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Texas Department of Transportation Commission Meeting

Commission Room
Dewitt C. Greer Building
125 East 11th Street
Austin, Texas 78701-2483

9:00 a.m. Thursday, August 29, 2002

COMMISSION MEMBERS:

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

STAFF:

MICHAEL W. BEHRENS, Executive Director
RICHARD MONROE, General Counsel
HELEN HAVELKA, Executive Assistant to the Deputy Executive Director

PROCEEDINGS

MR. JOHNSON: Good morning. It is 9:55 a.m. and I would like to call this meeting of the Texas Transportation Commission to order. I would like to welcome you to our August meeting. It is a pleasure to have you here today.

I will note for the record that public notice of this meeting, containing all items of the agenda, was filed with the Office of the Secretary of State at 1:17 p.m. on August 21.

We certainly appreciate your patience with the delayed start of today's meeting, but we think this is a very historical day in terms of dealing with some of the transportation and mobility challenges that we have in this state, and we are certainly glad that you are here to take part in that and that you are patient with the commencement of our meeting.

As appropriate, I ask my fellow commissioners if they have any comments they would like to make, and Ric Williamson, do you have anything that you'd like to bring?

MR. WILLIAMSON: Mostly good morning to you, sir.

MR. JOHNSON: Robert Nichols, well done; your work on the Central Texas Turnpike area is appreciated by not only your fellow commissioners but by the citizens who will travel those roads.

MR. NICHOLS: Well, thanks, that's great. Do you want me to make some comments also?

MR. JOHNSON: Certainly.

MR. NICHOLS: I have some comments I would like to make myself. First of all, I'd like to welcome everybody and thank you for being here. I realize today we don't have a number of delegations, although there's a lot of important items in here.

One particularly important comment I'd like to make has to do with my administrative assistant Sallie Burk.

Would you come up here a second? I'm going to embarrass you one more time. We have a framed resolution for you on your retirement.

Whereas ‑‑ and I'm going to skip some of the whereases ‑‑ Sallie Burk has associated herself with the department for 34 years. She began her career with the department in 1968, construction records clerk, Belton area; held other positions with the department including assignments in Waco and Austin Districts; appointed 1990 executive assistant to the department's associate executive director; in '97 she began working with me ‑‑ that's probably the hardest one right there.

(General laughter.)

MR. NICHOLS: Earned a bachelor's degree in public administration, St. Edwards, graduating summa cum laude, 1992 ‑‑ very smart lady. Achieved recognition as a finalist 1990 Outstanding Women in Texas Government Program. Her husband ‑‑ I call him Buddy, this says Bernard, their children Brian and Linda have enriched the TxDOT family.

And whereas, she possesses unsurpassed loyalty to the department and a love for serving the people of Texas, be it resolved the Transportation Commission, observing the occasion of her retirement ‑‑ which is tomorrow; you have to work one more day ‑‑ hereby extends their appreciation and serious wishes for your service.

MS. BURK: Thank you. It means a great deal to me.

(Applause.)

MS. BURK: I feel very blessed to have spent 35 years with TxDOT, and when Mr. Nichols first came on board, his first goal was to visit all 25 districts, and it was a rare opportunity for me to meet a lot of people in TxDOT and also to see TxDOT through his eyes. And what I came to realize is that we have a common bond through the nature of our work that gives all of us a rare strength and a sense of family. I may be out of TxDOT but TxDOT won't be out of me.

(Applause and pause for photographs.)

MR. JOHNSON: Sallie, I want to thank you for your patience and understanding because I find it amazing that anybody who graduated summa cum laude could work for Robert Nichols for five years. Probably intellectually, on average, the two of you probably make a smart couple.

(General laughter.)

MR. JOHNSON: On a sadder note, I would like to take a moment to recognize the passing of former Highway Commissioner and Chairman Bob Dedman in Dallas. Bob served two terms on the commission from 1981 to 1985 and from 1987 to 1991. I think everybody at the department would like to extend their deepest sympathy to the Dedman family. He contributed much to this agency and to this state and to his community and each is a better place for his gifts of his time and talent and resources.

Before we begin with the business portion of our meeting, I would like to remind you that if anyone would want to address the commission, you should fill out a card at the registration desk in the lobby. To comment on an agenda item, we would ask that you fill out a yellow card, and if it is not an agenda item, we will take your comments during the open comment period at the end of the meeting, and for that we would ask that you fill out a blue card. And regardless of the color of the card, each speaker will be allowed three minutes.

I hasten to add also that one of the anticipated agenda items which was removed was our rules on Access Management. Governor Perry and Lieutenant Governor Ratliff and Senator Shapiro have called each of the commissioners and a number of the staff and presented some ideas and suggestions that we defer action on this very important matter, and we have determined that that's probably the best course of action.

We, at their encouragement, have suggested to the staff that the manual for the new Access Management rules be published as quickly as possible; it will be on the internet site, if it is not already up ‑‑ and we would encourage everyone who has an interest in the matter to either get a copy from the department or to get a copy off our website, and look at it, review it, determine if you think it needs some modifications, and we will conduct three regional hearings around the state, three regional sessions, whereby we ask for input from the stakeholders as to their opinion of what is in the manual. Those locations and times will be announced fairly soon.

After we receive that input, we will again review the manual which will be crux of the rules, and we anticipate that the final rules will be adopted later in the fall or early winter, perhaps at our November meeting. That's for your information. We think it's the prudent and appropriate step that we listen to all involved parties because I think that's a healthy part of the process.

We will begin the meeting with the approval of minutes of our commission meeting in July. Is there a motion to that effect?

MR. WILLIAMSON: So moved.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

Mike, I will turn the meeting over to you for the basic agenda items.

MR. BEHRENS: Thank you, Mr. Chairman.

I'd like to take this opportunity, before we get into the agenda, to recognize a group from Waco that district engineer Richard Skopik has brought in. It's his young engineers group, and if I could get you to stand and be recognized. Thank you for coming.

(Applause.)

MR. WILLIAMSON: Are they high school or college?

MR. BEHRENS: These are graduates; they are young engineers on the department's payroll.

MR. WILLIAMSON: Those kids are out of school?

MR. BEHRENS: We're just getting older.

(General laughter.)

MR. BEHRENS: Richard, thank you for coming, and I hope you will visit with us here in Austin, and you're welcome to tour around the building when we get through with this meeting and meet you.

We'll go to agenda item number 2 and that's Aviation. Dave Fulton has two minute orders: one on regular airport improvement projects, and then his recommendations of two members for the Aviation Advisory Committee.

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

Item 2(a) is a minute order containing a request for grant-funding approval for 27 airport improvement projects. The total estimated cost of all requests, as shown in Exhibit A, is approximately $8.9 million, $6.6- federal, $1.3- state, and approximately $1 million in local funding.

