobs until the utilities are adjusted, but we can’t keep our program going if we don’t reach out there and take chances.

And then, you know, you talk about the small cities, and the situations I’ve had in a number of cases, to keep the cost down, well, they said, We’ll do it with our own people. Well, they may not have anything but a backhoe and three or four people. And it’s just delaying some of our projects just, obviously, much too long.

MR. LANEY: Well, I look forward, as I’m sure Robert and Johnny do, too, to a recommendation.

(General laughter.)

MR. HEALD: Don’t present a problem with a recommendation -- is that what you’re saying?

MR. JOHNSON: That’s the policy.

(General laughter.)

MR. HEALD: Thank you, John.

And do we have any of the air quality kind of questions?

MR. LANEY: I don’t know if Robert and Johnny know, we’re pulling those rules on speed limit in connection with air quality today because of some conceptual developments late yesterday afternoon. If you want to hear about it, I don’t know if Dianna and Carlos, do you want to ask them to do it or brief them independently. If you all can make it relatively brief.

I think in summary, the structure of the rule, as currently presented, needs a little more work, and I’ve asked that it be ready for our February meeting, but you all might go into a little more detail.

MR. LOPEZ: Sure. The way the rules are written right now –

MR. LANEY: Carlos, by the way, is head of our Environmental Department, and head of our sign team department, Dianna.

MS. NOBLE: We switched places last night.

MR. LOPEZ: Just for today. Walk a mile in my shoes.

(General laughter.)

MR. LOPEZ: My name is Carlos Lopez. I’m Director of the Traffic Operations Division.

The way the proposed rules are currently written put the onus on the MPOs to come to the Commission with a request for an environmental speed limit. In discussions late yesterday with Dianna and folks at TNRCC, the feeling is that that burden should be placed on TNRCC instead of the MPOs. The reason for that is that the TNRCC is actually approving the SIP, and the approval of that SIP may or may not coincide with what’s locally popular.

So TNRCC did not want to be viewed as abdicating the responsibility to the MPOs, and they feel like they ought to be the ones that ought to be submitting those requests. So because of that, the way the rules are written would not be actually how it would work in the real world.

MR. LANEY: Rather than a quick fix late yesterday afternoon, evening, overnight, we thought we might do it a little more carefully over the next 30 days.

Do y'all have any questions?

(No response.)

MR. LANEY: Anything else?

MR. HEALD: No, sir; that’s it.

MR. LANEY: Do you have anything?

(No response.)

MR. LANEY: I didn’t mention it in detail, but let me say now that public notice, containing all the items, was filed with the Secretary of State at 10:52 on January 18.

At this time, if there’s no further business, I’ll entertain a motion to adjourn.

MR. JOHNSON: So move.

MR. NICHOLS: Second.

MR. LANEY: We have a motion and a second. It is 8:17, and the meeting is adjourned. Thanks.

(Whereupon, at 8:17 a.m., the meeting was concluded.)

C E R T I F I C A T E

MEETING OF: Texas Transportation Commission Briefing Meeting

LOCATION: Austin, Texas

DATE: January 27, 2000

I do hereby certify that the foregoing pages, numbers 1 through 32, 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.

 _________________02/07/2000

(Transcriber) (Date)

On the Record Reporting, Inc.
3307 Northland, Suite 315
Austin, Texas 78731

 back to top

12:21 p.m. Tuesday, January 18, 2000 Special Meeting

COMMISSION MEMBERS:

DAVID M. LANEY, Chair
ROBERT L. NICHOLS
JOHN W. JOHNSON

DEPARTMENT STAFF:

CHARLES W. HEALD, Executive Director
HELEN HAVELKA, Executive Assistant, Engineering Operations

PROCEEDINGS

MR. LANEY: It's 12:21 p.m., January 18, and I'd like to call this special meeting of the Texas Transportation Commission to order. Public notice of the meeting containing all items of the agenda was filed with the Office of the Secretary of State at 10:15 a.m. on January 10.

Our agenda item this morning deals with the proposed adoption of administrative rules. Thomas, do you want to present them?

MR. BOHUSLAV: Good afternoon, Commissioners. My name is Thomas Bohuslav. I'm Director of the Construction Division. We just have this one item here. It's for proposed adoption.

Amendments are proposed to Sections 9.50 through 9.52 and Sections 9.54 through 9.59. These sections address our business opportunity programs. These sections are amended to comply with the new federal regulations for the DBE program contained in Title 49, C.F.R. Part 26, and clarify the relationship existing between federal regulations and HUB program requirements outlined in Government Code, Chapter 2161.

I'd just like to cover a few quick points on these rules. The department's policy in the past stated that the DBEs and HUBs shall have the maximum opportunity to participate in the performance of contracts. The policy now proposed replaces the word "maximum" with "an equal," so the statement reads, "DBEs and HUBs shall have an equal opportunity." This change conformed with the federal rules.

In addition, the goals process has been changed. In the past, DBE goals were based on a national goal of 10 percent. The new federal rules allow each agency to set their own goals based on availability with adjustments needed due to relevant evidence. The HUB goals are based on the General Services Commission's disparity studies.

One other point I'd like to make is the DBE certification requirements now include personal net worth certifications. A DBE firm owner may not have a personal net worth greater than $750,000, excluding their residence and value of the business being certified. This change was made to be in conformance with the new federal regulations.

Do you have any questions?

MR. LANEY: No questions? I would comment that we did discuss with the Attorney General's Office this morning some potential additions that I think we have passed on to Richard Monroe and his staff. I'd like for you all to consider in connection with a sort of a supplemental piece to this, relating to a race-neutral inclusion of small businesses. But you can take that up after we adopt.

MR. BOHUSLAV: Okay.

MR. LANEY: No questions. Can I have a motion?

MR. NICHOLS: So move we adopt this.

MR. LANEY: Second it. All in favor?

(A chorus of ayes.)

MR. LANEY: Thanks, Thomas.

MR. BOHUSLAV: Thank you, sir.

MR. LANEY: If there is no further business before the Commission, I'll entertain a motion to adjourn. This is our opportunity for public comment. Kirby, you want to make any comments?

MR. PICKETT: Not at this time.

MR. LANEY: Okay. At this time, it is now 12:24 p.m., and the meeting is adjourned. Thanks.

(Whereupon, at 12:24 p.m., the meeting was concluded.)

CERTIFICATE

MEETING OF: Texas Transportation Commission
LOCATION: Austin, Texas
DATE: January 18, 2000

I do hereby certify that the foregoing pages, numbers 1 through 6, 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.

01/21/2000
(Transcriber) (Date)
On the Record Reporting, Inc.
3307 Northland, Suite 315
Austin, Texas 78731

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Joint Briefing of the
TEXAS TRANSPORTATION COMMISSION
and
THE TEXAS NATURAL RESOURCE CONSERVATION COMMISSION

Room 201S, Building E
12100 Park 35 Circle
Austin, Texas

9:08 a.m. Thursday, January 20, 2000

TxDOT COMMISSION MEMBERS:

DAVID M. LANEY, Chair
ROBERT L. NICHOLS
JOHN W. JOHNSON

TxDOT STAFF:

CHARLES W. HEALD, Executive Director
 

TNRCC COMMISSION MEMBERS:

ROBERT J. HUSTON, Chair
RALPH MARQUEZ
JOHN M. BAKER

TNRCC STAFF:

JEFF SAITAS, Executive Director

PROCEEDINGS

MR. HUSTON: Good morning. I'd like to welcome everyone out to the offices of TNRCC this morning. The time is 9:08, and for the purposes of the TNRCC and our work in this joint work session with TxDOT, I'll have Duncan Norton read our caption.

MR. NORTON: This meeting is a joint work session for discussion between the Texas Transportation Commissioners of the Texas Department of Transportation, the Texas Natural Resource Conservation Commissioners and their respective staff. We've not posted this for any public testimony or comment except by invitation of the Commission.

And Item 1 is: Discussion of joint agency coordination of requirements under the Federal Clean Air Act, specifically issues associated with the State Implementation Plan and Transportation Conformity. I believe that's the way both the captions read for both agencies.

MR. HUSTON: Thank you, Duncan.

David, do you have some?

MR. LANEY: Thank you, Bob. I appreciate it. For the record, I just wanted to mention that notice of this meeting, for our purposes, was filed with the Secretary of State on January 12 at 9:10.

And aside from that formality, I just wanted to say I very much appreciate your hospitality in having us out here. This is a meeting, as far as we're concerned, the three of us and our agency, that I think bodes very well for sort of furthering already fairly significant cooperation between out two agencies. We are very much looking forward to this meeting, and hopefully to subsequent meetings.

It's hard to envision these kinds of meetings over time not having very significant dividends for our agency, for your agency, for our combined efforts, and for the state. And so we very much appreciate the opportunity. Thank you.

MR. HUSTON: Thanks, David. We echo those sentiments. This is important business we're about, and the continuing dialogue that goes on between our staffs is important. And I think it is appropriate that we escalate that dialog right up to the commissioners' level in our two organizations as we go about this important work.

Again, welcome everyone. We're very pleased that you came to join us this morning. We've got a relatively short agenda but a, I would suggest, powerful agenda. And having said that, we will move on to Item Number 1 which is a discussion of joint agency coordination requirements under the Federal Clean Air Act, specifically issues associated with the State Implementation Plan and Transportation Conformity.

Jeff, are you leading us off this morning, or Wes?

MR. HEALD: I believe I'm leading us off this morning, Mr. Chairman.

Good morning, Commissioners. My name is Wes Heald. I'm Executive Director of the Texas Department of Transportation. Over the years, Texas Department of Transportation and Texas Natural Resource Conservation Commission have largely worked independent of each other to accomplish primary goals, and for TxDOT that goal is providing safe transportation and mobility, and for TNRCC it's to protect the environment. Today, staffs from both agencies are here to brief you on areas on which we are working together.

Mr. Norton has already introduced our first agenda item. The Clean Air Act and Federal Surface Transportation laws have linked state and regional transportation planning and transportation project approval processes to the attainment of federal air-quality standards. Tougher air standards are meant to protect public health; they also mean we need to make bigger and better strides toward cleaning the air while meeting transportation goals of safety, accessibility, and mobility.

Providing information and briefing you this morning about this item, we have several presenters, including: Jeff Saitas, the Executive Director of TNRCC; Al Luedecke, Director of TxDOT Transportation Planning and Programming Division; Tonia Ramirez from TxDOT's Legislative Affairs Office; and Dianna Noble, Director of TxDOT's Environmental Affairs Division -- in that order. And I would remind each speaker to give their name for the record as they make their presentation, starting with Jeff.

MR. SAITAS: Welcome Commissioners. We're very glad to have you here, and it's quite refreshing to have this kind of a forum, being the first of its kind. Wes has been kind enough to go to breakfast together for the past six or eight months now, once a month, to try and improve the coordination that we are doing on some of these important issues we're facing.

I would offer for today that this is just a beginning, and it's a beginning mainly for a very large reason. As each of our agencies goes forward to carry out our specific agency missions, there are times that we don't keep front and foremost that we really do work for the state and it's really the state's interests that we also need to be focused on, and the state's interests are much broader and much more varied than the interests of our individual agencies.

In this particular case today, much of the presentation will focus on that the state's interests are not only having clean air, clean water, and safe land, but moving our people from one place to another, having things accessible, and doing so in a very safe manner, and that the state expects us to do all of those things and do them in the most efficient manner possible.

As Mr. Heald has said, we have not been doing the best that we could have been doing in terms of cooperating on those issues, and that's going to change, starting with today.

What I'm going to do in my presentation is going to start with really the fundamentals of the Federal Clean Air Act and then very quickly take it to where we are today. I will talk briefly about the plans that you've been hearing about to clean up the air in our major metropolitan areas, some of the challenges that we face in areas that don't violate the federal air-quality standards but might, and then I'll touch on what some of the consequences are if we don't.

At the end of my presentation, I'll turn it over to Mr. Luedecke from the Texas Department of Transportation, who will go into much more detail. So that's how I'm going to frame my comments for you today.

It all starts with the Federal Clean Air Act which is a 1990 federal law that set out some pretty broad guidelines that have an enormous impact on how we do things in this country. In that Federal Clean Air Act, even though there are tens of thousands of compounds that exist, they really only created standards for six. And the six are ozone -- and let me talk about ozone for the purpose.

There's two things that are particularly unique about ozone. We will hear in the public discussion that ozone at very high altitudes is a very good thing and we have seen that by it forming a very protective layer very high up over the southern polar region to prevent harmful rays from impacting the public. So ozone at high levels is good.

Ozone at levels that we breathe, depending on the concentration and depending who is exposed, can be very harmful. It is that pollutant that we will be focusing on today.

In addition to that, there are five other pollutants: one of them is called nitrogen oxide; one of them is called sulfur dioxide; one of them is called carbon monoxide. Those three particular pollutants, we are in this state in compliance in every part of the state.

The fifth pollutant is lead, and with the exception of Frisco -- which used to be a nonattainment area, but the local communities and stakeholders have gathered around and cleaned up that area and we're in the process of getting the federal government to recognize that now we are clean there, that will then bring Texas in compliance with the fifth standard.

The last one is particulate matter, and with the exception of El Paso, the state is in compliance with the particulate matter standard. That is just the broad background.

Now, on ozone, ozone is a particularly difficult pollutant to manage, because it is the only pollutant that we have that doesn't come out of a tailpipe. It is created through a chemical reaction that occurs when two classes of compounds mix in the presence of heat and sunlight. Those two classes of compounds are what we call, in the business, volatile organic compounds. And to give it a form, when we fill out gas tanks and we breathe the vapors, that gasoline that is evaporating is one of many volatile organic compounds.

When those type of compounds mix with nitrogen oxide -- which is essentially a product of burning fossil fuels -- in the presence of sunlight, it will create ozone, which is three oxygen atoms combined into a single molecule. So for us to clean up the air, the ozone, we just can't go to an ozone stack and control it at a stack. You actually have to follow the signs back through the reaction to figure out which class we need to reduce to prevent it from forming the ozone. Very sophisticated, very difficult scientific problem to address.

We have found through that scientific advancement that we need to focus primarily on the nitrogen oxide side of the equation, and that's what you're going to see much of the discussion be focused on as we prepare plans to clean up the state.

Let me now touch very briefly on what are the types of sources that actually create these compounds that react to form ozone. In the case of volatile organic compounds, we have emissions of those compounds from many, many different types of sources that will range from our major business like chemical plants and refinery plants along the Gulf Coast, to small type sources like paint and body shops, to even smaller sources that you have in many of our homes, things like our lawn mowers when we fill them up with gasoline or some of the solvents we use at home to clean up our house.

And the final big category of emissions are what we call biogenics, in the business, and what that means is that much vegetation, in and of itself, creates organic compounds. For example, pine trees in the Piney Woods will give off a compound called pining, which is highly reactive in the presence of nitrogen oxide and sunlight and heat. That is one class.

The other class, nitrogen oxides -- as I mentioned, comes from the combustion of fossil fuels -- can come from sources and does come from sources that are industrial in nature like big boilers and heaters at petrochemicals and refineries, big electric generating units at the utilities; small sources like our water heaters sometimes in our home or the lawn mowers again; it also comes from automobiles. So it is the compounds and the sources, and particularly the automobiles, that we are going to focus on today.

Now, the emissions of automobiles are important from four different aspects. One is the technology in the car: what type of engine and combustion control technology do you have. And for that you have seen the federal government move forward with a new standard for cleaner engine technologies called Tier II; it was announced by the president over the holidays. You also see a program developed in California, where California crafted its own program to reduce emissions from the automobile sector.

