Texas Department of Transportation Commission Meeting

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

11:00 a.m. Monday, November 24, 2003

COMMISSION MEMBERS:

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

STAFF:

MIKE W. BEHRENS, Executive Director
RICHARD MONROE, General Counsel
CHERYL WILLIAMS, Special Projects, Public Information Office
DEE HERNANDEZ, Chief Minute Clerk

MR. JOHNSON: Good morning. It is 11:10 a.m. and I would like to call this meeting of the Texas Transportation Commission to order. Please 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 3:31 p.m. on November 14.

Traditionally, I would ask my colleagues if they have any comments. I'm going to go first and say Happy Thanksgiving week to one and all. And Robert, what do you have?

MR. NICHOLS: Just welcome everyone for being here. It's a little unusual to be here on a Monday, but so be it. During the holidays, drive careful. Thank you.

MR. JOHNSON: Ric Williamson?

MR. WILLIAMSON: All rise. The chairman threw down the gauntlet, and I can never pass up a good fight. It's Amadeo's and Robert's birthday, so one, two, three.

(All sang Happy Birthday.)

MR. WILLIAMSON: That will teach you to challenge me.

MR. NICHOLS: Does the whole song go in the official record? It does, doesn't it?

MR. WILLIAMSON: And let's see, Robert, this will be what, your fourth time through 50?

MR. NICHOLS: I forgot.

(General laughter.)

MR. JOHNSON: I would also like for the record to reflect that as of this date Ric and Mary Ann Williamson have been married for 30 years. A wonderful and patient woman.

(Applause.)

MR. JOHNSON: Before we begin with the business portion of our meeting, I'd like to remind everyone that if you wish to address the commission, please complete a speaker's card at the registration table in the lobby. To comment on an agenda item, we would ask that you fill out a yellow card and please identify the agenda item.

And if it is not an agenda item, we will take your comments at the open comment period at the end of the meeting, and for that we would ask that you fill out a blue card. Regardless of the color of card, we would ask that you limit yourself to three minutes out of consideration for all present. We would also ask, out of consideration for all present, that you place your cell phones and pagers in the silent mode.

MR. JOHNSON: Our first item on the agenda is the public hearing regarding our project selection process, and Jim Randall, our director of Transportation Planning and Programming, will present this item. Jim, we're glad you're here. Welcome.

MR. RANDALL: Thank you, sir. That's a hard act to follow.

Again, for the record, my name is Jim Randall, director of Transportation Planning and Programming Division for the Department of Transportation. The notice for this public hearing was filed with the Secretary of State on November 5, 2003, and published in the Texas Register on November 14, 2003. This presentation and hearing is held annually to fulfill the requirements of the Texas Transportation Code, Section 201.602. The highway project selection process being discussed will be used for selections in the 2005 Statewide Preservation Program and Statewide Mobility Program. At this point we have a 13-minute video presentation. After the video I'll return to provide additional information and answer any questions. Thank you.

SPEAKER ON VIDEO: "Texas is famous for great roads, an efficient freight rail network, convenient air transportation, and vast shipping capabilities. This state's vast transportation system brings the world to Texas and affects our day-to-day decisions about where we live, where we shop, and how we access what we want. With efficient effective transportation infrastructure, we can live and work where we choose, we can shop at stores and malls near and far, we can obtain quality goods trucked in from all over the world via Mexico, Canada and our water ports.

"Recently TxDOT has made significant changes to the selection process to make it easier to understand. This simplification effort is not limited to project selection. TxDOT is focused on clarifying processes in all areas of the department from allocating funds to measuring success to issuing reports. TxDOT has simplified its operations into five major strategies in order to meet the department's objectives and goals. These five strategies are: PLAN IT, BUILD IT, USE IT, MAINTAIN IT, MANAGE IT. A detailed description of each of these objectives is obtained in the Project Selection Process brochure, as well as how each strategy relates to the operating budget.

"Each year hundreds of highway projects enter TxDOT's project selection process. Projects may be proposed by individuals, government officials, local or regional transportation planning committees, or by TxDOT itself, and recently, many of these individuals were involved in TxDOT's Unified Transportation Program restructure.

"The Association of Texas Metropolitan Planning Organizations, the Texas Transportation Institute, county judges, and regional planning councils forged a partnership with TxDOT through their involvement in working groups which collaborated to improve the department's project selection and funding distributions. The commission is incorporating the working group's findings after considering public comments from a public hearing in June of 2003.

"Another component of the Unified Transportation Program restructure was consolidating and reducing the number of highway construction funding categories. These new categories are: Category 1, Preventive Maintenance and Rehabilitation; Category 2, Metropolitan Area Corridor Projects; Category 3, Urban Area Corridor Projects; Category 4, Statewide Connectivity Corridor Projects; Category 5, Congestion Mitigation and Air Quality Improvement; Category 6, Structures Replacements and Rehabilitation; Category 7, Metropolitan Mobility and Rehabilitation; Category 8, Safety; Category 9, Transportation Enhancements; Category 10, Miscellaneous; Category 11, District Discretionary; and Category 12, Strategic Priority.

"The Preventive Maintenance and Rehabilitation, along with the Structures Replacement and Rehabilitation support our MAINTAIN IT budget strategy, while the other ten categories support our BUILD IT budget strategy. The MAINTAIN IT strategy is work which preserves our existing highway system and protects the taxpayers' previous investments. The BUILD IT strategy is work which enhances our transportation system.

"Projects constructed with Category 1, Preventive Maintenance and Rehabilitation, are selected at the TxDOT district level. The commission has delegated the project selection decision to the districts and distributes the funds needed to keep the system working through allocation formulas. These allocation formulas were developed by a collaborative working group and will be used for the first time in the 2005 Statewide Preservation Program.

"Category 6, Structures Replacement and Rehabilitation, is also part of the MAINTAIN IT strategy. This category of work includes bridges and underpasses or overpasses at railroads. Projects are recommended to the commission for selection by using an engineering-based cost-benefit analysis called the Texas Eligible Bridge Selection System, or TEBSS.

"Category 1 and 6 are listed in the department's preservation program. Information regarding the department's routine maintenance and contracted routine maintenance efforts can be found in the preservation program as well.

"Next are the categories listed under the BUILD IT strategy. These categories are included in the department's mobility program. Categories 2, 3 and 4 are for highway projects on important transportation corridors. A collaborative working group recommended the selection process for the categories and the commission concurred. The work group recommended more local control in project selection for Categories 2 and 3 by allowing the local metropolitan planning organization and the local TxDOT district office to recommend projects to the commission.

"For the eight metropolitan areas which include Austin, Corpus Christi, Dallas-Fort Worth, El Paso, Houston-Galveston, Hidalgo County, San Antonio, and Lubbock, this recommendation is important because it aligns with the Texas Metropolitan Mobility Plan. The Texas Metropolitan Mobility Plan will produce regional mobility plans which can streamline project delivery and for the first time establish goals in congestion reduction.

"While Category 2 and 3 will improve corridors in our urbanized areas, Category 4 will link these areas. The Category 4 work group recommended three classifications for these linking facilities: connectivity corridors, mobility corridors, and strategic corridors. These corridors are ranked by formula and the resulting projects will be recommended to the commission by TxDOT division staff.

"Projects constructed with Congestion Mitigation and Air Quality Improvement and Metropolitan Mobility and Rehabilitation funds are selected by the local metropolitan planning organization in consultation with the local TxDOT district.

"Safety projects which include highway safety improvement projects as part of House Bill 1, Rider 45, are ranked using safety engineering indices and selected by the Traffic Operations Division.

"Transportation Enhancement projects are selected individually by the commission after considering TxDOT committee recommendations. These projects are nominated by local entities.

"Projects in the Miscellaneous category can be selected in many ways. Most often these projects are selected by a TxDOT division after funds are allocated by the commission.

"District discretionary funds are distributed to the districts by formula and used at the district engineer's discretion. A new formula recommended by a collaborative working group will be used for the first time in the 2005 Statewide Mobility Program.

"Strategic Priority projects are selected by the commission on a project-by-project basis. These are projects which promote economic development, provide system continuity with adjoining states and Mexico, increase movement efficiency on military deployment routes, or address other strategic needs as determined by the commission.

"What we have outlined to this point has been traditional pay-as-you-go funding mechanisms for building our transportation infrastructure. This method has not kept pace with Texas' growth. Fortunately, we now have a powerful assortment of tools that will provide fast solutions to transportation problems. Many of these new tools were provided through House Bill 3588, passed by the 78th Legislature and signed into law by Governor Perry in June 2003. With the new tools comes new options, options which allow faster responses to infrastructure needs and the ability to leverage transportation solutions through agreements with other public and private partners.

"House Bill 3588 authorizes certain transportation-related fees to be moved from the State's General Revenue Fund to the Texas Mobility Fund. The benefit is TxDOT now has the ability to accelerate completion of highway improvements and start new ones. The Texas Mobility Fund provides brand new dedicated revenue to supplement the traditional pay-as-you-go method of financing highway projects.

"Bonds give TxDOT the ability to borrow money to pay for roads over time instead of having to come up with all the money up front. Although bonds don't provide any new money, they make it possible for the Texas Transportation Commission to afford more transportation projects now. The transportation users see a savings in time and productivity by getting out of congestion sooner and the State sees a savings because the cost of construction is in today's dollars.

"Because toll roads generate revenue to pay for projects now, they are the fastest way to quickly improve mobility and safety in Texas. Regional mobility authorities, or RMAs, may construct, maintain and operate transportation projects including highway, rail, aviation, and pedestrian facilities. RMAs have several options of generating revenue, revenue which can be used to create more transportation infrastructure.

"Comprehensive development agreements reduce the cost of completing a project and get roadways open to the public sooner by rolling all the design and construction of toll road projects in one contract. Ever heard of a toll road where the user does not pay a toll? Well, that's how pass-through toll agreements work. First, a local government or private entity makes a much-needed transportation improvement on a highway. The constructing entity is then reimbursed by the State through a fee associated with the number of vehicles using the improved facility.