A public hearing was held on August 5 of this year; no comments were received. We would recommend approval of this minute order.

MR. JOHNSON: Any questions?

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. FULTON: Thank you. Item 2(b) is a minute order for the purpose of appointing two new members, Mr. Jim Schwertner and Mr. Gordon Richardson, to the Texas Aviation Advisory Committee for three-year terms to expire on August 31, 2005. Mr. Schwertner is here and would like to briefly address the commission.

MR. SCHWERTNER: Mr. Chairman and commissioners, it's quite an honor to be considered to be appointed on this committee. I've been in the cattle business and aviation all my adult life, and this is going to be a real thrill and a real challenge, and I look forward to helping aviators and the citizens of Texas.

MR. WILLIAMSON: Wait, don't leave. We're glad that you're serving the state. I want to be sure that you're aware that under current law we have limited resources within which to invest in aviation as part of our transportation system. It is my belief that the commission is going to ask the legislature for perhaps additional funding for aviation or perhaps more flexibility with our existing cash flow for aviation-related matters. Will you be comfortable journeying with us across the street and talking to the House and the Senate and the governor about why it's important?

MR. SCHWERTNER: Most definitely I will, and I think you'll have the support of the governor.

MR. WILLIAMSON: Thank you. Welcome, glad to have you aboard.

MR. NICHOLS: I'd like to say, first of all, thank you for being willing to serve, and you're going to have a lot of fun. The work and time and common business sense that you'll be able to apply, you'll see some real benefits from it.

MR. SCHWERTNER: I think I'll have a lot of fun. Thank you, sir. Look forward to it.

MR. JOHNSON: Is there a motion to that effect?

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. FULTON: One final comment. Mr. Richardson is in Maine and he expressed also his appreciation and interest in working with the commission and the division.

MR. WILLIAMSON: Well, just let all your board members know, Dave, we're going to be pretty aggressive.

MR. FULTON: Thank you very much, appreciate that.

MR. BEHRENS: We'll go to item 3, Public Transportation, Margot Massey.

MS. MASSEY: Good morning. I'm Margot Massey, director of Public Transportation.

The item for you today is a request for toll credits from the Midtown Management District in Houston. They have received a federal discretionary grant directly from the Federal Transit Administration to pursue pedestrian amenities in downtown Houston to complement the transit system operations in the downtown Houston area. They're requesting toll credits in the amount of 371,000-plus dollars to match those federal discretionary funds, and we recommend your approval.

MR. WILLIAMSON: Will any of these amenities assist their light rail efforts?

MS. MASSEY: They will assist both light rail and the existing bus services in downtown Houston.

MR. JOHNSON: Is there a motion?

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

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

MR. BEHRENS: We'll go to item 4, our Proposed Rules for Adoption, and our first one will be concerning donations, and Jennifer.

MS. SOLDANO: Good morning. I'm Jennifer Soldano, director of the Contract Services Office.

This minute order adopts amendments to Section 1.503 and 1.504 concerning donations. Transportation Code Section 201.206 authorizes the department to accept a donation, including realty, personal, money and materials or services. Government Code Section 575.003 provides that the board of a state agency must acknowledge a donation of $500 or more in an open meeting not later than the 90th day after the date the gift is accepted.

The amendments to this section clarify the acceptance of a donation to pay for the travel of an employee who will be speaking at a conference. Since the commission meets once a month and sometimes this travel is requested on short notice, the amendments provide that the commission may acknowledge the donation for travel not later than the 60th day after the travel has been accepted by the executive director.

Other amendments change the threshold for when a donation agreement is required. It was $250, it is now $1,500. An agreement was to be required, regardless of the amount, if the donation involves real estate or if it is necessary to warrant or indemnify the department as to ownership, prevent possible claims that could result from the use of the property, or document conditions of the gift. These amendments also add that relocation benefits, if any, must be included in the agreement.

We recommend approval.

MR. JOHNSON: Any questions?

MR. WILLIAMSON: Yes. What's an example of this?

MS. SOLDANO: Often we have a private entity, such as Joe's Barbecue, who would like a traffic light, and it may be warranted but we don't have the money for it yet, and so we say: Yes, you may get one but it's going to be a few years down the road. And Joe's Barbecue says: Well, we'd like to give you the money for the traffic light so you can put it in now. That's a very common donation.

MR. WILLIAMSON: I heard and read words about employee travel.

MS. SOLDANO: And the employee travel, our employees are experts in many fields and different conferences really like for us to come and speak because we are the experts in the field. For example, at a bridge conference they may want someone from Bridge to come talk about the latest bridge developments, and in order for that to happen, they offer to reimburse for travel, and it's actual cost.

MR. WILLIAMSON: Thank you.

MR. JOHNSON: Is there a motion?

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. BEHRENS: Item 4(a)(2) Proposed Rules for Adoption on our Conditional Grant Program, and Bob Eason will present that.

MR. EASON: Good morning. I'm Bob Eason, deputy director of Human Resources Division.

The rules for the Conditional Grant Program currently stipulate that a student maintain a grade point average of 2.5 GPA; what we are asking is that the director of Human Resources have the capability to evaluate a first semester freshman's grade point average and make a determination as to whether they can reasonably be expected to obtain a 2.5 if they're less than a 2.5 for the first semester. We currently had this past year four first semester freshmen that had GPAs of 1.5, 1.7, in that area, and under the current rules we continue those individuals for a second semester to see if they can possibly pull their grade point average up to an overall 2.5. The likelihood of being able to do that is somewhat remote.

What we would like to do is be able to evaluate a first semester freshman, see if they have the capability to pull a grade point average up that's less than the requirement, and if not, terminate their participation in the program. We had, like I said, four this past year. We would then be able to reinvest the money in an additional student or two, depending on what action we were required to take this time.

MR. JOHNSON: Yes, sir?

MR. WILLIAMSON: Yes or no, the express purpose of our Conditional Grant Program is to allow us to recruit minority and female engineering students and computer science and I think some other disciplines.

MR. EASON: Yes, sir.

MR. WILLIAMSON: The effect of adopting this rule will allow us to more aggressively recruit minority and female engineering students.

MR. EASON: Yes, sir, and to evaluate the ones that we currently have selected for their potential to continue in the program and be successful.

MR. WILLIAMSON: So the department is taking, with the passage of this rule, an aggressive step to continue to reach out to the minority and female population of our state and encourage them to study engineering and become part of TxDOT.

MR. EASON: Yes, sir, I believe so.