The second key piece is the fuel that you put in the car, because certain fuels will cause higher emissions than others, so you'll see movement trying to make the fuel, that when put into automobiles, reduce emissions.

The third piece is how well the automobile is actually maintained, because we all know that no matter what technology you have on the car and what fuel you put in the car, no matter how good those two are, it won't make much difference if the car is not maintained and not running according to specifications and not running cleanly. So you will see efforts to move forward to make sure that we have cars inspected and maintained.

The last piece, which is going to touch heavily on what we do today, is the amount of miles we travel and how long our cars are running, because you can have the cleanest technology, the cleanest fuel, and a maintained car, but if it sits idling for a long period of time or you travel long distances for long hours, it will have a lot of emissions. So those are the four pieces, with the primary focus being on movement of our automobiles.

The one-hour standard, which is the one we are currently developing plans for in our major metropolitan areas, being Houston, Beaumont-Port Arthur, and Dallas-Fort Worth, is a standard which says: The concentration of ozone cannot exceed 125 parts per billion at a given point where it is measured more than three times in any three years. So that is the standard itself.

So the target we are shooting for is doing things that at the end of the day, that monitor that measures air quality will not measure ozone greater than 125 parts per billion more than three times in three years.

Now, the areas that currently do not meet, as I mentioned, Houston, they're an eight-county area; Beaumont-Port Arthur is a three-county area; and Dallas-Fort Worth is a four-county area. Separate and apart from the one-hour standard, the federal government, in July of 1997, came out with a new ozone standard. The underlying thought process behind that standard was that it is better to look at an average concentration in terms of the impact on health than a one-hour short-term reading. So they came up with an eight-hour average standard, and in doing so, they reduced the standard to 85 parts per billion.

Now, there's going to be more discussion later on about that standard and the challenges to that standard, but it becomes particularly important, because if the standard stands, then Austin and San Antonio will not meet it, because we have already measured the air quality that violates that proposed standard.

Let me touch very briefly on another standard that EPA developed at the same time as the eight-hour ozone standard, just for the purposes of putting it on the radar screen. It is a fine particulate matter standard, and the standard itself is defined as: Particles in the air of a size 2-1/2 microns or smaller.

Now, to give a physical representation of what that is, that is about one-thirtieth the diameter of a hair, so it is extremely small particles that we're talking about. The sources of those particles, again, predominantly are going to be combustion sources, which are the same categories we're talking about with respect to ozone: industry; utilities; small natural-gas-fired things, gasoline-fired things, including cars.

It is possible, although the data isn't completely in and validated yet -- it is possible that the area of Houston and Dallas may not meet the annual standard for fine particulate matter, so it is something we will have to watch and keep on our radar screens, because that issue will be evolving as we go forward.

Let me now move toward the plans. As I mentioned earlier, Houston, Dallas, and Beaumont-Port Arthur do not meet the federal air-quality standards, so we have to develop plans -- which we are in the process of doing -- to clean up the air and bring it back into compliance with the federal standard.

If I were to describe that in a nutshell, how it works, what we do is we go back in time and we pick a day, like in Houston, where we measured at a monitor the concentration of ozone in the air. And what we do is we say on that day or given days in time, what were the emissions in the Houston area at that time. If you can imagine how difficult that is, just driving through Houston trying to calculate and estimate everything that went on in that airshed on that day, and then match it with the meteorological information.

And the reason why we want to do that is because then we try to take a computer model and duplicate it. And that calibration mechanism is important, because that model is what is used for projection purposes in the SIP process. And let me tell you how that works.

Once you have calibrated that model, you then say: Here we are today in 1999; we know the emissions in Houston in 1999; we know that Houston is going to grow in the future; we know that the federal law says that we have to clean up Houston's air by November 15, 2007; we know, as I mentioned earlier, that the test for showing that you have cleaned it up is you have to have clean air for three years.

So whatever you do to clean up the air has to be on the ground in place by 2005, so that the summer of 2005 the air has been cleaned, the summer of 2006 it stays clean, the summer of 2007 it stays clean, then we go to the federal government and say the air in Houston is clean, we want to pull off that nonattainment designation tag.

So the way we try to do that is we say: The emissions were this in 1999; we're going to grown, so the emissions in 2007 will be bigger; we know we don't meet the standard today and if the emissions grow, we will be worse off in 2007.

So we take that inventory of all the sources of emissions, and then we start asking ourselves the question: Where are we going to cut; where are we going to start reducing the emission categories so that when we put that new inventory that has been reduced by strategies, when we put that into the model that has been calibrated, it predicts that in 2007 all of the area will not violate the standard and will have ozone at no higher than 125 parts per billion. That is what we call the State Implementation Plan process, and a big part of it is what we're going to talk about today.

Let me focus down a little bit more on the issues with respect to this particular meeting, and I want to focus on transportation and transportation conformity, but before I do that, let me just touch on general conformity.

Once you have a plan that says we're going to clean up the air and this is what the emission targets need to be, then things that occur and growth that occurs in the future has to conform with that general plan. Why that is important is because there are things that we know are on the horizon, big things that we know are on the horizon, that we have to account for in the planning process, things like Dallas-Fort Worth wants to build a terminal F at the DFW Airport. You may have heard that the Houston Port Authority wants to do a bay port expansion. That expansion would be an enormous amount of new container activity coming in, which would bring 7,000 18-wheelers a day, plus the associated rail, plus the associated barge and ship traffic.

All of that, when completed, will put new emissions into the atmosphere, and if those new emissions go in, something else has to go down, because at the end of the day, the total emission targets have to be met. That is general conformity.

The same concept applies to transportation conformity. We know that as we build roads -- we could look back in time, for those that have been in Austin when MoPac or 360 was built, there wasn't much traffic there, but today you could go and you will find a lot of traffic there. So as we expand, we know that in the future we grow, that we will have emissions associated with it.

So as you do that kind of planning process, you have to show that the transportation projects that we are going to contemplate and do will meet the targets that are set in the state plans to clean up the air.

How do we do that? Well, in the case of today, since we are in the process of developing plans for Houston, Dallas, and Beaumont, and since San Antonio and Austin are yet to be declared nonattainment, what we do is we look at a baseline of emissions, and the baseline has been picked to be 1990. And the reason it's 1990 is because that is when the Federal Clean Air Act amendments were passed and signed into law.

So the test that we're showing is: Will these new projects, when built, have total emissions less than the emissions that were there in 1990. So that is kind of the test for today. Now, in the future, once we have plans to clean up the air, the test will be: Will these projects in the future meet that plan. So that's kind of the situation and the process that we deal with.

Let me now move on to what happens if we don't. What happens if we don't prepare a plan? Either we don't prepare it at all, or the plan we prepared doesn't actually get the air cleaned, or the plan we prepared does show that it will be cleaned but it doesn't in fact implement it. If any of those situations occur, then the plan won't be approved, and there are consequences if the plan isn't approved.

The two most important consequences deal with economic activity and transportation. If we don't have a plan or it is disapproved by the federal government, then within 18 months, new businesses that would want to go and locate in an area that doesn't meet the air-quality standard would have to have twice as many reductions than the emissions the new business would cause. So they would have to go in that area and find somewhere else, somebody willing to stop doing something or reduce emissions in an amount double what they plan to do if they want to build.

And if you can think about that, what the impact would be on the economy of an area. When we're sitting in a global environment where people are looking at Southeast Asia, Europe, and Texas to build a plant, that is a unique factor to this country. So big issue, big consequence.

Equally big, if not bigger, is if we do not submit a plan, then within 24 months, federal funding for transportation projects is restricted, and y'all would know much better than I would what that impact means.

So those are the two big sanctions that would be imposed if we do not meet our commitment to develop and implement a bona fide plan to clean up the air. So that's the framework that we will be talking a lot about today with respect to these issues.

Let me touch on the consequence we call a transportation conformity lapse, and we are currently experiencing that in Houston. It's a situation where -- and it's likely to be an issue in San Antonio and Austin, as well -- if the transportation emissions and plans from future projects are not below that 1990 standard, and if, as expected, this summer EPA goes forward with designating Austin and San Antonio as nonattainment for the eight-hour standard, then there would be an immediate lapsing of the funding for certain transportation projects.

Now, Mr. Luedecke and presenters will talk a lot more about that later on in terms of how that process works, but what it does tell us is if that is a possibility in July, we need to be working together now to develop all of the information and proposals and plans so that we avoid that. And that is another key reason why we need to continue this working relationship and partnership so that we don't get in the situation where dollars are lapsed.

Now, the commissioners and members of our agencies are going to see a lot of questions asked, and they're already starting to be asked. And it's possible that you will see interests that will diverge on how transportation dollars are spent between those who live in attainment areas and those who live in nonattainment areas.

I was at a Senate hearing last week, and the question was asked: What happens if you can't spend the money in Houston; does the state still keep it; if so, can it be redirected to some other part of the state? So that dynamic is going to be coming forward, front and center, in the up-and-coming 12 months and certainly in the next legislative session.

With that, I think I've covered most of my topics that I was asked to introduce. Let me, at this point in time, turn it over to Mr. Al Luedecke who will bring forth much more information on the subject matters that I just very briefly touched upon. Thank you very much.

MR. LUEDECKE: Good morning, Commissioners. My name is Al Luedecke; I'm the Director of Transportation Planning and Programming for the Department of Transportation.

Federal legislation forever links the transportation community to air-quality issues. In this legislation, the playing field for achieving transportation mobility changed dramatically. Players are involved at all levels of government, as I will describe next, leading to critical, sensitive interdependencies. Not all the players are vested with the resources necessary to progress in this environment, and that's why our agency coordination becomes so important.

Federal regulations govern how, when, where, and why we must perform the elaborate tests of transportation conformity which is required for nonattainment areas to prove their transportation mobility plans contribute to cleaner air.

As most of you know, ours is one of the most robust economies in the country. One of the effects of that robust economy is the migration of people from the rural areas to the urban centers, and indeed, from outside Texas. As population increases in the urban centers, vehicle use or vehicle miles traveled increases. As a result, air-quality challenges are greater as we need to offset the effects of increased VMT within a limited geographical area.

When a local metropolitan area is in attainment, the planning and development process is fairly straightforward and consists of these four processes: Travel-demand modeling helps us determine the need; metropolitan transportation plan is the strategy of how to go ahead and address that need; the Transportation Improvement Program is the plan to accomplish those; and that leads, of course, to the Unified Transportation Plan, which is the document that funds and schedules the projects that we do.

Even when the metropolitan planning areas are in a nonattainment area, they must look ahead to be positioned to meet the transportation conformity requirements. Air-quality planning requirements include: an emissions inventory, which is a calculated total of emissions, by species, based on the total VMT modeled; a photochemical model which is a variable grid photochemical model that numerically simulates the effectiveness of emissions at vection, diffusion, chemistry, and surface removal process of pollutant concentrations within the three-dimensional grid; and finally, the state implementation plan which is, as Jeff pointed out, the state's air-quality plan, which is submitted to the governor, a designee to the EPA, to show that the state is fulfilling the requirements of the Clean Air Act.

Upon designation as a nonattainment area, the interrelationship of these competing requirements must be managed to achieve transportation conformity. The metropolitan area must now also consider air-quality planning requirements such as the state implementation plan, the chemical modeling, and the emissions inventories. The challenge is to bring all these activities together to achieve a common goal of efficient transportation in a clean-air environment.

And to complicate things, timing is everything. This diagram shows the multiple layers at different levels that have to be coordinated in order to make it work. An opportunity exists within both agencies to be very much involved. I'll take just a second to point out, in the very center, the TNRCC and the TxDOT logo is connected primarily with the MPOs in the metropolitan areas where our nonattainments are, to the MPO staff, to the various technical committees of the MPO, and of course our partners in the counties and cities, and the Federal Highway Administration, Federal Transit Administration. There is a tremendous opportunity for everyone to be involved in this process, and believe me, they are.

Experience demonstrates that transportation conformity adds a whole new layer of complexity to all of our work. Now you have the conformity submittal process which adds months to your planning cycle. In addition, public involvement increases because the air-quality issues need to be presented to the public with adequate time for their response and for your consideration.

Finally, the documentation, its sheer volume and formatting requirements, become exhaustive but unavoidable, due to the public nature of our work, and the constant concern of the various interest groups on all sides of the many issues.

In the Dallas-Fort Worth region, some local transportation control strategies that provide alternatives to single-occupancy vehicles have assisted in solving the air-quality problems. Local strategies include: high-occupancy vehicle lanes, or HOVs; rail or commuter rail and light rail; both intersection improvements and signal improvements. But when you look at their potential impacts to improve the air quality, they can provide only a part, small part, of the solution.

If you look at that chart, you'll note rail, which is a highly noted component of air-quality improvement. Look at the VOCs, if you took the full 108-mile total, applied the 5.9 pounds of reduction, that amounts to 637 pounds per day at a cost of around $5 billion.

As you can see on this next chart, the graph indicates that there is still a lot of local or national strategies that need to be included in order to demonstrate attainment. The chart there, the 126.9 for NO_x and the 43.8 is measured in tons, not pounds, and you can see the contribution in the lower part of each bar from the measures we've just discussed. The additional reductions, the green and the violet, I'll call it, are what's left to be done in other ways.

The following graphs and charts are examples of how the development of the MTP and the SIP -- Metropolitan Transportation Plan, and the SIP activities are coordinated to achieve required reductions in NO_x and VOC for the Dallas-Fort Worth region.

The 1990 model emissions level for conformity analysis were 306 tons of NO_x and 293 tons per day of VOC. For the moderate designation motor vehicle emissions budgets in November of '96, those numbers went to 165 tons for VOC, and we had a NO_x waiver at that time so it didn't apply.

When serious designation budgets came in in November of 1999, the conformity analysis, the budget for NO_x was 284 tons and the budget for VOC was 147 tons. Finally, for the attainment demonstration SIP in November 2007, based on transportation argument from Houston, the preliminary numbers at this time are 157 tons per day and 103 tons per day. The key here is that as population traffic is wanting to increase, economic development is increasing, the budget continues to decrease.

With all the previous information just presented to you, it should be obvious that we need a strategy for achieving transportation conformity. One of the biggest technical hurdles is the uncertainty of geographical boundaries of new nonattainment areas.

For instance, the near-nonattainment areas currently have a transportation planning process closely aligned with the metropolitan statistical areas. If they are designated nonattainment areas and the EPA favors nonattainment areas to be aligned with a consolidated metropolitan statistical areas -- which are quite often larger -- this adds to the complication on adequate local official representation and bringing them up to speed in the conformity process. No further information has been received from EPA yet on how they will rule on that.

TxDOT, TNRCC and the MPOs are working on institutional cooperation, such as an approach on the TDM and the emissions inventory. As an example of a successful mechanism for cooperation, we feel it's important to highlight the efforts of the Technical Working Group. This group has recently sponsored an air-quality training for technical and policy staff from across the state, and the training will be offered again in February of 2000.

This is a group of technical-level people at federal/state level that have been working for a number of years since we've been in nonattainment concerns, and this body of technical people constitutes the EPA's interagency consultation process for Texas.

We have created a strategy that addresses both emissions inventories and travel-demand modeling which are the two scientific components necessary to test for transportation conformity. The legislature approved funding under a rider in order to acquire resources necessary to develop inventories outside of on-road mobile sources. These other inventories include air sources, biogenic sources, point sources, and non-road mobile sources that Jeff has pointed out earlier.

Travel-demand modeling and mobile-source emissions inventories have to be completed for each of the four forecast years. This is because the regulatory intent is to keep the air clean throughout its foreseeable future and not just in one specific year on the books. The four forecast years we're considering now are 2005, 2007, 2015, and 2025.

