Texas Department of Transportation Commission Meeting

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

Thursday, May 27, 2004

COMMISSION MEMBERS:

RIC WILLIAMSON, CHAIRMAN
ROBERT L. NICHOLS
JOHN W. JOHNSON
HOPE ANDRADE
TED HOUGHTON, JR.
 

STAFF:

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

PROCEEDINGS

MR. WILLIAMSON: Good morning. It's 9:14 a.m. And I would like to call this meeting of the Texas Transportation Commission to order. Welcome to our May meeting. It's a pleasure to have all of you here this morning in the big room and in the waiting room behind and out into the foyer.

It is our tradition to begin our monthly meetings with opening remarks by the Commissioners. And it's my habit to begin with the Commissioner -- and how did we say we're going to say this?

MALE VOICE: It's your habit.

MR. WILLIAMSON: The most junior member, so I guess that would be Mr. Houghton.

MR. HOUGHTON: Good morning everyone. I believe today is going to be a -- as I said to a couple of the delegation's communities last night -- a high water mark day. I'm anxious to hear the presentations. I know you're holding back what was told to us over the period of the last couple of weeks. But I am looking forward to this meeting today, Mr. Chairman. It's going to be a whole lot of fun.

MR. WILLIAMSON: Good. Ms. Andrade.

MS. ANDRADE: Good morning. And I also would like to echo what Ted said, although I'm sorry that I wasn't at the reception last night. But I'd like to welcome all our delegations that are here. It's good to be back in Austin. And look forward to a great meeting. Thank you.

MR. WILLIAMSON: Mr. Johnson.

MR. JOHNSON: Gosh, you're going to hear much of the same remarks from me. It's a pleasure to have you here this morning. And to the good friends from DFW I appreciate your hospitality -- and Brazoria County the same. I'm sorry I didn't get to the El Paso function, but you just can't be everywhere that you want to be. As Ted mentioned, we're going to have a full and productive day and look forward to it.

MR. WILLIAMSON: Mr. Nichols.

MR. NICHOLS: I'd like to welcome everybody here also. Thank you very much for attending. I know a lot of you have come a long way to talk about the dreams and visions and needs of your community. We welcome them -- hope you feel comfortable. And drive careful when you go home.

MR. WILLIAMSON: Thank you, members. And I echo the remarks of welcome to our meeting. It falls upon me to be the school teacher in some respects. So, first of all, everyone always assumes they've turned off their phone and pager and Dewberry and all that stuff, and inevitably, one of us hasn't. So let's all take a moment, reach into our suit pockets and into our purse, and look at our personal communications devices and realize that -- son of a gun, I haven't changed the ringing style. And let's put them on the silent mode so that we're not -- Blackberry, Dewberry, whatever those damn things are called. I don't have one of them, but I know that they exist.

MALE VOICE: Steve has one.

MR. WILLIAMSON: Steve Simmons has one? Okay. Thank you very much. I'm not one for leaving the elephant unspoken of. This will be at times a contentious day. We have some fairly intense issues that need to be spoken of and discussed. And we have some delegations that will come asking for more than we can provide. And no doubt, one or more members will be suggesting alternative ways to provide for those needs.

But if we will all sort of commit ourselves to conducting ourselves in a civil and appropriate manner, none of us will be guilty of saying things publicly that we'll read about later and regret having said, and none of us will perhaps act in a way that's inappropriate to cause anger from others. That kind of nonsense isn't necessary.

I'll direct my criticism at myself first. I have lots of -- habit from the Legislature. I pick up sayings, and one that you hear me say often is, It's the no road to slow road to the toll road. That irritates some people. It irritates some members of the Legislature.

Let me just say that it is my belief that because of the tremendous population growth of this state, and the fact that our tax base doesn't exactly match our growth until years later -- that's the problem with the consumption tax in a growing economy -- is that it eventually pays the bills, but not until years after the growth and the need for the roads occurred.

Because of that, our state, whether you're in El Paso or Hays County or Brazoria County or Dallas or Houston, or even West Fort Worth, Glen, we face a cash flow challenge. That means you either build no roads or toll roads or you can wait slowly for the road to be built. That's what slow road means. So for those of you for whom that's irritating, let me just say I think that encapsulates the problems we all face. Those are our choices.

Let me also say that we can solve these problems. And this Commission's charge is finding ways to solve those problems as painlessly as we can. While none of us like doing some of the things that we do, we do it in the best interest of one state, Texas -- not one part of the state. We don't do it for the Republic of Mexico. We have great affection for our partners to the south, but we're not building our state for the Republic of Mexico or the province of Oklahoma -- that will get a news clip. We are focused on our state -- the entire state.

For the record, public notice of this meeting containing all the items on the agenda was filed with the Office of the Secretary of State at 1:15 p.m. on May 19, 2004.

Before we begin the business portion of our meeting, let me remind everyone that if you wish to address the Commission we ask that you complete a speaker's card, which can be found at the registration table out in the lobby off to your immediate right as you're facing me.

To comment on an agenda item -- that's something posted on our agenda -- we ask that you fill out a yellow card. If you're not commenting on an agenda item -- if you're wanting to make a comment in the open comment period, we ask that you fill out a blue card. But we've hidden all of them so nobody can fill one out and speak later on in the day. No, no. I don't have a blue card up here, but it's roughly the color of this institutional folder I carry -- and if you would please fill that out.

Regardless of the color of the card, we will limit each speaker to three minutes because we have a very long agenda with a lot of people that have to be heard today. If we didn't limit everyone somewhat we'd never get through, which would make some people happy.

We have three delegations appearing before us today -- the Brazos County delegation, the Dallas/Fort Worth region, and a delegation from El Paso. These delegations are number 6 on the agenda. And for those of you who are long-time participants in our Commission activities, you will have no doubt noticed by now that I have adopted the habit of moving delegations around in the agenda, and that's for the stated and express purpose of exposing the delegations to some of the business portions of our meetings, which I believe they can benefit from watching.

You also no doubt will have noticed that we are I would say, Mike, 95 percent complete on our web site advance posting and taking minutes out to the floor to the public. Probably got a little bit of tweaking left, but we're almost there.

And so increasingly, you may access our internet and see a month, two months, a year ahead of time those things that we intend to take up in our minute orders as fast as we think we can have a draft in front of you. And I want to take a moment to compliment Mike and the staff for how quickly you've accomplished that Commission goal.

The first item on the agenda is the approval of the minutes of the April Commission meeting. Do I have a motion?

MR. JOHNSON: So move.

MR. WILLIAMSON: Do I have a second?

MR. HOUGHTON: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of approving the Commission meeting minutes from the April meeting will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: Opposed, no?

(No response.)

MR. WILLIAMSON: Motion carries. Now we would like to take a moment to welcome Mac Tristan, who is assistant chief of the Carrollton Police Department, and who is also the chairman of the Automobile Theft Prevention Authority. Mac, welcome to our meeting.

MR. TRISTAN: Thank you very much, Mr. Chairman, members of the Commission, Mr. Behrens.

I appreciate your comments at the beginning. Our Board faces the very same issues. And it seems like whenever there's dollars involved there's certainly emotions involved, and we do the best we can with the funds that we get from the citizens. And those are always challenging decisions. So I empathize with you and I support you 100 percent in your decision making.

Thank you for allowing me the time to come before you to talk about ATPA, to brag on our awards, and present you with some of our awards. I was appointed to the Board of Directors of ATPA in 1997 by then Governor George Bush. In late 2002 Governor Rick Perry appointed me Board chair.

However, this is the first time that I've had the opportunity or come before this Board. In fact, January of last year was the first one I -- first time I met any of the Commissioners, including Mr. Behrens, when I met Mr. Johnson and we waited in the hallways outside the Appropriations Committee many, many days and many hours.

That, in essence, was a failure on our part of miscommunicating -- of non-communicating. And it's something that we started to remedy immediately. Mr. Behrens was nice enough to meet with me on several occasions after that. We've invited Mr. Johnson to some of our functions in the Houston area.

So we're trying to remedy that to make it known that we are ATPA -- we are under the TxDOT umbrella, and therefore, we have a responsibility to communicate with the TxDOT Board and Commissioners.

I'm here today to give you an overview and answer any questions for you that we may -- that you may have about TxDOT -- or ATPA, and, in fact, present you with some awards.

If we could start with our strange noise. We have a very catchy Power Point. We have an executive director that has a show background and a very enthusiastic staff. So you're going to see a lot of entertainment value in our presentation.

ATPA was established in 1991 -- and I'll go through this as fast as I can. And please stop me along the way. This is informal. If you have any questions, please let me know.

Our goal was to reduce auto theft in Texas. Auto theft was skyrocketing. And even though auto theft continues to go up, we are at a much lower auto theft rate since we were even in 1991, which is astounding when you consider the population increase in Texas and the roads and the vehicles that are out there and the number of targets that has increased.

We're funded by a dollar that all of us pay. Every one of us that drives a vehicle and gets liability insurance gets charged $1 that goes to the ATPA.

Since its inception, obviously, we've become a landmark and decreased auto theft by 53 percent. Again, that's not outstanding figure. We'll go over later in the coverage maps of how many grants we fund throughout the state.

Our ATPA program, which there were about 13 throughout the United States -- some of them have folded because of economic issues that they face, not unlike our state. However, several have copied our program. We go to conferences throughout this country, and there is always -- we're always commended by our work.

This past October I was at the International Association of Chiefs of Police in Philadelphia. They allowed me some time to present -- they asked me to present a session -- a workshop on auto theft prevention authorities that was attended by several states, and including Canada. And they're all wanting to copy what we're doing. So we've certainly served as a model for other states and other ATPAs.

We have our own staff -- a very small, but very effective five-member staff -- and we have a Board of Directors. We are seven members. Two are law enforcement, myself and the chief of Brownsville; two are insurance representatives, Mr. Boyce Miles from Houston, Mr. Ernest Garcia here from in Austin -- no, I'm sorry -- Mr. Mike Gerik from Waco; and two are consumer representatives, Ms. Denise Anaya Saenz -- she just changed her name -- I have to keep remembering that every time I say her name -- who is an associate of Mr. Houghton, and Mr. Ernest Garcia. And we have a standing member, who is a colonel of DPS. He appoints Mr. Marshall Gasky to the Board.

MR. WILLIAMSON: Who's that fellow over there on the right?

MR. TRISTAN: We have a young man that is tirelessly at every one of our meetings. And I was going to recognize him later, but --

MR. WILLIAMSON: That's okay. I just --

MR. TRISTAN: -- Mr. Jerry Dike and his big smile. And I think he's wearing one of his Texas ties -- I'm sure he is. And I've never seen him without one. So that's who that young man is.

We fund -- our mission, obviously, is to fund programs to reduce auto theft in Texas. We have a statewide network of law enforcement prosecutors, insurance -- everything from community awareness to actual hiring of law enforcement officials -- law enforcement officers to combat auto theft.

One of our strongest accomplishments that we're very proud of is the partnership that we have developed with Mexican officials. Prior to 1991, and even a few years after that, car goes into Mexico and it's gone. We have come so far in that. We still don't guarantee we'll get your car back, but we are speaking with Mexican officials. We are inviting them to our meetings, and we'll get into more of our Border Solutions Committee that we have established with Mexican officials -- with Mexican attorney generals -- that is quite effective.

Why is ATPA's work important? Well, obviously -- in 2003 you can see the figures of motor vehicles that were stolen in Texas, yielding losses of more than $700 million. In '91 we estimated a theft rate today would be over $1.7 billion. This is all something that we pay, we as citizens, you and I, out of our insurance. So I think we've certainly been effective in reducing that.

Vehicle theft is the costliest property crime in the United States. Most people --other than their homes, their car is the most expensive item that they drive -- that they have. And it affects the quality of life -- it affects the way of life.

I got a call just yesterday from one of the former city councilwomen in my city yelling at me because her husband went out to her driveway and her car was -- his Suburban was gone. Well, I'm sorry he left the keys hidden underneath the floorboard of his car -- the placemat. And they broke out the window and took his car. It's very easy actually.

So people get upset. It's something that people don't think about until you walk out and your car is not where you left it. And that's certainly an impact on all of our lives.

Insurance fraud is an up and coming trend that we've seen in the last three years where -- and we've actually funded some insurance task forces because a lot of people are simply reporting their car stolen and just getting the money out of it. And it's much more complicated than that, but it's costing us quite a bit of money.

ATPA is currently operating with 34 percent reduction of funding. As I said initially, in January of last year we were in the hallways of the Capitol. We met our 12.5 percent that was required, and then the Appropriations Committee ended up cutting us an additional 34 percent. This has caused us to work harder. This has caused us to reduce funding. This has caused us to eliminate grants. This has caused us to try to continue our trend with less money.

However, our citizens are still being collected the $1 for auto theft -- to go to Auto Theft Prevention Authority. And obviously, that $1 is not going to what they're contributing to.