MR. WILLIAMSON: Mr. Simmons, please be certain to have this transcript clearly typed out and please provide a copy of this transcript to Senator West who has an interest in our efforts towards all things inclusive of minorities and females. We would want him to know that we're aggressively reaching out to recruit minority students. Thank you.

MR. JOHNSON: Could I ask a question?

MR. EASON: Yes, sir.

MR. JOHNSON: Do I understand correctly that the first evaluation is made after the first semester and if a student does not produce a 2.5 average the first semester, then they would be subject to being taken out of the program?

MR. EASON: Yes, sir, that's true.

MR. JOHNSON: My sense is that might be a little severe, and the reason ‑‑ I'm speaking from personal experience here ‑‑

(General laughter.)

MR. EASON: I could probably do the same thing.

MR. JOHNSON: It's the first time that most young people are away from home and they don't have their mother or father waking them up and kissing them goodnight and going to bed and asking have they done their homework and their studies, and sometimes some of the other temptations of being away from home nab unsuspecting prey ‑‑ and I'm a living example of that ‑‑ and my sense is that perhaps if it were done after one year or two semesters it might take into consideration more tendencies of human nature and our educational system.

MR. EASON: I understand.

MR. WILLIAMSON: Correct me if I'm wrong, but Chairman, I think the point of the rule change is that some otherwise attractive minority and female students are not entering our program because the current rules would allow us to recoup that first semester's stipend if they dropped out, and we think that maybe we can pick up on youngsters who maybe are not doing as well and probably not going to make and perhaps relieve them from a little bit of the burden.

MR. EASON: Sir, if I could, I believe we passed a rule a couple of months ago that allowed freshmen to drop out of the program during their freshman year without being required to repay what we had paid them so far, so they kind of have a free ride for a year anyway, and what the rule would allow us to do, the amendment would be simply to evaluate those freshmen that are currently in the program and if an individual came up with, say, a 2.0 or something like that ‑‑

MR. JOHNSON: Or 2.4.

MR. EASON: ‑‑ it would not be a 2.5, but we would have the discretion to evaluate that individual and see if they could continue. Obviously, on the other end of the spectrum if it's mathematically impossible to make a 2.5 or the likelihood of making that 2.5 was remote, then we could take action to take them off the program and maybe put somebody else on who would have a better possibility of making it.

MR. JOHNSON: I think it's appropriate that in some instances that judgment be exercised as to the likelihood of success of a given candidate, and if that's part of it, then I think that's an excellent piece.

MR. EASON: Yes, sir.

MR. JOHNSON: Any other questions?

Robert, did you have anything?

MR. NICHOLS: No.

MR. WILLIAMSON: So moved.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. BEHRENS: Commissioners, we're going to take item 4(b)(4) which is a rule for Final Adoption at this time preceding the next rule for Proposed Adoption so we have it in the right sequence. John.

MR. CAMPBELL: Good morning. For the record, my name is John Campbell, director of the Right of Way Division.

I'd like to present for your consideration this minute order item 4(b)(4) which provides for the final adoption of the repeal of Section 21.104 of Title 43, Texas Administrative Code. This section is in regard to the operations responsibilities of the TxDOT Right of Way Division concerning substitute consideration for the sale of real property interests associated with a construction project.

This item was proposed for repeal at the May 30 meeting of the Texas Transportation Commission and no comments were received on the proposed repeal. Staff recommends your approval.

MR. JOHNSON: Any questions?

MR. WILLIAMSON: Is this the last time we're going to see him, or is he going to be up here a while?

MR. BEHRENS: He's going to be here for the next proposed rule.

MR. WILLIAMSON: Because I have a couple of unrelated questions. So moved.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. BEHRENS: Now we'll go to 4(a)(3) the Rules for Proposed Adoption.

MR. CAMPBELL: I continue to be John Campbell, director of the Right of Way Division, and I'd like to continue with the presentation of item 4(a)(3) for your consideration.

This minute order proposes the repeal of Section 21.101 through Section 21.103 and simultaneously proposes the adoption of new Section 21.101 through Section 21.106 with regard to the disposal of real estate interests. The repeals and the new sections are necessary to reorganize the subchapter into a more comprehensive, easy-to-follow format and to establish clear procedures for selling property by sealed bid sale.

Staff recommends approval of this proposed adoption.

MR. WILLIAMSON: So moved.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. WILLIAMSON: The Chair's indulgence? John, are you familiar with a right of way issue we have pending in Denton County?

MR. CAMPBELL: Yes, sir.

MR. WILLIAMSON: Recently local officials in Denton County have expressed some concern that our viewpoint of their right of way evaluation decisions on the condemnation is unfairly punishing them on their highway construction project. Are you familiar with that?

MR. CAMPBELL: Yes, sir.

MR. WILLIAMSON: Is it not the case that when the department makes a decision to authorize a district engineer to move forward with a project it does so with certain assumptions about the costs for the environmental process, the costs for the right of way, the costs for the material design, the costs for the material and the costs for the final layout?

MR. CAMPBELL: Yes, sir.

MR. WILLIAMSON: And is it not the case ‑‑ and maybe Mr. Behrens will answer this as opposed to you, it doesn't matter to me ‑‑ is it not the case that when a particular project that is presupposed to a cost of say $80 million suddenly costs $140 million because of an unanticipated increase in the cost of that project that we almost uniformly look at other projects available in the district to see where we can get as much congestion and mobility relief for our originally planned $80 million. Is that not the case that that's what we do?

MR. BEHRENS: Yes, Commissioner, that would be the case, or otherwise we would have to look at maybe dividing a project into segments and not do the full link, which is not the best way to develop corridors for transportation.

MR. WILLIAMSON: So just to clear the air amongst the department's employees and the commission and for anyone from the free press who might be present and interested in North Texas, it is not the case that Denton County is being treated unfairly as opposed to the rest of the state. It is the case that when local officials make a decision to pay a certain amount or to put us in a position for paying a certain amount for right of way, that by definition affects how we can approach the project, not just in Denton County, but anywhere in the state of Texas.

MR. CAMPBELL: Yes, sir.

MR. WILLIAMSON: Thank you, John.

MR. CAMPBELL: Further questions? Thank you.

MR. BEHRENS: We'll now go to the remainder of the Rules for Final Adoption, and 4(b)(1) would be the final adoption of rules involving our State Infrastructure Bank. Dorn.

MR. SMITH: Good morning, commissioners and Executive Director Behrens. For the record, my name is Dorn Smith, I'm the manager of the State Infrastructure Bank in the Finance Division.

MR. WILLIAMSON: Oh, you're important.

MR. JOHNSON: Running out of money, though.

(General laughter.)

MR. SMITH: Just a little bit of money; it's fading fast.