Our goal is to complete as much work as possible now on the scientific foundation that will be necessary to test for conformity upon designation. We also recognize that boundaries of these actual areas to be designated remain unclear, so our strategy provides for some reasonably anticipated boundary in order not to leave any community at risk due to lack of preparedness.

This next series of slides depicts two distinct approaches being used. The first has to do with the fact that we traditionally do not have a travel-demand model for population centers of less than 50,000, so we need an alternative approach for the rural counties which may be designated as nonattainment. In these cases, we're applying an alternative methodology which has previously been accepted by TNRCC and Federal Highway Administration.

The second approach involves the use of travel-demand models within the MPO boundaries.

As you can see, this slide labeled Step 1, which represents our approach for counties such as Bastrop and Caldwell, we use existing TxDOT data to estimate on-road mobile emissions for the year 1990. The second step for the rural county areas is to develop what we forecast their on-road mobile emissions to be for each of the four forecast years. We then compare these forecasts to the estimates we developed for the year 1990. Each forecast is considered to pass if the test of its calculated emissions are less than those in 1990 by some non-zero amount. This is what Jeff referred to earlier.

The next slide series depicts the approach that we are using when we have the benefit of a travel-demand model. Similar to rural counties, it is necessary to establish a 1990 baseline on what your future emissions can be. We do this using TxDOT products from the model development process to establish a 1990 estimated emissions.

Again, similar to the rural counties, we must now develop forecast emissions for each of the four forecast years. In this case, because we have a model, we're able to apply MPO-derived data to develop traffic assignments. We're in the process of discussing with the MPOs how we need to work with them to have the '05, '07, and '15 models and inventories ready to go on a timely basis.

The modeling process continues, allowing us to estimate forecast emissions. We then compare these to the 1990 baseline to determine if our mix of projects is within the allowable thresholds for air-quality goals. If it is, then we begin the steps of finalizing documentation for both the rural and the metropolitan areas for submittal to TNRCC and the Federal Highway Administration. This is known as the conformity document.

If, however, the first time through, we find that the emissions exceed the 1990 limit, we must go back to the drawing board with the MPO and the TxDOT district. At issue will be how we change our proposed mix of projects in the various forecast years in order to come under the 1990 baseline. And this is the iterative process of work that leads our scheduled concerns.

Once this process is accomplished, the results are turned over to TNRCC, Federal Highway Administration, and, of course EPA, whose review will take 60 to 90 days. And I'll stop there and, I think, turn the presentation over to Tonia Ramirez.

MS. RAMIREZ: Good morning, Commissioners. My name is Tonia Ramirez, and I'm a legislative analyst for the Texas Department of Transportation Legislative Affairs Office. My part of the presentation is to give you a little sense of what we can and cannot do when an area enters a transportation conformity lapse.

Back in 1990 when the Clean Air Act was passed, and subsequent to that, the first nonattainment areas were designated for ozone under the one-hour standard, we had a lot more flexibility than we have today, and that's because three specific court cases have changed the transportation conformity regulations, and I'm going to go over those just briefly for you.

In 1990, when an area was designated as nonattainment, there was a one-year grace period upon designation during which time that area was not subject to the transportation conformity requirements. That grace period gave those regions time to develop their transportation plans and their air-quality plans simultaneously so that they could continue their mobility projects while they also developed their clean air plan.

In 1997, the Sierra Club filed suit against the EPA, and the court ruled in November of 1997 that the one-year grace period was invalid. And the effect of that is that when a new nonattainment area is designated -- as Jeff indicated is possible in the near future -- the requirements for transportation conformity will be immediate upon designation.

So the transportation conformity lapse will, therefore, be effective immediately upon designation, because those new nonattainment areas will not have their emissions plan in place to compare their transportation plans to and, therefore, determine conformity. We are pursuing the alternative tests, that both Al and Jeff described, to demonstrate conformity in the absence of an emissions budget for new nonattainment areas.

A second court case that has limited flexibility is a case brought by the Environmental Defense Fund, and the D.C. Circuit Court ruled on this case in March of 1999. The primary effect of this court case is the invalidation of a provision called grandfathering, and grandfathering was a practice whereby if a project had made it through the National Environmental Protection Act clearance process -- which is very intensive -- it could go on to letting.

The effect of the EDF court case is that the grandfathering provision was invalidated, which means that when an area enters an conformity lapse, only projects that have received a letter of authority from the Federal Highway Administration -- which is the next-to-last step before letting -- or if the project has received a full-funding grant agreement from the Federal Transit Administration and is a mobility project in which it adds capacity to the system, those projects can no longer go forward. Only the ones that have the full-funding agreement or the letter of authority can go forward during a conformity lapse.

And this basically limits the ability of the state to continue the major mobility projects, some of which will actually have air-quality beneficial results, during a conformity lapse. What we're left with is what's called the exempt list, which is primarily safety improvements, traffic signalization, rehabilitation, maintenance, that kind of thing, in a conformity-lapse situation.

The third court case that's important is a case that was brought by the American Trucking Association, and it was also a suit against EPA, and the target of that court case was the eight-hour ozone standard. And in May of last year the circuit court ruled that the ozone standard was remanded back to the EPA for lack of documentation supporting the standard. And what this has done is put a lot of uncertainty into the planning landscape for both air-quality improvements and transportation mobility.

The EPA is appealing this hearing, and it is likely to go before the Supreme Court before the issue of the eight-hour standard is resolved. As a result, the EPA has put on hold or has deferred some important activities that will give us a little bit more clarity in what we do to proceed with transportation conformity.

The first one that was mentioned is that the governor is not yet required to make the nonattainment area boundary recommendations, as was previously set to happen in July of 2000, and so we don't know for sure whether we're talking about the metropolitan statistical area or the greater area that would include more counties that Al described. So what we're having to do is go forward with our best professional estimates and try to minimize the impact in the absence of direct guidance from EPA.

Also, they have not issued new or revised conformity regulations for those nonattainment areas under the revised ozone standard because the ozone standard itself is in question. It is still possible that the EPA could designate the new nonattainment areas under the eight-hour standard this summer, but it is possible, also, that they could find some other mechanism to delay the impact of that. And we're waiting to hear from the EPA on what they're going to rule, and hopefully we'll hear that very soon.

Basically, what these three court cases have done has left the landscape for transportation conformity very uncertain, and our job as the Department of Transportation and as the TNRCC is to meet our mutual goals of air quality and mobility in the absence of this certain guidance from EPA, so we are taking a lot of educated guesses, but we are going to try to minimize the impact that the transportation conformity lapses that we anticipate will have on the areas.

The next slide shows what we anticipate could be the economic impact of a lengthy lapse in the major metropolitan areas in Texas. As you see, this was the information we presented when the two agencies went to Washington last summer to brief the Texas Congressional delegation.

At that time, we anticipated that it would take 34 months, using the iterative process that Al described, to demonstrate conformity in the new nonattainment areas of Austin, San Antonio, Tyler, and Longview. And as you can see, in each of those cases, there is significant transportation projects which would be affected by that lapse.

The bottom of the page shows the existing nonattainment areas, and they have their own schedule for meeting specific time lines, and they have some lapses that could come up with regard to their current state implementation plan. And as you can see, in those major metropolitan areas, the potential delay in transportation projects is significant. And there will be a ripple effect, also, in the fact that we're not allowed to proceed with our planning and right-of-way acquisition and other important aspects in the progress of a transportation project during a conformity lapse. So we'll see a ripple effect even after the conformity lapses have ended.

Some of the things that we've done as a joint agency is we have briefed the Texas Congressional delegation about this important issue; we have briefed the Senate Legislative staff; and we are providing individual briefings on this issue as we've been requested to. And we have worked with members of the Congressional delegation to try to restore some of the flexibility that was taken away by these court cases so that we can continue our mutual goals of continuing to meet the mobility needs of Texans while also doing our part, through the transportation conformity process, to minimize air-quality impacts.

And now I turn it back to Dianna.

MS. NOBLE: Good morning, Commissioners. For the record, my name is Dianna Noble and I'm the Director of Environmental Affairs for the Texas Department of Transportation.

This segment of the air-quality briefing follows presentations that discussed: the state implementation plan, its purposes and what is involved in its development; the link between transportation and the attainment of federal air-quality standards; the complexity of the transportation conformity process and the extent of the players involved in the process; and the challenges we face in achieving clean air and meeting transportation needs and the consequences in not achieving both.

As was mentioned earlier, the Texas Department of Transportation and the Texas Natural Resource Conservation Commission have traditionally worked largely independent of each other in striving to accomplish our individual agency primary goals; however, there are several things that prompted us to work together.

For TxDOT, in our mission to move people and goods safely, effectively, and efficiently, we also envision providing a transportation system that is also environmentally sensitive.

Specifically regarding air quality, federal regulations link state and regional transportation planning and transportation approval processes to the attainment of federal air-quality standards. We recognize and we support tougher air standards meant to protect the public health. In addition, tougher air standards mean we need to coordinate our efforts in order to make bigger and better strides in cleaning the air and yet meeting the transportation needs in the area of safety, accessibility, and mobility.

As part of my presentation, I will be providing to you an overview of objectives that staff of both agencies identified as a result of various issues. One is in dealing with the development of the state implementation plan, the development of transportation conformity, the development of metropolitan transportation plans and improvement programs, and in dealing with and interpreting the impacts resulting from lawsuits, and through working with and discussions with local governments, metropolitan planning organizations, and other interested and involved parties.

I'd like to point out at this time that staff developed these objectives toward achieving two over-arching goals: One is cleaning up the air through achieving air-quality standards; and the second one is addressing transportation needs by demonstrating transportation conformity and minimizing the impacts of a conformity lapse.

What I hope to achieve by describing these objectives to you are the following: I'd like to provide you with some examples of ongoing joint cooperative efforts; I hope to identify objectives needing both agencies to work cooperatively on; and I hope to generate ideas, comments, and direction from you.

The history of trying to clean up the air is a long one, and progress has been made. The Texas Natural Resource Conservation Commission and TxDOT must coordinate their activities to accomplish two major pieces of work in an effort to achieve established air-quality goals at the state level while providing needed transportation improvements. These work activities which compete for limited staff resources are the Comprehensive Plan for Achieving Attainment, which is the state implementation plan, and the transportation conformity process.

As I mentioned earlier, federal legislation links the two, thus necessitating that transportation plans established throughout Texas contribute to meeting specific goals for improving air quality. Again, a critical task is to develop a comprehensive plan for achieving attainment that is supported by state and local governments and all Texans.

I'd like to, at this time, give you a status of the development of those plans. Comprehensive plans are currently under development and consideration to significantly improve air quality in Texas' major metropolitan areas. Considerable efforts have been expended in developing projects and the right mix of projects to meet transportation conformity requirements, as well as meeting transportation goals. We are now dealing with more difficult and a more complex set of solutions.

The Dallas-Fort Worth and Houston-Galveston Comprehensive Plan involves substantial individual and public cost and significant lifestyle changes. In North Texas a steering committee was formed that developed a list of on-road and off-road control strategies for inclusion and consideration by the Texas Natural Resource Conservation Commission in the state implementation plan. Again, these strategies have statewide, local, and lifestyle implications.

A couple of the strategies that directly affect transportation include the following: a reduction in speed limits of five miles per hour, and a restriction on the use of heavy-duty construction equipment. Again, these proposals were recommended for the area by the North Texas Clean Air Steering Committee, a group of local officials and stakeholders. For your information, the plan for the Dallas-Fort Worth area is due to the U.S. EPA April 2000.

Similar strategies are being considered for the Houston-Galveston Comprehensive Plan, and like the Dallas-Fort Worth plan, have statewide, local, and lifestyle implications. In the Houston-Galveston plan, they too are considering the reduction in speed limits and the restrictions on the use of heavy-duty construction equipment. For your information, the plan for the Houston-Galveston area is due to the U.S. EPA by December 2000.

As a result of these strategies, for the reduction of speed limits, for example, TxDOT is proposing rule revisions to provide a method for reducing speed limits to address environmental issues that could be implemented in nonattainment areas such as Dallas-Fort Worth and Houston-Galveston. At this time, TxDOT is assessing the impact on the construction restrictions and will be providing the assessment to the Texas Natural Resource Conservation Commission.

However, if the construction restrictions remain in the state implementation plan, TxDOT will be revising construction specifications to address the construction restrictions as defined in the state implementation plan. If the construction strategy restrictions remain in the state implementation plan, these restrictions will become effective June 2001.

At this time, I would now like to describe for you the coordinated agency objectives that were developed by staff. There is a need to implement effective outreach. Public involvement is a major key in a successful program, especially for a program that would involve lifestyle and habit-changing type issues. We need to work together to expand each other's audiences in order to efficiently link those interested in, involved in, and affected by state implementation plans and transportation projects.

We need to accelerate the science, as was mentioned previously by Tonia and by Al Luedecke. We need to continue to work on the information and modeling needed to address the July 2000 eight-hour designations and to implement guidance as it is released by the Environmental Protection Agency.

Work is needed to move air-quality beneficial projects during a conformity lapse. We need to achieve flexibility in order to advance transportation-type projects during a conformity lapse that will help clean the air and meet transportation goals. Examples of these include intersection channelization projects, interchange reconfiguration projects, and one that was relayed to me by the North Central COG, which is freeway bottleneck removal.

We need to minimize procedural lapses. As described by Al Luedecke, we have been working with the near-nonattainment areas to prepare for the anticipated designations in July 2000 under the eight-hour standard.

As mentioned to you by Tonia, at the time that we had done the original estimates in the summer, we had estimated the July 2000 conformity lapse would last as long as 34 months; however, as a result of our cooperative efforts and our communication with the near-nonattainment areas, we are now estimating that lapse has been reduced to 18 months, and we will continue to work together to try to make that impact even less.

Again, as part of minimizing procedural conformity lapses, we need to communicate with each other, EPA, and the MPOs regarding the latest information on what's going to happen July 2000. And we also need to continue to communicate with each other, EPA, the MPOs regarding the related lawsuits, new lawsuits, and regulation interpretations.

In spite of our best coordinated efforts, it is difficult to anticipate a change in how regulations must be reinterpreted by EPA as a result of litigation. That is one of the primary causes of the current conformity lapse in the Houston-Galveston area. However, operationally speaking, Houston has managed to minimize their letting impact on their transportation projects greatly. However, work has been suspended on some transportation projects.

There's a need to evaluate new ways to reduce mobile emissions; for instance, evaluate alternative construction methodologies, technologies for retrofitting existing construction equipment, cleaner fuels, cleaner vehicles. There's a need to benchmark regional- and statewide-type options; for example, investigating the operational air-quality benefits associated with advanced management, translating that to be intelligent transportation systems.

There's a need to participate in the development of local control strategies for reducing emissions. Regional stakeholders, including both public and private sectors, must take an active role in developing an appropriate attainment strategy for their region. However, it is essential that both agencies be at the table and be present at the time, in order to provide technical assistance and recommendations.

There is work needed to regain transportation conformity flexibility. As described by Tonia, recent federal court decisions have taken away critical flexibility that the EPA had provided in terms of state implementation plan approval processes and transportation conformity regulations. We need to continue to educate on the expected impacts resulting from this lost flexibility.

At this time, I'd like to turn over the rest of the presentation to Mr. Saitas. Mr. Saitas will be describing to you additional objectives, as well as closing remarks, related to this item.

MR. SAITAS: Have you had enough yet, Commissioners?

(General laughter.)

MR. SAITAS: Clearly, the sense and the critical nature of the issues that we face are extremely important. I would like to really reiterate two things that Dianna had mentioned as being very important to progress.