Categories of funding obviously include law enforcement detection and apprehension. We actually fund police departments and sheriff's departments throughout the state that submit grant applications. A lot of those -- they add officers, they add staff, they add equipment -- we fund that. We also fund Attorney General's Office and several prosecution efforts.

We fund equipment, auto theft -- automobile registrations, and a public awareness, which is a huge, huge part of what it is we do. As police officers we have only limited capacity of stopping auto theft. We could do -- we can be much more effective by working with the community, working with our citizenry, and explaining to them what they can do to remove themselves as targets.

We have -- that's what our awards are about today. The Watch Your Car Campaign was started by ATPA. The H.E.A.T. program -- all of these things are an effort to create awareness so that your car is not stolen. You do everything possible to make sure your vehicle does not become a target.

VIN etchings -- agencies throughout the state that are funded by us will buy equipment to do VIN etchings where they'll actually put your VIN number on every window of your vehicle and any other part that you want -- no cost. I was -- I just found out a couple of weeks ago that car dealerships are charging as much as $300 to do that. We do that for our citizenry at no cost -- part of our funding.

This gives you a map of our coverage. As I am getting older it's hard for me to read. But obviously, the green is our coverage map. The red is -- okay. That is where the grant actually is awarded to. The important part is the white, where there is no coverage.

Now, there's no coverage by ATPA grants. There are police departments and sheriff's departments obviously in those areas. And they have -- they do what they can with their staff in fighting auto theft.

Border Solutions Committee is, again, something we're very, very proud of. Several years ago -- and I don't know who the brainchild was of this. I wish I could say I was, but I was not. Whoever it was was a genius because we have established communications with Mexican attorney generals, Mexican officials.

We have meetings yearly along the border. The chair -- we appoint one of our Board members to chair this Committee -- and that is Ms. Denise Anaya Saenz. I'm sorry. It's Mr. Ernest Garcia, isn't it. I'm sorry. Mr. Ernest Garcia.

And we actually meet -- we have a full house when we have the Border Solutions Committee. We have interpreters, we exchange ideas, we exchange -- it's just an open communication to address auto theft, because our cars are going over there and their cars are starting to come over as well. And it's important that, when your car is sitting over there and you can see it from across the border, you're able to get it back. We're able to do that now in many, many instance whereas before, as I said, it was a total loss.

The Border Partners Program is actually an offshoot of the Borders Solutions. It's a three-part project to combat auto theft along the El Paso/Juarez border. It provides computerized exchange of information between both sides of the border. And as you see, there's three essential components -- intelligence, international liaison, and investigation.

These are more of the hard -- the actual investigators in Mexico and Texas that are actually working on auto theft as opposed to the attorneys general and other higher officials from Mexico that try to remove the bureaucracy involved when getting vehicles back and forth.

BATIC is another offshoot of what we're trying to do with the Mexican border. It is administered by DPS. It is a system where any law enforcement official, not just in Texas, but throughout the state, can call in stolen vehicles. And Mexican officials can call in there. It's one place to limit communication, and we can get communication out on stolen vehicles -- get cars back, as you see, and recovered. We recovered 2,028 vehicles in FY '03 with more of a -- with a value of over $26 million. 2,028 vehicles, okay, may not seem like a lot. But when we had zero before it is certainly quite an increase.

The H.E.A.T. program is extremely effective. It continues to grow. It's amazing, as long as we've been doing it, how people still don't know what the H.E.A.T. program -- how it works. It's free. It goes into the computerized system. And if your vehicle is seen being driven between 1:00 a.m. and 5:00 a.m. police officers can stop that vehicle with no probable cause and identify the owner of the vehicle. If it, in fact, is the owner they send them on their way. If it is not, obviously, they've got some explaining to do. But that is the purpose of the H.E.A.T. sticker.

There is also another -- that goes in the back. There's also a small -- a sticker that goes in the front just under the rearview mirror. And that's where customs agents, as they're going across the border and they can see that H.E.A.T. number and they can stop it and check it as well. Very, very effective.

The RATT office is to Reduce Auto Theft in Texas. This is our main crime prevention program for ATPA. It's headquartered out of the COG office in Arlington -- North Central Texas Council of Governments. They disseminate all kinds of public awareness materials. They provide all of the campaign materials -- posters, brochures -- everything for every ATPA throughout the entire state.

And they actually travel throughout the entire state to attend fairs -- any community event that they're needed. And that's where they go. And again, we can't do this alone, so we need the communities' help to be a part of this.

This is some of our communications that we've started -- some of our media campaign with our own grantees. We've taken the newspaper route. It catches people's eye and people's attention. Auto theft's becoming a gateway crime into many, many other things, including some terrorist type activities that -- where we're talking about tractor-trailers and rigs and everything else that we're having to deal with now. And these are actual headlines that have come up throughout the state and that have sometimes resulted in sad outcomes.

We -- actually the Houston Police Department is -- their auto theft division is working huge, huge -- a large operation of stolen vehicles that are going to Central America and have recovered quite a bit. They're doing an outstanding job with the people that they have in that operation.

Now comes the awards section. They are -- the Telly Awards -- and since I've been involved in it -- I've heard of the Telly Awards, I just didn't realize how prestigious it was. It's a nationally respected and international competition. It's not just for public service campaigns. It's for actual commercials of any kind. It honors outstanding commercials and programs and film production, and they receive over 10,000 entries annually.

We have two awards to show you. The first one is a P.S.A. -- and it was a bronze award for this past year -- '04. Is that right? You want to go ahead and play it?

(Whereupon, a videotape was viewed.)

MR. TRISTAN: Obviously, Sheriff Will Catchum -- I didn't come up with that either, but it's catchy and it works. That was the one that we just got this past year. We also -- they did the last -- the best of the last 25 years. And in 1995 we put together this one P.S.A. that has been aired constantly. It seems to be one of the favorites. And we'll play that now.

(Whereupon, a videotape was viewed.)

MR. TRISTAN: That -- we also have similar commercials like that. Some of them are in Spanish -- several of them are in Spanish, in fact. We have several radio spots in English and in Spanish. And it worked very, very well.

I want to thank TxDOT and all of their support and the Commission. Mr. Behrens has been more than grateful -- or more than willing to meet with me at different times. It's been a difficult couple of years, as everyone knows. We still try to do the best we can. We have a mission, and we will do the best we can with our mission.

And when we started in 1991 we were under the Criminal Justice Division. In '96-'97 we were moved under TxDOT. It's been a great marriage, if you will. Mr. Jerry Dike is a great diplomat of TxDOT. He is directly responsible for our staff. He is at every one of our Board meetings. And I call Mr. Dike a servant leader because he's willing to -- and able -- he'll do anything, even if it's to get you a glass of water or run you copy of something. Jerry is right up front, and I appreciate that so much.

I appreciate the support that the Commission has given us, and hopefully, we can communicate better as we move on to these difficult times. And whatever we can do for you, certainly, we're available to you.

I'll answer any questions that you may have before we go on and ask the Chairman and Mr. Behrens and whoever else to come receive these awards.

MR. WILLIAMSON: Okay, members. The floor is yours. Questions for this gentleman?

MR. JOHNSON: I just have an observation. Mac, that's a great presentation, but even more so, those numbers are remarkable for what you've been able to accomplish and with a limited amount of resources.

And so I'm reminded that a long time ago my car was broken into, and I called my good friend Johnny Holmes, who was then the District Attorney of Harris County, trying to evoke a little sympathy and -- which I was unsuccessful in doing. And he turned around and asked me a question. He said, Well, was your car locked. And I said, Well, it was in my garage. And he said, Well, why don't you do something stupid like lock your car. And I mean, ever since then I have locked my car regardless of where it is.

So -- you know, we -- through that experience, and through some of the messages that you're providing, we do learn. And hopefully, everybody will get it. And I salute the work that you're doing.

MR. WILLIAMSON: Are you suggesting that's the copy for the next ad?

MR. TRISTAN: Thank you, Mr. Johnson.

MR. WILLIAMSON: Okay, Mac. I think we're ready to move on then.

MR. TRISTAN: Very good. If -- I'd like to ask Mr. Chair and Mr. Behrens, if you'd come down, and anyone else who would like to, and present these awards to you. I think someone wants to take some pictures, but --

MR. WILLIAMSON: This will be the whole Commission.

(Whereupon, pictures were taken.)

MR. WILLIAMSON: We appreciate the job that Mac and his agency and every state employee and volunteer to state government does in the furtherance of advancing the state's policies.

We have a -- if you will indulge us, we have a resolution. You know, this is an unusual agency of state government. Everyone's proud of their employees, but we are known throughout the land as being particularly family oriented and are cognizant of the contributions of our employees over the years. And so we frequently at these Commission meetings take time to recognize and honor employees who have made the long trip down the road of TxDOT and have decided to retire. And we're going to honor one of those valued employees today.

Could I have Al Rubio come up here please? Al, where are you? (Pause.) Al, where are you? (Pause.) There you are. Al, good morning.

MR. RUBIO: Good morning.

MR. WILLIAMSON: Come out here and let us all kind of eyeball you. You spent your career eyeballing us. You know, one of the things we're all -- we live in mortal fear is Al rotates those cameras when we don't think they're watching us and catch us, you know, doing things we shouldn't be doing.

MR. RUBIO: Yes, sir.

MR. WILLIAMSON: And Mike, I'm going to turn it over to you at this point.

MR. BEHRENS: Thank you, Chairman. Al, you work behind the scenes -- you're always behind us and have been behind the Commission for a good while and have participated in these meetings a good while. And I want to read a resolution that the Commission has for you.

The resolution states, "Whereas the Texas Transportation Commission takes great pride in recognizing Alberto G. Rubio as an outstanding and dedicated employee who has served the Texas Department of Transportation with distinction for almost 19 years as supervisor of video production in the travel division.

And whereas, Mr. Rubio's creative talents and technical expertise have benefitted the Transportation Commission through his assistance with the design and renovation of the Commission hearing room through the state-of-the-art audio/visual support he and his staff deliver during the Commission meetings and through his exceptional assistance during the introduction of the Trans-Texas Corridor Plan at the Governor's Mansion and at the Texas Capitol.

And whereas, Mr. Rubio has contributed 24 years of state service while earning the respect and appreciation of his fellow employees and others who have been privileged to witness his professionalism.

And whereas, Mr. Rubio has produced over 100 programs which have trained employees, promoted travel to Texas destinations, and informed the citizens of Texas about TxDOT.

And whereas, Mr. Rubio's distinguished achievements on behalf of TxDOT earned a Communicator Crystal Award for the video production, The Queen Isabella Causeway. While his extracurricular accomplishments include Academy of Television, Arts, and Sciences Emmys for his work on the Ironman Triathlon broadcast.

And whereas, Mr. Rubio has devoted most of his professional life to promoting Texas and to improving transportation safety and mobility, and thereby bettering the quality of life for all Texans.

Now, therefore, be it resolved that the Texas Transportation Commission on the occasion of his retirement from service with the State of Texas hereby recognizes and thanks Al Rubio for his career achievements and loyal service to Texas and its citizens."

Presented by the Texas Transportation Commission on this, the 27th day of May, 2004, and signed by all five Commissioners.

MR. RUBIO: Thank you very much. Mr. Chairman, Commissioners, Mr. Behrens, it's been fun working here. Without Mr. Taylor, who is the first division head that gave me the once over and hired me on his whim, and the six executive directors that I've served under, it's been with the people that I'm charged with and the people who have helped me, like Debbie Snyder and Bernard Stafford and Bill Blanton here -- without them I couldn't have done anything. And it's been a very good environment for me to be able to work for the state, to watch my kids grow, and be able to stay at home.

I'd like to thank everybody. I'd like to thank Doris Howdeshell, Geoff Appold for giving me the environment of being able to go out there and be innovative and to design the facility here and other facilities. And I'm going to miss it. And I'll be around. And thank you very much.

MR. WILLIAMSON: We thank you for your retirement and everything.

(Pause while pictures were taken.)

MR. WILLIAMSON: I'm trying to think how to structure this. We have the advantage from up here of knowing about how long things are going to take. And the next item on the agenda is probably going to take some time.

I think what I want to do is first -- I know that Senator Shapleigh was here earlier and had to step out on a matter of business. Are there any other members of the Legislature present in the room at this time?

(Pause.)

MR. WILLIAMSON: Commissioner Daugherty, are you present?

MR. BEHRENS: He's now signed up for item number 3.

MR. WILLIAMSON: I understand that, but I just want to know if he's in the room. (Pause.) Commissioner, if you would, bear with us. We need to have -- we're going to take a couple minute break, and then we're going to have this discussion on the Strategic Plan, which is directly related to your comments.

MR. BEHRENS: That's what he signed up for.

MR. WILLIAMSON: Right. And I know that you have pressing business, and I want to provide the Senator and yourself with the opportunity to move on if you need to. But since I kind of know how long all this is going to take, and I need to be respectful of all of our guests, we're going to take a couple of minutes -- and only that -- I mean, you shouldn't leave unless you really need to. And then, Coby, you can get ready because I want to have the discussion on the Strategic Plan at that point.