Agenda item 4(b)(1) proposes amendments to Sections 6.23 and 6.32 of the Texas Administrative Code, which deals with the application procedures and commission actions pertaining to the State Infrastructure Bank. These amendments include technical language corrections that would clarify the information required in a SIB application and actions taken in review of the application.

In May you approved the proposed amendments for publication in the Texas Register and no comments were received. Staff recommends your approval.

MR. JOHNSON: Any questions?

MR. NICHOLS: A comment. I remember when the legislature passed this and then we adopted the rules, instead of figuring out how we were going to do it, and I just want to say I think you have done a great job in administering this program.

MR. SMITH: Thank you, sir.

MR. NICHOLS: It's understood by the counties and cities, I believe, fairly well and you have done a good job at keeping it simple, and this step gives you a little more flexibility and still keeps it simple.

MR. SMITH: That is correct.

MR. NICHOLS: So I just wanted to really compliment you for the work that you are doing on it.

MR. WILLIAMSON: Hear, hear.

MR. JOHNSON: That's a very good observation.

MR. SMITH: Thank you very much for the support.

MR. NICHOLS: With that, I so move.

MR. WILLIAMSON: And I second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

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

MR. BEHRENS: We'll go to 4(b)(2) which is a rule for final adoption on federal, state and local participation, and Ken B. will present that.

MR. K. BOHUSLAV: Good morning. My name is Ken Bohuslav, I'm the director of the Design Division.

The minute order we have for your consideration proposes final adoption of amendments to Sections 15.51, .52 and .55 of the Federal, State and Local Participation rules. The proposed amendments were presented to the commission at the June commission meeting and were advertised July 12, 2002, of the Texas Register; no comments were received. Staff recommends your approval.

MR. JOHNSON: Questions, comments?

MR. WILLIAMSON: So moved.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. BEHRENS: Item 4(b)(3), the final rules on vehicle registration renewal via the internet. Jerry.

MR. DIKE: Thank you, commissioners. My name is Jerry Dike, division director of Vehicle Titles and Registration Division.

This minute order adopts Rule 17.29 concerning internet vehicle registration renewal. In the Year 2000 the commission authorized this pilot program and it is successful. For example, Harris County does over 5,000 internet renewals per month. We proposed these in May of this year and no comments were received. We recommend adoption of the minute order.

MR. JOHNSON: Question.

MR. DIKE: Yes, sir.

MR. JOHNSON: Is not the submission of an insurance certificate required for renewal?

MR. DIKE: They don't submit the insurance certificate, they do the insurance policy number, the insurance agent, and an 8:00 to 5:00 phone number and the counties verify sufficiently.

MR. JOHNSON: Are the counties that have adopted this approach seeing an increase in the number of registrations via the internet?

MR. DIKE: Yes, sir, but it has plateaued. For example, in Harris County it's plateauing at about 3 percent of the public; there's one county, Denton County is up to about 5 or 6 percent of the public. A lot of the e-commerce people feel like it will plateau and then maybe in a few years it will increase, but there's a number of people that do not like to use credit cards over the internet.

MR. JOHNSON: Are we part of the process of getting the word out to constituents of the counties?

MR. DIKE: Yes, sir. In our registration renewal, notices we send out every month, about 1.2 million, we have a flyer in there that addresses that and it's also on the back of the envelope for those counties that participate. Right now we have about 35 or 40 counties participating, most of the urban counties.

MR. JOHNSON: Terrific.

MR. NICHOLS: You said it plateaued out at 3 percent?

MR. DIKE: Yes, in Harris County; in Denton County, it's up to 5 or 6 percent.

MR. NICHOLS: Okay.

MR. JOHNSON: Any other questions or comments?

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. BEHRENS: We'll go to item 4(b)(5), Carlos will present final rules on congestion mitigation facilities.

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

The minute order before you proposes adoption of new Sections 25.40 through 25.43 concerning congestion mitigation facilities. These new sections implement state law regarding HOV lanes and high occupancy toll lanes. The state statutes allow the department to design, construct, operate or maintain an HOV lane on the state highway system or to charge a toll for the use of one or more lanes of a state highway facility, including an HOV lane.

The rules outline the point in the product development process that the designation of HOV and HOT lanes should be brought before the commission for consideration and the factors that the commission can consider in establishing toll charges.

These new sections also authorize the commission to enter into any agreement with a regional tollway authority or a transit authority to operate one or more of the lanes on the state highway system.

We received no public comments and recommend approval of the minute order.

MR. WILLIAMSON: Question.

MR. JOHNSON: Yes, sir, a question.

MR. WILLIAMSON: Will this assist hometown John in Houston on the Katy Freeway?

MR. LOPEZ: Yes.

MR. WILLIAMSON: And what happens if Cameron County forms an RMA and they want to do an HOV or HOT lane, will this rule extend to them also, or will we have to amend our rules again?

MR. LOPEZ: What the rules do is outline the point in the whole project development process that they ought to come here and say we're proposing this to be an HOV lane; that typically would take place after the environmental process is done.

MR. WILLIAMSON: Well, let me rephrase it a little bit and maybe we need to research this. This occurred to me last night while I was reading my book. What happens if Waco comes to us and says: We want to form an RMA and we want you to take the inside lane of 35 and convert it to an HOV lane or an HOT lane, and we want to participate in the conversion with TxDOT and participate in the toll revenues. My point is will this rule authorize us to move forward with that pending the federal government's approval.

MR. LOPEZ: My understanding is yes, it would.

MR. WILLIAMSON: Because I can well see once this concept kicks on on the Katy Freeway in Houston, some of the other urbanizing counties around the state are going to look at that and say: Well, wait a minute, rather than build a loop, why don't we just get TxDOT to convert one of these lanes to a toll facility to encourage people to take an alternate route, and the ones that don't, we'll collect money from and help them do it. I mean, I can see that being an entrepreneurial thought for some people out there. Skopik could come up with that idea for sure. Okay, thanks, that was my question.

MR. JOHNSON: Any other questions, comments?

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

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

MR. WILLIAMSON: Plus we couldn't let Carlos off the hook without asking a question.

MR. BEHRENS: Carlos will also do item 5, Traffic Operations, authorizing some funding for ITS projects.

MR. LOPEZ: Item 5, this minute order authorizes federal funds under various ITS programs with TEA-21 and the required state match for these funds. It also authorizes the department to apply for an additional $5 million in ITS funding, if it became available, and should the funds be awarded, authorizes these additional federal funds and the required $1.25 million in state match. Although the minute order authorizes the full 20 percent-required state match, we will be looking for other sources to match, including in-kind services, local funding sources, and other non-ITS related federal funds.

We recommend your approval.

MR. JOHNSON: Any questions?

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: Carlos, one question. Is the 20 percent of the total project cost a standard ITS state match?