One is both of our agencies have certain work groups that we have been dealing with and seek input from ever since probably we began as agencies. It is time now that we start to combine those work groups. Since we now have a combined goal, the work groups and stakeholders need to be pulled together as well. That will be a critically important thing for us to do as we move forward.

The second piece is more of an implementation thing, and that is the two agencies are going to formalize this work group in the name of a creating an interagency work group so that we can continue to progress on these issues, and at the appropriate time, bring those issues before you for guidance, direction, and approval.

The last thing I'll do in terms of closing remarks is I would offer that what you're seeing here is something new. The next generation of efficient government will come from the streamlining of the interfaces of our agencies, because we have been proceeding in our own way following our own missions, in a sense, oblivious to the missions that the other agencies have had.

We're going to move forward, not only with our agency missions, as mentioned earlier, but with the state's interest in mind. And I would offer that -- and actually in counter to a comment that was mentioned to me earlier this month by a business leader in an area of the state commenting on Houston. His words were that "Houston is dead." And I had to beg to differ with him very strongly.

What I said to him is: Call me in ten years, because I believe in ten years Houston will be a more vibrant economy, the air will be cleaner, because every time this state has been challenged with a difficult problem -- which is what we have -- we have found ways to rise and meet that challenge.

And I will tell you that today our agencies are prepared to move cooperatively, collectively, and in a unified manner to make sure that we do that in the timeline that was given to us.

I thank you for your patient attendance to this rather complex issue this morning.

MR. HEALD: I believe we would, at this time, field any questions that you might have -- or at least attempt to.

(General laughter.)

MR. HUSTON: I don't know what the term "attached at the hip" means to the rest of the folks in the room, but clearly our two agencies are, on this matter. This would probably be a good time to hand out the test on acronyms and diagrams. Oh, there's going to be an audience participation, too, on that, so --

(General laughter.)

MR. HUSTON: Speaking of audience participation, I notice that Senator Buster Brown has joined us this morning, Chairman of the Senate Natural Resources Committee. Senator Brown, we appreciate your attendance this morning.

Questions, gentlemen?

MR. LANEY: Bob, if you don't mind, can I start with a couple of comments?

MR. HUSTON: Absolutely.

MR. LANEY: First of all, Jeff and Wes and Al and Tonia and Dianna, that was a very articulate and insightful presentation, and I very much appreciate it. I know it was helpful. It may have been redundant for the three commissioners of TNRCC, but it was less redundant for us and very, very helpful. And it becomes a part of our vocabulary in a way it has not been in years past, in 2000 like it never has before, so it's important.

I share with you, Jeff, I think the ultimate underlying optimism that this is a challenge we can tackle. How we get there, I don't know, in all the bits and pieces and the directions we take, but it is extremely important from a transportation standpoint, from an economic opportunity and economic development standpoint, and every other quality-of-life element that we address that we do tackle it. And I know the quality of our staff and your staff, Bob, and the strength of the agencies working together can have a phenomenal impact.

So my compliments again for the presentation, and from the standpoint of TxDOT Commission, you have our entire support for an integrated exercise going forward. You can count on that.

Let me start with a couple of questions, if I may, Jeff, and I'll have some others, but let me start with a couple that occurred to me in connection with your presentation. You walked through the various elements of the challenges facing us, whether it's ozone or particulate matter or whatever. How do we deal with, or how do we figure into that complex equation and modeling process and conformity process issues that we have no real control over? And we may have none of those issues, but it occurs to me that there may be ozone or particulate matter issues, whether in El Paso or anywhere in the Lower Valley, that are not a product of industry or mobile sources in the state. How do we deal with that?

MR. SAITAS: Okay. To give by way of an example, Chairman, let's take El Paso. It's a very unique situation, not only in the state but certainly in the country. El Paso sits right next to another state; it shares a metropolitan with another state, New Mexico; it also shares with a major metropolitan across the river in Juárez.

The federal law actually had a special classification form, and actually it's called a Section 118 Waiver, and what it said was El Paso, but for the emissions that are coming from Juárez, would you be clean? So there's a different set of federal law, I would offer, in answer to your question, for El Paso.

But let's take a more telling example. Over a year and a half ago, you might remember, when smoke drifted into the state and it came from -- that was the first point in time that the public really understood that pollution travels, because they could see it and they could smell it.

Well, when that smoke came, a couple of things happened. We talked about ozone being created from the combustion of fossil fuels. Well, certainly when you burn forests and cropland, you create those same pollutants, and that's exactly what happened, and by the time it came here, in that smoke was also elevated readings of ozone.

And what we did is we petitioned to the federal government and said, You can't hold us accountable for things that are not within our control, things that, in fact, were generated in another country and we just happened to measure them here at our monitors. And we were successful in not being held accountable for those days that we tied to that.

So in answer to your question, I think there are some mechanisms that exist for things that are beyond our control. But I would offer "beyond our control" applies in another way as well. As we go forward with these plans, you've got to think of what are the emission sources.

Some of those sources are best addressed with local-type solutions; some are best addressed with state-type solutions; but there are others that are best addressed with federal-type solutions, things like standards for locomotives, standards for aircraft engines. Those things -- and there are a number of categories like that -- we, as a state, need to push the federal government and say: If the air is to be cleaned in this state, then we both have to do our share. We have to do the state measures and the local measures, but the federal government as well needs to hurry up and do the federal measures.

So I'd answer your question in those two types of ways with things that are kind of beyond our control.

MR. LANEY: One little follow-up, Jeff, and then I'll turn it over to the others. In terms of migration of pollution elements of one sort or another across the border, is there any interrelationship between our major metropolitan areas and the same sort of type of migration or transport of pollution?

MR. SAITAS: Absolutely. And in a way, it was fortunate that an unfortunate thing happened, and the unfortunate being the smoke coming in the state, the fortunate aspect is the public getting educated, because that's, in fact, what happens. We know, and the science shows that Houston impacts Beaumont; Beaumont impacts Houston; Houston impacts Dallas; Corpus Christi impacts San Antonio; San Antonio impacts Austin.

It's all connected which is why we have formulated a strategy to look at it as a region, and we've pushed hard, for the first time in the country, to get the federal government to recognize that we need to put all of these areas on the same time and do it all at the same time and manage it as a single-type effort.

Yes, in fact, the pollution does move, and we need to look at it that way, because, to give an example, we have a contract with Baylor University and it equips an airplane with very sophisticated monitoring equipment. There was a given day where the plane was flying along the northeast Texas-Louisiana border measuring the air quality coming into the state, and it was roughly in the 60 to 80 parts-per-billion range. And as that air mass moved over East Texas on this hot particular day, that ozone increased to 100 to 120 parts per billion -- remember the standard is 125 -- it increased to 100 to 120 parts per billion before it got to Dallas-Fort Worth.

So if the standard is at 125 and the air is coming in at 120, what chance does Dallas-Fort Worth have to clean the air? It doesn't. So you have to do two things: You have to reduce emissions locally, but you also have to reduce the concentration coming in, because it does move, Mr. Chairman.

MR. LANEY: I hate to take any more time with each question, but one follow-up on a similar question, and that is, Dianna, you mentioned that the North Texas plan for addressing these issues and the Houston plans were due in, one in April of 2000 and one in November of 2000 -- or December of 2000. When do we expect a response back from the EPA with respect to the acceptability or not of these plans?

MS. NOBLE: I believe Jeff might be able to answer that question better than I, but my understanding is that once it's submitted, we have a consultative agreement with EPA that allows for their review concurrently with Federal Highway, and I believe that that period is three to six months. Is that correct, Jeff?

MR. SAITAS: That's correct.

MR. LANEY: So will these plans begin to be implemented before we have a response from EPA, or do we wait?

MR. SAITAS: Well, we would hope -- the plans themselves are essentially, Chairman, a compilation of a number of rules, and some of those rules would have effect immediately and some would have effect sometime in the future. I would think that we would probably make those on an individual rule basis and not on a plan basis and say: Before we implement any rule, we're going to wait for approval from the EPA.

But let me add, we are working very closely with our Region VI EPA office. This is not something we're going to spring on them and say, We're done. This is something we have been consultating with them all along, and the relationship we're building is a relationship of: Listen, no surprises; if we're starting down the wrong path, don't wait till we get to the end to tell us it ain't going to work.

MR. LANEY: The counter-side to that is if we decide or if you conclude, or whoever the specialists conclude, that, in fact, speed limits in major metropolitan areas do have a material impact on these parts-per-billion standards, it makes no sense for us to wait for three to six months after December of 2000 to take action, if it can have an impact. So that's really the only question, and there may not be an answer yet, but we need some guidance on that.

MS. NOBLE: I would like to elaborate on that. That's one of the reasons one of the objectives developed by staff included the continued evaluation of emission-reduction strategies, the goal being that we continue to evaluate whether or not the current strategies are the most cost-effective and the most locally accepted. If not, we're hoping to develop strategies that could be replaced, potentially, during a mid-course correction, is my understanding, so that was why we included that strategy. In case we find that that is not an appropriate strategy, we need to look towards developing some other strategies to replace it with a more effective strategy.

MR. LANEY: Thank you.

MR. HUSTON: David, as a follow-up to that, I think that Jeff said the way that these various strategies are implemented is through a variety of methods. In the case of the TNRCC, it's in our rules; in the case of certain control strategies, there is potential state legislative action necessary; other strategies have to be undertaken at the federal level, and what we can do is push that process; others require local actions of one sort or another.

Even though we will be in a period of having no formally approved plan, there's little question about the fact that a lot of action has to be taken, and there's no incentive to wait, but there's a whole lot of timelines that will be going on and superimposed over one another as we all go through this process.

I'd like to follow up with sort of a capsule summary, if you would, of exactly where we are, locale by locale, on transportation conformity/lapse, with respect to the existing one-hour nonattainment areas, and assuming that EPA proceeds with eight-hour area designations in July -- which, as I understand it, is the last word we have, although we're trying to influence that.

Could we just tick down the areas and talk about calendar a little bit?

MS. NOBLE: I'll try to summarize that. At this time and since November 17, Houston-Galveston has been in a conformity lapse related to the requirement of them demonstrating transportation conformity to the NO_x emission budget that was submitted as part of the 9 percent rate-of-progress SIP. That work is still currently underway, and my understanding, through discussions with the Houston-Galveston area COG, is that they're hoping to have all the information available and submitted so that the conformity lapse is lifted February or March or April of 2000.

The next anticipated conformity lapse will come about with the July 2000 eight-hour designations, at least that's what we're anticipating, pending additional guidance from EPA. As described, that conformity lapse specifically directed towards San Antonio, Austin, and Tyler-Longview, we had anticipated that lapse to be 34 months, but again, as a result of the cooperative efforts and coordination between TxDOT, TNRCC, and the near-nonattainment areas, we're estimating that that lapse has been reduced to 18 months, and we will continue to work on minimizing that lapse.

MR. HUSTON: And that would be potentially Austin, San Antonio, Longview-Tyler.

MS. NOBLE: That's correct. And I believe -- my understanding is that Houston-Galveston, because of the fact that they are currently a nonattainment area under the one-hour standard, and the fact that the eight-hour designation will not change the area size, and the fact that Houston-Galveston has a one-hour emissions budget, that they, in essence, will have a very, very minimal transportation conformity lapse associated with that designation.

The situation in Dallas-Fort Worth is a little bit more complicated, because, as Jeff had mentioned, the one-hour designation currently covers a four-county area; the eight-hour designation could potentially cover an additional eight, increasing that to 12, which results in a donut-type situation. My understanding is that county judges and the local elected officials, in concert with the North Central Texas COG, have been working with the Environmental Protection Agency to come up with a method of addressing the fact that they still have not attained the one-hour designation and the potential implications by having a designation also on the eight-hour standard.

So at this time, I'm not really sure what, if any, transportation conformity lapse Dallas-Fort Worth may or may not experience as a result of the eight-hour designation.

MR. SAITAS: I can't add anything to that.

MR. LANEY: When will they have some better sense of the possible lapse?

MS. NOBLE: At a meeting in San Antonio, I believe it was last month, Gregg Cook had indicated at this meeting that Region VI EPA was working with and trying to get more direction from EPA in D.C., and that EPA Region VI is hoping to get together with the areas within their jurisdiction sometime in the spring to provide some guidance or some sense of what may or may not happen with the July 2000 designations in terms of what, if any, transportation conformity requirements will be or will not be required and what the implications may be with that designation.

So I don't anticipate anything further until the spring; however, as mentioned previously, we will continue to work on developing the science in terms of the emission budgets and the transportation-demand modeling that is needed, using coordinated efforts with TNRCC and working with the near-nonattainment areas, in order to minimize a conformity lapse if that happens to be the case with the designation.

DR. BAKER: There was mentioned a couple of times this morning about working with our Congressional delegation to achieve the loss of flexibility that we had lost through the lawsuits. Are we optimistic about that?

MS. RAMIREZ: Mr. Commissioner, there was a bill that was filed -- actually, there were two bills filed during the last session of the Congress that would restore some of the flexibility lost by these court cases. One bill in the Senate was sponsored by Missouri Senator Bond and made its way out of the committee; unfortunately, it was voted out on a strict party-line vote. And since it's an election year, I would predict that it would very difficult for members of Congress to vote for a bill that changes or amends the Clean Air Act. So the prognosis is not very good, but we're going to continue to educate the delegation about that.

On the House side, there is a bill that's similar to the Senate bill, but it hasn't had any action taken on it yet.

MR. NICHOLS: I have a question. On these models and the plans that are being put together that are based on the current one-hour standard and the current boundaries, I know you said on some of these we're going to have to presume the eight-hour standards, but it appears -- my question relates to, if we have to change the modeling if the standard does change this coming summer, based on the court cases, do we have adequate resources to do the modeling and then the subsequent plans to submit in a reasonable period of time?

MR. SAITAS: That is going to be an issue that we're going to address internally. Wes probably could address TxDOT, but that's an issue that we're going to review out through our LAR, the Legislative Appropriation Request process. I mean, certainly we've got to get a better feel as to what exactly the work load is, and we're going to know that pretty quickly, but that certainly is an issue that we're going to do through the appropriations process and that really starts to begin at the end of March, first of April.

So I don't have an answer yet to that, because we really haven't put the pencil to the paper yet, but there's a lot of work out there. And it's a lot of work not just for the state; it's a lot of work for the locals as well.

MR. HEALD: Al, why don't you address that also.

MR. LUEDECKE: As you can imagine, we've been taxed pretty heavily since the nonattainment issues of the Clean Air Act came about, and we've been working very closely with the districts and the MPOs. We've recently been granted some additional FTEs to take on this additional work. I'm not sure that it's enough at this time, but we are at full steam.

MR. HEALD: Well, what I was hoping you'd get into is -- the MPOs that are doing their own modeling and then the ones that we would have to do for them.

MR. LUEDECKE: Right now Houston and Dallas-Fort Worth have their own modeling staffs and are very competent at it. We work very closely with El Paso and the Beaumont-Port Arthur areas with our staff to help them get through these attainment features. San Antonio and Austin are large MPOs; they will bring staff on board. And they are, in fact, bringing staff on board now to present this issue. Of course, the Tyler area, we will be working closely with them like we do with the El Paso and Beaumont-Port Arthur areas.

MR. HEALD: I think I could say that it's highly likely that we're going to have to increase staff to be able to handle this.

MR. JOHNSON: One observation that I have deduced from this is we are at a junction of the three branches of government. Ms. Ramirez talked about the lawsuits that have a decision, and I assume some appeals. Obviously there are a number of other lawsuits. She mentioned legislation which is before both houses of the federal government, and we obviously have the EPA as a hugely significant player here.

My question, Jeff, is how do we determine whose cue do we follow?