So everybody that's just got to stop and take a break, of which I'm one, you've got 120 seconds.

(Whereupon, a short recess was taken.)

MR. WILLIAMSON: Mr. Behrens, why don't you take over?

MR. BEHRENS: Thank you, Mr. Chairman. We're going to go to our agenda item number 3, which will be a discussion item that concerns our 2005-2009 Strategic Plan.

Coby Chase will lay out some ideas and some priorities that we have been discussing. And this Strategic Plan will be being put together in the next month and be presented to the Commission in our June meeting. So Coby, I'll turn it over to you.

MR. CHASE: My name is Coby Chase, Director of Legislative Affairs of the Legislative Affairs Office of the Texas Department of Transportation.

MR. WILLIAMSON: Coby, use your microphone --

MR. CHASE: Did Al already retire? Did he just leave after he got his -- can you hear me?

MR. WILLIAMSON: Can you hear me now?

MR. CHASE: Can you hear me now? The purpose of this discussion item is to seek the Commission's direction for the 2005-2009 Strategic Plan. Let me take a few minutes to discuss the background and present some of the challenges.

A formal Strategic Plan has been required of all state agencies since 1992. The instructions, written by the Governor's Office and the Legislative Budget Board, tabulate the areas required to be covered in the plan. These include topics such as assessment of internal and external developments, performance measures, goals, and strategies.

It can be a complex paperwork exercise resulting in a document that sits on a shelf collecting dust, or it can be a defining experience that sets the agency's direction in a meaningful way. We aim, of course, to take the latter approach. We take this plan very seriously here at TxDOT.

Over the past years the Agency came under increasing fire, and justifiably so, if I might add, because it was almost impossible to measure in a meaningful way what it is we were doing.

In 2003 then Chairman Johnson convened a working group that set five objectives for the Agency to reach. These things -- these are things anyone would reasonably measure the Department of Transportation by.

Objective 1, Reliable Mobility. The goal there is to reduce congestion.

Objective 2, Improve Safety. That tends to speak for itself.

Objective 3, Responsible System Preservation -- or, to most people, that means maintenance.

Objective 4, Accelerated Project Delivery -- or how much faster can we deliver projects.

Objective 5, Economic Vitality -- or how do we contribute to the economic health of Texas.

Mr. Johnson's five strategies were added to Commissioner Williamson's simplified set of fundamental strategies -- plan it, build it, maintain it, use it, and manage it. Commissioner Williamson wanted these to serve as the basic framework for discussion of the Department's actions and presentations to the public and the Legislature.

And when you think about it, everything we do falls along these lines. We're either planning something, building something, drivers are using something, we're maintaining something, or we're managing something. Whenever we're confronted with a challenge this is how we respond.

Ron Hagguist, who is with Transportation Planning and Programming, is the Strategic Plan's project manager. Some of you might know him as the intellectual steward of the point of collection issue. He's brought on board the Center for Transportation Research at U.T.  -- and they're here -- Rob Harrison, Jolanda Prozzi, and Khali Persad -- to help us put it all together and to apply some outside critical thought to what we're doing.

Also guiding this effort are Steve Simmons, Amadeo Saenz, James Bass, Jefferson Grimes, and Steven Polunsky.

The next Strategic Plan, the one we're discussing today, builds on the foundation of the previous plan. Like I said, this Agency takes its Strategic Plan very seriously. And it doesn't exist in a vacuum.

I want to take the time to highlight for you seven key challenges as we see them. And these are very important challenges -- and I'm going to spend some time on each one of them.

Significant events, some very recent and some from the very recent past, will shape our Strategic Plan. I believe it is very important that you understand what these are.

Challenge 1 -- escalating costs have just recently been captured. In December 2002 the Commission insisted that the Unified Transportation Program, the master plan for developing and building projects, be adjusted to reflect true costs. Projects tended to get into the pipeline with one cost estimate, and when it came time to build them the price would escalate, seemingly overnight. And not only was it inflation, but unexpected environmental situations and scope creep, as is said around here, meaning the size and breadth of the project would grow.

This leaves us with two results now. One is that projects are more realistically priced and constrained based on accurate cash flows. A clear vision of reality exists. The second, however, is that the ten-year program has now been stretched to 15 years. When this reality seeped into the public's consciousness, the results were the transportation equivalent of shock and awe, I would say, in my opinion.

Chairman Williamson can testify to that firsthand. He had to spend a day in Temple, Texas, explaining this to a rather large group put together by Representative Delisi and Frasier, who were concerned about this.

MR. WILLIAMSON: Hang on a second, Coby.

MR. CHASE: Uh-huh.

MR. WILLIAMSON: Now, you're laying this stuff out fast, and we appreciate brevity. But I want to be sure the Commission members and our partners in the transportation world have a moment to focus on this. So challenge 1 -- you're making us painfully aware that when we decided after many years of doing things one way that we preferred a plan that accurately reflected the cost of Loop 375 in El Paso, State Highway 121 in Weatherford, Dallas, and Fort Worth, State Highway 59 in the west Houston area. The actual cost ten years from now for those projects would be calculated into the plan and not the original cost from two, five, ten, or fifteen years from now.

MR. CHASE: Right. You were -- the Commission's action was -- it was a very monumental exercise, as I recall my observation of it. And it closed the gap. I mean, it was reality now. It's what projects cost by the time they reach your desk.

MR. WILLIAMSON: So the situation prior to this decision by this Commission was we might have $5 billion worth of projects on our books covering 600 -- $5 billion worth of cost covering 600 projects on our books, everyone in the state expecting their piece of the 600 projects to get started because it was in our plan.

But the reality was we didn't have near enough money to pay for all of those. And rather than admit that and confront ourselves and the public with that we just kind of let it keep rolling.

MR. CHASE: Yes.

MR. WILLIAMSON: It wasn't really a ten-year plan. It was a 12-year, 15-year, 16-year plan.

MR. CHASE: Right. Well, remember, how many times a project would percolate up to the system, and for some reason, you had to find extra money to keep it moving -- to get it going. And that seemed to be an exercise every Commission meeting -- or not every, but many Commission meetings. And this newly adjusted cost figures seem to put that in better check.

MR. WILLIAMSON: Amadeo, why don't you come up and just touch a little bit on the project selection process prior to this change and after the change is fully implemented here in the next year or so.

MR. SAENZ: Okay. Thank you. For the record, I'm Amadeo Saenz, assistant executive director for engineering. Our project selection process, prior to the change in 2002, is that most of our projects -- and I'll talk about mostly the mobility projects, the projects that were selected at the Commission level.

They were all based on a cost effectiveness index. And they were all measured against each other based on this cost effectiveness index.

MR. WILLIAMSON: Okay. Cost effectiveness index.

MR. SAENZ: Right. But we would look at --

MR. WILLIAMSON: Well, what is a cost effectiveness index?

MR. SAENZ: We would look at the cost of the project, and then we would divide that by the -- say, the number of vehicle miles traveled, the average daily traffic. And that ratio is how cost effective that project would be. The lower the number that means that -- the cost divided by benefits -- the lower the number the project was a better project to build. It would address more traffic. And the whole goal was to reduce congestion. So we would be able to select those projects based on cost effectiveness.

MR. WILLIAMSON: So for example, if you had a loop around Stephenville costing $10 million that, when completed, would serve 5,000 cars, you would divide the money by the cars?

MR. SAENZ: We would divide the cost -- say, the cost of the project -- and there were several factors, but real simply, we would divide the cost of the project by the number of cars times the length of the project, which we would equate to vehicle miles traveling on that particular piece of highway.

MR. WILLIAMSON: And you would -- and accepting for a moment that Stephenville is in a different category than Dallas, but you would then take LBJ Freeway in Dallas and do the same basic analysis. And then you would ask yourself, if you had $1 to spend either in Stephenville or in Dallas --

MR. SAENZ: Right.

MR. WILLIAMSON: -- which project would you spend the dollar on that would result in the highest benefit to the State of Texas.

MR. SAENZ: That's correct, sir.

MR. WILLIAMSON: Not to Stephenville or not to Dallas, but to the State of Texas.

MR. SAENZ: The State of Texas.

MR. WILLIAMSON: And that's because we're a statewide system -- we're not a regional system or a county system, we're a statewide system.

MR. SAENZ: We were looking at statewide mobility, and we wanted to address statewide congestion and mobility problems.

MR. WILLIAMSON: Okay. Continue.

MR. SAENZ: Okay. What that would do is, of course, being a -- the state divided into 25 districts and having 25 district engineers that were competing to get some of the mobility money, we would look at ways to make that project as, what I would call, lean, mean, or as streamlined as possible to keep your cost as low as possible. And then you would break up your project to find out what piece of that project gave you the highest benefits.

MR. WILLIAMSON: When you say cost you mean --

MR. SAENZ: The cost of the --

MR. WILLIAMSON: -- projected cost.

MR. SAENZ: The -- well, the cost of the project at that time.

MR. WILLIAMSON: At that time.

MR. SAENZ: We were using the cost of the project at the time that we were submitting it for it to compete with other projects across the state.

MR. WILLIAMSON: So when the loop around Wichita Falls was initially costed and the cost effectiveness index calculated, that would kind of become written in stone and stay with the plan.

MR. SAENZ: Right. That project -- let's say, for example, we were talking about 1998 and we were looking at a loop in Wichita Falls. We would determine the cost of that project in 1998 dollars, divide it by the 1998 traffic, and then we would calculate a cost effectiveness index for that project.

That project would compete with other projects that were of similar size. We had that broken up between metropolitan areas, urban areas, and in rural areas. And we were able to compete. And then the projects that had the lowest cost effectiveness index would be the ones that would be selected.

MR. WILLIAMSON: So that was -- or that model applied -- or where that process applied fairly and uniformly and rigidly across the state it could be said that that was a hard way of distributing dollars -- a harsh way.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: A competitive market-oriented results based method of distributing limited dollars.

MR. SAENZ: That's correct.

MR. WILLIAMSON: And that -- help me with my memory -- but I was in the Legislature I think at the time. That was implemented in the late seventies, early eighties and being fully followed by the early to the mid-eighties.

MR. SAENZ: That is -- that's correct. That was -- I think it was initiated during the time of Chairman Lanier, I believe, when he was on the Commission. And he came up with a mechanism that we could evaluate all projects based on a cost effectiveness instead of just selecting projects by whichever method was being selected prior to that.

MR. WILLIAMSON: Where -- well, a fair and rigid application of that process would have resulted then probably in no project, other than those in Dallas and Houston, that were being approved.

MR. SAENZ: It pretty much did that. And, of course, I could -- in speaking through -- a little bit through history and my time that I was in Pharr, Pharr being an urban district and then also characterized as a metro district in some areas, we were having a hard time in getting our projects to compete with projects in Dallas and Houston.

So what we would look at is we would then wind up building just very small segments of projects. We would have to break them up and find those nodes that had the highest traffic counts to make those projects compete. But it was still pretty hard in getting our projects to move forward and get them into the plan.

The problem then, once they got into the plan -- because we went out there and we tried to cut the cost down at the very beginning, once the project got into the plan and we started designing it that we went in to come up with final design, and because of the changes in environmental and also the additions that needed to be done, that project estimate would then increase for two reasons -- one, because the scope increased, and also it was calculated and came into the plan based on, say, 1998 dollars. And now I may not be able to build this project till 2003. So I've got five years of inflation that were not included in the original estimate.

MR. WILLIAMSON: And not only inflation in the sense of the price of oil going up or the price of labor going up --

MR. SAENZ: That's correct.

MR. WILLIAMSON: -- but inflation in the sense of more people building on the right of way --

MR. SAENZ: And we had additional right of way cost --

MR. WILLIAMSON: -- or utilities being laid.

MR. SAENZ: -- we had additional utilities that needed to be located. So all of those were costs that you added to the project that would, if you calculate it all now and you put time value of money, it would have decreased the cost effectiveness.

MR. WILLIAMSON: So how does -- what -- how does the direction the Commission has taken in recent years changed that project selection process that got us to the point -- and let me be sure I understand the dollars because I have forgotten since Mr. Nichols started us down this path two years ago. We had about 6 billion in projects that were actually 10, or was it 10 billion that was actually 15? I can't remember.

MR. SAENZ: We had about -- we had in --

MR. WILLIAMSON: Or do you remember?

MR. NICHOLS: Yes. I'd like to comment on that. Basically, as I understood it, we let out to construction about ten -- about a thousand contracts a year. So we do a ten-year fiscally constrained plan, so we have roughly 10,000 projects in that plan at any one particular point in time. Each year we let those out, and then we bring in another group. The ones that are brought in on the ten-year plan were brought in with the best estimated dollars at that time.