MR. LOPEZ: Under this particular program it is; it's an 80-20 program.

MR. JOHNSON: Thank you. There is a motion and second. All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. BEHRENS: We'll go to item 6, Transportation Planning, and recommend a minute order for authorization of federal funding for project development and construction of permanent border safety inspection stations. Amadeo.

MR. SAENZ: Good morning, commissioners. it sure is nice to follow Carlos; I don't have to move the mike. If I follow Thomas, I've got to reach down and grab it.

(General laughter.)

MR. SAENZ: Thank you, Mr. Behrens. Good morning, Mr. Chairman and commissioners.

Item 6, this minute order authorizes $40,823,650 in federal funding for project development and construction of permanent border safety inspection stations at sites which have yet to be selected in the Pharr, Laredo, and El Paso districts. The federal funds will be used to streamline federal and state inspection along the border. The commission recognizes the need to work with the Texas Department of Public Safety and the federal agencies to protect national security by providing adequate stations at the border.

The actual location for each of these stations has not been determined but will be established through the project development process. While the department has the responsibility for site selection, the department will not do so without specific concurrence from the Department of Public Safety.

Funds for these projects must be obligated with the Federal Highway Administration by September 30, 2002; the amount does not include any of the state matching funds. With the approval of this minute order, the executive director will be authorized to enter into any necessary agreements and proceed in the most feasible and economical manner with project development to facilitate the development and construction of the border safety inspection stations to service the locations described on the attached exhibit.

Staff recommends approval of this minute order.

MR. WILLIAMSON: Several.

MR. JOHNSON: Questions, comments?

MR. WILLIAMSON: Multiple.

MR. JOHNSON: Yes, sir.

MR. WILLIAMSON: Mr. Saenz, I want to clarify for the record a few things. We are not authorizing a specific site in this action. Is that correct?

MR. SAENZ: No. We are authorizing the funding to be used at the locations that are shown on the exhibit; we have not determined exact sites for the border safety inspection stations.

MR. WILLIAMSON: So if the good mayor of Laredo or the House and Senate members ‑‑ both of whom I count as friends ‑‑ were to be told that we made a decision today about siting and funding a specific site for a border inspection station in Laredo, that would not be accurate? All we've done is authorized you to accept federal funds so that we can continue our process.

MR. SAENZ: Yes.

MR. WILLIAMSON: Now, I understand that there are some in the Laredo area who have complained that we have not sought the input of citizens of Laredo or citizens of Webb County with regard to the location of any border inspection station in Laredo. Do you understand that people have complained about that?

MR. SAENZ: Yes, sir, we've heard, but we have had countless meetings with the City of Laredo, with stakeholders in the City of Laredo, with trucking organizations; we have public meetings on the development of these border safety inspection stations in the Laredo area; we've had public hearings just this last month, and we're taking all this information that we've received through the various meetings and that's what we use as part of the planning process to develop the projects.

MR. WILLIAMSON: Now, that being the case, Mr. Saenz, why would anyone from Laredo or Webb County allege that we are not allowing them to have input?

MR. SAENZ: I guess really what it is we have meetings, we hear their concerns, we go back and we study what the issues are that they've brought up, determine whether it is or is not an issue, and so far what we've determined we've been able to address all these concerns, and if it is not an issue, then we move forward. They may not like our answer.

MR. WILLIAMSON: So is it credible for me to say that the matter is that we just don't agree as opposed to we haven't listened to them?

MR. SAENZ: That's true.

MR. WILLIAMSON: Now, I notice in the minute order and the material laid out as part of the record you furnished some related documents. One of the documents appears to be a letter from the U.S. Department of Transportation Federal Motor Carrier Safety Administration which says ‑‑ and I'm going to read in part: "The Federal Motor Carrier Safety Administration believes the intent of Congress to ensure safety at the border would best be served if inspection facilities are placed as close as possible to ports of entry."

So is it your understanding that the United States Department of Transportation has given us guidance to locate as close as possible?

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: And in this letter I do not notice a differentiation between trucks originating in the Republic of Mexico inbound interior United States and trucks originating in the Republic of Mexico inbound to the commercial zone only. I don't see a differentiation.

MR. SAENZ: There is no differentiation.

MR. WILLIAMSON: So our viewpoint is the federal government doesn't really care the purpose of the truck, the point is the intent of Congress in their world is that all trucks be inspected at a location as close as possible to the port of entry.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: Now, that's not the department's interpretation, that's words that the federal government has expressed in this letter.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: I also notice that the Department of Public Safety has provided us a letter. It reads in part: "The Department of Public Safety believes that permanent border safety inspection facilities, when appropriately designed and located and operated, will not impede legal compliant commercial vehicles from entering Texas into Mexico, or vice versa."

So it's the department's view that wherever these are sited, including at the port of entry, the Department of Public Safety's view is that traffic will not be impeded.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: And has the Department of Public Safety been allowed input on the location of these facilities?

MR. SAENZ: Yes, sir. The Department of Public Safety has been our partner as we've developed these projects since 1999.

MR. WILLIAMSON: Just a few more questions, Mr. Chairman.

If I understand the history of our responsibility to build the station, the legislature passed a statute and have passed numerous Appropriations Act riders which instructs us to be responsible for the construction of the facility.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: But the truth of the matter is we are only the constructor and the landlord of the facility, we don't do the inspections. Is that correct?

MR. SAENZ: That is correct.

MR. WILLIAMSON: The Department of Public Safety does the inspections.

MR. SAENZ: That's correct.

MR. WILLIAMSON: And we would not build on a location a border safety inspection station unless the Department of Public Safety said to us: That is where we will inspect.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: And if, for example, we decided that it's more prudent to build at the Mile Marker 28 on Interstate 35 north and east of Laredo, and if the Department of Public Safety said, You're welcome to build there but we won't inspect there, there would be no reason for us to build there.

MR. SAENZ: Correct.

MR. WILLIAMSON: Thank you, Mr. Saenz, and thank you, Mr. Chairman.

MR. JOHNSON: Amadeo, I have a question basically about the mechanics of the way the border facilities work. Is it true that when a vehicle enters the United States from Mexico the first point of contact is with United States Customs?

MR. SAENZ: Yes, sir, at this point.

MR. JOHNSON: So it's reasonable to expect that Customs being the diligent agency they are, that a line is going to form and there will be, for lack of a better description, congestion at some of these entry points where a lot of vehicles attempt to enter the United States.

MR. SAENZ: Yes, sir.

MR. JOHNSON: So there's already a line there, certainly at Laredo, due to the location and the job which the United States Customs authority must do.

MR. SAENZ: Yes, sir.