"The 4,000-mile Trans-Texas Corridor will revolutionize mobility in Texas by providing safer and faster transportation, relieving congestion in the metropolitan areas, moving hazardous materials from populated areas, providing separate lanes for cars and trucks, and high-speed rail for people and goods, and smoothing the progress of cleaner air and statewide economic development.

"For the first time TxDOT is authorized to build and manage rail infrastructure. Rail could play a key role in reducing congestion on existing highways and provide choices for travelers and freight. Couple the Trans-Texas Corridor and new rail component with the department's current work in aviation, transit and the Gulf Intracoastal Waterway, TxDOT's challenge now lies in fulfilling the promise of House Bill 3588.

"Through creative thinking and cooperation, Texas has the financial ability to build transportation infrastructure that can support our needs now and into the future. As our state/local leaders and private entities put these tools to work, our roadways will become less crowded and Texans will have an easier time getting where they need to go. A great state needs great transportation, and TxDOT will lead the way to ensure that transportation improvements enhance the quality of life for Texans.

"For more information on the topics discussed here, please see the associated web sites listed."

MR. RANDALL: We hope to use that as our public outreach and education program and provide copies to the 25 districts as well as the MPOs.

In order to complete our presentation, I'd like to point out that copies of the Project Selection Process brochure, along with an addendum, can be found in the foyer. The brochure will recap the information provided in the video, and the addendum provides more detail on the ranking index and allocation formulas used in the project selection process. A copy of the presentation in VHS and CD format can be found in the foyer, as well, who want to take the public hearing home to share with others who could not attend.

We are requesting written comments regarding the highway project selection process be mailed to the address shown. The deadline for comments is January 5, 2004. That concludes our presentation, and I'll turn it back to you, Mr. Johnson.

MR. JOHNSON: Thank you, Jim. Any questions, Robert or Ric?

MR. NICHOLS: I do, but have you got some people?

MR. JOHNSON: I do, but I was going to let you go ahead.

MR. NICHOLS: That's the first time I've seen the video; I thought it was a very good video. Also, I just thought I'd make the comment that this has been a long time in coming. I know these type changes were discussed three and four years ago and really came more into fruition in the last year or two. You all have done a tremendous amount of work.

I know a lot of MPOs, different transportation groups have had input statewide on this thing, and it's really a very significant change that needed to occur, and I think it incorporates so many different things. I think it's wonderful.

MR. RANDALL: Thank you, sir.

MR. NICHOLS: The numbers that are in the chart that I've got, just for the record, as I understand it, some items that are not in that, the revenues from the Texas Mobility Fund are not included.

MR. RANDALL: That's correct.

MR. NICHOLS: Any revenues that would come in from bonds being sold -- I'm not talking about the equity part but the bond money that would be put into construction -- that's also not in these numbers.

MR. RANDALL: That's correct, sir.

MR. NICHOLS: And the revenues that are in the numbers are also based on estimates on the federal re-authorization which is still up in the air.

MR. RANDALL: That's correct, sir.

MR. NICHOLS: So once the federal numbers are locked in, these numbers again would probably change depending on whether it was up or down or whatever.

MR. RANDALL: Yes, sir.

MR. NICHOLS: Okay.

MR. JOHNSON: Jim, excellent presentation. The video, I think, is so clear in describing our process and the end result, whereas, before it was very complex, at least when you presented it and tried to make what some people would call sense out of nonsense. So I salute you and everybody involved in the video, but also the process, to echo what Robert said. It was done by building consensus in all of our categories, the appropriate way to do it. It puts more of the responsibility back to locals who are familiar with the challenges and the priorities that they have, and it's been a long time coming but I think it's been worth every bit of the effort and the time that it's taken to get here. I want to congratulate you and your division -- are you a division or a department guy -- division guy.

MR. RANDALL: I'm a division guy.

MR. JOHNSON: Anyway, well done.

MR. RANDALL: Thank you, sir.

MR. JOHNSON: We do have one person who has requested to speak on this item, and then we also have a group from South Texas who asked to speak to the commission, and I thought this might be an appropriate time. Maureen Crocker from the HGAC, the Houston-Galveston Area Council. She's the transportation policy coordinator. Maureen, we're delighted that you could join us today.

MS. CROCKER: Thank you. I appreciate the opportunity to speak. This morning I will read a letter that was submitted earlier this year by the Transportation Policy Council. The members of the Houston-Galveston Transportation Policy Council think the issues raised in this letter are pertinent to the Project selection process and want to make sure it's part of the record.

"On behalf of the Transportation Policy Council for the Houston-Galveston Transportation Management Area, I am writing to convey our comments and concerns regarding the overall impact of the Unified Transportation Program in our region.

"At 4.7 million persons, the Houston transportation planning area is home to 22.4 percent, nearly one-fourth of Texas' total population. In addition, its residents and businesses account for 18 percent of daily vehicle miles traveled on the State's system. The Texas Department of Transportation's Houston District comprises six of the eight counties in the planning region, and therefore, has a significant impact on the region's roadway infrastructure.

"The 2004 SMP allocates $1.5 billion for roadway projects in the Houston District during the 2004 to 2007 time frame. This construction allocation is 21 percent of the statewide allotment. The out years for the SMP show Houston maintaining a 21 percent share of statewide roadway construction funding. We are pleased that the Statewide Mobility Program's proposed funding level represents significant improvement as compared to the previous decade.

"We are also optimistic about the increased opportunity for regional determination of project priorities and funding source proposed under the Texas Metropolitan Mobility Plan. The Houston Metropolitan Planning Organization has worked closely with TxDOT in its efforts to develop a program focused on the urgent and growing mobility needs of urban areas. We are hopeful that the additional flexibility promised under the TMMP will allow metropolitan areas and district offices to better utilize limited resources.

"Throughout the region, local government entities are taking the initiative to investigate new opportunities for funding transportation projects; however, the TPC remains very concerned about the allocations to the Houston District under the Statewide Preservation Program. The 2004 SPP approved by the Texas Transportation Commission provides less than $1 billion to the Houston District for fiscal years 2004 through 2007. That represents only 11 percent of the statewide total of preservation and maintenance funds.

"Currently 50 percent of the state maintained lane miles in the Houston District require major maintenance. Moreover, district personnel expect this percentage to increase, given current levels of funding. Our progress on congestion relief will mean little if poorly maintained roads reduce travel speeds and create new traffic bottlenecks.

"It is my understanding that TxDOT and the Texas Transportation Commission will be revisiting the allocation formula for SPP funds before fiscal year 2005. I respectfully request that the Houston-Galveston region and other urban regions of the state be included in those discussions.

"As we complete work on our 2025 Regional Transportation Plan, we are becoming alarmingly aware of the huge maintenance and rehabilitation needs currently facing the region, both on and off the state system. The addition of new capacity to improve mobility will only increase our preservation needs. Your consideration of these comments is appreciated."

MR. JOHNSON: Maureen, thank you. Mr. Williamson has a question or comment.

MR. WILLIAMSON: Who do you represent?

MS. CROCKER: The Houston-Galveston Area Council, and this letter was written by Chairman Judge Eckels, Harris County.

MR. WILLIAMSON: Chairman?

MS. CROCKER: Robert Eckels.

MR. WILLIAMSON: The county judge?

MS. CROCKER: Yes.

MR. WILLIAMSON: And who are the other members of that?

MS. CROCKER: We have county commissioners; we have eight counties on our council: Fort Bend, Liberty, Montgomery, Harris, Chambers --

MS. CROCKER: So the judge was writing in his capacity speaking for all those people on these positions?

MS. CROCKER: Yes. The entire council approved this letter before it was sent.

MR. WILLIAMSON: Thank you.

MR. JOHNSON: Any other questions?

MR. NICHOLS: I had one. On the Category 2 on the expansion money, the 21 percent, I was trying to make sure were they saying that they did not think that was a fair percentage?

MS. CROCKER: No. The council is very pleased that that's an increase and that's proportionate.

MR. NICHOLS: Okay, it's just on the preservation.

MR. WILLIAMSON: They weren't whining about that; they were whining about the other.

MR. NICHOLS: Right. I'm just trying to make sure. Thank you.

MS. CROCKER: Okay.

MR. JOHNSON: Chance Sampson, who is a legislative aide to Senator Judith Zaffirini, has -- their group that wants to talk about US 59 through Goliad, Live Oak and Bee counties. Is everybody present?

MR. SAMPSON: Yes, sir.

MR. JOHNSON: Good.

MR. SAMPSON: Good morning, Mr. Commissioner, Mr. Executive Director, commissioners. My name is Chance Sampson; I'm legislative aide for Senator Judith Zaffirini, and I'm here today on the senator's behalf to introduce some local officials from Senate District 21 to discuss funding for Highway 59 and converting it into a four-lane divided highway. I also have a letter here from Senator Zaffirini that she's asked me to read for the public record.

First of all, representing Bee County is Commissioner Susan Stasny, who has worked with TxDOT for approximately the past 12 years on Highway 59 issues, and she brings with her a proclamation signed with unanimous consent of the Bee County Commissioners Court.

Representing Live Oak County is Mayor Kenneth Chesshir from Beeville -- which is not actually in Live Oak County but Judge Huff is actually in the Ukraine right now and was not able to be present today, so he's asked Mayor Chesshir to step in for him, and they have all worked together on all these issues as a sort of tri-county region.

And then finally, although Goliad County is not in Senate District 21, I'd like to introduce Judge Harold Gleinser who has worked with officials in Bee and Live Oak counties to make Highway 59 a priority.

Also, David Flores who is a consultant for the tri-county area will make a statement to conclude. And if it's all right now, I would like to read the letter from Senator Zaffirini.