And I think the reality set in a few years ago that we had not -- we want a ten-year fiscally constrained plan -- that's what the Legislature expects, that's what the federal government expects, that's what we told everybody. But we had not allowed -- or the basic inflation costs on projects. And when you go and you add that in for 10,000 projects scattered over a ten-year period of time it added so much extra cost that, instead of a ten-year plan, all of a sudden we had a 13-, 14-year plan.

So we realistically realized a few years ago that we had booked a lot more projects than could be built in that ten-year period.

MR. WILLIAMSON: What was the dollars, Amadeo?

MR. SAENZ: I think -- in fact, the numbers that I recall, just looking at the mobility categories -- or categories that do -- add more lanes, we had available revenue of about $10 billion over this ten-year period. And we were only -- and we had about 13 to $14 billion worth of projects in our ten-year plan. So we, in essence, had four extra years in our plan -- in our ten-year plan back in 2002.

MR. WILLIAMSON: And so I want to reduce it to words that normal people can comprehend. We had $14 billion worth of approved projects and only $10 billion to pay for it.

MR. SAENZ: Yes.

MR. WILLIAMSON: So increasingly, projects were being slowed down and not started, but until this Commission decided to take this position --

MR. SAENZ: Right.

MR. WILLIAMSON: -- no one really wanted to talk about the elephant being in the room.

MR. SAENZ: That's correct.

MR. NICHOLS: There was a false --

MR. WILLIAMSON: We just kept telling everybody there was a road fairy, and we kept rolling.

MR. SAENZ: That's correct.

MR. NICHOLS: There was a false hope out there that the project that was brought in to the ten-year plan would begin construction within a ten-year period or possibly sooner. And what we realized at that time was that really was a false hope.

MR. WILLIAMSON: Now, I had come on the Commission -- or I had been on the Commission about six months when we decided to redo things. One of the impressions I recollect having is that, in the delegation appearances during that first six months, I would continually see projects in this plan that couldn't be paid for move quickly to actual construction when delegations would come in and say, we found $20 million in our community. Here, you take the 20 million and put it with your $100 million estimate, the 100 million, by the way, being from six years ago when it's now going to be a $180 million project but we're still carrying it as 100 million.

Wealthy communities would come in, give us 20 million to buy down the cost to the state of that project, allowing it to move up on the cost effectiveness index --

MR. SAENZ: That's correct.

MR. WILLIAMSON: -- thereby preempting lower income communities such as the ones that appear quite a bit in the Pharr district, moving their projects even further down the list.

MR. SAENZ: Right. That --

MR. WILLIAMSON: So is that the case?

MR. SAENZ: That was happening to some extent. We were getting projects -- communities would come in and they would leverage their own dollars. That would lower the cost to the Department for that project, making the cost effectiveness index better. And so projects that were competing on their own merit -- or on their own dollar -- now fell further down because the other projects got ahead of us.

MR. WILLIAMSON: And I know, because I've looked at Coby's layout, that we're going to be talking about the impact of NAFTA and having to get ready for that. But is it fair for me to assume that communities primarily along the border, who at that time did not have the cash flow to pool their cash and bring in and buy down projects, were actually put at a disadvantage to communities in the interior of the state or on the northern or the eastern border --

MR. SAENZ: That's correct.

MR. WILLIAMSON: -- because of that.

MR. SAENZ: That's correct, sir.

MR. WILLIAMSON: So how did what we -- how did the changes we make change that?

MR. SAENZ: Well, the changes that we're making now is -- of course, the first thing we're doing as we -- as we work our ten-year plan, we're putting the plan based on the dollar estimate of when the project -- we expect the project to go to construction. So if I have a project today that I expect to go to construction in 2010, I am calculating the construction cost estimate for that project based on 2010 dollars.

The other thing that we're doing is that we've moved away from cost effectiveness index. And we have working groups that look at first restructuring our UTP to make it a lot more simpler. We went from 34 categories down to 12 categories.

MR. WILLIAMSON: Who were these working groups? You know, traditionally, we're criticized for forming committees of ourselves and telling ourselves what we're going to do. Who were these working groups?

MR. SAENZ: The working groups -- first of all, of course, the original looking at or restructuring our UTP was as a result of -- I think -- I believe something -- it was a result of some input and also some books. So we hired TTI. TTI went out there and interviewed all our MPOs and interviewed --

MR. WILLIAMSON: MPO leaders or the MPO groups?

MR. SAENZ: The MPO groups, the policy board people that were -- which are elected officials. Also the technical people, which are more of the worker, what I call --

MR. WILLIAMSON: Elected locally or statewide?

MR. SAENZ: Statewide. And got some --

MR. WILLIAMSON: So members of the Legislature were in some of these interviews?

MR. SAENZ: Yes, sir. And then we had members of the Legislature -- because some of the MPOs have members of the Legislature in their MPO policy board. And based on that feedback, we reduced the number of categories from 34 to 12.

The categories were not 34 when ISTEA first came about. They grew through the years. For example, because of the -- of some of the areas and because of some of the things that were influencing the Department like NAFTA we came in there during 1999 and added a new category into the UTP -- this is before we started restructuring -- and added a NAFTA category.

And that was because we saw that NAFTA -- the treaty had been signed -- there was some impact to the border. We were not being able to address the border through cost effectiveness back then, and --

MR. WILLIAMSON: Okay. Wait, wait, wait. You're losing some of us, I think.

MR. SAENZ: Okay.

MR. WILLIAMSON: You're saying that the cost effectiveness index, when it started and got rolling was a hard, even harsh, method of allocating the state's resources.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: That had the, perhaps, intended consequence of routing most of the state's cash to Dallas and Houston --

MR. SAENZ: That's correct.

MR. WILLIAMSON: -- because that's where the population is.

MR. SAENZ: Right.

MR. WILLIAMSON: And that harshness over time became uncomfortable for legislative leaders, governors, and Commissioners.

MR. SAENZ: That's correct.

MR. WILLIAMSON: And so then the softening -- the rounding of the edges began. The willingness to see beyond traffic congestion in Dallas and Houston and share of the state's resources began -- that rounding of the edges occurred.

MR. SAENZ: It started occurring --

MR. WILLIAMSON: One of the ways that occurred was by adopting larger numbers of categories into which El Paso, Laredo, Pharr could compete.

MR. SAENZ: The three districts -- so that we could compete. And that was, for example, our NAFTA category. When that was put in place -- because the three border districts could not compete well with the other metropolitan district for the mobility money and because the Commission identified that we needed to address some needs that would be coming. Because of the NAFTA treaty we set up a separate NAFTA category.

And now the Pharr district, the Laredo district, and the El Paso district would compete, but only among themselves. We were still using cost effectiveness, but we were only competing among ourselves.

MR. WILLIAMSON: It's a rational decision.

MR. SAENZ: Right. And this allowed us -- and the Commission put together a working group, and that working group identified $1.8 billion worth of projects to address congestion issues on the border that could result -- as a result of NAFTA.

And, of course, the Commission -- we have been working on that. Those projects have been identified. They're in our UTP. We have built -- constructed a large percentage of them, and the rest are still in the UTP and on schedule to be developed.

MR. WILLIAMSON: Well, we may touch on that again in a moment. But again --

MR. SAENZ: I wanted to go back and I guess --

MR. WILLIAMSON: -- tell the Commission have the process now today as we envision --

MR. SAENZ: Okay.

MR. WILLIAMSON: -- it is going to be different --

MR. SAENZ: Right.

MR. WILLIAMSON: -- from two years ago.

MR. SAENZ: Okay. The process now -- because we have to -- the working groups that restructured the UTP that made it much more simpler -- it allows more flexibility and may -- instead of 34 buckets of money we now have 12. So some have been combined. So the buckets are now bigger. They have most dollars and they have more flexibility as to what projects can be built from that particular bucket -- with monies from that particular bucket.

The other thing that we did is we also wanted some assistance, because what we were hearing is that, you know, we're not getting our fair share -- the money is not being distributed like it should be across the state. So we put together some working groups. And these working groups consisted of people from the Department, some of our district engineers, people from the MPOs, the people that are on the policy boards, some local elected officials, we had some county judges, we had some city council members, we even had some state Representatives that were part of MPOs.

And we had these five working groups put together -- you all recall the formulas that we would use to distribute money in the different categories. One was in the metropolitan mobility, another group was working on urban mobility -- and metropolitan are areas greater than 250,000 population. Urban is areas between 50B and 200B  -- is over 200-. And then the statewide connectivity, or the rural areas, are the rest of the state. Also --

MR. WILLIAMSON: Were those elected officials that participate, and primarily the members of the Legislature, did we like select our favorites, or did our district engineers use their own judgment, or did we send a letter to all 181? How did that work?

MR. SAENZ: We worked with the district engineers. We also had just -- the other thing that happened, for example, I think Representative Pickett was on the -- what I call the category to the metropolitan mobility working group. And that he was -- he was I guess chair of the MPO. And because of his position in the MPO he came on as the representative for that category to the working groups.

So all these working groups worked together, and they put together a report. And if you all recall, last July we had a -- presented the recommendations on how to distribute the money in mobility categories, in district discretionary categories, as well as the preventive maintenance and the rehab categories. And we had --

MR. WILLIAMSON: When you say distribute the money, that means money, the source of which is our gasoline tax --

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: -- allocation from the Comptroller --

MR. SAENZ: This would --

MR. WILLIAMSON: -- and our motor vehicle registration fee allocation from the Comptroller?

MR. SAENZ: This would be all the money that was coming in to Fund six through our gasoline tax and our vehicle registration and motor fuel tax.

MR. WILLIAMSON: Which the Comptroller permits us to spend --

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: -- allocates to us.

MR. SAENZ: And so these groups came up with what I call the funding formulas and the distribution of those formulas across the state. And that is now what we are using as we move forward in developing the next Unified Transportation Program -- our next ten-year program -- so that the -- for example, in the mobility categories the metropolitan areas said that they wanted to get the money distributed by an allocation --

MR. WILLIAMSON: Of money.

MR. SAENZ: -- of money, not --

MR. WILLIAMSON: Not projects.

MR. SAENZ: -- not by projects. Because, one, we know what projects are higher priority in our area -- what projects will get us better improvements to our transportation mobility than you do. And that's rightly so.

MR. WILLIAMSON: So the difference between then and now -- then was we approve projects. Now, or soon to be in the future, we will allocate cash.

MR. SAENZ: Yes, sir. We'll allocate --

MR. WILLIAMSON: And the Houston district and the Dallas district and the Fort Worth district and the Waco district will take their allocation of cash and make their own decision about which projects move forward and which don't.

MR. SAENZ: That's correct.

MR. WILLIAMSON: I think that answers the question that I wanted answered. Members, do you need to talk to Amadeo while he's here? He's going to be here for the morning. (Pause.) Okay. Thank you, Amadeo. Coby, if you'll continue, please.

So challenge 1 is your Strategic Plan is going --

MR. CHASE: You know how much everything costs now.

MR. WILLIAMSON: -- to have -- I'm sorry.

MR. CHASE: The first challenge is you know how much everything is going to cost now.

MR. WILLIAMSON: So the Strategic Plan that you're going to present to us next month will take into consideration that, for the first time in modern time, we're actually dealing with how much it's going to cost us to do the things we say we're going to do.

MR. CHASE: Yes, sir.

MR. WILLIAMSON: Okay. Proceed, please.

MR. CHASE: Now, I'm going to cover some of the same territory that was covered in some of the questions, so bear with me. The second thing -- the second challenge to finding the landscape of our Strategic Plan is, as was just discussed, the simplification of the Unified Transportation Plan.

The UTP, as it's called, grew over time, not just in the number of financially vague projects, but also in the number of funding categories. Thanks to old Commission funding initiatives, changes in federal law, and actions at the Legislature 34 funding categories existed. Our planning professionals at the MPOs and in the districts spent more time moving money around than they did moving drivers around.

The Commission insisted that this be collapsed and let Austin figure out -- Austin meaning the Department of Transportation -- figure out where the money comes from and let the districts and MPOs figure out which projects were the best.

After a great deal of agony, 34 categories -- the 34 funding categories were collapsed into 12, making the process much easier to understand both from the inside and the outside.

Once the Commission simplified the funding categories, the Agency asked local elected officials, MPOs, TxDOT staff, and state elected officials to help us develop the best methods of distributing mobility funds, preventative maintenance funds, rehabilitation funds, and discretionary funds.

MR. WILLIAMSON: And when you speak of mobility funds here you don't speak of funds from the mobility --

MR. CHASE: No, no. Things --

MR. WILLIAMSON: -- Prop 14.

MR. CHASE: -- that get you home faster every night -- adding capacity -- getting you where you need to go.

MR. WILLIAMSON: Gasoline tax?

MR. CHASE: Gasoline tax money. Yes, sir.

MR. WILLIAMSON: Motor vehicle registration fees.

MR. CHASE: Yes, sir. Absolutely. But that's, of course, when the real fun started. They had to decide how to equitably distribute the funds, just like you've done in the past.