MR. JOHNSON: Is it reasonable to expect that when the safety inspection stations are located wherever they're located, but in the words of the federal government, as close to the border as possible, as the process becomes more efficient that those vehicles, especially the trucks that these stations are charged with inspecting to make sure they comply with state law, that process will enable the efficient and quick passage of those trucks, and thus it's reasonable to expect that a second line will not form after the first line at Customs and those vehicles are released through United States Customs.

MR. SAENZ: That's correct.

MR. JOHNSON: What I'm trying to get to here is there's no reason to expect there's any additional congestion that's going to be created by the location of safety inspection stations as close to the border as possible, as has been requested by the federal government and also the Department of Public Safety.

MR. SAENZ: That's correct, and we verified that through some of the studies. These were some of the issues that we heard as we had the public involvement and we did some traffic analysis and the determination was that the facility was sized large enough to be able to address so that you would not have additional congestion and additional lines.

MR. JOHNSON: Great. Thank you.

Robert, did you have anything?

MR. NICHOLS: Just a couple of comments. I think the language is real clear from the federal government that near the border is very near to the border, not 30 miles from the border. Also, I think this minute order is very specific in the selection process we will not select the spot without specific concurrence of the Department of Public Safety ‑‑ that's pretty simple.

With that, I'll just so move.

MR. WILLIAMSON: I'll second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

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

MR. SAENZ: Thank you very much.

MR. BEHRENS: Item 6(b), (c), (d) and (e) and those will be presented by Jim Randall, items pertaining to transportation planning.

MR. RANDALL: Good morning, commissioners. My name is Jim Randall, director of the Transportation Planning and Programming Division.

Item 6(b), this minute order authorizes the replacement of the southbound Interstate 44 bridge across the Red River in Wichita County. The condition of this bridge warrants its replacement. Transportation Code Chapter 224, Subchapter (e) provides authority for the department to spend or allocate aid from any available money to acquire, construct, or maintain a bridge across a stream that is a boundary between Texas and another state in an amount not to exceed one-half of the amount. Oklahoma will prepare the plans, specifications and estimates subject to approval of the department and the Federal Highway Administration. Upon approval, the department will reimburse Oklahoma 50 percent of these costs. Oklahoma will let the project to contract.

The total estimated construction cost of the project is $8,800,000. The department's participation will be 50 percent for a total construction estimate of $4,400,000. Approval of this minute order will further expedite the agreement process. Once the governor executes an agreement, the executive director is authorized to pursue the most feasible and economical manner with project development to include providing 50 percent of the PS&E costs of replacing the southbound structure across the Red River at a total estimated construction cost of $4,400,000 to be funded in Priority I, Category 6(a) On-State System Bridge Replacement and Rehab Program of the 2002 UTP.

We recommend approval of this minute order.

MR. JOHNSON: Questions?

MR. NICHOLS: Comment ‑‑ well, partly a question too. I'm supportive of this because the bridge needs to be built, and although we're paying for half the design, we're agreeing here that Oklahoma is going to do the design of the bridge, our half and their half.

MR. RANDALL: Yes, sir. We have several agreements with the surrounding states that on some bridges we take the lead on it and on other bridges Oklahoma; this is one of those bridges where Oklahoma takes the lead.

MR. NICHOLS: Okay, so we do alternate.

MR. RANDALL: Yes, sir.

MR. JOHNSON: Does this mean the bridge will be dark red instead of orange?

(General laughter.)

MR. RANDALL: I prefer burnt orange myself, sir.

MR. NICHOLS: That's all I had.

MR. JOHNSON: Did you have anything, Ric?

MR. WILLIAMSON: I wouldn't touch it. So moved.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. RANDALL: Item 6(c), this minute order reappoints two members of the Border Trade Advisory Committee. Transportation Code Section 201.114 requires the Texas Transportation Commission to appoint a seven-member Border Trade Advisory Committee to advise the commission on border trade transportation matters. Title 43, Texas Administrative Code, Section 1.84 contains the rules for the committee including the provision that the committee serves staggered terms unless removed sooner at the discretion of the commission.

Minute Order 108842, dated March 28, 2002, appointed Richard Valls of Laredo and Dr. Charles Crespy of El Paso to serve on the committee for a term expiring August 31, 2002. Upon your approval, these candidates are recommended for reappointment with their terms expiring on August 31, 2005. Staff recommends approval of this minute order.

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. RANDALL: Item 6(d), this minute order appoints nine members to the Bicycle Advisory Committee. The committee provides the Texas Transportation Commission with insight from the perspective of bicyclists. Its primary mission is to advise the commission on bicycle issues and to provide a forum for communication among the department, bicyclists and the public. A new committee needs to be appointed to assist in the implementation of the department's Safe Routes to School Program.

This committee functions under Title 43, Texas Administrative Code, Section 1.85 concerning advisory committees. When appointing members, the commission may consider facts such as desirability of geographic and occupational diversity. The committee will be appointed to staggered terms as follows:

For terms expiring August 31, 2004, Mr. David DeLeon of McAllen, Andrea Dunn of Dallas, Tommy Eden of Austin, Michael Wyatt of El Paso;

For terms expiring August 31, 2005, Gretchen Arnold of Corpus Christi, Regina Garcia of Houston, Anthony Hoover of Denton, Don Rogers of Dripping Springs, and Robin Stallings of Austin.

These candidates are recommended for your approval.

MR. JOHNSON: Any questions, observations?

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. RANDALL: Item 6(e). We're bringing you the fourth-quarter program for disadvantaged counties to address matching fund requirements. In your books is Exhibit A that lists the projects and staff's recommended adjustments for each one of them. The adjustments are based on the equations approved in earlier proposals.

There are 16 projects in four counties and a reduction in participation for these projects is $190,264. We recommend approval of this minute order.

MR. JOHNSON: Any questions?

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. RANDALL: Thanks.

MR. BEHRENS: We'll go to item 7; Jennifer will present three donations to the department.

MS. SOLDANO: I am Jennifer Soldano, director of the Contract Services Office. Item 7(a) is a donation of $20,000 from First United Bank to upgrade a retaining wall from a riprap wall to a block wall at the northwest corner of the intersection of FM 2528 and FM 2255 in Lubbock. This is part of a project to widen a non-freeway facility and to construct an overpass at Loop 289 over FM 2528. We recommend that you accept this donation.

MR. JOHNSON: I assume this new wall will be aesthetically pleasing to those who view it.

MS. SOLDANO: Yes. Apparently the bank has extensive landscaping at that area and so this blends in and is very nice.

MR. JOHNSON: Questions?

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Thank you.

MS. SOLDANO: Item 7(b) is a donation of $20,000 from the Associated General Contractors of Texas to defray part of the total cost of a $771,000 research project which will research the efforts of using Purinox, a fuel designed to reduce harmful emissions from diesel engines in department-owned on-road and off-road vehicles. The effects of the emulsified fuel on department maintenance operations will be examined. We recommend that you accept the donation.