MR. JOHNSON: You can either read it or just place it in the record, whichever you prefer.

MR. SAMPSON: I was actually asked by her if I could read it. It's a one-pager so it shouldn't take too long, if that's all right.

MR. JOHNSON: Okay.

MR. SAMPSON: "This is to request that the Texas Transportation Commission act expeditiously to approve funding necessary to expand US Highway 59 into a divided four-lane highway in the tri-county region of Bee, Goliad and Live Oak counties.

"On January 22, 2002, an information sheet was faxed to Jose Aliseda, former Bee County judge, at the request of David Casteel, district engineer for the Texas Department of Transportation. It stated that the project to upgrade Highway 59 in this area would be let and built under one contract with a proposed letting date in 2007. Officials in the tri-county area have planned accordingly and failure to deliver on this commitment would cause unacceptable hardships.

"According to county officials, traffic collisions have quadrupled on Highway 59 in the tri-county area since 2000, mainly because traffic in this area is too dense for a two-lane highway. My constituents cannot afford to wait to determine if the Interstate 69 Corridor will follow the path of Highway 59. I am certain that studies, once completed, will reveal that Highway 59 is indeed the most logical path for the corridor to follow, largely because of its importance for both commerce and homeland security.

"Because of the increased trade generated by the North American Free Trade Agreement, Highway 59 is becoming an increasingly vital artery for international commerce. What's more, it would be an important evacuation route from areas of the state vulnerable to terrorist attacks.

"I urge you to approve funding for this project that is vital not only to Bee, Goliad and Live Oak counties, but also for all of Texas.

"Very truly yours, Senator Judith Zaffirini."

MR. JOHNSON: Thank you.

MR. SAMPSON: Thank you. And I don't know what order they're coming up but they will come up now also.

MR. JOHNSON: I think Judge Gleinser from Goliad County.

JUDGE GLEINSER: May I enter these into the record?

MR. JOHNSON: Please.

JUDGE GLEINSER: My name is Harold Gleinser, county judge of Goliad County. I would like to speak to you a little bit about trade.

US Highway 59 is a vital and integral part of not only our tri-county area but the State of Texas and the nation. The latest statistics from the Bureau of Transportation indicate that Laredo, Texas is ranked sixth in the nation for import/export commodities. This ranking translates into $39.2 billion in exports, and $44.4 billion in imports, for a total import/export business of $83.7 billion per year.

The NAFTA trade agreement has caused border crossings to grow dramatically each year since inception: in 1997 roughly 1.25 million; 1998, 1.35 million; 1999, 1.48 million; and in 2000 right at 1,500,000. This translates into about a little over 4,000 truck crossings per day.

The increased traffic caused by NAFTA alone has put our highways across Texas in need of major expansion. Currently TxDOT truck traffic flows indicate that the majority of truck traffic entering at the Laredo border utilizes Interstate 35 to San Antonio, then proceeds to Interstate 10 to Houston and then to the Port of Houston. The Port of Houston is the nation's 12th largest U.S. port by value of shipment with $18.7 billion in exports and $24 billion in imports annually. This totals to $43.4 billion in annual shipments.

Few can argue that the majority of trucks that service the Port of Houston are the same trucks that crossed at the Laredo border. The I-35 to I-10 truck route from Laredo to Houston is a journey that is approximately 70 miles longer than a straight line route from Laredo on State Highway 59 to Houston. Most engineers and mathematicians agree that the shortest distance between two points is a straight line.

While the extra mileage may seem to add only time to the journey, a closer look at fuel costs reveal a dramatic expenditure burden for truckers and the trucking industry. These expenditures are then passed on to the companies who then pass the burden of payment to the consumers by raising prices of goods. Increased expenditures always equals increased costs.

An average 18-wheel truck operates at an average of four to six miles per gallon, or roughly $1.10 per mile of operation. At 70 miles, that adds a total of about $77. While this added expense may not total very much on an individual basis, it's significant when you figure in 4,091 trucks, the average trucks crossing per day, would total to an amount of $315,000 per day, or to make it in bigger terms, $114,968,161 per year. This cost is undoubtedly passed on to the consumer.

The U.S. Bureau of Transportation and the TxDOT truck traffic flow maps reveal a telling picture of business travel on the arteries of the NAFTA lifeline. However, they cannot forecast or determine the tax burden to the Texas taxpayers who must absorb the cost of the highway maintenance and repairs to the over-utilized highways. TxDOT estimates that repair and maintenance on rural highways costs $35,000 per mile per year, or $3,000 a month per mile.

Expanding US 59 is vital to the future of Texas and to NAFTA. Increased emphasis on infrastructure development along the Texas-Mexico border is needed to meet the region's transportation and economic needs. Increasing and restoring funding for highway projects in our region to start construction projects sooner would help jump-start a lagging economy, create new jobs, and help draw additional federal highway funding.

An established principle of economic development is that a well-developed infrastructure is essential to attract high-value businesses to an area. Improving highway infrastructure along the border and South Texas area is an important first step to begin improving the economic prospects of the region, the state and the nation. Funds for trunk system improvements for a four-lane divided highway on Highway 59 from Victoria to Laredo were approved over 20 years ago. We cannot afford to wait any longer; we need this project to be completed now.

Thank you for your time; appreciate it very much.

MR. JOHNSON: Commissioner Susan Stasny, Bee County.

MS. STASNY: Thank you, Chairman Johnson, Commissioners Nichols and Williamson. I am Bee County Commissioner Susan Stasny. I speak on behalf of Bee County Judge Jimmy Martinez.

The issues presented today by the tri-county alliance of Bee, Goliad and Live Oak are supported by statistics and data generated by the United States government and the Texas government, and by the victims who lost their lives on the highway that is vital to our communities, our state and our nation. Few can argue that US 59 through Goliad, Bee and Live Oak counties is in desperate need of expansion.

While our highway issues are not unique, the results of the remedy are. TxDOT has traffic maps that reveal that the arteries of the highways that give life to NAFTA are clogged. Expanding US 59 helps unclog the arteries, and thus truck traffic, the lifeblood of a growing economy, can flow more easily through our state, our nation, and our continent.

Expanding US 59 increases traffic flow across the state and increases the percentage of expansion of Texas highways to meet current needs at a lower cost. Current expansion level of needs met is at 36 percent; the expansion of US 59 would bring the level of needs met much closer to 50 percent.

Expanding US 59 would cause a great incentive for the federal funding as it benefits Texas, the nation, and all of North America.

Expanding US 59 would save tax dollars by eliminating redundant spending. US 59 is within the footprint of I-69 and the Trans-Texas Corridors. By directing funds to US 59, the state could save future tax dollars by building US 59 to the I-69 standards within the footprint.

Expanding US 59 would also reduce the cost of tax dollars by reducing the annual maintenance cost of contracts required to repair and maintain I-35 and I-10 from over-usage by commercial trucking.

Expanding US 59 would also provide another weapon in the planning of homeland security by providing an additional route for responding to terroristic threats at the border or at the port.

Expanding US 59 would reduce the ozone action days in San Antonio and the surrounding areas by reducing 70 miles for each truck that travels between Laredo and Houston. A straight and more direct route would reduce an incalculable amount of environmental damage created by truck emissions.

Commissioner Williamson, we support Governor Perry's Trans-Texas Corridor and we applaud his vision for all forms of transportation in Texas, and appreciate your presentation to the Regional Leadership Conference in Corpus Christi.

Commissioner Nichols, we also appreciate your numerous trips to South Texas. As you may recall, in 1998 with Representative Judy Hawley leading the charge, a similar coalition requested a jump-start for US 59 at a commission meeting held in Victoria.

Commissioner Johnson, it's the first time I've spoken before you; however, we'd like each of you to know that US 59 through Bee, Goliad and Live Oak counties was designated a part of the High Priority Corridor. It is our request that each of you understand our frustration at receiving notification in January of 2002 of construction dates for US 59 in approximately 2007, only to see new plans further delay highway construction in our rural area. It seems we no sooner get in line for funding than we go to the back of the line. Unfortunately, we do not see our small local banks becoming partners in this section of the Trans-Texas Corridor that comes through our three counties.

We beseech the commission to approve construction funds and to provide a solution to the traffic and safety needs of Bee, Live Oak and Goliad counties. Thank you. And you have a resolution from Bee County?

MR. JOHNSON: Kenneth Chesshir, the mayor of Beeville.

MAYOR CHESSHIR: Good morning; it's great to be here. I have also a proclamation from Live Oak County that I'd like to enter into the record.

MR. JOHNSON: Thank you.

MAYOR CHESSHIR: Okay, now I'm ready to talk. I'm here to represent Bee, Live Oak and Goliad counties in the expansion of Highway 59. I realize this commission would do everything for everybody if they could, but that's not feasible. Your final decision has to be what's best for Texas, and I feel that the expansion of this highway is best for Texas. To recap what Judge Gleinser said, just the common sense theory of the straight line from Laredo to Houston, 59 also crosses Interstate 37 which is access to San Antonio and also down to the Valley, down to Corpus, so it already crosses a major thoroughfare there.

Also, the I-69 Corridor, of course we're hoping it comes through our counties, but that's a project that's years from now, and planning infrastructure you can generally only do it for about 20 years. So these counties, and Texas as well, have a problem now with I-59; we need to widen it now.

Now, TxDOT has already obligated close to $10 million, give or take a few hundred thousand, for a Corridor Super 2 highway, and we feel that the $10 million is approximately about 20 percent of what it would take to widen 59 from Goliad all the way to Live Oak County. And I don't mean to say it's only money because I know when you're doing a budget -- I've had to do a few budgets -- but I feel in the grand scheme of things the extra money here would be well spent.

Another point I'd like to bring up is that trucks now traveling from Laredo to Houston are now traveling an extra -- this is just trucks -- 286,000 plus some miles per day using I-35 and I-10 which they could use I-59, like I say, a straight line directly to Houston.