MR. SAITAS: Well, the way the law sets up is it's the State of Texas' responsibility to develop that plan, and if we don't do it, the federal government will. So the way we're looking at it is the guidelines have been set out, it's our responsibility to create those plans, and we're going to do it, and we're going to do it on time, and it's going to be a plan that's based on sound science and it's going to show that it cleans the air, and that's what we're going to do.

MR. HUSTON: I don't want to get out too far ahead of what the TxDOT formal comments will be, but obviously we've been hearing a little bit about delaying the use of heavy construction equipment for certain morning hours. Share with us your thoughts about that a little bit.

MR. HEALD: Well, I'll be glad to, but I wish the Texas AGC was here to share theirs with you.

(General laughter.)

MR. HUSTON: They already have.

MR. HEALD: It's going to be very controversial, and there is, I understand, already public hearings being set up, and I'm sure they will be strongly against that, and that's basically about all I can say about it.

MR. LANEY: Let me follow up on the same question. Part of this is for you, Wes, and part, perhaps either for Dianna or Jeff. Whether it's heavy construction equipment and the emissions from that equipment or diesel, commercial diesel vehicles, how significant a contributor are those sources to the overall impact, particularly in the major metropolitan areas; and assuming that it is a significant contributor, if we did, in effect, close down the activities during certain morning hours, particularly in the summertime, what is the impact on a project?

And I know the projects are so different in terms of length and complexity, but can you give some sense to our brethren over here at TNRCC, Wes, of the impact in terms of the lengthening potential of an average-type project or any additional costs, et cetera?

MS. NOBLE: Looking at -- and we don't have that analysis quite developed, but these are the issues that have come up. For example, in the Dallas-Fort Worth area, by shifting the construction time by three hours, and after speaking with our district engineer there, one of the things he indicated to me was that there are some local restrictions on nighttime construction. Now, let's just take that as is for face value.

Realizing then that there could be a potential impact when work cannot be accomplished during three hours of the day, it has a potential then -- when we have a 12-hour standard work day -- of increasing potentially the completion of a transportation project by 25 percent that may result in additional construction costs that could be associated with nighttime construction because of the fact that there are some added issues that we have to deal with.

One of the most critical is the issues of safety related to workers' ability to maintain the attention they need during nighttime, and obviously -- as was experienced in Austin -- the ability of the drivers to recognize the fact that construction is occurring. We have not yet developed the actual cost benefit and the costs associated with that, but at face value there appears to be that there will be implications in terms of the ability for projects to be completed as well as the associated costs.

In terms of the actual emission reduction strategies, I would like to at this point elaborate a little bit on how that specific strategy ended up being a recommendation by the North Texas Steering Committee, and this was discussions that I had with Michael Morris, as well as the county judges that were involved with that.

The Dallas-Fort Worth area was in a situation where they had done everything that they felt that they could that was less of an impact on terms of lifestyle and dramatic changes to how the community had worked, and that included developing a mix of projects. They started having to look at the strategies that would be and would require a little bit more pain, and they needed a certain amount of budgets that they started piecemealing and looking at different strategies that maybe on the whole didn't contribute a whole lot, but helped to achieve that discrepancy and that additional strategies that were needed.

In terms of the entire construction, that is what was described to me as: Maybe highway construction contributes a small part in terms of the emissions, but in terms of all the construction activity that could occur, that would provide, I believe it was, 6.4 tons per day. And I do not remember exactly how many tons they needed to make up in order to meet the emissions budgets necessary for that area.

And again, the reason that staff identified that continued effort to develop and look at emission strategies is related to some discussions that I have had with the Texas Associated General Contractors, as well as benchmarking -- if you remember, that was another item -- benchmarking with other states.

We were able to identify that, at least in the state of California, there seems to be a technology that was developed there in which existing construction equipment is retrofitted, and the analogy being that they felt that that type of control contributed the same reductions that would be associated by shifting the construction. And by the way, by shifting the construction it's not the emissions that are reduced, but it's what Jeff described as that peak period when that VOC is formed when ozone and NO_x get together and make the bad VOC. So it's shifting that in order for that chemical occurrence not to occur.

So what we are hoping to do is working with the AGC in assessing alternative construction methodologies that may or may not prove to be any more beneficial than the construction shift, but again, the goal being that if there is a strategy that can provide at least that much emission reductions or better, we hope to develop the science necessary to show that and to maybe make a midstream correction.

However, if that's not a case, the model as described to me by Michael Morris, does indicate that by shifting construction, they are able to gain that emissions reduction necessary to demonstrate conformity.

MR. HUSTON: Jeffrey.

MR. SAITAS: What Dianna said, to give some numbers to it -- remember I was talking about nitrogen oxide is one of the two components that creates ozone. In the Dallas-Fort Worth area, about 15 percent of the emissions in that area are from construction-type equipment. Now, that's not just highway construction; that's all construction -- just to give you an idea of the relative size of the pie.

Shifting the four-hour shift of heavy-duty, off-highway diesel equipment actually shifts the emissions of 16 tons a day, so it's a big shift. Now, Dianna made the point it doesn't come out of the air, but it's shifting it. And what that does is it actually takes away its ability to react with VOC in the heat of the day to create ozone. So that's what you're doing is you're trying to reduce the ozone by shifting the emissions and not giving it time to react.

Having said that, what we're hoping happens through this comment period of these rules is that we all stay focused on what the end result is. The end result is a plan that cleans the air. And if there is some other way that we can get there that makes better sense economically, does not impact lifestyles, maybe it's technologically based -- if there's a better way to get there, we need people with the ideas that are out in the regulated community, that are out in the public, that are out in our institutions of higher learning to come forward and say: Listen, there's a better way to do it, and we can get the same import or better, and this is the way to do it.

We're hoping that some of these less-attractive options will end up being replaced with more-attractive options, and we still have a bona fide plan to clean up the air on time.

MR. HEALD: I might add to that, you know, I don't have any numbers to give you, but we're doing quite a bit of nighttime work now. And we're encouraging all of our district engineers to look at nighttime work and begin to use that whenever there's lane closures and such as that involved during these peak periods.

So I would say we're having a lot of success. Philosophically, we'll have to keep working that direction probably whether or not we've got an air-quality problem or not. It's going to take some time to get buy in; it will probably cost us some money, and probably the extra money will be worth the effort.

MR. MARQUEZ: Jeff, I believe these rules that we've proposed with regards to the construction shift, we're soliciting comments also on what can be done; can that be phased in so that the ban itself would occur later but would allow construction to continue during the morning hours as long as newer, cleaner equipment is being used which is less polluting. So that essentially would create an incentive then for builders, construction companies to get cleaner equipment so that they can work during the morning hours for a while.

So that would be an intermediate step, and I think we're soliciting comments on that type of approach and see what benefit it could produce.

MR. HEALD: And I would say that we understand that, and TxDOT understands that we'll be paying for that, and that nothing but good will come out of that program.

MR. HUSTON: Both Jeff and Ralph have made the point, but we simply cannot say it often enough. This needs to be a collaborative process of everybody that's affected, and I'm trying to think of somebody that isn't; therefore, everyone needs to be and stay engaged in this process. To call some of the measures that have been proposed in the major metropolitan plans unpopular would be generous.

(General laughter.)

MR. HUSTON: We need ideas, we need replacements. We are quite willing, as Jeff says, and anxious, in fact, to hear about what the alternatives are. And the message that we have got to get out, loud and clear, is it's not going to be very productive if the comments at the public hearings that are scheduled starting in a few days and in the written comments are nothing much more than, I can't play for the following reasons; thank you very much.

That's nice to know but not very helpful in developing the plan and reaching the goal that Jeff says we must stay focused on. And the key is we've got to have replacement ideas; we've got to have different ways to go about it. And I guarantee you, there is no pride of authorship here at the TNRCC, no pride of authorship on this plan whatsoever.

We will take ideas and better strategies that reach this long-term objective in a heartbeat, and we would love to put those in our recommendation for the plan as it goes forward and is submitted to EPA by the governor. And we simply cannot say that often enough nor make that clear enough; it's just a must. We've got to have engagement, and we've got to have the ideas flowing.

As Dianna mentioned, I'm also very encouraged that there is a recognition now in this state implementation plan development process of the need for midpoint correction, the need to look back at this in the roughly 2003 time frame and revisit what have we accomplished so far; how are we getting there; what's working; what isn't working quite the best way we know; what has happened to the models; what's happened to our emission inventory.

This is not a constant; these things just don't stay in place from today and we don't have to look back on it again until 2007. So that's a very important part of this process as well.

I don't want to cut this dialog off. We do have another also very important agenda item, and I think we should at least start working toward concluding our discussion of this item, but if there are more questions or comments, please make them.

MR. LANEY: I've got one more question, Bob. And, Jeff, I'll raise this for you. As background -- you probably know this -- but one of the things we see, and have seen over the last four or five years in a way we never anticipated, is the increased volume of truck traffic in the state from outside the state, intrastate, and a lot of it is NAFTA driven, and the lion's share by far is on a handful of principal corridors, one being 35 which runs right through the center of San Antonio, Austin, Dallas, and Fort Worth; and then going east-west, Houston has its own share, needless to say.

There has been now, as of this month, and there was two or three years ago as well, a postponement of the authority of Mexican trucks to come into the state. I have assumed, but I don't know much about it, that there could be at least some difference in diesel technology on that side of the border versus on this side of the border.

If we are having our metropolitan areas, like the Dallas-Fort Worth area or Houston or whatever, basically throw everything they can into plans that are lifestyle-changing, painful exercises, and barely reach conformity, is there any risk that two years hence or five years hence when we've finally wrestled this thing to the ground and the curtain rises on the border and we see an enormous volume, potentially, of Mexican diesel-truck traffic moving north through these cities that we are, in effect, not anticipating something like that and it basically turns us around in the wrong way?

MR. SAITAS: Mr. Chairman, you're right on the mark, and I wouldn't limit it just to the truck traffic from Mexico. The fact of the matter is that as good as we want to try to guess what's going to happen in this state over the next eight, nine years, we might get part of it right, but to the extent we do visualize certain things, it's absolutely right.

I mean, if you start putting in a whole lot of truck traffic that are diesel on main thoroughfares in areas that are challenged, San Antonio and Austin, it's going to exacerbate the challenge. I mean, it will, but that's, again, predominantly a solution that needs to be driven at the federal level. That's where we need to take a state position. We need to say: Listen, on one hand you're telling us to clean up our air; on the other hand, the goal of the country is to increase trade. Well, we need to do both. We need to increase trade, and, oh, by the way, we've got to make sure that we still meet our clean-air goals. And we need to communicate that message very loudly so that when that curtain does rise, we don't find ourselves in a situation of having a plan that doesn't work anymore because we didn't anticipate this heavy flow of diesel vehicles.

MR. LANEY: Well, independent of Mexico, Jeff, as you probably know -- and Wes, correct me if I'm wrong -- we're seeing an annual increase to the tune of roughly 15 percent per year.

MR. HEALD: That's correct.

MR. LANEY: Which is a phenomenal increase, and we expect it to continue, and I assume that it's being cranked into the modeling exercise.

MR. SAITAS: Right. The growth estimates have been projected. Now, I don't know if the growth estimate was put at whatever, the 15 percent, or what the number actually is, but I know that's part of the whole analysis of trying to guess what the inventory is going to look like in eight years as you grow all of these things.

MR. MARQUEZ: I'd just like to make a statement, maybe since we're talking about closing this topic. I think we all understand the difficulty of the task we have with getting cleaner air in Texas, and at times it seems like it's mission impossible, and for a while I think many people thought that it would be an impossible task, that it would never get done.

Well, there are a couple of things that I believe are happening now that are extremely encouraging and that really change the landscape and the way that we look at things and we do things. One is that Texas does have the resolve to clean up the air. The second thing is something that I believe this agency realized just a very few short years back, that we alone cannot clean up the air in Texas; it would be impossible for us to try to do it.

If you look at what happened in the past, it was this agency issuing regulations and the federal government fighting us and the local officials fighting us. So it was a very divided situation that didn't let us get too far. What I see of the new move that we're looking at, we began with what I'd like to consider as the vertical-type cooperation. We knew that the federal government has a role to play; they have a number of rules and actions that they must develop to help clean up the air. We have our role. But then local communities and local governments have their role and the things that they can contribute.

So we began that vertical-cooperation approach between EPA, TNRCC, and local governments, and that has been extremely successful. We could not have gotten so far as we've gotten as of today if it had not been for that cooperation.

I believe that what we're seeing here today, it's the other part of the cooperation, the horizontal-type cooperation, where now we have state agencies really working together to achieve very similar goals. We're seeing that horizontal cooperation not only happening with state agencies, we see it happening with local governments, and right now there's a group of local officials that have been getting together from different nonattainment areas and near-nonattainment areas, and they're talking to each other and helping each other and exchanging ideas and looking for how they can plan together. So there's that horizontal integration at the local level.

The next one, and the one that I believe that has potential -- and may be happening to some degree but we need to keep pushing -- is integration at the federal level, integration and cooperation at the federal level. We talk about EPA and the Federal Highway Department working together. We are very interested in EPA and the FAA working together because of emissions from airplane engines, for example, and standards for new airplane engines. That can be a great help to some parts of Texas.

So we need to keep looking for every opportunity we have to work together to achieve common goals, but I think that that has been a shift, that is something that is new now that you have government at all levels, both vertically and horizontally, working together towards a common goal. And that makes me very optimistic that, like Jeff said, a few years from now we're going to look at Houston, we're going to look at Dallas, and we'll see they have grown, they're economically prosperous, and they have clean air.

MR. HUSTON: With that, thank you to staff for an excellent presentation of a very complex issue.

Now let's move on to Agenda Item Number 2.

MR. HEALD: Commissioners, again, we are going to change direction a little bit here and we're going to talk about recycling. Both the TNRCC and TxDOT have joined efforts to try to address some of our recycling problems, mostly in the area of compost and scrap tire usage.

We have some folks here today to brief you on these issues. Tom Weber, Kathey Ferland, and Linda Brookins from TNRCC will present our agencies' joint efforts to use compost on highway rights of way. Ms. Ferland manages Pollution Prevention and Industry Assistance in TNRCC's Office of Small Business and Environmental Assistance. Mr. Weber and Ms. Brookins work in the Water Quality Planning and Assessment in TNRCC's Technical Analysis Division.

And following that presentation, our recycling efforts turn to scrap tires, a very sensitive issue with the Texas Legislature.

TxDOT and TNRCC believe that interagency cooperation can lead to increased recycling; however, as related to scrap tires, in particular, the real solution will ultimately be market-driven, and that's an issue that both Jeff Saitas and I, in our many times testifying before the Texas Legislature, have stood together on. There's no real magic, one-solution formula for getting rid of scrap tires; it needs to be addressed on a very broad front. And we look at, to some degree, privatization, and to make sure that we support all efforts toward a market-driven approach, which is something beyond what our two agencies can accomplish alone.

Rebecca Davio, TxDOT Recycling Coordinator, and Anne Rhyne, who manages TNRCC's Registration and Reporting Section, will present the scrap tire issue. So I believe we're going to start off with Tom.

MR. WEBER: Good morning, Commissioners. My name is Tom Weber. I'm the manager of Water Quality Planning and Assessment Section here at the TNRCC.

Working together to protect and improve water quality with compost -- that's the subject that I'm going to briefly introduce here. We're pleased to have the opportunity to announce an innovative and groundbreaking new composting project that involves both of these agencies. TNRCC and TxDOT staff have been working closely together to design this project. We've had significant input from stakeholders, as well as the EPA. The EPA will be a primary source of funding for this project through a federal grant.