MR. WILLIAMSON: They're donating what?

MS. SOLDANO: They are researching a fuel ‑‑

MR. WILLIAMSON: How much are they donating?

MS. SOLDANO: $20,000.

MR. WILLIAMSON: And how much did you say the total cost is?

MS. SOLDANO: $771,000.

MR. WILLIAMSON: And we're paying for the other $750-?

MS. SOLDANO: Yes.

MR. WILLIAMSON: That's nice of those guys; they should be complimented for that. So moved.

MR. JOHNSON: Where is this study going to be done?

MS. SOLDANO: Paul?

MR. KRUGLER: For the record, my name is Paul Krugler, director of Research Technology Implementation. The University of Texas Engines Research Group has the contract with us; there are subcontractors of worldwide reputation, actually, working with them, Southwest Research Institute and Eastern Research Group as well, the Southwest Research Institute from San Antonio.

MR. WILLIAMSON: Will they be studying just that trade name product, or will they be studying emulsified diesel generally?

MR. KRUGLER: They will be focused, sir, on the Purinox itself as that's the initial blend that we're looking at. Part of this research will also be to develop a specification and methods of tests for us to evaluate alternatives to that.

MR. WILLIAMSON: And I guess the reason we're focused on that particular trade blend is because it's the only one TNRCC has approved for use in our state at this point?

MR. KRUGLER: That is my understanding; they're also one of the larger suppliers as well. That's to my best knowledge.

MR. WILLIAMSON: Okay. After we vote, I think we ought to recognize AGC for kicking in; that's very kind of those guys.

MR. NICHOLS: I second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. WILLIAMSON: Please tell them we thank them.

MR. JOHNSON: Yes, indeed.

MS. SOLDANO: Item 7(c) is a donation of approximately $580 from the American Institute of Steel Construction, Inc., to reimburse the department for the travel expenses of an employee to attend a meeting of the Certification Committee in Chicago. The department requires this certification for its steel bridge fabricators. The participation of a department employee on the committee helps to ensure that the department maximizes its benefit from this program.

MR. WILLIAMSON: So moved.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

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

MR. BEHRENS: Items 8 and 9 will be presented by Cheryl Mazur, item 8 being our 2003 Operating Budget, and item 9 being our 2004-2005 Legislative Appropriations Request.

MS. MAZUR: Good morning Chairman Johnson, Commissioner Nichols, Commissioner Williamson, and Mr. Behrens. For the record, my name is Cheryl Mazur and I'm the manager of budget and forecasts for the Finance Division.

Agenda item number 8 is the minute order requesting approval of TxDOT's Fiscal Year 2003 operating budget in the amount of just over $5.16 billion. This operating budget is in exact accordance with the Appropriations Bill that was passed during the last legislative session. Staff recommends your approval.

MR. JOHNSON: Any questions?

MR. WILLIAMSON: Well, we're glad you're here, but where is Fast Jimmy Bass?

MS. MAZUR: He is selling bonds.

MR. WILLIAMSON: Selling bonds?

MS. MAZUR: He'll be back this afternoon.

MR. WILLIAMSON: Is he in New York?

MS. MAZUR: He's in Dallas.

MR. NICHOLS: Hopefully his pockets will be full when he gets back.

MS. MAZUR: They're supposed to be.

MR. NICHOLS: I didn't have any questions. I so move.

MR. WILLIAMSON: I second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MS. MAZUR: Item number 9 is a minute order requesting approval of TxDOT's appropriations request for the Fiscal Year 2004-2005 and is in the total amount of just over $10.75 billion for the biennium. Staff recommends your approval so that we may submit the Legislative Appropriations Request to the Legislative Budget Board on August 30.

MR. JOHNSON: Questions?

MR. WILLIAMSON: A couple.

MR. NICHOLS: Couple.

MR. WILLIAMSON: Oh, go ahead, I yield. Please.

MR. NICHOLS: First of all, thank you for the work that you do on this; I know it's pretty extensive and you worked on it a long time. I just wanted to point out really more for the audience and everybody to recognize that this is the first year in our LAR that we've actually requested with our new authority for railroad right of way for non-dedicated money. We did have legislation at the last session requesting money if it was authorized; they gave us the authority but they did not give us any money, so we have requested a million dollars for that.

MR. WILLIAMSON: It was complimenting your work on that.

MR. NICHOLS: Do what?

MR. WILLIAMSON: It was complimenting your work on that particular item.

MR. NICHOLS: Oh, thank you.

MR. JOHNSON: Any other questions or observations?

MR. WILLIAMSON: Yes, sir, I have a few.

MR. JOHNSON: Yes, sir.

MR. WILLIAMSON: This Legislative Appropriations Request we're forwarding is in conformance with the regulations set out by the Legislative Budget Board and the Office of the Governor. Is that correct?

MS. MAZUR: That's correct.

MR. WILLIAMSON: And you're familiar with the fact that we have actually submitted two Strategic Plans to the governor, one of the style that they require a request and other of a style that we are suggesting is better for the management of government?

MS. MAZUR: Yes, sir.

MR. WILLIAMSON: Commissioners, I would ask that we give some thought to authorizing Mr. Bass and his department to begin to construct an alternative Legislative Appropriations Request that exactly matches our recommended Strategic Plan, so that they can have ‑‑ they being the legislature and the governor can have two different ways of approaching government to compare one with each other and two different budget requests that support those different ways of approaching government.

MR. JOHNSON: Do you have a thought in mind relative to the timing of that suggestion or request?

MR. WILLIAMSON: I know that James and the department, like all of us, are overwhelmed; I would only ask that they move as expeditiously as possible.

MR. JOHNSON: With the thought being that it be ready for the next session.

MR. WILLIAMSON: At least by the session, if not, a couple of weeks or month or two ahead of time. If we're going to advocate for looking at transportation in a different way, I think the more warning that we give the governor and the legislative leadership, and the more respect we show them by giving them an opportunity to consider it, the better off we are.

MS. MAZUR: We can certainly do that.

MR. JOHNSON: Do we have a motion?

MR. WILLIAMSON: So moved.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. BEHRENS: We go to item 10, Thomas will present our contracts for the month of August.

MR. T. BOHUSLAV: Good morning, commissioners. My name is Thomas Bohuslav, the director of the Construction Division.

Item 10(1) is for consideration of the award or rejection of highway maintenance contracts let on August 6 and 7, 2002, whose engineers' estimated cost are $300,000 or more. We had nine projects; staff recommends award of all projects.

MR. JOHNSON: Any questions?