So I feel that we have a legitimate argument here, and I would appreciate it if you would look at this with an open mind. And I want to thank you for listening to me and thank you for the time you give Texas. I'd like to wish you a Happy Thanksgiving, and God bless you, and God bless Texas.

MR. WILLIAMSON: We need to match this guy up with the guy from Sugar Land who is getting our airport money here in a little bit.

(General laughter.)

MR. JOHNSON: David Flores.

MR. FLORES: Mr. Chairman, good morning; commissioners, good morning. I am the consultant that represents the three counties, and in canvassing the counties, speaking to the county officials, speaking to the public, the common denominator was the clear and present danger that existed on Highway 59. As mentioned, since 2000, accidents have quadrupled on that stretch of highway, something that none of us could live with, especially if our children are traveling up and down that highway. We use it for economic reasons, we use it for social reasons, just to go back and forth between the cities.

What I saw here was a concern so great that three counties were willing to come together and for the first time in history passed joint resolutions to present to you today. It's the first time the three counties have come together and unified and said we can be strong, strength through unification. That's what they've done today.

One of the messages that we want to get across is that we want common sense government. A straight line is more cost-effective and a shorter distance than a jagged line, so economically it makes sense to have a straight line. Even a child, if you said draw a point, a straight line from Laredo to Houston, it goes right through 59.

The other issue is the counties now wish to work smarter, not harder, and that's become very contagious. We've seen it through the city officials and the county officials. We're having a lot less in our budgets now so we're having to work smarter. We're coming up here saying: Okay, we're doing our part; we want to ask you to do your part, and we're willing to do whatever we need to do to help you in our communities. And we believe 59 is not only good for the tri-county area, for the state, for the nation and the continent because it is the National Free Trade Agreement which affects the whole continent, and thus that spurred all three counties to come before you and request you reconsider funding for the expansion of Highway 59.

MR. JOHNSON: Thank you.

MR. NICHOLS: What type of consultant are you? Engineering consultant?

MR. FLORES: No, not at all. The only type of engineer I am is the sanitation engineer when my wife says take out the garbage.

MR. NICHOLS: Well, they introduced you as a consultant.

MR. FLORES: I'm a legislative consultant, legislative liaison. I basically help different entities in issues with state government.

MR. NICHOLS: Okay.

MR. JOHNSON: Did you have any questions of any of the presenters?

MR. NICHOLS: I had a number of comments. Do you want me to go first?

MR. JOHNSON: Yes.

MR. NICHOLS: Okay.

MR. JOHNSON: Ric, did you have any questions?

MR. WILLIAMSON: I'll yield to the senior member on his birthday.

MR. NICHOLS: I'm the newest member.

MR. JOHNSON: Freshman and senior.

(General laughter.)

MR. NICHOLS: I noticed all of our speakers kind of got to the back real quick. This isn't like church where we don't notice you if you get in the back row.

To the mayor, Mayor, were you mayor of Beeville in '98-99?

MAYOR CHESSHIR: I've been mayor for going on eight years.

MR. NICHOLS: Did you make the presentation in Victoria when we were down there?

MAYOR CHESSHIR: No, sir.

MS. STASNY: Judge Martinez did.

MR. NICHOLS: All right. I had a number of comments; I don't know that they're questions so much.

I think that your comments and concerns are very justified, and I think the commission agrees that the US 59 route is extremely important to the state, and it's certainly the shortest route for NAFTA traffic going up to the Port of Houston, and also short-cutting to the Port of Corpus Christi from Laredo for shipments.

It was not funded, as I recall, 20 years ago; these improvements were funded about four years ago. I remember when we voted on the improvements. Maybe it had been in the plan but the great bulk of expanding the corridor I think was approved about four years ago; I remember when we did it.

When we approved four-laning the great bulk -- or basically all of US 59, filling in the gaps on the trunk system on the Phase 1 Corridor, we ended up recently with somewhat -- I'm trying to explain. First of all, we do think it's extremely important, so therefore, we're in agreement with you, but the conflict all of a sudden is that Interstate 69 -- which is a reality -- is going to overlap significant portions of this route.

Right now today we are not quite sure which portions it will and it won't, and if we go in and spend money converting it to a four-lane and it happens to be an area that exactly overlaps, then we have totally wasted that money. But if we know it's an area that's going to overlap, then we can bring it up, as we expand it, to interstate standards and not waste that money. And the process of determining which of these areas, the exact specific location where Interstate 69 will go, is in the process of study. I don't mean 20- and 30-year study; I mean it's imminent.

I know that portions of that route of Interstate 69, the exact locations in a couple of counties in East Texas, has been completed and that we have hired a firm or a series of firms to go in and identify -- I think it was like 12 or 13 segments of study -- exactly where those locations would be. Now, what I'm not sure about is what the timing for completing those studies are.

I think as important as this route is to get expanded for that traffic, it is very important to get that study over with or complete so that we will know exactly where that is so that when we do the expansion -- and I think at that point basically we can get after it -- it's not going to be wasted. It's a shame to have built something new and then turn right around and tear it up.

I don't know if I need to ask Mike or Amadeo the status on the Interstate 69 study and where we are on that.

MR. SAENZ: Thank you. For the record, I'm Amadeo Saenz, Assistant Executive Director for Engineering Operations.

Commissioner Nichols, we have finalized, we have the consultants in place, we are going to start the public involvement process for the I-69 Corridor in the next couple of months -- it's going to take us three or four months -- and we estimate somewhere between 18 and 24 months to be able to get the route identified to move forward on the I-69 project.

MR. NICHOLS: Okay. So in 18 to 24 months from now, or 18 to 24 months from a couple of months from now?

MR. SAENZ: I would say 18 to 24 months from now.

MR. NICHOLS: So at that point we should know where it laps or goes off to the side, and then we'll have that first question answered. Then the second thing is the U.S. Congress, in funding Interstate 69, will either lock in, on this next six-year formula, funds for that construction or they will not. If they do -- and we should know -- it should have been already voted on this Fall but the U.S. Congress I think put it off five more months, and we can only guess as to when the final vote on that six-year bill will be.

If there's going to be funding from the federal government for Interstate 69 in the next six years, it will be in that six-year bill. Hopefully they vote on it by this Spring and then we'll know. If they have construction funding and as soon as we get those routes identified, then we'll have money to build it to interstate standards. If they choose not to put in any construction money for Interstate 69 and we have identified those routes, then at least as we go in and do expansion, it will be in the proper places so that we don't waste the money. That's kind of the way I am on it.

So we do agree with you that it's a significant route and we're not just putting the whole thing off. I think what the administration was trying to do with the Super 2 was to, in the temporary period, try to go in there and get you some passing lanes and things like that while all this is being studied. That's kind of my understanding.

MR. JOHNSON: Ric, did you have anything?

MR. WILLIAMSON: (No audible response.)

MR. JOHNSON: Several things that I wanted to mention, and a lot of it echoes what Robert has brought forth.

First of all, we share your concern. I mean, the fact that you're here makes it important to us, but it's important to us because we recognize that US 59 and I-69 are vital corridors for the development of this state and its trade with Mexico and for many, many reasons. And we also recognize that the most direct way someplace is a straight line where practical, and we believe that it's practical in this case.

And also, please note that safety is one of our highest, if not our highest, priority and concern. And I believe that David Casteel, who was the district engineer in Corpus Christi and is now the district engineer in San Antonio, has worked on and has some safety-added projects that have been approved and will be working on this stretch of road.

So I recognize that we're crawling before we walk and walking before we run, but unfortunately, with the advent of I-69, as Robert has so eloquently explained, and the concept of the Trans-Texas Corridor, it would be expensive and repetitious if we did something now and then just a few years from now we repeated it somewhere else. And I think we would be probably justly criticized for being wasteful, and the last thing the three of us -- and I'm speaking for the three of us, probably shouldn't be -- we are stern stewards of the resources we have and waste is not something that comes into the equation.

Believe me, this is not a conspiracy to put some of these things off, it's just the way things unfolded in this particular instance, and we regret that. We understand that areas are affected, the people are affected, but we're getting there, albeit not at the pace that you would prefer, but if you'll continue to work with the commission and district engineers, we are going to get there. And we appreciate your being here today and re-emphasizing the importance that it is to your three counties.

I know to the east of Goliad, to Victoria, I believe that work is about to be let, if it hasn't been let, to expand 59 between Victoria County and Goliad. So we're getting there, and we recognize it's not as fast as you would like, and we regret that. But thank you for being here.

MR. JOHNSON: The next item on the agenda is the approval of the minutes of our commission meeting in October. Are there any additions, deletions or corrections to those minutes?

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

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

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

We will then move to the Grand Parkway Association and their status on projects and activities, and I believe Robin Sterry, who is the assistant executive director of the association, will present the report. Welcome, Robin.

MS. STERRY: Good morning, gentlemen. I'm pleased to be here and it was a lovely drive from Houston this morning.

Just to give you a brief overview of the status of the different segments of the Grand Parkway, I've got a PowerPoint presentation and you all have a copy of it in front of you.

This slide shows the various segments, all the way from A to I-2, the various 13 different segments and the different times of initiation for the different segments. I'll go into detail for each of them further on in the presentation. As you can see, it does form an almost complete loop around Houston; it's outside of 610, Beltway 8, and the State Highway 6/FM 1960 corridor.

Segment D is our first segment that we initiated back in the early '90s. It was constructed and open to traffic in 1994. In 2003 we've accomplished a number of things in our coordination with TxDOT as well as Harris and Fort Bend counties on looking at the options available on Segment D for building out to a full freeway facility and utilizing toll financing. Our projected accomplishments along with Segment D include continuing these discussions with the different tolling authorities -- whether it be Harris County Toll Road Authority, Fort Bend County Toll Road Authority, or Texas Turnpike Authority -- to look at finalizing the improvements along Segment D.