One of our goals today is to receive your suggestions and fine-tuning of this project before it's formally proposed to EPA this spring.

Everyone benefits. This collaborative project brings together our two agencies, also other agencies and stakeholders as well, to benefit the citizens of Texas and the state's environment. Other agencies include the state Water and Soil Conservation Board, the General Services Commission, and others.

We'll be addressing each of the listed benefits that you see here, in particular, as we describe this proposed project. Now, first I want to turn to look at how this project fits with the strategic approach that the agency has in improving water quality.

TNRCC uses a strategic approach to identify and correct water-quality problems, which we call a watershed management approach. A watershed is all the land that drains to a particular water body, whether it be a stream or a lake, an estuary, et cetera. The first step in this approach is to identify and prioritize water-quality problems that exist. This occurs through monitoring of those conditions.

One such watershed with a high-priority water-quality problem is the North Bosque River. This watershed in North Central Texas is the primary focus, but not the only watershed, that will be addressed by this project.

Working with affected parties in the watershed that has a problem, we study the sources of all the pollution; we then determine the capacity of the watershed to assimilate and absorb the pollutants from these various sources; then we develop an implementation strategy. This would reduce the overall load of pollutants to a level that will restore the water quality in the watershed.

One implementation effort that we have involves the presidential administration's Clean Water Action Plan. It's an initiative that EPA has underway throughout the nation. EPA is currently providing each state with an infusion of extra dollars to support the state efforts at nonpoint source water pollution controls. EPA and TNRCC share the goal of using these funds to implement nonpoint source controls in the watersheds that need to be restored and are not meeting the clean-water goals that both the state and the federal government share.

For these reasons, this joint-agency project -- which you're going to hear more about -- meets the goals of the Clean Water Action Plan, it directs public resources to a high-priority water quality problem, and would begin a major recycling effort in that region of the state.

With this introduction, I'm now going to turn this over to Ms. Kathey Ferland who is going to get into more of the particulars.

MS. FERLAND: Good morning. For the record, my name is Kathey Ferland and I'm the Manager of the Pollution Prevention and Industry Assistance Section at TNRCC.

As this slide indicates, one of the challenges faced by the state is that of dairy manure management practices affecting the water quality in the Bosque River watershed. It is estimated that 250,000 cubic yards of manure, or 15 percent of the statewide total, is generated in the Bosque watershed annually.

The application of this manure on farm fields has saturated much of the land's ability to absorb nutrients. As a result, these nutrients run off. This leads to increased bacteria and algae, which have harmed the Bosque River's ability to support a variety of uses such as recreation, fishing, wildlife, and drinking water.

The second challenge faced by the state is that of assuring roadside vegetation. Bare slopes result in erosion and increased runoff, as shown in this slide. It can be difficult to restore grass cover after road construction, especially if good quality topsoil with organic matter is not available. When vegetation is not quickly restored, costly corrective work and project delays can occur.

Fortunately, these two challenges, too much manure in one location and the need to restore roadside vegetation in others, can be addressed by a single solution: compost. Composting the manure serves several purposes. Pathogens are killed during the composting process and the volume is reduced by half. This results in a product that is more easily transported and is a valuable resource since it's a rich source of organic matter for the soil.

Studies have shown that compost use offers several benefits. It establishes roadside vegetation more quickly; reduces runoff and erosion significantly; and quadruples the soil's ability to hold water, thus reducing the need for irrigation. Bulk compost sells at a cost comparable to existing alternatives such as topsoil or topsoil-and-erosion control blankets.

TxDOT and TNRCC have been laying the foundation for this project for several years. In 1996, tests by the Texas Transportation Institute proved that compost can meet TxDOT standards for highway vegetation establishment. On the basis of this evidence, TxDOT adopted specifications for compost and compost-amended topsoil in highway vegetation projects in 1998. Since adoption of these specifications, TxDOT and TNRCC have conducted five successful compost demonstration projects.

This slide shows the before-and-after pictures at one demonstration project at a highway overpass near Big Spring, Texas. On the left you see compost being applied to the barren slope at a site that had repeatedly frustrated TxDOT efforts to establish vegetation since the road was built in 1968. Compost containing grass seed was applied in mid-May 1999, and by mid-June vegetation was growing on this steep slope, shown in the picture on the right.

It's time for implementation. TxDOT has begun to specify compost use in a few highway projects. This practice is catching on slowly as more TxDOT engineers become familiar with this new specification. The General Services Commission has expressed interest in offering compost on state purchasing contract for use by all interested agencies and local governments. Meanwhile, this summer, the TNRCC Watershed Management Project is scheduled to submit the watershed management plan for the Bosque.

All the pieces are in place now to foster compost market development, beginning with state agencies and local governments. TxDOT has provided leadership in this area and has prepared the way for other agencies by developing standard specifications and conducting the demonstrations I discussed.

At this time, I would like to turn it over to Linda Brookins, who will describe this proposed project in greater detail.

MS. BROOKINS: For the record, I am Linda Brookins, team leader of the Watershed Management Team in the Water Quality Planning and Assessment Section at TNRCC.

The proposed project overview - This project will use the state's purchasing power to create a market for manure-derived compost from the targeted watersheds. EPA has earmarked funds for TNRCC to use towards implementing solutions for nonpoint source pollution. TNRCC will provide a total of $2 million to TxDOT and General Services Commission as incentive payments to these and other state agencies and local government agencies that use compost from targeted watersheds.

In a rough calculation, we estimated that 51 road miles of revegetation could make use of the $2 million for transportation incentive dollars. The rest of the EPA funds will be used for technical assistance to compost producers and users.

Eligible TxDOT district offices for the

Bosque - Unfortunately, the yellow doesn't show up very well on this slide, but there might be a better picture in your handout for the district offices that will receive incentives for this project. The incentive payments and technical assistance provided to TxDOT will be designated for the seven TxDOT districts shown here which are within a 150-mile radius of the Bosque watershed.

The Fort Worth, Dallas, Brownwood, Wichita Falls, Waco, Abilene, and Austin Districts will be affected with this. These areas are close enough to the sources of composted manure that it will be economical for them to continue using this compost after the incentive payments are discontinued. Likewise, the TxDOT districts in a 150-mile radius around the Lake of the Pines watershed will be eligible for incentives for using compost derived from that watershed manure sources.

So the Bosque is the one centrally located near the Waco area. The districts that we're talking about here pretty much sweep around that area of the Bosque, up into the Dallas-Fort Worth area. The Lake of the Pines is the other targeted watershed we're talking about; we have not identified the affected districts here that can receive the incentives, because we're concentrating today, for our presentation purposes, on this area.

Proposed project incentives - TNRCC identifies livestock facilities that are within the targeted watersheds. TNRCC tracks manure derived from these sources and verifies which compost is eligible for the incentive payments. TxDOT area offices will specify the use of eligible compost and receive incentive payments through the TNRCC grant towards their transportation costs for using compost.

Highway construction is the largest governmental market for compost. TxDOT alone could potentially consume all the manure compost from the North Bosque watershed. However, this project seeks to expand all viable governmental markets for compost, so we will also work with the General Services Commission to make compost incentives and technical assistance available to all users of the state purchasing system.

Technical assistance is a very important component of this. A technical assistance consultant will provide support to compost producers and agencies to, one, assure that participating composters are equipped to produce compost that will consistently meet TxDOT specifications or other relevant specifications for compost; two, help TxDOT and other state and local government agencies incorporate compost into their vegetation and landscape management practices; help these agencies target the most cost-effective and beneficial uses of compost -- examples might include applications where there are poor or highly erodible soils and where irrigation costs can be reduced; and, finally, assure successful beneficial use of compost.

This means two things: that the users of the compost become satisfied long-term compost customers, and finally, that the use of the compost benefits water quality rather than harming it.

Assuring sustainability - It links composters to reliable markets. The technical assistance provider will help open the doors to compost markets in government and help the governments be wise about compost users. Identifies the best compost uses - The technical assistance program will help agencies find the uses of compost that are most likely to be worthwhile for the long term. It rewards only economical, sustainable uses.

As we have shown, this project will provide incentive payments only where agencies are using compost in cost-effective and beneficial ways, and only where they are within roughly 150-mile radius of the targeted sources of manure. In this way, the new governmental demand for compost will continue to draw manure from those sources after the incentives are discontinued.

Everyone benefits. There is a long list of parties that will benefit from this project, in addition to the environment. Citizens will benefit from better water quality, as manure and its nutrients are converted from water pollutants into soil-building compost. TNRCC will benefit from a timely implementation strategy to address the needs of high-priority watersheds. TxDOT will receive financial and technical assistance to expand the use of compost and improve roadside vegetation methods, and will receive help in growing a competitive composting industry to supply that practice.

Livestock producers will benefit from a more satisfactory solution to their long-term manure management needs in impaired watersheds. The compost industry will benefit from increased demand and visibility for its products, and participating state and local government agencies will benefit from improved landscape practices at a good price.

So, in summary, this proposed project helps solve important environmental challenges, particularly the water-quality challenges in some of our highest priority watersheds. It provides self-sustaining, market-driven solutions linking the buying power of government with a competitive composting industry, and it builds mutually beneficial public-private and interagency partnerships that accomplish both economic development and improvement of water quality and other natural resources.

That concludes our presentation, and at this time we're available for any questions or suggestions you might have to offer us.

DR. BAKER: Just a comment, Bob. I had the opportunity to attend one of the five demonstrations that Kathey talked about. I left here a little bit cynical, not really looking forward to the day -- matter of fact, that was the day that I happened to have met Commissioner Nichols up in the Dallas-Fort Worth area. But when I got there and saw the equipment that had been developed in the relatively recent years for delivering this product and applying it, and then the other thing that I was so impressed with that day was the entrepreneurial interest in the product. The one thing that seemed to be lacking was a market.

I'm excited about the prospect. I think when Jeff mentioned while ago that within ten years what his expectations for Houston air quality and the economy, I would guess that in ten years there's a real possibility that we will have found a use for most of that manure in that part of the state and there will be even interest enough that they be looking to municipal sources for that same sort of organic material.

MR. HUSTON: Obviously, we spent a lot of time this morning focusing on the air planning and the further development of the state implementation plan. We at the agency have another process going on on the water side of the ledger called the TMDL process, the determination of the total maximum daily load that would be allowable into a water body that is in some way impaired by our measures today and is not fully in compliance with water-quality standards.

I've made reference many times on many occasions that we should be looking at that water process, that TMDL process, very much like we do the SIP process on the air side, because it has all of the same fundamental pieces. We're not in compliance with an established standard; we need to do the complete analysis of the loading to the stream; we then need to develop and implement a set of strategies to reduce those emissions or those discharges in a way that will allow us to re-achieve the standard. It's exactly the same process.

Interestingly, we will be doing it on a couple of hundred stream segments that are in one or another, maybe for a single parameter, outside the bounds of our current water-quality standards.

Solutions, as have been described here, are very, very exciting when they go across a rather significant industrial segment of the Texas economy, that being our agricultural or livestock production, which exists in many parts of the state.

As John pointed out, making this a market-driven system is, of course, the key to long-term success. I was excited when Linda and her people and Tom started briefing me on the idea of redirecting some grant funds that have become available to kind of jump-start and incentivize the system in the -- as I understand it, the single area where it needs it, and that is in the transportation cost of getting the supply to the demand. If it works as well as it appears it could, the marketplace has an interesting way of resolving those differences over time.

And we're not talking about a big subsidy here. We're not talking about a big loser that you're throwing money at. We're just tweaking it in one single area where it just doesn't quite work out today cost-wise, but if you take that deficiency off the table, all of a sudden, it looks very, very good. And as John says, we're excited again about this cooperation that's going on, because one of the huge marketplaces could be, in fact, highway work, roadwork of all kinds.

MR. NICHOLS: I was going to echo some of what Dr. Baker also said. The demonstration project we attended, not only did it appear to be a very practical method, but it also was brought to our attention there were some actual advantages for the composting on some of these right of ways as opposed to the conventional method. The problem at the time was that our people specifying those are not aware -- which we discussed -- of those specifications and how they have to be geographically modified, but I think that's being refined. And the second thing were the contractors, the people who actually do this, really aren't there right now except in very limited number.

But I think it should be encouraged at our agency and our engineers may have an opportunity to have much greater exposure to it and be encouraged to look at that. And I was not aware of the incentive that the EPA had, and I think that will be a big help in getting over that hurdle, because I do think that once it is used and the exposure is there and more suppliers available, it would be a great long-term source or place to go with some of this stuff.

MR. LANEY: John, I didn't know you were there with Robert. I had visions of Robert, when he talked about this experiment, dressed in these big rubber boots and hanging onto that big hose for dear life.

And there have been a number of things that I envisioned over time bringing the two agencies, the two commissions and even commissioners together, but never in my wildest dreams did I think it would be manure.

(General laughter.)

MR. LANEY: It leaves me with a little trepidation to wonder what's next that's going to bring us together.

And I quizzed Robert on the program, as he understood it and so forth, and we've had a little discussion about it. I see no downside, only upside, and I think it is an absolutely terrific result. And I compliment you all for all your work on it, and I agree with Bob that if we can prime the pump from a market-driven standpoint, it's alive and well for a long time to come. I think it's terrific.

MR. HEALD: Commissioners, I might add, I guess for most of my career we've been doing our best to re-establish vegetative cover where we disturb the soil in road construction work, and we do that by jump-starting the re-establishment by using various products, seeding and sod and use of hay and fiber products. So I don't think this is going to be a major change, and I don't think it's going to take a lot of effort on our part.

I would assume that two million was two million a year, or was that just a one time two million? That's a joke.

(General laughter.)

MR. HEALD: I could see some worried looks. So we'll be glad to work on this, and I'm kind of excited about the prospects too, so I think the payoff will be large.

MR. HUSTON: There are so many parts of this that are beneficial; there are almost too many of them to number, but what this can do for us in some very complicated situations in certain watersheds throughout this state where there is a concentration of industry -- and it is an industry -- that has the effect of creating a large supply of this material, what that can do for us water quality-wise is going to be very, very significant, plus just the benefit that this has in the overall composting arena that we've got to continue to take steps in through time to continue to handle waste problems that we've got. And when you can do it and the market takes over, that's the win, that's the way it works finally.

David, you said you were worried about what might be next. Well, let's talk about tires for a while. I've noticed that Jeff Saitas has left the room. This has got to be Jeff's favorite legislative topic.

(General laughter.)

MS. RHYNE: Good morning. I'm Anne Rhyne. I'm the Manager of the Registration and Reporting Section of the Office of Permitting, Remediation and Registration. This is Rebecca Davio; she's with the General Services Division of TxDOT. And together we're going to present the Tires Report.

Right now she's passing out to you the Tires Report, and she's also handing out some samples of crumb rubber and shreds so that you can see what we're talking about, and you can see what tires look like when they go through a few stages of processing, but please don't throw them at us.

This report was required by TxDOT Rider 47 and TNRCC Rider 24 of House Bill 1, and it was due to the appropriate legislative committees on January 1. And if you look inside the front cover, you'll see which committees we delivered it to, to the chairs of those committees, the last week of December. It was also delivered to the governor, the lieutenant governor, the director of the Legislative Budget Board, Representative Kino Flores who originally sponsored it, Speaker of the House Laney, Senator Bernsen, and Representative Glaze.

It's available on the website; also located inside the front cover you can see that.

And I want to just briefly tell you what the rider says; it is very brief. It says that TxDOT and TNRCC will work together to coordinate efforts on acquisition and potential uses of crumb rubber and that we'll report to the legislature January 1 of each year.