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. T. BOHUSLAV: Item 10(2) is for consideration of the award or rejection of highway construction contracts let on August 6 and 7, 2002. We had 149 projects, with an average of 4.77 bidders per project. Commissioners, this is the largest dollar volume letting we've ever had for a month.

We do have one project we recommend for rejection which is project number 3024, it's in Starr County. We had one bidder who was 26.6 percent over and the prices were above what we would expect in that area and we'd like to go back and readvertise and try to get some more competition and see if we can get better prices on the project.

Staff recommends award of all projects with the exception noted.

MR. JOHNSON: Question. Assuming this passes, where will this bring lettings for the fiscal year?

MR. T. BOHUSLAV: I believe we'll be at about $2.7 billion.

MR. JOHNSON: Thank you.

MR. NICHOLS: That does not include the roughly $1 billion contract that the TTA issued on 130.

MR. T. BOHUSLAV: That is correct, it does not include those.

MR. NICHOLS: So at some point, even though they don't all go through the Construction Division, as far as the total work that is going out from this agency, it's really at this point more like $2.7- plus an additional billion.

MR. T. BOHUSLAV: If you just add those right on top to what we let, that is correct.

MR. NICHOLS: And that probably will be repeated again this next year.

MR. T. BOHUSLAV: Yes.

MR. NICHOLS: If through your division we issue roughly $3 billion, then I think on the 130 project and the T and all that, it's going to be another roughly billion going out through the TTA, so that's going to be an additional, for a total of 4.

Also I think it's important to note that not only did you crank out an amazing amount, the industry is extremely competitive ‑‑ I assume because the economy is slow right now ‑‑ and getting an average of almost five bids per contract and coming in with almost 8 percent below estimate. It is a very competitive industry out there right now and it's a great time for us to be issuing and cranking up a lot of projects.

With that, I'll so move.

MR. T. BOHUSLAV: Our highway cost index has come down as well; over the year we've seen it reduce almost 10 points.

MR. JOHNSON: From that vantage point, my interpretation would be this would be an excellent time to be building more roads. Is that a fair impression?

MR. T. BOHUSLAV: Contractors are still hungry right now, you bet. The last two months we let two half-billion-dollar lettings and of course when you talk to other states, they're just dumbfounded by what we've done, but it really starts out there in the districts putting all those plans together and getting everything worked out, all the agreements and the funding and everything worked out. It's a major effort, but I just wanted to make that mention to you, I guess.

MR. JOHNSON: Well, the Construction Division is to be congratulated for another excellent year.

MR. T. BOHUSLAV: Well, it's part of the Design and all the districts out there that do all the work as well.

MR. JOHNSON: Absolutely.

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. BEHRENS: Commissioners, I understand before we take item 11 we'll be going into executive session, so I'd recommend that we take item 12, the routine minute orders at this time. These are listed as they appeared on the posted agenda. If you'd like us to present any of them individually, we can do so; if not, I recommend approval.

MR. JOHNSON: Any questions about the routine minute orders?

MR. NICHOLS: I have none and I also move we adopt them.

MR. WILLIAMSON: I second.

MR. JOHNSON: There's a motion and a second. All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

At this time the meeting will be recessed for the commission to meet in executive session pursuant to Government Code Chapter 551.071, as posted in the meeting agenda filed with the Office of the Secretary of State. We stand in recess.

(Whereupon, at 11:05 a.m., the meeting was recessed, to reconvene following executive session.)

MR. JOHNSON: This meeting of the Texas Transportation Commission is reconvened. The commission has concluded its executive session with no action being taken on any matter.

I would now like to call on Richard Monroe to present item 11.

MR. MONROE: Thank you, Mr. Chairman. For the record, my name is Richard Monroe, general counsel for the department.

The minute order before you concerns funding of the suit of the State of Texas v. Exxon. The suit is built around the issue that Exxon has drained oil and minerals from underneath Texas right of way and the attorney general has filed suit to recover the monetary value of those minerals. The attorney general has told me that he is quickly running out of money and that he may need another $1 million to fund this suit. So far the department has funded this suit out of Fund 6, as required by the legislature in the last legislative session, to the tune of $1.7 million, and even before that the department gave the Transportation Division of the Attorney General's Office approximately $75,000 just to get this matter started. We would hope that the Texas Department of Transportation would recover the monies recovered by the attorney general in this suit.

With all of that in mind, I would recommend that you approve the minute order granting up to $1 million to the attorney general, to be paid out in installments at the direction of the executive director or his designee.

MR. JOHNSON: Any questions or comments?

MR. WILLIAMSON: Yes. Do I understand, Mr. Monroe, that we acquired title to these minerals by paying for as Fund 6 for the Highway Department all these many years ago?

MR. MONROE: Yes, sir. Back in those days we acquired title to the center of the earth; we have absolute fee, including mineral interests.

MR. WILLIAMSON: So the State Highway Fund, as it's known, or Fund 6 has the ownership and Fund 6 is providing the funds to pursue this litigation. Would it be reasonable for the commission to ask that a letter be sent to the leadership letting them know that we're continuing to fund the lawsuit and letting the leadership be aware that our position is we're doing this on the assumption that any recovery will be returned to the Transportation Fund?

MR. MONROE: I think that would be more than reasonable.

MR. WILLIAMSON: I'd suggest we do that, Mr. Chairman.

MR. JOHNSON: All right. Any observations, comments, questions?

MR. NICHOLS: No.

MR. JOHNSON: I have one and that is to thank Attorney General Cornyn and his staff for the excellent work that they've done thus far on this case, and we look forward to working with them to its completion.

If there are no further questions or comments, I'll entertain a motion.

MR. WILLIAMSON: So moved.

MR. NICHOLS: Second.

MR. JOHNSON: All in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

We'll now enter into the open comment period of the meeting. Are there any speakers signed up for open comment? There being none and there is no further business to conduct before the commission, I will entertain a motion to adjourn.

MR. WILLIAMSON: So moved.

MR. NICHOLS: Second.

MR. JOHNSON: It is now 12:03 and all those in favor, signify by saying aye.

(A chorus of ayes.)

MR. JOHNSON: Motion carries. It is 12:04 and this meeting is adjourned.

( Whereupon, at 12:04 p.m., the meeting was concluded.)

C E R T I F I C A T E

MEETING OF:     Texas Transportation Commission
LOCATION:      Austin, Texas
DATE:           August 29, 2002

I do hereby certify that the foregoing pages, numbers 1 through 65 inclusive, are the true, accurate, and complete transcript prepared from the verbal recording made by electronic recording by Penny Bynum before the Texas Transportation Commission of Texas.

9/03/02
(Transcriber) (Date)

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

Thank you for your time and interest.