The next segment that we had initiated was Segment I-2 which was on the east side of Baytown that goes from I-10 on the east side down to State Highway 146. We received our final environmental approval of the record of decision back in 1998, and in 2003 we went to construction, and that includes all of the three segments that are shown and highlighted on the slide which goes from I-10 to FM 565, from FM 565 to 1405. Now, we are still in coordination with Harris County Toll Road Authority on looking at tolling options available for this, but the project has gone to construction as of August.

Segment C is our next segment that we've been working on. It goes from 59 in the southwest area down to 288 on the south side in Brazoria County. We have released the draft environmental impact statement and we held the public hearing. The public hearing brought up a number of issues that were needing to be addressed before we move forward with the final environmental impact statement, including hydraulic studies and an endangered species. We have written the final environmental impact statement, it is being reviewed by the Environmental Affairs Division as well as FHWA, and we anticipate its release very soon in the calendar year. Once we have the release of the document, then we'll hold a public workshop for that document, as well as the schematics, and we anticipate getting the record of decision for environmental approval from FHWA in early 2005.

Fort Bend County is very anxious to begin the portion that goes south from 59, so they would like to move forward with the construction starting at 59 and going down to Rabbs Bayou as early as 2005, and would be participating in right of way acquisition as well as some of the PS&E work.

On Segments E, F-1, F-2, and G, we received our funding to initiate the studies for the segments at the same time, and we've moved forward with all of those and we've staggered the release of the DEIS for each one. For Segment E which goes from I-10 up to US 290, we released the DEIS back in February of 2003, we held the public hearing back in March. We had approximately 70 people attend and we received approximately 30 different comments.

We've been meeting with all the different tolling entities -- which is Harris County Toll Road Authority, Fort Bend County Toll Road Authority, Texas Turnpike, TxDOT, and FHWA -- to discuss how to move the Segment E portion forward as a toll road. What we're looking forward to in 2004 is the preparation and the release of the FEIS and to hold a workshop on the release of that document, and hopefully to prepare the record of decision to move forward to FHWA.

On Segment F-1 from 290 to State Highway 249, we have released the draft environmental impact statement and we held our public hearing last Tuesday. We had approximately 150 people and our comment period ends on January 19. What we look to do in the next calendar year is to prepare and release the final environmental impact statement for this segment.

Segment F-2 which goes from State Highway 249 to IH-45 in the Spring area, we've held numerous meetings with not only the different local and state agencies involved with this, as well as the community. This is a very active community and we speak to the homeowners associations, community school boards, and MUD boards. What we hope to do within the next calendar year is to release the draft environmental impact statement -- very soon in the calendar year since the document is in review with the FHWA and ENV at this time, and then soon after that hold a public hearing and also prepare the final environmental impact statement.

Segment G, again is from IH-45 to US 59, and for this next year, we hope to get the document up to TxDOT and FHWA for review and then release that document and hold the public hearing.

The next segment that we've moved forward with is Segment B down in the Alvin area. It goes from State Highway 288 in Brazoria County to IH-45 over in Galveston County. We held the scoping meeting in September of '02; we held a public workshop in February of '03. In this calendar year we hope to present the draft environment impact statement. We hope its release will be in early 2004, and then a public hearing in mid 2004. We look to release the final environmental impact statement in fiscal year 2005. We have continued involvement with the county and local officials to discuss tolling.

Segments A, H and I-1, those are on the east side of the region and north of 90 and I-10 and also south between State Highway 146 and IH-45. Those three segments currently have no studies underway. Now, we have been talking to Mr. Trietsch at the Houston District at looking at doing some corridor preservation studies for those three segments. The northeast area of Houston around Lake Houston continues to develop. They are actually starting to accelerate some of their growth in that area and if we can do corridor preservation without the full environmental document, at least any growth that happens can be complementary to any type of facility that would be required in the area.

And I've left the best for last. We do anticipate the release of the Harris County Toll Road Authority's traffic and revenue studies for tolling of all of the segments, from what I'm hearing from them, at the beginning of the calendar year, and it is looking very favorable for each of the segments to move forward with some option of tolling. Now, whether they choose to participate or whether we choose to participate with the other counties or Texas Turnpike Authority, that's yet to be determined.

MR. JOHNSON: Questions?

MR. WILLIAMSON: I'm going to have a comment, but I would yield to yourself.

MR. NICHOLS: Have you got some speakers?

MR. JOHNSON: No. That's the next one.

MS. SPERRY: I didn't know if anybody had come up for us.

MR. NICHOLS: I just want to make sure, every segment that is either under construction or is not built yet is being considered for possible tolling?

MS. SPERRY: Very strongly so, yes, sir -- including the segment that is built; we are in discussion with TxDOT because it was an interim phase construction, there are no overpasses at some locations of the major thoroughfare intersections, and we're looking at options available to building it out to a full freeway facility and utilizing toll revenues for those improvements as well as for that segment.

MR. NICHOLS: It's built basically like two frontage roads on the outside of the right of way; main lanes could be considered possibly as tolls.

MS. SPERRY: Yes, sir, except there's not continuous frontage roads along any of the segments. It does have frontage roads along certain portions, but some of the intersections are not complete yet.

MR. NICHOLS: Great.

MR. JOHNSON: Ric, did you have anything?

MR. WILLIAMSON: Well, my questions and comments would parallel where Robert was going, but perhaps I misunderstand who owns this asset. Is this going to be a county asset or a state asset?

MS. SPERRY: This will be a state asset. Now, the county, Harris County Toll Road Authority, has joined in participation with our traffic and revenue studies, but this is still State Highway 99.

MR. WILLIAMSON: Well, we've been talking about conversion of this to a toll road for over 15 months, I believe -- because that was when it was first raised here.

MS. SPERRY: Right.

MR. WILLIAMSON: Of course, this is the Chair's part of the state so his thoughts carry a lot of weight, and I couldn't tell if my colleague Mr. Nichols is lukewarm, but I don't want to be lukewarm about my position. I would not want to put one dime of the state's money in this project unless I knew for drop-dead certain that it was going to be a toll road. I think this is the fifth time I've said that very strongly, and if I've left any doubt in anybody's mind, I want to address that right now.

MS. SPERRY: No, sir.

MR. WILLIAMSON: Because we can well ill-afford to be in San Antonio promoting toll roads and El Paso promoting toll roads and even in Beeville and Laredo promoting toll roads, and not say in the strongest of terms: This asset needs to be a tolled asset. It doesn't matter to me what the cash flow study that the judge is doing says; I don't care. I'm not interested in any state money going to this project if it is not a toll road.

MS. SPERRY: Yes, sir.

MR. WILLIAMSON: Can I be any more clear than that?

MR. NICHOLS: It's clear.

MR. WILLIAMSON: I'm just one vote but that's my strongest feeling.

MS. SPERRY: Yes, sir.

MR. WILLIAMSON: If we're going to build toll roads in the state, we need to build toll roads.

Thank you for indulging me, Chairman. It's your part of the state.

MR. NICHOLS: Does that mean you think it ought to be a toll road?

MR. WILLIAMSON: Absolutely.

(General laughter.)

MR. NICHOLS: I think we've all been saying that, and as I understand it, I think that's the way you're headed.

MS. SPERRY: Yes.

MR. NICHOLS: We should have the revenue studies to know what bonds could be sold. Once we get the revenue studies, then we can convert within a few months.

MS. SPERRY: Exactly.

MR. NICHOLS: In other words, in the first quarter of the next calendar year, with the traffic studies, we should be able to know what kind of toll bonds you could sell.

MS. SPERRY: And to clear up some of the miscomprehension probably that was put forward by my part, the tolling is not the question. It's the question of who's going to participate in it, whether it be the Harris County Toll Road Authority, the Fort Bend County Toll Road Authority, or Texas Turnpike Authority. We've met with all three of those entities, all are excited about the opportunity, but we just, until the study comes back, don't know who's going to participate at what level.

MR. WILLIAMSON: That's fine.

MR. JOHNSON: And also, the studies are going to tell which segments are the most toll viable which means those are going to be the ones that are done in that order time-wise.

MS. SPERRY: Yes, sir.

MR. JOHNSON: But I don't think that I'm going to express my sense quite as strongly as Mr. Williamson did, but I think it's unanimous in the sense of the commission that this needs to be a toll project. It will be done somewhere between 15 and 25 years more quickly by doing it that way. There will be segments of it that will be less toll-viable but those will be the last to be done simply because the funds, the bonding source to do them, it will probably have to be done off positive cash flow as opposed to depending on bonds. But this and all projects like it around the state, be they in Bee, Goliad and Live Oak counties or wherever, they need to be considered as toll.

MS. SPERRY: Yes, sir.

MR. WILLIAMSON: I was a little straightforward, Chairman, just because I'm entering my third year in partnership with you and Robert, and one thing I observe is that frequently we talk up here about what we want without voting on it and we think we make it clear -- and I know we all individually privately talk with our employees and the community leaders of this state about transportation issues -- and yet remarkably, time after time, a month, two months, six months goes by and what we said seems not to have been heard.

And so when the kind lady uses words like "discussing tolls" that's not what I want to hear. That's why I wanted to be quite frank in my expression. We need to build toll roads, that's what we need to be doing; we don't need to be discussing building toll roads and we don't need to be leading people in Spring and Tomball and all those communities out there into thinking that those might not be toll projects because then it just creates problems for the commission six years from now and the governor, whoever he or she is, and all the other politicians and officials who have to bear the heat of moving in this direction and we don't want to do that. Don't let people think that it's going to be a tax road, not a freeway, a toll road.

MS. SPERRY: Right, yes, sir.

MR. WILLIAMSON: Distasteful, move on.

MR. JOHNSON: Robin, thank you very much.