In December 2003 the Commission adopted the work group recommendations. These are now being used as a base for the financially realistic 2005 UTP. Two important things happened when you did that. You started distributing funds based on the needs of a region, not the needs of a project, and removed yourself from the project selection process.

Challenge 3 -- the next logical step was the Texas Metropolitan Mobility Plan. It is an undeniable fact that Texas' metropolitan areas are the economic engines of this state. All reasonable transportation planning models suggest that money should be spent where the congestion is. It isn't exactly a secret, but sometimes it can be a politically -- it can be politically thorny to say something like that.

MR. WILLIAMSON: Are you -- and so in warning us about the challenge, are you suggesting that the money has not been spent where the congestion is over the last 20 years or so?

MR. CHASE: Yes. I hope I'm not just suggesting it.

MR. WILLIAMSON: So when you say it's not a secret -- it's politically thorny -- what you mean is it hasn't been spent where the congestion is. How do we know that?

MR. CHASE: It has to a degree, but if you were -- if -- we have to spend money in places that aren't congested.

MR. WILLIAMSON: Do we keep data on that, Amadeo?

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: Do we keep data on where the money's spent and by district --

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: -- and by -- if I understood your previous testimony, the single barometer an engineer tries to use in the allocation of resources and the decision making process is the vehicle miles traveled, the basis of that cost, the effectiveness index. Is that correct?

MR. SAENZ: That's correct.

MR. WILLIAMSON: You have that data handy?

MR. SAENZ: I've got a table up here with our expenditures over the last 30 years.

MR. WILLIAMSON: By district?

MR. SAENZ: By district. Yes, sir.

MR. WILLIAMSON: Put that up, will you?

MR. SAENZ: And it's got a lot of data because it's 25 districts.

MR. WILLIAMSON: I can't even read it. Can you focus it? That looks like the old highway department. We need --

MR. SAENZ: But what we have there, just -- kind of just to walk you all through -- of course, the first column is the district -- we have 25 districts. The second column is our construction and maintenance expenditures that we have had from 1970 to 1998.

MR. WILLIAMSON: So this is the list of our districts?

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: What's this?

MR. SAENZ: That is the construction maintenance expenditures that have been spent in each of those districts between 1970 and 1998.

MR. WILLIAMSON: Hang on a second. Between 19 when?

MR. SAENZ: 1970 -- just -- can you just go up so we just can see -- right there. See, our construction maintenance expenditures between 1970 and 1998. And the reason that I have it broken out like this because --

MR. WILLIAMSON: So over 28 years one -- we spent $3.2 billion.

MR. SAENZ: That's correct.

MR. WILLIAMSON: Actual dollars or adjusted for inflation?

MR. SAENZ: These are adjusted and calculated based on the year 2004. I brought everything forward to today's dollars.

MR. WILLIAMSON: So we spent $10 billion two in Dallas -- 10 billion two --

MR. SAENZ: In Dallas we spent $10.2 billion in 2004 dollars over that almost 30-year -- 28-year period.

MR. WILLIAMSON: We spent 2.5 billion in Bryan?

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: 2.3 billion in El Paso?

MR. SAENZ: That's correct.

MR. WILLIAMSON: 6.7 billion in Fort Worth.

MR. SAENZ: That's correct.

MR. WILLIAMSON: Okay. What's this percentage right here?

MR. SAENZ: That's just the percentage of the dollars spent in a particular district as a percentage of the amount spent in the entire state.

MR. WILLIAMSON: Okay. So I want to be sure I understand this. I don't want to operate --

MR. SAENZ: Yes.

MR. WILLIAMSON: -- on emotion. I want to operate on facts. You're saying that in the Pharr district, your old home town, the 2.4 billion spent over that 28-year period --

MR. SAENZ: Yes.

MR. WILLIAMSON: -- was 2.65 percent of the total.

MR. SAENZ: It's 2. -- yes.

MR. WILLIAMSON: Correct?

MR. SAENZ: It's 2.5 -- yes, you're pointing -- it's the same -- it happens to be the same number, but you went to Waco. It's --

MR. WILLIAMSON: 2.65.

MR. SAENZ: -- 2.65 of the total.

MR. WILLIAMSON: Okay. What's this column?

MR. SAENZ: Okay. What I did there -- I was using this thing when we were looking at expenditures, so I broke it up. And between 1999 and 2003 -- and I'm using this chart because I was using it to compare our NAFTA funding -- this is what was spent -- the same -- the amount of money spent in those districts between 1999 and 2003.

MR. WILLIAMSON: Okay. So again, with Pharr --

MR. SAENZ: In Pharr --

MR. WILLIAMSON: -- whereas from '70 to '98 2.4 billion was spent -- 2.65 percent of the total.

MR. SAENZ: Yes.

MR. WILLIAMSON: From '99 through 2003 --

MR. SAENZ: We spent --

MR. WILLIAMSON: -- 1.06 billion was spent --

MR. SAENZ: Right.

MR. WILLIAMSON: -- for 4.4 percent of the total --

MR. SAENZ: Yes, that's correct.

MR. WILLIAMSON: -- of state expenditures.

MR. SAENZ: Of state expenditures.

MR. WILLIAMSON: So a simplistic way of looking at it, when you were district engineer --

MR. SAENZ: We spent more money in Pharr.

MR. WILLIAMSON: -- we almost doubled the percentage of the state's resources in Pharr.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: And you thought we moved you up here because we wanted your help up here. You didn't realize we moved you up here so you'd quit spending all that money in Pharr. But is that how I read that?

MR. SAENZ: Yes, sir, that's correct.

MR. WILLIAMSON: Okay. What's that last column over there?

MR. SAENZ: The column is -- of course, this is what we have programmed in our current UTP between 2004 and 2007. Again, these are the program projects that are in the UTP, you know, for that time period. And, of course, the column after that is just the percentage of those dollars compared to the total.

MR. WILLIAMSON: So again, in Pharr, the 4.47 projected is going to follow the 3.37 --

MR. SAENZ: 3.37.

MR. WILLIAMSON: -- still above the 2.65 historically.

MR. SAENZ: Yes, sir. Right.

MR. WILLIAMSON: But falling.

MR. SAENZ: It is falling.

MR. WILLIAMSON: Are any of these programs winding down?

MR. SAENZ: The program is winding down. And as a result -- because, as I mentioned, I was looking at the NAFTA program here and to see what impact the NAFTA program had had. We had put together the NAFTA program in 1998 -- the end of '98. We started spending money in the latter part of '99, and it was going to go really from about 2000 to 2010.

MR. WILLIAMSON: So what -- this is the vehicle miles traveled?

MR. SAENZ: That is the vehicle miles traveled in the district. And what it does, it takes the average daily traffic for a particular highway and multiplies it by the number of the miles that -- of that highway. So this is a barometer of how many vehicle miles are traveled in that --

MR. WILLIAMSON: And that was the basis of the cost effectiveness index of the old way of allocating money.

MR. SAENZ: That was part of it. We had another couple of factors, but this was the main part of it.

MR. WILLIAMSON: On a percentage basis.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: You say main part. How much? 50? 60? 80?

MR. SAENZ: I'll look here at the --

About 60 percent.

MR. WILLIAMSON: Okay. The 4.47, 3.37 -- so the Pharr district had 3.58 percent of the -- or whatever, if I'm on the right --

MR. SAENZ: Yes, Pharr district has 3.58 percent of the vehicle miles traveled in the state.

MR. WILLIAMSON: And in the next four years they'll get 3.52 percent of the money.

MR. SAENZ: That's right.

MR. WILLIAMSON: For the previous five they got 4.47 of the money.

MR. SAENZ: And then in the early years they were getting 2.65.

MR. WILLIAMSON: 2.65.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: What happened to Dallas?

MR. SAENZ: Dallas --

MR. WILLIAMSON: 11 percent of the money going to 12 percent of the money. Right?

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: Falling to 11 percent of the money?

MR. SAENZ: Right. In Dallas the vehicle miles traveled is 15.84.

MR. WILLIAMSON: What happened to Houston?

MR. SAENZ: Houston had 19 percent of the money in the -- between -- in the first 28 years. Then they dropped to 14-and-a-half percent of the dollars in '99 and 2003. And they're at 16.44 with that program over the next few years. Their vehicle miles traveled is 20.06.

MR. WILLIAMSON: So is it fair to say that over about a ten-year period the percentage of the funds were transferred from Dallas and Houston to the rest of the state?

MR. SAENZ: It is. And if you look at it -- and if you just look at the NAFTA program, when the NAFTA program was put in place, because a chunk of money was carved out -- the total money did not change, so the chunk of money was carved out to address the border. Then the money from the other parts of the state had to come -- the money had to come from somewhere so it came from projects in the other parts of the state. And most of it came from the -- if you look at that most of it came from the metropolitan area.

MR. WILLIAMSON: So -- okay. Thank you. So how will that change under our third challenge, Coby, the Texas Metropolitan Mobility Plan?

MR. CHASE: Last year Governor Perry asked the Commission to do a few things to make the project selection system better. The Commission honored the Governor's wishes in its August 2003 Texas Metropolitan Mobility Plan. Here's the practical effect of what happened.

Governor Perry wanted to make certain that the state's metropolitan areas had a guaranteed source of funding. This is similar to the way the federal government sends highway funding to the states, in predictable streams.

However, this is entirely new in Texas. The benefit is that the Commission moved away from picking projects on a case-by-case basis to looking at the needs of an entire area.

This bears repeating because I really don't think the magnitude of this has completely sunk in with most people. It seems like every time I explain it to somebody it's outside of the Greer Building, or outside of the Department. It's a bit of a surprise.

The Commission now has guaranteed the metropolitan areas of the state steady and predictable funding with available revenue. The Commission gets out of the process of deciding each project and leaves that to the local MPOs to decide.

The Commission will measure the plan by two simple yardsticks -- will congestion be reduced and has the area's baseline funding been leveraged. And by baseline funding, I mean gas tax dollars, just to put it simply, things --

MR. WILLIAMSON: Okay. Stop. I don't mean to be rude, but normal people might have not understood what you just said. Let's go back and make sure I understand since I consider myself a member of the normal people.

You said the Governor asked us to do a plan that would provide reliable funding. We responded with the Texas Metropolitan Mobility Plan. What are the -- Amadeo, where you'd go? Steve?

MR. SAENZ: I'm right here.

MR. WILLIAMSON: What are the metros?

MR. SAENZ: The metros --

MR. WILLIAMSON: Who are the metro districts?

MR. SAENZ: The metros are the eight largest metropolitan areas of the state.

MR. WILLIAMSON: And they are?

MR. SAENZ: They're the ones that have their population greater than 200,000 population or more.

MR. WILLIAMSON: So that's Dallas --

MR. SAENZ: Dallas --

MR. WILLIAMSON: -- Houston --

MR. SAENZ: Dallas/Fort Worth, Houston --

MR. WILLIAMSON: Wait, wait. Dallas, comma, Fort Worth.

MR. SAENZ: Dallas slash Fort Worth. They're together because they're one metropolitan area.

MR. WILLIAMSON: Okay. They're one metropolitan -- okay.

MR. SAENZ: Houston, Pharr, Corpus Christi, El Paso, Lubbock is our newest one, Austin, and San Antonio.

MR. WILLIAMSON: Okay. And what you said, Coby, was we've made an allocation of resources to those metropolitan areas. And we, the Commission, will measure the projects they choose to fund out of that allocation by two simple yardsticks. You said, will congestion be reduced -- doesn't that get us back to the CEI, Amadeo, the harsh allocation?

MR. SAENZ: It gets to measuring the impact on congestion -- determining a congestion index -- a measure of congestion. How are you improving congestion?

MR. WILLIAMSON: Ah.

MR. SAENZ: It's not on a --

MR. WILLIAMSON: So it doesn't have anything to do with cost effectiveness.

MR. SAENZ: No.

MR. WILLIAMSON: It has everything to do with congestion relief.

MR. SAENZ: How do you relieve congestion in an area.

MR. WILLIAMSON: And then we also -- and this is a plan we've already adopted.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: And this is a plan that was developed from the ground floor up with participation by community transportation leaders, including some legislators --

MR. SAENZ: It started as part of the restructuring, and that's where we had the input. The Texas Metropolitan Mobility Plan started with a group of our district engineers and some of our staff here in Austin. But then we incorporated and got a lot of feedback and comment from our large metropolitan area stakeholders and partners in putting the plan together. And now we have asked people like Michael Morris --

MR. WILLIAMSON: And Michael, you understand the Texas Metropolitan Mobility Plan to include a component that says how much of the gas tax funding has been leveraged in the tolls.

(Michael Morris nods yes from the audience.)

MR. WILLIAMSON: Thank you. So Coby, you say challenge 3 is our Strategic Plan that we've got to approve in June will, by necessity, be influenced by the Texas Metropolitan Mobility Plan.

MR. CHASE: Yes.

MR. WILLIAMSON: Which has not got anything to do directly with the mobility fund.

MR. CHASE: Nothing -- no.