Well, this first report was developed sort of as a baseline for all future reports. It shows a picture of the current situation of tires in Texas, date it was entered into the geographic information system, and maps were developed that this had not ever been done before. It was this assignment that brought us together, literally, to coordinate data and look at Texas overall, and see where the tires are, where the equipment is, where stockpiles are, where shreds are, where processors are. Previously, we had all this data in our databases, but it's never the same as when you see it across the state.

The format of the presentation is that, first, Rebecca will briefly discuss TxDOT's recycling program; then she'll go over the program history at TNRCC; she'll cover scrap tire supply in Texas; and then I'll pick up with equipment and uses, draw some conclusions, and then we'll cover the action plan. So right now I'll go ahead and turn it over to Rebecca.

MS. DAVIO: Good morning, Commissioners. My name is Rebecca Davio, and I'm the Recycling Coordinator at the Texas Department of Transportation.

What I'd like to do to try and give you a little bit of perspective about scrap tires and about what our agencies have been doing to try and deal with them is start out by giving you a little bit of background about TxDOT's recycling program.

TxDOT's recycling program was formally started in 1994, and we designed it to be a comprehensive statewide program, such that every single one of TxDOT's almost 14,000 employees all across the state could participate by recycling and by using recycled-content products, whether they work in an office or in the fleet or in road construction and maintenance.

And we've taken a number of major initiatives in the road construction arena. Those initiatives include conducting 25 research projects on how to use a wide variety of recycled materials in road construction, things like shingles and toilets and compost and scrap tires. From those research projects, we've done nine demonstration projects across the state, actually using those materials, getting that firsthand experience that's so essential.

And from just those nine demonstration projects, TxDOT has taken the most successful of those applications and developed specifications so that we can continue on and go to more full-scale implementation across the state.

Some of the ways that we have been trying to help develop the markets here and get the word out, both to the recycling industry but also to the road construction industry, is last year TxDOT designated 1999 the Year of the Recycled Roadway Materials. Every month we prepared a packet of information -- brief but comprehensive, hopefully, packet of information about a different recycled material that had great potential for use in road construction. The materials that you've heard about already, the compost, had a packet; scrap tires will have a packet. This information, again, goes to the road construction industry players as well as the recycling industry to try and help develop markets.

Another thing that we've done to try and make it easier to use recycled materials in road construction is we've developed a geographic information system that we have information that shows where the supply of recycled materials are available, where the processors of these materials are that have the capability and the willingness to make this material meet TxDOT's specifications, and we plan on sharing that information to all the interested players. Ultimately, the plan is to have that information on the web.

In using recycled materials at TxDOT, we've developed kind of a slogan and a campaign theme against which we measure everything, and that slogan is: "Using Recycled Materials in Road Construction Works." These materials are good quality, they're cost-effective, and they're good for the environment. That's a very high standard, but fortunately there's a lot of recycled materials that can meet that standard, including, in many instances, the use of scrap tires.

Now to give you a little bit of perspective about TNRCC's recycling efforts, and particularly their scrap tire program. Their scrap tire program was created by the legislature and it ran from 1992 to 1997. During that time, there was a fund, a waste tire recycling fund. That fund was made, in part, from a $2-per-tire fee that was collected, so every time you bought a new tire, you paid a $2 fee, and the majority of that money came to TNRCC.

Those funds were used to pay processors to collect tires and to clean up PEL sites. And PEL is Priority Enforcement List sites, and basically those are scrap tire dumps where people would just take their tires and dump them on the back 40 or some vacant property. And originally there were 960 sites that were identified, and TNRCC has used their funds to clean up 754 of those sites, so that's actually about 75 percent of the sites have been cleaned up.

The processor payments, the payments to the scrap tire processors to create shreds such as the ones -- actually a little larger then the ones that you have samples of -- those payments ended on December 31, 1997, and that was legislation that ended that program. The funds that were there to clean up the scrap tire dumps were totally depleted as of August of last year, and so basically TNRCC, the scrap tire functions that are left here at the agency are registration and reporting, so they would register scrap tire processors and require reports from them about the volume of tires and their uses.

Anne mentioned earlier that we had used our geographic information system to bring the data that they had in their databases to life, and basically this map is one of a series that you'll see here that we think communicate that tires are not a consistent statewide problem, that they are distributed by population. The rule of thumb is one tire per person per year, so you can see that the darker areas represent a higher concentration and that those areas coincide with our major metropolitan areas.

This map represents the annual, or the current generation of scrap tires. And this map represents more of the historical or the stockpiled scrap tires. The yellow dots on here represent stockpiles of scrap tire shreds, so those shreds were created during the previous waste tire fund period when the processors were paid to produce those shreds. Those shreds are, in theory, ready to find an end-use. And the size of the dots do indicate the size of the stockpiles, so as the dots get bigger, the stockpiles get bigger.

You'll notice that there are still the small red dots, and they are smaller. These are the locations of those scrap tire dumps, or the PEL sites, that I mentioned. So that gives you a sense of where the stockpiles of tires are located in the state, and now Anne is going to tell you a little bit about the tire processing equipment to deal with the stockpiled tire supply.

MS. RHYNE: Before I talk about equipment, I wanted to add an additional point to the TNRCC scrap tire program. The PEL fund that was depleted August 31, 1999, was actually an additional $9 million emergency fund that was appropriated from '97 to '98 to clean up the sites, because during the WTRF, the money was used to pay processors, and so now additional money was given separately to clean up the sites. And so the 960 sites were cleaned up through that fund.

Tire processing equipment, there are basically --

MR. LANEY: Let me ask you a quick question. When you say "cleaned up," were they eliminated?

MS. RHYNE: The sites were cleared.

There are five types of processing equipment. Balers compress usually 100 car tires into blocks; these blocks can be used as fencing or fill material. Splitter, cutter, or quartering machines, the law requires that before any tires can be landfilled, they have to split, cut, or quartered, you can't put a whole tire in a landfill.

Shredders, those are what you see in front of you; this cuts it into smaller pieces. Crumbers is fine crumb -- you may have a couple of samples of those out there, and then any other innovative equipment. An important thing to remember about equipment is the smaller the particle, the more expensive the process is to get it that way.

Here's a map of where the processing equipment is in Texas. See, we're being educated through this process of writing up this report as much as you are, because, again, this is the first time we're looking at it across the state. Processing equipment tends to be in areas where the largest generation of tires is. And as Rebecca mentioned earlier, a rule of thumb is that one tire is generated per person, so then tires usually equals population.

This map, along with the supply map that Rebecca showed earlier, and Attachment 7, a list of processing equipment that's in the report, all three of these together can be used by the two agencies and by the public to determine, for any particular generator or stockpile, what their options are. And so we can use these tools to help us help people do something with their tires.

Just to give you an idea of what it takes to operate or set up equipment, some of the things that need to be considered when trying to find an end-use for tires, a crumber needs a continuous supply of tires; same with tire-derived fuel, or TDF, that needs a continuous supply coming in. Tire equipment can be very expensive; a shredder can cost up to $250,000. So cost of equipment, cost of transportation, supply, ease of getting that supply to the processing -- all these I've mentioned earlier about supply and demand -- these are all things that need to be considered when depleting existing stockpiles.

Here are the end-uses from 1998 reported data, and this pie chart represents all the data that was reported to us. The red area, the largest area is tire-derived fuel, so you can see that 62 percent of the tires generated in Texas in 1998 that were recorded went to tire-derived fuel. Thirty percent, the yellow area, went to civil engineering, and this would be leachate-collection systems, septic systems, backfill, embankments. Four percent went to crumb rubber, and another 4 percent went to other uses, and other could be anything that people find an approved use of tires or compliant use; nothing that violates any of our rules.

MR. LANEY: In connection with tire-derived fuel, do the tires need to be processed?

MS. RHYNE: No.

MR. LANEY: Whole tires.

MS. RHYNE: I'll get into that. For tire-derived fuel, you can use whole or shredded, so it's the easiest way to use it; however, it's a very expensive setup to start with. Tire-derived fuel requires extensive plant modifications; and, therefore, it would require modifications to the air permit. It needs a continuous supply, but it emerges as a preferred, perhaps, use of tires, and it was the largest in 1998, so we must have something here.

Civil engineering - Examples of civil engineering uses are landfill, septic systems, LRPUT -- that stands for land reclamation projects using tires, and that's covered by our rules and that is something that we review and approve. People notify us of a LRPUT, and we look it over, and then we issue them a project number and they now have a LRPUT.

Embankments, erosion control -- crumb is used in asphalting products, and then any other -- that could be bales, playgrounds, die-cut products. Someone called a couple of weeks ago and wanted to build a house out of tires, so we get all kinds of "other" also. Each of these needs to be evaluated on a case-by-case basis.

Here are the highway end-use options, and the main point of this slide is that TxDOT has developed standards to address these uses of tires. And the numbers in parentheses is the specific TxDOT standard for that material, so shreds used in embankments need to conform to TxDOT Standard 132.

Now, on this next slide here, this again is the GIS, and what we've done here is it's more of a theoretical map, and I'll tell you what it means. The counties that are outlined in red are areas where active processors are located; those are the counties. Based on the data that they reported in 1998 -- and remembering that one person equals one tire per year for new generation -- based on what they reported, we put in a program -- or TxDOT did -- to expand the area, the colored area, to include the population around that processor; just saying, in theory, based on what you told us you do, if you continue to do that, you can serve this many people.

So just pick an area: purple. In the purple area, you see that there's two counties with processors. If those processors processed a million tires last year, then, in theory, they serve a million people for new generation. So the area around it is the area that includes a million people. The boundaries are not going to be exact; this is mainly to illustrate a point.

So those are the areas potentially served by processors today. Look at all the white. All the white area are areas that are not currently served; there are no processors in that area. So if you're going to see stockpiles of tires, to get them to any one of those processors, you're going to have to figure in transportation costs, which can be very high.

Now, this is the stockpiles overlaid on the last map. Remember the red dots are the whole tires and the yellow dots are the shreds. These are the remaining stockpiles; this is the 200-and-so that were not cleaned up under the PEL fund. Look where they are; now look back at the purple. If we expect the processors there to be able to potentially serve that area, then why are there so many stockpiles in the purple? Why is that?

Well, we've never been able to have the data to ask questions like this until we see this. Those are PEL sites, and perhaps they're there because in many instances there is no one there operating the site to pay a transporter to come pick them up. So see, it's clearly a market-driven business.

The processors must be getting their tires elsewhere, and unless their supply decreases, they're not going to drive around and clean up existing abandoned stockpiles for free or at their own expense. These are all questions that we need to ask ourselves as to why do these stockpiles stay there and why are they not cleaned up. Every situation is different, but until we see data like this, we really don't have the tools to ask ourselves any questions, and so that's why this can be very helpful.

Now, by the same discussion, you'd say, Well, how come there's no stockpiles in the green or the orange? Well, because that's where ERRI and Gibson are located, and they cleaned up many areas around them during the waste tire recycling fund.

Through the course of developing this project, TxDOT and TNRCC have already begun to share information. We've already learned about where the equipment is, and with many thanks to Rebecca Davio and Mary Wright Eyster, who pulled together the information for this report, were able to discuss what our options are and what is available to us within the programs.

We've identified four main tasks for the action plan. Number one, to maintain accurate data and disseminate data about stockpiles, processors and end-users. An example of that already that we've done is we put this report on the internet. We also want to link it to all current tables so that people can go in, click on this report, and then click further to find a list of transporters, and that helps people to help themselves more, when we put the information out there and make it available to them. That makes it imperative that we keep it updated and as accurate as possible.

Another example of this is, effective December 15, we transferred some tire functions to the regions, and so we have also made the data accessible to the regional offices through T-Net.

Number two, evaluate the end-use options to select uses that are economically viable, and a checklist was developed specifically for this report to help people do that themselves, and it's included as Attachment 9.

Number three, if we are to address this stockpile problem, we must identify a funding source outside of our agencies. Neither TxDOT nor TNRCC has any funding specifically designated to address tire sites.

And number four, TNRCC will take the lead in developing a plan to encourage increased use of TDF, and we've already begun to do this. We'll coordinate with industry, we'll look for training opportunities, we'll talk more with air permits, and we'll learn as much as we can about TDF so that when people call us, we can give that to them, the most accurate information.

TxDOT will take the lead in developing a plan to increase the use of tires in road construction. We're to report our progress back to the legislature January 1, 2001; however, because we've gained so much momentum for this report, and to maintain momentum, we've agreed to meet quarterly, staff of the two agencies, and we're going to provide a written status update on our progress on these action items to each other.

So that concludes the report, and Rebecca and I would be happy to answer any questions that you have.

MR. JOHNSON: You mentioned a house of tires. What is the status of that, and if it's been approved, where might one go visit?

(General laughter.)

MS. RHYNE: Okay. As I mentioned, December 15 we transferred some functions to the regions, and LRPUTs is one of them; Beneficial Reuse Projects is one of them. So they're currently talking to the region about that. We do have a list of items to consider -- actually cautionary items to consider when creating a beneficial use project, and so they're still working it out with the region on that one. I'd like to see it.

MR. MARQUEZ: They probably put the house on the road already.

MS. DAVIO: This wouldn't be the first house built out of tires.

MR. LANEY: Where is the first house?

MS. DAVIO: Dennis Weaver built his house out of tires. You can't see the tires; they come in and stucco.

MR. LANEY: It doesn't use whole tires.

MS. DAVIO: Doesn't use whole tires.

MR. HUSTON: First of all, I'd like to congratulate both of our staffs on this report. This is not only well done, but the content of it is substantial. There's a lot of stuff in here, and in grappling with one of Jeff Saitas' favorite topics -- at least it must be, because I remember very distinctly the first time I met Jeff Saitas about a year ago, and tires wasn't the first word he said; I think it was about the third.

It seems to me like this is a big materials management project is what this is. First of all, I think that the action plan is a pretty good one. I would make some recommendations that the staff consider focusing that action plan in the short term even a little bit more.

It seems to me we have two problems. If I read the numbers right, in '98 we only beneficially used about two-thirds of the generated amount, so we're falling behind, and I assume we're doing that every year. I think we've got to get that taken care of. I mean, I think our first focus should be on we've got to stop stockpiling, or at least get it down to a very small number, because if we don't, the solution to the cleanup just really snowballs. I mean, it really gets worse and worse and worse, and it happens fast.

It looks to me like, just based on a couple of pieces of information in here -- one of which is this '98 uses chart -- very clear where things are going now. And on the fuel side, when I couple that with another table -- I want to say it was Appendix 6 -- there's a built-in capacity in permitted sites to use a lot more of this for fuel without permitting one more site, without, I assume, investing one more capital dollar. I don't know that, but --

MR. SAITAS: I'm not sure about the investment. Some of those -- like for example, I think in New Braunfels, one of the facilities down there has the ability to -- at least permitted authorization to go and handle tires. I'm unsure whether they have actually expended the dollar value to actually construct a delivery system, because if you take it, they actually spend a couple hundred thousand dollars to deliver the tires in. And it's a scientific issue, because once that tire gets into a cement kiln, you've got to make sure it hits at the right point, it's got plenty of time to burn and combust and doesn't affect the product, so it's a fairly sophisticated issue.

But that's why we put that up there as a TDF action plan, because there is additional capacity up there, and maybe with some seed money to convince these people to go ahead and do that, we might be able to begin solving this shortfall of one-third of the tires.

The other side of it, though, I will tell you, having gone through personally on some of these projects that were originally authorized, there will be a lot of discussion in the public when the conversion is made from coal to tires. I mean, there's a concept of the tire is a waste product, and we're burning waste and that's bad.