Mike, with that, we'll continue with the rest of the agenda, but before we get to that, I wanted to recognize Cheryl Williams' presence on the dais. She was ours for a while and then retired to the sanctity of the Public Information Office, and we're glad you're back this month. We understand in March you'll be retiring and wanted to thank you for what you've done for the three of us up here but what you've done for the department and we'll miss you in April.

MS. WILLIAMS: Thank you very much for your kind words.

MR. WILLIAMSON: Are you sure you have to retire?

MS. WILLIAMS: I have to be about it. You know what I'm saying?

MR. WILLIAMSON: Be about it. We all like to use the term "Get on the road and be about it."

MS. WILLIAMS: Right.

MR. JOHNSON: Michael.

MR. BEHRENS: Thank you, Mr. Chairman. We'll go to agenda item number 4, our Aviation minute order for the projects to be approved for the month of November.

MR. WILLIAMSON: This is the guy I want to ask about building 59 with those trucks straight through his backyard of this airport.

MR. FULTON: Thank you, Mike.

Commissioners, for the record, my name is David Fulton, director of the TxDOT Aviation Division.

This minute order contains a request for funding approval for 18 airport improvement projects. The total estimated cost of all requests, as shown on Exhibit A, is approximately $18 million, $11.4- federal, $5 million state, and $1.8 million in local funds.

A public hearing was held on November 3 of this year; no comments were received. We would recommend approval of this minute order, and I believe there are a couple of gentlemen who would like to address you.

MR. JOHNSON: Thank you, David.

Do you have an order? I've got David Ellison's card up top. Would you like to go first, David, or how about you, Mr. Thompson, assistant city manager from Sugar Land.

MR. THOMPSON: Mr. Chairman, commissioners, good morning -- good afternoon now, I should say. My name is James Thompson; I am a member of the City of Sugar Land City Council, Sugar Land, Texas; I'm also the council's liaison for the Sugar Land Regional Airport, serving in this capacity for the past eight years.

The project before you today is the result of several years of working closely with the Texas Department of Transportation Aviation Division, to meet the current and future needs of general aviation in the Houston metropolitan area. The City of Sugar Land acquired the airport in 1990, prior to which the airport was a private airport known as Hull Field. The airport has been designated as a reliever airport to both Intercontinental and Hobby airports to reduce congestion and provide for the additional needed capacity for general aviation.

The Sugar Land Regional Airport has operated as a self-sustaining enterprise fund since the city's purchase of the airport. The airport has continued to enhance that capacity through a number of projects undertaken, in addition to becoming the major business airport within the Houston area. Over the past few years the airport has continued to see an average annual growth of approximately 10 percent.

This project, again, is the coordinated effort of the Texas Department of Transportation Aviation Division, city management, airport staff, and Congressman Delay's office. The project began with the annual capital improvement budget planning process which identified an alternative to building the needed general aviation capacity. The preliminary engineering has been completed and the wetlands mitigation is currently underway.

It should be noted that the staff of TxDOT Aviation has taken a very proactive approach to the wetlands mitigation and through their efforts were able to provide a win-win proposition that not only mitigated three acres of wetlands on the airport, but also re-established 30 acres of wetlands at the Brazos Bend State Park.

This phase, Phase 1 of the project, will begin the construction of two bridge taxiways, drainage and associated apron. When the project is completed, it will provide for 85 new T-hangars, a new general aviation business center supporting flight schools, mechanic shops, radio and electronic shops, self-fueling facility, and a small city park.

This project truly demonstrates the unique cooperative effort between local, state and federal entities not only to identify the needs of commercial aviation but to identify and act on the needs of general aviation as well. These airports have become increasingly more important to communities. A recent economic study indicates that over $25 million is added into the local economy annually from the Sugar Land Regional Airport.

Under the direction of Director Dave Fulton, this is the single largest undertaking in TxDOT Aviation history. Projects such as these provide airports with the resources to develop additional infrastructure, to increase revenue sources needed to maintain self-sufficiency, in addition to developing alternative aviation markets and jobs. The growth of Sugar Land Regional Airport can only be attributed to the commitment of the city, and the support of TxDOT Aviation, and our congressional office.

Airports such as the Sugar Land Regional Airport have also taken on many new responsibilities post-911 in becoming more important in the emergency planning process.

Commissioners, the brochures that I handed to you is a recent update of our comprehensive business plan. There's two areas I'd like to point out. On page 5, number 10 is our goal on transportation mobility. Recently many of you visited our community on the opening of Highway 59 and you know Sugar Land has been very progressive in that respect. And then on page 19, which is our goal number 8, I wanted to point out our commitment to the Sugar Land Airport. This is a community effort; we get citizen support and political elected officials support.

Again, I would like to extend my thanks to the Texas Highway Commission, Dave Fulton and his staff on behalf of the City of Sugar Land for the continued support and development assistance, not only of the Sugar Land Regional Airport but also all general aviation airports in the State of Texas. This project will serve as a model on how government agencies can work together to provide the much needed capacity and repairs for general aviation.

Thank you very much, commissioners.

MR. JOHNSON: Thank you.

Are you David Ellison?

MR. ELLISON: Yes, I am.

MR. JOHNSON: Sorry for getting you two confused.

MR. ELLISON: That's okay. Thank you very much, Chairman Johnson, Commissioner Nichols, Commissioner Williamson, Mr. Executive Director.

I'd like to add thanks to the commission and to the agency on behalf of Allen Bogard, the city manager. We really appreciate the fine working relationship, professionals-to-professionals, and as exhibited by our elected official here, it truly does take everyone working together at all levels and demonstrating exemplary leadership and a broad vision.

I'd like to just briefly mention that in addition to all the things already said by Councilman Thompson, there is a level of detail and commitment to professionalism, customer service and excellence and forward-thinking planning that exists on the part of our aviation director, Mr. Savco, who is here in the office, and your people who have guided us through a successful business planning process. Every objective in that business plan that has had about a five-year life has been achieved.

One of our strategic projects, led by our council and our city manager, Mr. Bogard, is to update that business plan. We all know in communities as busy as Sugar Land and in regions as busy as Fort Bend County we sometimes have dissenting voices. I want you to know that in that comprehensive plan and in every document, when we talk about the growth and success and the economic viability and importance of Sugar Land's Regional Airport -- which is its official name now; it's been changed from the Municipal Airport for legitimate reasons already discussed -- we also talk about the importance of partnership with community. We have a very active community-driven noise mitigation plan; we have a very active citizen advisory group that's appointed by the mayor and council who helped us to develop those policies; and your staff and your executives have again been tremendous assets to us.

But it's really the attention to the day-to-day, mundane work in terms of the customer service, the convenience and safety, and adequacy of the infrastructure that's provided by a lot of people in this link and in this chain that has helped to make this airport a success, in addition to your support and the vision. We commit to you that if this $8.2 million, as this particular phase of this project is actually approved, we commit to you that this project will be run successfully, it will be managed successfully, the communication and the partnership that has gotten us to this point will absolutely continue well into the future.

With the $5 million terminal that is going to link up to the community's vision for economic growth. We have a new Marriott Conference Center and Hotel; our airport will be one of only three or four operating airports during the Super Bowl. So in every phase, again, sir, we appreciate everything you've done and we commit to you to professionally continue in this approach. Thank you very much.

MR. JOHNSON: Thank you.

David, I believe you brought forth a recommendation?

MR. FULTON: Yes, sir. I would recommend approval of all 18 of these grant requests.

MR. JOHNSON: Any questions, comments?

MR. NICHOLS: That's a great presentation, and that is a busy airport. I flew into it about 18 months ago, and I mean, it is a busy airport.

MR. JOHNSON: And going to get busier.

MR. NICHOLS: Yes. So moved.

MR. WILLIAMSON: Second.

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

(A chorus of ayes.)

MR. JOHNSON: Motion carries. Thanks, David.

MR. BEHRENS: Agenda item 5(a), we have our rules for Proposed Adoption, and these are rules concerning rail facilities and abandoned rail.

MR. RANDALL: Jim Randall, director of the Transportation Planning and Programming Division.

Item 5(a), this minute order proposes adoption of new Sections 15.150 through 15.153 to be codified under Title 43, Texas Administrative Code, Part 1, relating to the department's acquisition of abandoned rail facilities.

Transportation Code, Chapter 91, authorizes the department to acquire, finance, construct, maintain, and operate a passenger or freight rail facility or system, including the acquisition of abandoned rail facilities. House Bill 2, of the 78th Legislature, Third Called Session, 2003, directs the Texas Transportation Commission to adopt rules governing the disbursement of funds for acquiring abandoned rail facilities. In establishing this criteria, the commission is required to consider the local and regional economic benefits realized from the disbursement of funds in comparison to the amount of funds disbursed.

The department has scheduled a public hearing in Austin on January 9, 2004 to receive comments concerning the proposed new rules. The minute order presented for your consideration authorizes publication of the proposed rules for adoption in the Texas Register for the purpose of receiving public comment. Staff recommends approval of this minute order.

MR. JOHNSON: Any questions?

MR. NICHOLS: No. So moved.

MR. WILLIAMSON: Second.

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

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. BEHRENS: Agenda item 5(b), we have two rules for final adoption, the first being on employment practices and our conditional grant program. Diana?

MS. ISABEL: Good afternoon. This minute order adopts amendments to Section 4.21 and Section 4.25 which concerns the Conditional Grant Program. The commission passed the proposed amendments in September; we submitted the amendments for comment; we did not receive any, so at this point staff recommends that final adoption be made by the commission.

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.

MS. ISABEL: Thank you.

MR. WILLIAMSON: Thank you very much for your hard work on this.

MR. BEHRENS: Agenda item 5(b)(2) is final adoption of a rule for motor vehicle registrations. Mike?

MR. CRAIG: Good afternoon. My name is Mike Craig; I'm deputy director of Vehicle Titles and Registration Division. We're bringing to you today the minute order that adopts amendments to Section 17.22 of the Code regarding motor vehicle registration.