MR. WILLIAMSON: And that plan, approved from the grassroots up, is built upon the notion that your projects will reduce congestion and your allocation of gasoline tax and motor vehicle registration fees will be leveraged in order to build the maximum amount of assets in your community possible as quickly as possible.

MR. CHASE: Exactly. Precisely.

MR. WILLIAMSON: Please continue. And members, please interrupt at any time. This is not a two-person show. Any time you have questions just go.

MR. CHASE: The big eight regions, as they were just described, face acute problems. It is important that they go to the next level and identify not just projects by the magnitude of their funding shortfall.

Their plans also need to contemplate other modes of transportation and new sources of funding to create a plan to reduce congestion. And if I may editorialize for a moment, a perception still lingers that projects are awarded by the Commission because someone made the right phone call to the right person. It certainly isn't accurate, but the suspicion exists. If it were true, I would try to make those phone calls for Mo-Pac. This isn't -- I've been trying from the inside.

This isn't to say that the rigid selection criteria put in place during the Lanier years hasn't become somewhat malleable over time -- the congestion index. Any system that exists this long can't completely withstand alteration or control by outside forces.

For instance, the cost effectiveness index -- the measure of a project's worth is scored by its cost and ability to provide mobility -- has been skewed in two directions. And we had a fairly healthy discussion about this. Let me just say, rich communities can buy down the cost of a project by making it easier to get. Disadvantaged communities, thanks to a change in law, can waive some of or the entire local share. The result is that it became so weak that it could easily be manipulated by --

MR. WILLIAMSON: That relates to the question I asked Amadeo a while ago --

MR. CHASE: Yes.

MR. WILLIAMSON: -- about communities bringing cash in to buy projects --

MR. CHASE: Right. But it wasn't just weakened by rich communities -- not the best choice of words. But it can also be used by economically disadvantaged communities as well. So it starts to become nothing at some point.

MR. WILLIAMSON: So it started out harsh and square cornered and sharp, it became rounded and blunt, and then it became kind of dented, and at the end indistinguishable as a rigorous method of distributing cash.

MR. CHASE: Right. Precisely.

MR. WILLIAMSON: But we don't have that luxury anymore. I'm sorry. Go ahead.

MR. HOUGHTON: Let me ask a question. Do the communities -- or, Amadeo, do they have now the MPOs or the DEs [phonetic] their history of index from TTI? I mean, I have it right here of various communities the index --

MR. SAENZ: Yes, sir.

MR. HOUGHTON: -- and what the pattern has been --

MR. SAENZ: Yes, sir.

MR. HOUGHTON: -- and index and what the future now holds for them?

MR. SAENZ: Absolutely.

MR. HOUGHTON: They do have that now and they're working off of that index? That congestion index?

MR. SAENZ: The eight large MPO -- the eight metros are working on their Metropolitan Mobility Plan. And part of it is they need to see what congestion index is going to be, so that data has been provided. We've been working with TTI to provide them that data for each of the eight metropolitan areas.

MR. HOUGHTON: And they are getting that information.

MR. SAENZ: Yes, sir.

MR. HOUGHTON: Okay.

MR. NICHOLS: Mr. Chairman?

MR. WILLIAMSON: Please.

MR. NICHOLS: I -- the comments I'm going to say I've said publicly at a few other places. But much of what we're going over -- a different way to look at the same thing is that, I know from over a period of years the legislative members, as well as communities, have asked us to do with our planning document three basic things -- make it simple so people can understand it, make it fair -- everybody agrees with fair --  and give us some local input -- an opportunity for input rather than projects popping up by some formula out of Austin.

In tackling those three things, the simplification -- make it simple -- our project was -- our selection categories of funding was very complicated. And when things are complicated, people don't understand them and they don't -- not to trust them. The taking of 32 categories and bringing them down to 12 was a method of simplifying it, to answer the first.

We further simplified that by breaking it into preservation, that which it takes to maintain the system, and the expansion or new stuff, which is what most people are asking for.

In the fair category, the Department has always, I felt, tried to very objectively have a criteria for project selection. It was more a needs basis. That's why there was formulas -- and a wide variety of those complicated formulas -- to take the random picking out.

But fairness -- by going to a allocation basis, I think the Commission recognized that the needs were so great in all these areas and that a community's plans and dreams in their development process is much more than just a cost effective index on one particular project segment over another.

And by going to an allocation basis on the fairness we -- then communities are able to plan out. The allocation basis, very simply, since two-thirds of the people lived in the metropolitan area, I think we -- the Commission picked in that process roughly two-thirds of all the expansion money, allocated that for the metropolitan areas.

Further breaking it down, we got all the metros together and they actually agreed on a formula of how to distribute those funds amongst themselves based on population, vehicle miles traveled, number of cars registered. So beginning this past year, all the expansion money -- basically all the expansion money was allocated to those communities.

The third piece of the formula let us have local input. The Commission turned over, in effect, to those metropolitan planning organizations, who have very professional staff working with our districts, to lay out and help decide amongst themselves, with all these dollars they now have allocated to them, which projects are going to be the most critical for the development of our community.

And how it develops in Houston might be a different method than how it develops in Dallas/Fort Worth or El Paso or San Antonio. Some may choose a different mix of transit or rail or highway expansion or whatever, but that's a local choice. So those bodies recommend to us which of those projects. So that's the local input.

And that's the part that also was implemented this past year. And what most communities have not realized -- it just hasn't really sunk in yet, but I think it will as time moves on -- is that they are empowered to take the money allocated to them, rearrange in their project mix that which is already on the books.

We then took another step, so they could plan further out, all the way out to 2030 and gave them the authority to -- development authority, with the districts working with the MPO, to try to plan projects even further out.

So they can see in each of these communities which projects they can do, which projects they can't do. Our districts can now go in and anticipate in the future with traffic volume growths, based on forecasts of population growths, what the congestion index will be, what the shortfall in transportation will be.

And I think what we're discovering is, in those areas of the state that we have done that, it is dramatically short, even though it's allocated. We had estimated three times off for the last several years, and what we're discovering as we pull these numbers, which should be complete early in the fall, is that the shortfall is about five times off -- five times off -- because we continue adding volume at a very high rate in those areas and not nearly the capacity.

But the only way to expand that, using our traditional funds, is by pulling money away from some other community, which is not what we said we were going to do.

MR. CHASE: Exactly. And you never said it was enough. You just said it was guaranteed and it's flexible, which is -- which actually does a whole lot.

MR. HOUGHTON: I have another question --

MR. CHASE: Yes, sir.

MR. HOUGHTON: -- Coby and Amadeo. Where is the check and balance? You mentioned earlier in the discussion that roads that were built shouldn't have been built just because -- whatever the reasons were.

Now we have a congestion index. Where is the check and the balance? And it sure looks good -- nice, you know, pavement on the ground or concrete -- but it doesn't meet a standard of busting congestion.

MR. CHASE: Well, all --

MR. HOUGHTON: I mean, we can put the interchanges in the air and the concrete on the ground, and you know, feels good, looks good, look at what we've done. Now, where is the check and balance from this Commission?

MR. CHASE: I'll let Amadeo fill in if I miss something. But the Commission will be approving plans. Each plan will -- and the project in the plans will be able to identify the amount of congestion expected to be reduced. Is that -- did that answer the question? You, the Commission, will be approving the plans.

MR. HOUGHTON: All right.

MR. CHASE: And each project will say it will reduce the congestion -- it's scored by the Texas Congestion Index, which we all see once a year on the Today Show, thanks to Tim Lomax at TTI.

MR. HOUGHTON: All right.

MR. WILLIAMSON: So challenge 3 was understanding the impact of the Texas Metropolitan Mobility Plan on our Strategic Plan.

MR. CHASE: Yes, sir. And -- but I do need to end this by reminding you that the -- you are committed to this, and that the funding is now promised to communities like Houston, Fort Worth, Dallas, El Paso, and it does come with a cost. Then this will weigh heavily on our Strategic Plan.

Challenge 4 -- NAFTA. And spring boarding a little bit off the -- NAFTA is something that was unexpected. I mean, you couldn't factor that into a formula. NAFTA was a good idea, but it wasn't our idea. Regardless, it now resides squarely on our border with Mexico. Our border communities rightfully pointed out that this would a disproportionate impact on their trade transportation infrastructure, and it did.

Then Lieutenant Governor Perry and former Commission chairman David Laney announced in October 1999 a plan to accelerate border trade transportation infrastructure. Commissioner Nichols, Johnson, and Laney fanned out across the border to make the announcement. Lieutenant Governor Perry joined Commissioner Nichols to reveal the news in El Paso. The result was a $1.8 billion acceleration of projects along the border.

We're now in the fourth year of that ten-year program. And if you recall my discussion earlier about springing project costs you won't be surprised to learn that the price has jumped to $2.4 billion.

MR. WILLIAMSON: That's 2.4 billion from 1.8 billion for the same projects envisioned in October of 1999?

MR. CHASE: Exactly. And you are committed to funding that. That's a 34 percent increase. We've gone to contract with $865 million. But my point here is that this is a commitment made by the leadership in this state to fund the projects in the border area.

The money, however, did not magically materialize. The metropolitan areas of the state subsidized this expansion in border infrastructure. Now, they also realize -- they also rely on a healthy border infrastructure to move goods and services to their parts of the state and through the state. But --

MR. WILLIAMSON: So those are the percentages that Amadeo put up earlier that I asked about.

MR. CHASE: Exactly. That was precisely what you were talking about at that point.

Challenge 5 -- new funding methods. The Legislature has recently granted us three powerful new methods of financing --

MR. WILLIAMSON: Stop.

MR. CHASE: Yes, sir.

MR. WILLIAMSON: What happens -- you're telling me about challenges in your plan.

MR. CHASE: Yes.

MR. WILLIAMSON: So Amadeo, what happens when -- is this going to be a ten-year plan or is it going to take longer than ten years? Did you say something about that earlier?

MR. SAENZ: Based on the dollars that we have available to us -- the Fund 6, gasoline tax, motor fuel tax -- we get only so much money. So if the project cost has escalated, then the projects have to be delayed or kicked back. So it takes longer to build.

MR. WILLIAMSON: So the projects will be built, albeit at a higher cost in a longer time line.

MR. SAENZ: Yes, sir. Because the longer the project takes, inflation also increases, so it just -- this is going to continue to escalate and get bigger.

MR. WILLIAMSON: Okay. So going back to challenge 2 and 3, how does our new method of planning, and in particular, the Texas Metropolitan Mobility Plan, impact the resources that are going to be available to El Paso, Laredo, and Pharr? In other words, we're going to this allocation system.

MR. SAENZ: Okay. For El Paso and Pharr, that are two of the metropolitan areas, they're putting together this Metropolitan Mobility Plan. We asked the metropolitan areas to put together a plan that was not financially constrained.

We've given you your dollars numbers, but set them aside for a little while. Go out there and identify your needs and determine if you build that what will be the resulting impact on congestion. Okay?

You start -- really, you start by -- if I don't do anything, my congestion is going to grow to say, three. If I go out there and I build all of these -- and we want them to look at across the border -- we just don't want them to look at highways, we want them to multi-modally -- look at rail, look at public transportation, look at what can help you decrease congestion in your area.

Once you identify your needs and your plan then you will come back and say, Okay, if I build this I will now be able to reduce congestion through my cost -- through my congestion index to this amount.

MR. WILLIAMSON: Uh-huh.

MR. SAENZ: Now I come back to the other side and I pick up my ledger and I find out how much -- what resources do I have available to me. Well, you have the money available through the Commission from the gasoline tax. And if you're including some public transportation, you might have some public transportation dollars available to FTA and local tax bases that are available.

And you look at now what can I build and how far can I go down and build with the dollars that I have available to me. Then what's left over to get to that desired congestion index will be what we call your gap, or much more money do I need to get to that point.

If I can only build half of it, then my congestion will not be what I planned to be -- it's going to be something higher. And that's what the metropolitan areas are going to put together to identify how they can best leverage their resources to come up with a way to make up that gap and get their congestion to a point that they are willing to live with.

MR. WILLIAMSON: Okay. That explains that for me. Thank you.

MR. CHASE: Challenge 4 -- NAFTA.

MR. WILLIAMSON: Well, I think --

MR. CHASE: Challenge 5. I'm sorry.

MR. WILLIAMSON: -- I understand, Coby. I -- you made that clear, and I --

MR. CHASE: Okay.

MR. WILLIAMSON: I feel comfortable with the answer Amadeo gave.

MR. CHASE: Okay.

MR. WILLIAMSON: You're just making us -- you're just saying we've got that commitment. Commitment's got to be maintained. Amadeo said we're going -- that commitment's going to be reflected in our Strategic Plan.

MR. CHASE: Correct.

MR. WILLIAMSON: Okay.

MR. CHASE: I apologize. I went backwards for a second.

Chapter 5 -- new funding methods. The Legislature has recently granted us three powerful new methods of financing projects. Let me speak to each one individually.