The fact of the matter is when we did some studies, as you burn tires -- and it is cleaner than coal in many cases. So actually you have a double benefit here: You take care of a waste stream, and oh, by the way, you're making the air a little bit cleaner as well. But that's just another issue we'll have to deal with as we go forward with an action plan to increase that use.

MR. MARQUEZ: Jeff, talking about that issue, in talking to cement kilns about their air emissions, that they need to reduce the nitrogen oxide, many of them claim that by burning tires they reduce the actual emissions of NO_x, and it seems like we have a real win-win situation here where they may have a method of compliance that, while it might be more expensive to them to process more tires, it would reduce their cost of complying with the NO_x limits. We need to really be sure that that's happening, that it does provide a reduction in NO_x, and if so, we really need to get behind it.

MR. SAITAS: Actually, Commissioner, in the case of some of the Ellis County facilities, they're getting paid to take the tires.

MR. MARQUEZ: Right.

MR. SAITAS: So it's a revenue stream there, and in addition, it reduces emissions, and in addition, it gets rid of a waste stream, and it affects their bottom line, so it's a very attractive option for a lot of people.

MR. JOHNSON: Jeff, I might have misunderstood one of the things that you said, but talking about the emissions issues of tires. I think you said that in some instances it can be cleaner burning than coal. I assume by that that in some instances it is not.

MR. SAITAS: Well, what I meant by that is when you burn coal, there's a whole myriad of pollutants, and the bulk of them will go down, but there may be a pollutant or two that goes up slightly. I think that's what we found, and that's why I mentioned that. Because the constituents, the actual chemical constituents of coal aren't exactly the same as the constituents of a tire, so if there's a constituent that's in the tire, a certain metal that wasn't in the coal, then obviously that's going to be a new pollutant, and that's what I meant by that comment.

MR. LANEY: You mentioned cement kilns as users or potential users -- current and potential users. Is any coal-burning industry a potential user?

MR. SAITAS: Well, I will tell you, take for example we've seen big power utilities. Now, I remember going up nearby here to ALCOA; they have four big utility boilers, and I went to see them and talk to them about the possibility of them burning tires. What ends up happening in that big boiler when you put that tire in -- first of all, you can't put a whole tire in, you've got to put a much smaller piece for it to fluidize and burn. But there's a metal constituent of it and the problem that they saw is that that metal would melt and that slag would run down to the bottom of the boiler and actually plug up holes. So there's some technical issues there that they had to work through, and it never ended up to be a successful option for them.

So you can always ask the question if somebody burns coal, but there may be technical impediments to actually making it work.

MR. HUSTON: It just seems to me like this is an opportunity, and I know you're already focusing on that, and I'm just trying to beef that focus up.

The other side, the other big use in the civil engineering that it seems to me we should really take a more refined look at and what jumped out at me was the beneficial uses at a landfill. There are some uses of this material at a landfill for leachate and cover that, yes, we're disposing of these tires in the landfill, but we're doing it and benefiting the operation of the landfill along the way. And that seems to me to be an area that we should focus on on the other big component of the current use, and that is the civil applications.

If we could refine this, as we broadly prosecute this action plan, to really hone in on a couple of things like that -- and, you know, this is after spending 45 minutes with this report, so I've become the world expert, of course. Those are the two things that jumped out at me and I would strongly recommend that we focus on kind of tackling this problem in two stages.

One is eliminate the annual deficit, or all but eliminate it. There's always going to be a certain geographic component that it's just going to be a matter of proper disposal, because any marketplace you generate is probably going to be too far and the supply is not going to be large enough. There were big white areas on some of those maps; that's going to be always just a disposal management issue, I think.

But where there is a lot of supply and potential demand, if we can get to that first threshold and get their focus on a handful of actions that we could go put some muscle behind, maybe some dollars behind -- whatever it takes to properly incentivize that -- and get to the point to where we're eliminating the addition year after year after year of a problem that it's going to cost us potentially a lot of money to clean up.

And then round two of that will be work on the elimination of the stockpile, which is going to require an altogether different funding mechanism, I would think.

MR. SAITAS: Right. The major issue that led to the demise of the program is there was money paid to take whole tires, big piles of whole tires and make big piles of shreds, and that's what happened. A whole lot of money was paid for that. If there's any program that comes forward in the state, it has got to focus on the final disposition of that tire. It has to do that.

Now, the best of all worlds -- I know that Mr. Behrens and Mr. Heald and I share this -- is it would really be nice if we could make it a market-driven approach, because right now, you take Ellis County, you don't need a program for that one facility to burn over three million tires a year. You don't need that. I mean, that would be the ideal state if we can just get a whole slew of market options there and it drives it in and of itself and we don't need to have a government program to do that.

But there will be challenges, as the chairman said, in various parts of the state where it may not be effective with a market because of transportation issues, how to get the tires from one place to another.

MR. MARQUEZ: And, Rebecca, this is a great report, and it really takes some facts and makes it very clear, very visible, easy to understand. I guess the obvious question to me, though, is tires are not just a problem in Texas; they're a problem everywhere in all the states with large metropolitan areas, and it might be useful at some point to get a comparison of what the end-uses are in other states and how they have solved the problem, because I think it begs the question are we reinventing the wheel. You know, what's happening in other places.

MS. DAVIO: The end-uses for the U.S. as a whole, I believe, are fairly similar, both in proportion and in types of end-uses, to what we're doing in Texas.

MS. EYSTER: Actually, we saw an increase in the use of TDF between '96 and '98, whereas, nationwide the statistics that we saw from the Scrap Tire Management Council in Washington, D.C., were that there was actually a decrease in the use of TDF nationwide. And there are actually some tires-to-energy plants located in the northeast states.

But actually, the landfill uses in Texas from '96 to '98 actually decreased. We used over 41 percent of the tires in 1996 in landfill uses, because we had incentive programs; we actually offered a reduction in the tipping fees that the landfills were required to pay. And also, the mandate for recycling 100 percent of the tires before the processors could get paid went away when the program went away, so that's probably why that decreased to 20 percent of the use. However, it's still a pretty substantial use, and it appears to be a sustainable use.

MR. LANEY: Is there any concentration anywhere in the country of TDF users that have more need for a supply of tires than is available locally?

MS. EYSTER: Well, they all have their own supply to draw from, and actually, there are quite a few tires shipped out of Texas to different locations. Part of the problem is that, you know, you have to have a certain supply of tires in order to make some of the uses work, like TDF, and if you have to have them in a shredded form, you have to have some stockpiling to help that occur.

And when people speculatively stockpile the tires and then maybe their contract goes away and somebody else gets the contract, then you have to find some kind of substitute use. And there have been some problems, too, with the management of the stockpiles and some fires. There was one plant in, I believe it was, Illinois that actually caught fire that was stockpiling to burn for TDF.

We need all the uses, is the point, and some of them can be shipped out to other places, but we still need uses in state to minimize the transportation costs.

MR. HUSTON: Part of what causes me to say that we should try to reach the first threshold first, of handling the continuing supply on an annual basis, is because it is a continuing supply. That's a lot easier arrangement to make with the end-user when there is no question about the continuity of the supply. It isn't a big pile sitting out there that we know we've got to get rid of and then it's gone, it's a continuing supply.

And I think that getting to that point, number one, eliminates the growth of the stockpile issue, but also is a lot easier to handle -- or should be.

MS. DAVIO: There's also funds associated with the annual supply.

MS. EYSTER: Once there's a stockpile, there are usually no funds available to clean that stockpile up; whereas, there are funds to handle the existing continuous supply. Louisiana has a six-month limitation on the amount of tires that can be stockpiled at their facilities that have to process tires and get a stockpile to deliver it to an end-use, and that may be one solution.

In Texas, a company could stockpile as many as they want; they do have to put up financial assurance, and their storage methods have to be approved by TNRCC. So that's sort of a limitation, but maybe there could be some reasonable amount of tires that could be stockpiled, depending on what the nearby uses are.

MR. LANEY: So what do they do when they reach that six-month limitation?

MS. EYSTER: They can't bring in any more tires until they reduce their stockpile.

MR. HUSTON: Then they start showing up in all kinds of interesting places.

(General laughter.)

DR. BAKER: I was about to ask that question. Do we have any kind of indication of whether we have illegal dumping taking place? Is that a bigger problem today than it was?

MR. SAITAS: There is illegal dumping, Commissioner, occurring.

DR. BAKER: Is it on the increase?

MR. SAITAS: Well, in various parts of the state, you'll hear that it is. Some regions will say yes. Some will say, No, I'm not seeing anything more significant. I think it really would go toward what you're seeing on that chart.

DR. BAKER: I would guess.

MR. SAITAS: I will tell you that when the chairman and I visited with Mayor Ramirez, he made, very pointedly, remarks to me in El Paso, and he said he thought that tires were being dumped illegally and he wanted to address it through a local ordinance; and I think when we were testifying in Laredo, the Laredo officials were saying so as well. So I think it's characteristic of most things, and that's some parts of the state, yes; some parts, not as bad, not getting worse.

MR. HUSTON: Any other questions of staff?

(No response.)

MR. HUSTON: Thank you very much; very good presentation.

I think our only remaining agenda item is to talk briefly about the near-term future.

I, for one, have found this very beneficial. I think that there's obviously been a lot of things said today regarding the coordination and cooperation issues between our agencies. Jeff made a very correct remark earlier in the day when we were talking about the air matters. These are not agency issues that we're dealing with, these are state issues; they're state issues that then go beyond our state's boundaries.

We need to be keeping that focus. I know that we're trying to do that within the TNRCC, and I'm quite sure you're doing that also within TxDOT, to try to maintain the right viewpoint that we are after reaching good solutions to statewide issues. That's fundamental to our air-quality work, and that's why you see so much of what we're doing has a regional component to it. You cannot solve that problem by just looking into the Dallas-Fort Worth Metroplex; you cannot solve it by just looking at Harris County; you've got to look regionally in that issue.

There are all sorts of reasons why we should continue to improve the working relationship between our agencies, so long as we maintain that focus that we're out trying to solve state problems, not agency problems.

I'm encouraged to hear about the interagency work groups that are being set up. We've got to streamline the interfaces. I think somebody used that term. And that's obviously very important that we do that at the staff level where the work is occurring day in and day out, and the questions are being formulated in a way that are brought to our respective groups in providing our policy guidance and our decision making.

I would strongly recommend we think in terms of another meeting in the not very distant future. The clocks are ticking, certainly on the air matters; the water is right behind it, by the way. TMDLs are upon us, so we're making comments today, in fact, to proposed rule changes that have been promulgated by the EPA. We have a bit of a disagreement with some of those proposals, and we have so stated that we have a disagreement.

But the important part of our message back to the EPA on the TMDL rules is that we're not ignoring this problem; in fact, we're being very aggressive about this problem on a statewide basis, and the legislature supported that in the last appropriations.

And again, one more issue where many agencies are and need to stay involved on a cooperative basis, to look across the waterfront at solving water-quality problems that exist; it's not as simplistic as just throwing it into one box or another; it has to be looked at on a very broad watershed basis with all of the contributing components, some of which we touched on today in looking at future solutions.

A long-winded way of saying I think we should think strongly about having our staffs coordinate another meeting in the not very distant future.

MR. LANEY: Let me add to that. I agree, this has been very beneficial, very interesting. And I think we all scratched our heads, probably on both sides of the aisle here, when we started thinking about a joint meeting, because it was a little bit of a foreign concept. The closer we've gotten to it, the more interesting it is, and the fact that what's gone on here today has been as interesting and substantive as it has been leads me to agree totally.

This year, in particular, particularly from the standpoint of air quality, is a pivotal year with what's going on in the nonattainment and noncompliance areas, and I would -- even though on an ongoing basis perhaps less frequently is more the rule of the day -- this year, I think maybe a slightly more aggressive schedule of meeting could be beneficial to us -- and I hope to you. And on top of that, I would like, on behalf of our Commission, to invite you to join us at our headquarters at the Greer Building at the next meeting.

And I would propose that we not decide at this point, but I would certainly recommend to our staff, and to you all as well, that we look at a meeting sometime in the June or July period, if not slightly before, in anticipation of what may be developing about that time with respect to air-quality issues in Houston and north Texas, and just an update, as much as anything else, as we move forward into a fairly challenging and complex landscape for the second half of the year.

But I very much appreciate your hospitality. I know it's an enormous logistic exercise to pull this together with two staffs, two agencies, and so forth. It has been extremely beneficial, I think, from our standpoint. And I would certainly like to give our two other commissioners to say something; I've been sort of hogging the microphone; I know they have something, usually, to add.

(General laughter.)

MR. NICHOLS: Usually to add. I appreciate the hospitality also. It has been very informative. Different people have different pieces of the puzzle, and the more we can share that, the more it will come together. And as Commissioner Marquez said, I do sense out in the public, cities, counties, communities, MPOs, are working in a very positive framework to help resolve some of these air-quality issues.

I also want to say I've seen a lot of different explanations of this whole problem of air quality and the Clean Air Act, but the presentation or briefing that your staff put together was one of the best I've ever seen. It explained it to me very well on a step-by-step basis that I had not seen before. I look forward to the next meeting. Thank you.

MR. LANEY: Johnny, do you want to add anything?

MR. JOHNSON: I think probably what I'm going to have to say echoes much of what David and Robert have said. This has been a hugely informative session for me on many of these areas. I think you know a little, and you find out you need to know a lot, and this has taken some steps in that direction.

I'm also very impressed by the coordinated effort of these two departments. I think without efforts such as these, if you look at the challenges that lie ahead and you stand in awe of them, without the coordinated effort, we'll never get where we need to be.

And the other thing I think these two departments have that are going to make sure that this effort is successful is a great deal of resolve, and I'm deeply impressed by that.

There's been one strain, or one expression that has come through in some of the issues, and it's entrepreneurial spirit. And I think, whether we're talking about programs such as the composting, even the tire issue, but also when we're setting the rules for air, that we should never underestimate the entrepreneurial spirit of the people of this state and this nation, whether we're talking about changing work hours or the requirements that SUVs burn certain types of fuels or have certain types of engines. It's a remarkable ingredient that's hard to quantify, that is entrepreneurial spirit, but I don't think we should ever underestimate it.

MR. HUSTON: Any comments?

DR. BAKER: While I had thought that this would be the beginning of a relationship, I'm sort of surprised at how much we've worked together already, and that was really brought home today with some of the remarks that have been made.

We have challenges far too great for us to be wasting energy going separate directions; there's too much to be gained by working together in efficiency, so I'm really excited about what I have seen here today.

MR. HUSTON: Anything to add to your earlier remarks?

MR. MARQUEZ: I think it's enough, but I like something that Jim said, how much work has taken place between our respective staffs. They've really done a great amount of work putting things together; they can work together, they've demonstrated that. And I think it's great that we are endorsing that effort and promoting that effort and keeping that horizontal cooperation moving and expanding. Appreciate your coming here.

MR. HUSTON: David, I assume what we want to do is leave it to staff to sort of tell us what the proper timing is? I think they have an awfully good sense of it, but I think, like you, it's in the very late spring or early summer time frame when it will be appropriate for us to be doing this again.

MR. LANEY: I agree.

MR. HUSTON: Having said that, again, thanks for coming, and we look forward to coming to your house next time. And thanks to all the staff who prepared for today, and thanks for everybody's attention. And at 12:19, we will stand adjourned.

(Whereupon, at 12:19 p.m., the meeting was concluded.)

C E R T I F I C A T E

 MEETING OF: Texas Transportation Commission and Texas Natural Resource Conservation Commission

LOCATION: Austin, Texas

DATE: January 20, 2000

I do hereby certify that the foregoing pages, numbers 1 through 134, 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 and the Texas Natural Resource Conservation Commission.

__________01/31/2000
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