The background on this is statutory changes that were enacted by the 78th Legislature Regular Session 2003 included several provisions requiring clarification of the Texas Department of Transportation's rules governing motor vehicle registration. These changes are: the exemption of electric personal assistive mobility devices from the need for registration; terminology relating to salvage and non-repairable vehicle titles; clarification of the department's authority to refuse to issue or to reject objectionable alpha-numeric patterns on license plates; and re-codification of specialty license plate provisions from the Transportation Code, Chapter 502, to Transportation Code, Chapter 504.

The Transportation Commission, by Minute Order 109371, dated August 28, 2003, proposed amendments to this section. No comments were received, so we recommend final adoption.

MR. JOHNSON: Any questions?

MR. WILLIAMSON: Now, who is this guy?

MR. NICHOLS: It says Jerry Dike in my book right here.

MR. BEHRENS: Jerry Dike's deputy, Mike Craig.

MR. WILLIAMSON: Is this his first time before us?

MR. NICHOLS: Did Jerry tell you about the questions he sent up for us to ask you?

MR. CRAIG: No, he did not, but I'm sure they're very detailed. I'm willing to answer any.

MR. WILLIAMSON: Where's Jerry? Is he playing golf today?

MR. CRAIG: He had a higher calling today; he had to do a presentation for the Executive Women in Texas Government at the Renaissance Hotel.

MR. WILLIAMSON: That would be a higher calling.

MR. JOHNSON: Much higher.

MR. WILLIAMSON: Well, I wish we'd had a little warning; I'd have had a few questions for you.

MR. CRAIG: I've noticed that before, yes, sir.

(General laughter.)

MR. JOHNSON: I have a question and it's sort of a lob; it's a slow pitch. Are all the newly available license plates, as authorized by the legislature, on our web site in terms of informative purposes to let out into the public domain what is available and then how you go about ordering those?

MR. CRAIG: That's a lob but there are probably two different ways to answer that. I'll answer it in the most direct. We have listed all the ones that are potentially available; we've added every one that are potentially available to the application forms. As you know, some of these have not made, if you will, paid the $15,000.

MR. JOHNSON: The financial requirement.

MR. CRAIG: Right, but they are out there. There is the potential to be issued, and we've identified those. As they do make the $15,000, they're available as being applied for.

MR. JOHNSON: Do we advertise on the web site the way to get the application?

MR. CRAIG: Yes.

MR. JOHNSON: If they're noted and described on the application. The application itself is not on the web site. Is this correct?

MR. CRAIG: That's correct, but they are listed as a listing under categories of plates, broken out by non-profits or specialty plates, military, those types.

MR. JOHNSON: Thank you. Anybody else have anything?

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. CRAIG: Thank you very much.

MR. WILLIAMSON: You got off light.

(General laughter.)

MR. BEHRENS: Item number 6 is our Public Transportation agenda item, and this one deals with the use of toll credits in the Beaumont and Port Arthur area. Sue?

MS. BRYANT: Good afternoon, Mr. Chairman, commissioners, and Mike. Thank you very much.

The minute order before you is requesting approval of toll credits in the amount of $1,550,000 for the City of Beaumont, $750,000 of toll credits for the City of Port Arthur. The toll credits are being requested to be used as non-federal match for transit capital projects. These toll credits will leverage $6.2 million in federal funds for the City of Beaumont and $3 million in federal funds for the City of Port Arthur. The funds will be used to purchase 20 compressed-natural-gas-fueled buses for Beaumont and 10 propane-fueled buses for the City of Port Arthur.

This is particularly requested because as of November 13 the non-attainment area went into a conformity lapse, and so the purchase of these buses is specifically requested to help with the clean air efforts in this non-attainment area.

We do have some guests from Beaumont-Port Arthur and the MPO, including Bob Dickinson. They have not signed up to speak, but if you have any questions regarding their request for the toll credits, I'm sure they'd help answer any.

MR. JOHNSON: Are there any questions or observations?

MR. NICHOLS: No. This minute order, in effect, is more -- are we directing in this also to expend toll credits to other areas that may have air quality problems, or just specifically to this one?

MR. JOHNSON: This one specifically.

MR. BEHRENS: We're looking at an individual as they come up, because this one we had the conformity lapse.

MR. NICHOLS: But for the public that are interested in toll credits, we're holding back, as I understand it, quite reservedly on these things until we've come up with a statewide plan.

MS. BRYANT: That's correct.

MR. NICHOLS: But recognizing that areas that have serious air quality problems, where this might help that, we're taking an exception, this being one of them.

MS. BRYANT: Yes, that's correct.

MR. NICHOLS: Okay.

MR. JOHNSON: Mr. Ric?

MR. WILLIAMSON: Robert said it all.

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. WILLIAMSON: Before you leave, let me ask Mike, and you might have part of this answer -- if you don't mind, Mr. Chairman -- where do we stand on our inventory to see what our total toll credits are? Is Sue in charge of that or is that someplace else in the department?

MR. BEHRENS: I think Mr. Bass can help us on that, but I know James has put a report together where we're looking at the potential that we have for toll credits such as the Camino Colombia Toll Road, we have some coming there, and we're also looking at some other areas. We're currently doing that inventory now, and then we have to work with the feds also to verify the numbers.

MR. WILLIAMSON: I guess there are three things about toll credits that come up: one is what have we earned to date; two is how do we disburse them to the highest and best use; and three is this notion of understanding how toll credits can be used to earn federal funds for commuter and light rail projects in our state's urban areas -- or what we like to affectionately refer to as the McCarley Computer Express in North Dallas.

MR. JOHNSON: Go ahead.

MR. NICHOLS: I interrupted you.

MR. JOHNSON: Mike, we are ascertaining the projects that have been done that would qualify for toll credits that have not been applied for.

MR. BEHRENS: That's correct.

MR. NICHOLS: The comment that I was going to make, really for the record, people in here that are interested in this, in the federal re-authorization bill, the interpretation section related to toll credits, if there was some clarifications or slight tweaking could mean literally hundreds of millions of dollars more for Texas for matching grants. Thank you.

MS. BRYANT: Thank you very much.

MR. JOHNSON: It has great potential.

MR. BEHRENS: Agenda item number 7 is our Transportation Planning and Programming minute orders, the first being for authorization to do pier protection on two bridges, and the last one, the adjustments to our economically disadvantaged counties.

MR. RANDALL: Again, Jim Randall, director of the Transportation Planning and Programming Division.

Item 7(a), this minute order authorizes the advancement of two bridges requiring pier protection in Cameron and Harris counties to CONSTRUCT authority in Category 6, Structures Replacement and Rehabilitation, of the 2004 Statewide Preservation Program. The bridges are located in Cameron County at Park Road 100 over the Gulf Intracoastal Waterway, and in Harris County at Interstate 10 over the San Jacinto River.

Minute Order 109336, dated July 31, 2003, authorized both bridges in DEVELOP authority in the 2002 Unified Transportation Program. TxDOT's Bridge Division completed a statewide vessel impact risk assessment for all bridges crossing waterways with documented barge or cargo vessel traffic. The bridges were screened based on exposure of structural elements to vessel traffic, bridge type, and level of protective system already in place, and were evaluated based on vulnerability to vessel impact and criticality of the bridge's structure.

In order to provide for a safer transportation system, the pier protection for these bridges need to be advanced to CONSTRUCT authority at a combined total estimated construction cost of $10 million, to be authorized in Category 6, Structures Replacement and Rehab, of the 2004 Preservation Program. We recommend approval of this minute order.

MR. JOHNSON: Questions?

MR. WILLIAMSON: Is either one of these bridges or improvements to one that we keep getting all those damn letters about?

MR. JOHNSON: The I-10 one is.

MR. WILLIAMSON: The cement dust and the reef and all that business?

MR. RANDALL: About the reef and the cement dust?

MR. WILLIAMSON: Tearing down the bridge.

MR. JOHNSON: No. That's the causeway, the I-45 Causeway at Galveston.

MR. WILLIAMSON: What are we doing to make it where we don't get any more of those letters?

MR. RANDALL: I don't know; I'll have to defer to Mr. Behrens on that one.

MR. BEHRENS: I think we're getting closer to working with them.

MR. JOHNSON: There's dialogue with the contractor.

MR. BEHRENS: Yes. Gary's been talking with the contractor.

MR. JOHNSON: And Parks and Wildlife.

MR. BEHRENS: And Parks and Wildlife, but I think they're trying to work an agreement now with the contractor that they will take that out and make the reef. It will take some commitment from Parks and Wildlife as far as funding.

MR. WILLIAMSON: What's their holdup? Are they holding it up, Parks and Wildlife?

MR. BEHRENS: No, not at this point. I think it's been good discussions and they're moving forward.

MR. WILLIAMSON: I'll sure be glad when we quit getting those letters. Once a week I get a ten-page letter about all that.

MR. BEHRENS: In fact, I just talked to one of our Bridge Division people I think it was last week, and he said one of the people that had been writing the letters has been a part of those meetings and he's been very complimentary of the department now since he's been involved.

MR. WILLIAMSON: Okay.

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 7(b), we bring to you the first quarter program for economically disadvantaged counties to adjust matching fund requirements. In your books is Exhibit A that lists the projects and staff's recommended adjustments for each of them. The adjustments are based on equations approved in earlier proposals. There are 25 projects in four counties; the total reduction in participation for these projects is $597,963. We recommend approval of this minute order.

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: Motion carries.

MR. BEHRENS: Item number 8 is a State Infrastructure Bank loan for the City of Socorro. This is for final approval of that application.

MR. BASS: Good afternoon. For the record, I'm James Bass, director of Finance.