The Texas Mobility Fund was capitalized this last session with revenues derived from certain traffic fines. Next biennium it will be funded with fees associated with driver's licenses and automobile inspections. This is truly new money.

The Commission is currently considering a Strategic Plan just for the Mobility Fund. And let me emphasize this is separate from what I'm discussing about the Agency's Strategic Plan.

The Commission is currently considering a Strategic Plan just for the Mobility Fund. Should two-thirds go to the metropolitan areas of the state and one-third be used in rural areas? Should preference be given to creating assets like toll roads or liabilities like pay-as-you-go roads? Or will non-highway innovative revenue-generating projects be considered? Is it about cement or is it truly about mobility? You'll be wrestling with that question, and we have to wrestle with it in the Agency's Strategic Plan.

The Legislature and Texas voters created what we call Ogden Bonds last year.

MR. WILLIAMSON: So why do we need a Strategic Plan for the Mobility Fund? Why do we need a separate one?

MR. CHASE: Well, it is -- well, first of all, it's required separately in law. And second --

MR. WILLIAMSON: Wait, wait, wait. It's what?

MR. CHASE: Required separately in law. House Bill 3588 required that the Agency adopt a Strategic Plan for the guiding principles and how these Metropolitan Texas Mobility Fund will be distributed.

MR. WILLIAMSON: So the law requires us to adopt a Strategic Plan for the use of the Mobility Fund. Correct?

MR. CHASE: Yes.

MR. WILLIAMSON: Is that what you just said?

MR. CHASE: Yes, sir.

MR. WILLIAMSON: Steve, I know you're familiar -- and James -- with the Mobility Fund. Does the law Coby's talking about give us guidance about, for example, allocated equally by population or equally by income -- average personal income, or geographically?

MR. BASS: No, sir, it does not.

MR. WILLIAMSON: Doesn't give us any guidance about, take the Mobility Fund and be sure that you return it to the communities in the exact same proportions as those citizens might have paid the fines?

MR. BASS: No, sir, it does not.

MR. WILLIAMSON: Does it tell us to use it for toll projects or not use it for toll projects?

MR. BASS: No.

MR. WILLIAMSON: Does the law give us any guidance at all?

MR. BASS: No, sir. It just merely states that prior to issuing debt backed by the Texas Mobility Fund the Commission must adopt a Strategic Plan for the use of those proceeds.

MR. WILLIAMSON: So the law is clear. It's the responsibility of the Commission to determine how the funds are to be used -- how the debt is to be used. And it must incorporate that now into a Strategic Plan.

MR. BASS: Correct.

MR. WILLIAMSON: Unequivocal. Is Richard Monroe here? (Pause.) Is that how you see it from the OGC from the legal perspective, Mr. Monroe?

MR. MONROE: That's not just the OGC's perspective. That's the only perspective.

MR. WILLIAMSON: Thank you, sir. When do we -- if you've got to incorporate that into your Strategic Plan, when do we have to adopt -- what's the path, Steve, for adopting this?

MR. SIMMONS: For the record, my name is Steve Simmons. I'm deputy executive director of TxDOT. I believe that at your June Commission meeting we'll be presenting you with the Strategic Plan for the Texas Mobility Fund. There was a discussion item at the last Commission meeting on how to develop it.

MR. WILLIAMSON: Okay. Thank you. Do we have to spend it on roads?

MR. BASS: No. The law states that it can be for roads or other public transportation projects.

MR. WILLIAMSON: So for example -- and I'm not trying to suggest anything to the mayors of our cities that are appearing today -- but we could take this money and use it to move the BNSF and the Union Pacific out of downtown El Paso, Fort Worth, Dallas, Brazoria County?

MR. BASS: I think you would have to be able to do that if, in the place you are going to put a commuter rail project, or something that would be public transportation; my understanding is that you cannot use the proceeds of the Mobility Fund simply for a freight rail project since the law refers to public transportation.

Now, if the movement of a freight rail is associated with a larger project, then I think that portion would be eligible under the Texas Mobility Fund.

MR. WILLIAMSON: And who were the authors of that law -- of the statute?

MR. BASS: Senator Florence Shapiro and Representative Clyde Alexander.

MR. WILLIAMSON: We need to send them a nice thank-you letter for their farsightedness. So you're saying, James, that money -- Mobility Fund money can be used to purchase the UP through downtown Houston if, in moving the UP out to the west edge of Houston, we're converting the existing track to a commuter rail and expanding -- is that 90, John -- 90A that's against the track?

MR. JOHNSON: 90A.

MR. WILLIAMSON: 90-A -- using the right-of-way to add a -- perhaps an express lane on both sides. No doubt Gary would want it to be a high occupancy toll lane. That would be all right?

MR. BASS: That's my non-attorney understanding, yes.

MR. WILLIAMSON: Okay. Please continue, Coby.

MR. CHASE: The Legislature and Texas voters created Ogden Bonds last years. This is not a new source of revenue, but it is an important new method of financing projects. They're also called Prop 14 Bonds.

Right now it allows 1 billion per year for three years, slicing off 20 percent for safety projects. The debt payments are made from existing Fund 6 revenues. And the question we have to ask is how will that eventually factor into regional funding?

Tolling -- once project specific revenue bonds are paid profits may exist -- I'm using their quotes -- profits may exist. Consideration needs to be given to how communities should leverage these invaluable assets into more projects. It may be on the unpredictable side at the moment, but I believe this is something that we will be seeing or, at least, strongly contemplating within the five-year horizon of our Strategic Plan.

MR. WILLIAMSON: So I want to go back to Ogden Bonds for a moment. The voters approved and -- well, obviously, the Legislature approved, the voters approved, and the Commission, in theory, has approved the notion of borrowing money -- no more than $1 billion a year and no more than $3 billion -- against our gas tax and motor vehicle registration receipts. And that will be incorporated into your Strategic Plan.

MR. CHASE: Yes.

MR. WILLIAMSON: And then, as we develop project specific revenue bonds and begin to figure out to calculate when positive cash flow might occur, if it appears that positive cash flow is going to appear -- occur in the next five-year cycle, you'll incorporate that into your Strategic Plan.

MR. CHASE: Yes, sir.

MR. WILLIAMSON: So for example, if we elected to invest $500 million in a toll project with NTTA at -- the toll project was only going to cost $700 million -- and our Bond Counsel and our traffic engineers estimated that in the third year we would begin to generate positive cash flow, you would incorporate that into your Strategic Plan.

MR. CHASE: Yes. But I do want to make it clear. The Agency's Strategic Plan is not project by project by project. It is about the over -- the Commission's priorities and where things like that, should they occur.

MR. WILLIAMSON: But you're certainly not going to bring us a Strategic Plan that would ignore the beneficial impact of 40 million a year or 60 million a year in state tolls.

MR. CHASE: Precisely.

MR. WILLIAMSON: That's the decision -- if the Commission took the strategic decision to go down that path.

MR. CHASE: Yes, sir. Absolutely. But I didn't want to confuse the audience to think that, for some reason -- I'm putting a lot of -- we are deciding local projects in the Strategic Plan.

MR. NICHOLS: Are you looking for comments in this area?

MR. WILLIAMSON: I am open at any moment for any Commissioner --

MR. NICHOLS: I'd like to take that moment.

MR. WILLIAMSON: -- to soar like a Jacksonville Knight.

MR. NICHOLS: All right. In the Strategic Plan I think we're dealing with not only the resources that we have to expand -- I think a lot of people are thinking in terms of expansion of highway systems in the metropolitan areas -- and how -- in the shortfall how we're going to get there. The Strategic Plan, in my opinion, should also incorporate ideas of how to get there in that shortfall and encouragement. But also keep in mind two other factors --

MR. WILLIAMSON: Uh-huh.

MR. NICHOLS: -- related to that, that as we add capacity, we are also going to have to preserve that capacity. Many people forget that the 30, 40-year cost for maintaining and preserving a piece of roadway is actually -- costs more than the actual construction -- of that roadway in the first place. And many times -- many times.

So if we're trying to come up with a shortfall of 30 or 40 or $50 billion and we figure out a way to do it and build it, then we're going to also have to come up with twice that number, maybe three times, over the next 30 years to preserve it.

MR. CHASE: Exactly.

MR. NICHOLS: So that needs to be in there. Secondly, that if we come up with a way to -- so it's helpful if we can come up with ways -- with methods that help cover the preservation costs as we go.

MR. CHASE: Exactly.

MR. NICHOLS: Build it in there. Number two, there needs to be a realization that even though we're shooting for a 20, 30 plan, a point in time that we have arbitrarily set as a milestone, that whatever plan we come up with -- or idea -- to obtain our goal by that date, that is not the end, in that as long as our state is very fortunate to have economic development growth, population growth, that the demands for transporting goods and people will continue to expand, probably at even greater rate.

So whatever method we put to fund the shortfall, it would be very helpful if it could continue and expand and help pay for that which is to follow and leave the generation that's coming behind us with options and choices in that method.

MR. CHASE: Absolutely. That is an excellent idea and -- or two excellent ideas. And I hadn't intended to discuss it, and I'll only touch on it lightly, but there -- that is a very important point. Our system is large -- it's 80,000 miles, it's aging. It's older than I am. And as I'm learning as I get older, there are increased maintenance costs.

And I think sometimes when you look at our budget and you see the size of our letting, that is often confused with new capacity. And that's just not the case. A lot of that is maintenance. Sometimes we go tear up an entire lane of an interstate and just put it back down because it's time to do that. And so I think your point is very, very well taken. And I didn't put these in my comments, but you're right. We definitely need to acknowledge that.

MR. WILLIAMSON: One of the things you suggested in challenge number 5 -- or one of the things you brought to our attention is incorporating the Ogden Bonds and tolling revenues into our Strategic Plan. When we use Fund 6 revenues -- gas tax, vehicle fees -- can we use that to backstop or underwrite the Mobility Fund debt service, James?

MR. BASS: No, sir, we cannot. Again, I was reminded to introduce myself for the record. I'm James Bass, director of finance for TxDOT.

MR. WILLIAMSON: So the Mobility Fund is backed up only by the cocktail of fees this two years, and then the driver's license record fees and the others we're more familiar with in the out years.

MR. BASS: Correct. The Constitutional amendment that created the Mobility Fund actually prohibits the use of the gas tax or vehicle registration fees from being used as security for those funds out of the Texas Mobility Fund.

MR. WILLIAMSON: And I'm kind of curious. You've spent a lot of time in the last six months -- or I guess last year -- understanding toll debt and debt in general. We are, up until the last couple of years, have been a debt free department.

Is it the case -- and I'm going to pick a company out of the air and not because I have a preference for them, but because I'm familiar with them. Is it the case that Merrill Lynch would rate our bonds and sell us money at one rate of interest or at one rate of return if the only collateral were the Mobility Fund cash flow itself? And would loan us more money on a project at a lower rate of interest or at a lower rate of return if we took the cash flow from the Mobility Fund sources of cash, indebted that, and then took that cash and built a toll road which they also financed?

MR. BASS: I think number one may be overly technical. Merrill Lynch would not do the ratings. There are other firms that do that independently.

MR. WILLIAMSON: Tried to pick a company that he wouldn't say that.

MR. BASS: Do it independently for the market, and then Merrill Lynch would service the broker to hook us up with the individual investors. My understanding is that the securities for the Mobility Fund and a toll road, even though, if we blend those together they will be seen as separate securities. There would be separate bonds issued by the toll project --

MR. WILLIAMSON: So we --

MR. BASS: -- and there would be separate --

MR. WILLIAMSON: -- could, in the context of our Strategic Plan, take 250 million a year in tax receipts, pledge that for the Mobility Fund to generate perhaps 2.5 billion, and take the 2.5 billion, and depending on the toll project, generate another $5 billion for toll construction, resulting in $7.5 billion of tolled assets.

MR. BASS: Correct. And one of the things -- I think perhaps getting to the same point beyond my technical issues with it, as you know, on a toll road a traffic and revenue engineer will do an estimate as to how much traffic will be on that road. It will then show how much the people driving on that road are willing to pay as a toll, and that revenue stream will give you how much you can issue in debt.

Many times the amount you can issue in debt will not meet the cost of that project, or it will be very close to it. The closer it is -- that margin of error is smaller and smaller -- the credit rating you talked about will be lower, increasing the cost of the project.

By taking some of those costs of that project off, either through toll equity provisions, then the same traffic would be on that road and it would make those bonds stronger, cheaper. And so it could go to help build more infrastructure.

MR. JOHNSON: Mr. Chairman.

MR. WILLIAMSON: Please.

MR. JOHNSON: James, could you clarify something for me? What I hear -- or maybe what I'm interpreting -- is, is that the possibility is that we would blend funding or bonding from the Mobility Fund with either project or system toll bonds. And yet, would they be separate issues or would they be blended issues?

MR. BASS: My understanding they would be separate issues because the revenues pledged to pay back the individual bond holders or investors -- if it's the project revenue it would be that toll --

MR. JOHNSON: From the project or the system.