Item 8 seeks your final approval of a loan to the City of Socorro in the amount of $318,500 to fund right of way acquisition costs in connection with the expansion of Farm to Market 76 from a two-lane road to a four-lane divided road in Socorro. Interest would accrue from the date funds are transferred from the SIB at a rate of 3.8 percent, with payments being made over a period of ten years, the first five of which would be interest only. Staff would recommend your approval.

MR. JOHNSON: Any questions?

MR. NICHOLS: 3.8 is considered fair market value?

MR. BASS: It's slightly lower. When this application came in for the ten-year period, it was around 3.95 or 4. The City of Socorro is located in an economically disadvantaged county, and so there is a slight discount from market rates for them.

MR. NICHOLS: So moved.

MR. WILLIAMSON: That's why they call him "Fast Jimmy Bass."

(General laughter.)

MR. BEHRENS: Do you want to add anything on toll credits?

MR. BASS: I think you covered it. One of the key things is that on the toll credit issue the states are kind of self-certifying -- or not kind of, we actually are self-certifying, and so we want to ensure that the information we're getting from the other tolling authorities within the state would stand up to any post audit to make sure that what we're verifying is accurate.

MR. WILLIAMSON: Second.

MR. NICHOLS: The second is fine. I was just going to ask another question. Are you familiar with the rates that agencies charge each other, like the General Land Office when they're loaning or leasing to other agencies, what percent they charge?

MR. BASS: I'm not familiar with that, not off the top of my head.

MR. NICHOLS: If you were to guess a number?

MR. BASS: It would depend. If they're all within general revenue, I would imagine it may be close to what is being earned by the State Treasury.

MR. NICHOLS: Which is about?

MR. BASS: Which is about 1.6 percent.

MR. NICHOLS: If it were over 5 or over 6 percent, you would consider that high?

MR. BASS: Yes.

MR. NICHOLS: All right.

MR. WILLIAMSON: Extremely high? Usuriously high?

MR. BASS: Some of it would depend upon what the market rates are at that time, and I may have a general idea of what you're talking about. Some of it depends upon if we sought debt in the market, could we get it cheaper, and then from the other side of that equation, is the other party looking at it as an investment product, what could they reasonably expect as a rate of return from someone with an entity with as strong of a credit rating as we have. And I think all those factors would need to be considered, and I'll leave it at that.

MR. NICHOLS: That's pretty vague. Are you going to be here for a little while?

MR. BASS: Yes, sir.

MR. WILLIAMSON: We may want to ask you some more questions.

MR. BASS: I'll try and be here.

MR. WILLIAMSON: In fact, we're probably going to ask you some more questions.

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

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. BEHRENS: Agenda item 9, minute order relating to toll facilities and contract approval and administrative procedures.

MR. SAENZ: Good afternoon, commissioners, Mr. Behrens. For the record, I'm Amadeo Saenz, Assistant Executive Director for Engineering Operations.

Item 9 involves the revision of contract approval and administration procedures for the development, construction, maintenance and operation of TxDOT turnpike projects. The minute order cancels Minute Order 108753 which established the Texas Turnpike Authority Division, TTA, director's authority to execute contracts and related documents. The proposed minute order incorporates TTA into the Texas Department of Transportation's contract procedures and policies and authorizes the executive director to delegate signature responsibility and authority of these contracts. Staff recommends approval of this minute order.

MR. JOHNSON: Any questions?

MR. NICHOLS: From a practical standpoint, this is about what we've been doing anyway, isn't it?

MR. SAENZ: Yes, sir. It is taking everything that was set separate and apart for the Turnpike Division at the time to the Turnpike Authority Board and incorporating it into TxDOT's process.

MR. NICHOLS: Okay. So moved.

MR. WILLIAMSON: Second.

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

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

MR. BEHRENS: Agenda item 10 is our contracts for the month of November, both in maintenance and highway and building construction.

MR. BOHUSLAV: Good morning, commissioners. My name is Thomas Bohuslav; I'm director of the Construction Division.

Item 10(a) is for consideration of the award or rejection of Highway Maintenance Contracts let on November 4 and 5, 2003 and whose engineers’ estimated cost is greater than $300,000. There are ten projects we recommend for award; we recommend award of all projects.

MR. JOHNSON: Any questions of Mr. Bohuslav?

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. BOHUSLAV: Item 10(b) is for consideration of award or rejection of Highway Construction and Building Contracts let on November 4 and 5. We had 67 projects; we recommend all projects for award.

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.

Thomas, I wanted to follow up on one thing that Robert was questioning about, I believe at the last meeting, on our calculation of percent underrun. For a long time, I believe the interpretation was the percent underrun was a fairly accurate number, and at least I was crediting to the number of bidders.

It looked like there were a lot of bidders more so than there had been in the past and that made for more keen competition and we were benefiting, but I believe your dialogue with Robert last meeting when we were talking about some of our bases that we're calculating, our cost estimates might not be catching up timing-wise with the period.

Are we doing anything about trying to get out calculations as to what the estimated costs should be? Are we improving our methodology or trying to get some of our assumptions more current?

MR. BOHUSLAV: Let me separate two things first. The Highway Cost Index, the number that we run every month just to see what our index is of what it costs to do per unit of work, that's separate from how we estimate projects. About two years ago, February of 2003, and before that 2002 and before that we saw an increase in our prices, significant increases around the state, almost 10 points came up during that previous six-month period. That's since come down. Our indices was about 149 in February of 2002 and today it's about 140, so it's come down since that time period.

That is separate from how we estimate projects. At that time we saw the indices coming up so we told the districts: Hey, be aware that your prices are coming up and you may need to adjust your estimates. Because they send their projects in four or five months before they're let and the estimate is already tied to that when they let, so we just advise them that they might want to consider re-looking at those estimates again before it's let where we have a more reasonable estimate at the time.

Districts use historical prices when they estimate their projects. We maintain a database -- and it's on our web -- where we maintain for every item out there the 12-month average price for that item, and there are 5,000-some-odd items out there. And so they use those values along with their knowledge in the local area of what kind of prices they see and the type of projects that they let in their area, and they adjust their prices with all of that information and they evolve that into a unit price for each item and it comes up with a total estimate by the time you extend all those prices.

They're pretty good at doing that out there in the districts, and we have developed tools in the past through research projects to try to assist them in coming up with an overall project or identify the type of project and come up with all the size of job and so on, and they would use that to compare their breakdown on how they come up with their prices out there.

They generally don't use cost-based estimating procedures which is what contractors use to come up with their prices. They may, if they're not familiar with an item, use a cost-base, and in addition, they may call a contractor out there for specialty work to get information in regard to what does this work really cost down here because we don't have any historical values for that type of work out there.

The question is do we need to go back out to the districts and give them additional assistance in this area. I don't know that in the estimating process that we can get a whole lot better; there's not a lot of refinement there. An initial scope of projects, though, is where we may be weak. When a project is originally conceived, they have this idea about a project, and by the time you get it ready for letting, there have been requests by cities and counties and other entities and other individuals, and maybe Austin has changed some procedures and policy requirements and there's a bigger scope to the project, so the cost of the project has come up much higher than what we originally conceived. There is some refinement that can be done there and there is stuff being done on the national level to address that.

But I think we're pretty good. We generally underrun our estimates, almost every month. You see this month an 8 percent underrun. When you see a bump or a glitch where we're over, it's normally one project. That Dallas High Five project came in significantly over and it bumped our overall estimates over that month. Generally I think our per-project estimates are good; we've got some that bounce around here and there. And there are occasions where I don't think we paid enough attention on an individual engineer basis to an estimate, if we looked at it hard enough, but I'm not sure how much more effort we need to put into it.

Is it affecting our business? That's my question to you. I'm not sure it is because I feel comfortable with what we bring in here to you every month.

MR. JOHNSON: Thank you for that clarification. Does anybody else have anything for Thomas?

(No response.)

MR. JOHNSON: Thank you.

MR. BEHRENS: Agenda item number 11 is our Routine Minute Orders. They are as posted on our agenda that we put out before the meeting. If you would like any of them individually discussed, we'll be happy to do that; otherwise, we'd recommend approval.

MR. JOHNSON: Any questions or observations about the routine agenda items?

MR. NICHOLS: No.

MR. WILLIAMSON: I thought we were going to bring "Fast Jimmy Bass" back up here.

MR. NICHOLS: I'll ask him about it after while.

MR. WILLIAMSON: Did you move?

MR. NICHOLS: I so move.

MR. WILLIAMSON: Second.

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

(A chorus of ayes.)

MR. JOHNSON: Motion carries.

We have now come to the open comment period of the meeting. Do we have any speakers?

MR. BEHRENS: No.

MR. JOHNSON: There are none.

MR. WILLIAMSON: Why is Monroe coming up here? We're in trouble.

MR. MONROE: I just wanted to make sure -- and the court reporter can tell us -- that we got a motion, second and a vote on the construction contracts. I don't believe we did.

MR. NICHOLS: I was concerned we didn't vote on B.

MR. JOHNSON: I was under the impression that I asked for a motion and then I asked Thomas the question.

MR. BOHUSLAV: That sounds correct. He asked the question after the motion and second.

MR. JOHNSON: But thank you for being on your toes there, counselor.

Is this correct?

THE REPORTER: (No audible response.)

MR. WILLIAMSON: I thought we skipped it, too. I was going to see if anybody caught it. I was watching a bunch of contractors back there in the back. They were fixing to have a heart attack.

MR. JOHNSON: There are no speakers who have signed up to speak during the open comment period. Is there any other business to come before the commission?

(No response.)

MR. JOHNSON: There is no need of an executive session. There being none, I will entertain a motion to adjourn.

MR. NICHOLS: So moved.

MR. WILLIAMSON: Second.

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

(A chorus of ayes.)

MR. JOHNSON: Motion carries. Please note for the record that it is 12:59 p.m. and the meeting stands adjourned.

(Whereupon, at 12:59 p.m., the meeting was concluded.)

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