MR. BASS: -- revenue from the specific project. The Mobility Fund --

MR. JOHNSON: And the other would be from --

MR. BASS: -- bond holders would be from the --

MR. JOHNSON: Okay.

MR. BASS: -- various taxes and fee --

MR. JOHNSON: So the path that I perceive that the Chair is going down is a big picture, cumulative path, and not these substantive smaller parts that add up to this larger pool of potential funds that could be available if we sort of blend the project or system toll financing with the Mobility Fund financing.

MR. BASS: I think, as an example, would be the projects here in Austin -- it's kind of stand alone project -- just 100 percent project financed -- the numbers would not have worked. Therefore, the project would not be built.

However, through the toll equity provisions of the Commission, we're able to commit money to that project to make the math and the finance work. And now the project is being built today rather than 20 or 25 years from today. Through the Mobility Fund, that can also be used under the broader umbrella of toll equity to help similar projects like that throughout the state.

MR. JOHNSON: Thank you.

MR. WILLIAMSON: And you intend to incorporate this, Coby, into the Strategic Plan. Okay. Continue.

MR. CHASE: Challenge 6 -- the declining purchasing power of the gas tax. This doesn't take long. This isn't exactly a news flash, but it is the underpinning of everything else.

The gas tax simply hasn't kept pace with the vehicle miles traveled on our roads. And with cars becoming more and more fuel efficient, it never will. Fuel efficient cars cause congestion, just like a gas guzzler does, but they pay less to use the system. The bedrock of our financial system is deteriorating, and I suspect there's little we can do other than plan for a different future.

MR. WILLIAMSON: Wait, wait. How do we know it's deteriorating? Have we done studies on this?

MR. CHASE: Yes, we have figures -- I believe James has them -- that show the gas tax over time has not kept up anywhere near with the amount of vehicles traveling on our system.

MR. WILLIAMSON: I hope yours is easier to read than Amadeo's.

MR. BASS: I keep forgetting if this is portrait or landscape, and I chose wrong this morning. What this shows -- it begins with 1993. And 1993 is significant in that it was the first full fiscal year of the last increase in the state's motor fuel tax. That change from 15 cents to 20 cents per gallon occurred during 1992, so 1992 was not a full year under either method. 1993 was the first full year.

The left column there, motor fuel tax unadjusted, is merely the actual dollars collected in current year dollars. The motor fuel tax adjusted for HCI -- and HCI is a highway cost index -- in effect, it's a consumer price index for state DOTs, if you will. It then takes --

MR. WILLIAMSON: Is it generally accepted, like, by the federal government? Is it a reliable index?

MR. BASS: The Federal Highway Administration has a index as well that looks over for the entire nation. Our construction division manages the highway cost index. They mirror each other very closely, but a lot of times we'll rely upon the highway cost index, since it is specific to what's going on in the state of Texas.

And so that adjusts the actual motor fuel tax dollars. It discounts it by inflation and, in effect, moves that back to 1992 purchasing power.

One oddity you'll see in 1993 is that the adjusted figures are actually slightly higher than the actual dollars. And what that means is the highway cost index between '92 and '93 actually saw some slight deflation. So our purchasing power in that one year went up slightly. But as you can see throughout the years, it has gone down -- or, actually, it's remained surprisingly constant in 1992 dollars.

The next column is the vehicle miles traveled on the state highway system. And the fourth one there, motor fuel tax unadjusted per 100 vehicle miles traveled, shows, for every 100 vehicle miles traveled on the system, the revenue to the State Highway Fund back in '93 was $1.34.

MR. WILLIAMSON: Okay. Now, I want to be sure I understand this. This isn't something that normally makes sense.

COURT REPORTER: Mr. Chairman, can you talk in the mike?

MR. WILLIAMSON: No, I don't want to talk in the mike. $1.34 at the top, $1.29 right there.

MR. BASS: Correct.

MR. WILLIAMSON: You're saying on an unadjusted basis the amount we collect per mile of wear and tear on our road has gone down.

MR. BASS: What we had was the VMT on the system went up by 44 percent, and then that dashed line is the difference between actuals and then projections. The last year of actuals is 2003. From '93 to 2003 vehicle miles traveled went up 44 percent, yet, the dollars -- actual dollars in the state highway fund from gas tax went up 38 percent.

MR. WILLIAMSON: So forget the inflation -- forget that. Just on a pure dollar basis it went down.

MR. BASS: Correct. If you then follow over and look at --

MR. WILLIAMSON: You say this is the projected line. Who made these projections? What's the source for this?

MR. BASS: The projections on the traffic came from our Transportation Planning and Programming Division off that column. The revenue projections to the state motor fuel tax to the far left were made by Finance Division in our monthly cash forecast for the State Highway Fund.

MR. WILLIAMSON: Thank you. So you're going to incorporate this into the Strategic Plan, Coby.

MR. CHASE: Yes, sir. Lastly, challenge 7 -- the rising role of regions. This Commission has signaled its intention that regions are in the best position to address their transportation needs. Nowhere is this more evident than the three new Regional Mobility Authorities that have either even been formed or are being formed. Their true power is unknown, but in an exciting sort of way really.

However, the Agency will need to make calculations about the degree and depth of capital to invest in their success. So the questions are, where will we find the money and how will it fit in our overall strategy.

MR. WILLIAMSON: Steve, you've been doing some work on RMAs? You've been working for the Commission with RMAs?

MR. SIMMONS: Yes, sir.

MR. WILLIAMSON: Give me a glimpse of the impact of the RMA process on our Strategic Plan.

MR. SIMMONS: Chairman, I think it's kind of the good news, bad news is. You know, the good news is we're giving the local control over to the regions by creating these Regional Mobility Authorities. And by doing that they're going to have a new source of revenue to start working on additional projects in their areas. That's the good news.

The bad news is, we don't know how much we're going to have to partner with them at the very beginning to make a project profitable for them to move forward in a Regional Mobility Authority.

So those two unknowns -- one, on the account that we don't know how much we will be working with the RMAs up front. And the good news is how much revenue they're going to be generating from these toll projects that will then be able to be put back in the projects, not only on their system, but also to offset some of the work on our system.

MR. WILLIAMSON: Okay. Well, let's take as an example -- we really can't talk about Houston or Dallas/Fort Worth much because we've kind of got [indiscernible] and NTTA as the toll authorities of choice in those two areas.

Let's take San Antonio for a moment -- Bexar County. 281 -- I'm not suggesting, Hope, I'm just dreaming. RMA formed to expand 281 for express lanes north. Tom Griebel tells us in a year that he -- it's a $700 million project and he needs a minimum 200 because he can only finance 500 over a 30-year period. That would be a $200 million hit in toll equity from us.

MR. SIMMONS: Yes, sir.

MR. WILLIAMSON: That's the unknown you're talking about.

MR. SIMMONS: That is correct.

MR. WILLIAMSON: Now, what would happen --

MR. SIMMONS: It's a good unknown because we're getting a project for --

MR. WILLIAMSON: $200 million.

MR. SIMMONS: -- $200 million.

MR. WILLIAMSON: What would happen if Tom said, But if you'll give us 300 million the RMA will have a spare $4 million a year or $10 million a year, and we want to use that to study expanding -- and forgive me for my numbers -- is it 1604?

MR. SIMMONS: 1604.

MR. WILLIAMSON: 1604. We could do that.

MR. SIMMONS: It's another good thing.

MR. WILLIAMSON: Or we could even -- Tom Griebel could even say, If you'll give me 400 million I'll have 20 million a year. I'll take 10 of that and I'll re-leverage that to expand whatever. Is that -- so that's what you're saying to us.

MR. SIMMONS: Yes, sir.

MR. WILLIAMSON: Or Loop 375 in El Paso is a good example.

MR. SIMMONS: Correct.

MR. WILLIAMSON: El Paso could form an RMA. They could say, For another 200 million we could take it all the way to the mountains. We need at least 50 million of that in order to justify it on a debt basis. If you guys will give us 100 million we can start generating cash flow for ourselves immediately to use to build the interchange at Interstate 10.

MR. SIMMONS: That's exactly correct.

MR. WILLIAMSON: I can't think of other examples because I'm -- can't think of Dallas and Houston because they're not RMA candidates.

MR. NICHOLS: Let me throw something in here. There are other toll authorities in the state besides Harris County and TTA. A number of counties, like Fort Bend County and Brazoria, who's I know here and going to be talking about it later, have formed toll authorities as opposed to regionals. So they're going to become a factor in this also because they're going to be looking, hopefully, for some equity to kick start their projects.

And we also do not want to forget that in a number of applications around the state where counties or regions choose not to, but would rather our Texas Turnpike Authority, TTA, to do that project -- internally, our own division -- may be faced with that same thing.

I think, since we're talking about input and discussion items here, that it's probably real important to note that internal to a region, since -- particularly a metropolitan -- since we've gone to an allocation basis, there's only one of two real sources to look for equity into toll roads.

Number one would be look inside your allocation that's given to the MPO. And if the area or region chooses that project, or maybe two or three projects instead of one, is kick started better by an allocation internally of those funds, so be it. That would be one source of equity. The only other sources of equity -- we might have to kick start some of these toll projects -- would be something like the Texas Mobility Fund.

MR. SIMMONS: Yes, sir.

MR. WILLIAMSON: And we're incorporating that -- and we should incorporate that into the Strategic Plan, Coby. Thank you, Steve.

MR. SIMMONS: Thank you.

MR. WILLIAMSON: Okay, Coby. I note from your notes here you're almost wrapped up on kind of telling us what you're going to incorporate in the Strategic Plan.

MR. CHASE: Almost comes in three sentences. Procedurally, the Strategic Plan is due on Friday, July 2, which means that the final version will be before you at the next Commission meeting for a vote. I'll leave it at that. Any final comments --

MR. WILLIAMSON: Sorry for --

MR. CHASE: -- or questions.

MR. WILLIAMSON: Sorry for such a long morning, but it was --

MR. CHASE: No problem.

MR. WILLIAMSON: -- an important discussion that had to be had. Members, any other -- we've got two people who wish to comment, in addition to Coby. Okay. Well, have a seat and stay on --

MR. CHASE: Thank you.

MR. WILLIAMSON: -- standby. Chair recognizes Gerald Daugherty.

(Pause.)

MR. WILLIAMSON: Too late. Chair recognizes --

MR. DAUGHERTY: That's not nice.

MR. WILLIAMSON: Can't you have fun in this job? You know you -- we could really have fun is you give him a standing ovation when he walks in. He would want to know why people were applauding. (Pause.) Gerald? (Pause.) Did Gerald give up on us?

MALE VOICE: Somebody's looking for him.

MALE VOICE: He just walked out a moment ago.

(Pause.)

MR. WILLIAMSON: We could let Glen Whitley speak for Gerald Daugherty. (Pause.) We could let the mayor of Laredo speak. (Pause.) Okay. Well, while they're looking for Gerald -- oh, here's Gerald. He was over in the TTA section signing up for the TxDOT toll plan for the Austin area.

MR. DAUGHERTY: Thank you, Mr. Chairman. Just when I thought it was time to go outside I knew you'd call me.

Good morning, and thank you for having me. Mr. Behrens, Mr. Chairman, members of the Commission, especially Ms. Andrade that's new -- welcome to the Commission -- and Senator Houghton.

For you all that don't know that I am the Precinct 3 County Commissioner here in Travis County. And I know that some of you know me a little. And I would probably start by saying that if I am not known as the person that is the biggest proponent of building road systems then you probably haven't been around here much. I mean, I have spent the last ten years of my life trying to figure out a way to do that in central Texas -- in Austin -- especially Travis County.

As you all know, we have put together a plan with our district engineer -- and let me say that our district engineer has done a very good job of putting together a plan for us for tolls. And the RMA has also been very involved in that.

And let me start by saying that I am very supportive of building tolls. I think that it is a mechanism that we all recognize that we are going to have to do in order to really try and catch up. I don't know that we can catch up in central Texas -- we are so far behind. But I am willing to try.

I'm going to be very blunt in -- as I generally am -- and very to the point as to what I feel like that I need from you all as Commissioners. There are really two things that I'm having some real heartache over. And that is that I'm being told that we have got to do our plan that has been presented to us, and we have a very short fuse, that fuse being somewhere in the 60- to 90-day range.

Now, I know that some of you all have been elected officials. And I just want you to know that some of us are having a difficult time taking these tolls out and selling them. As I have told our district engineer and the head of our RMA, I said, I'm not known for somebody that's bashful. I will go out if I feel like that I've got the right marching orders and I will try to sell something. But I'm not interested in going bear hunting with a switch, which is exactly what I've had to do with parts of our plan.

What I need is I need some time, because I do think that in this community that I am identified as someone that is very willing to get out in front and to build a road system.

Mr. Chairman, I know that you remember it whenever I came to see you in 1997 over at the Capitol. I mean, I was there over transportation dollars. Now, it was sort of in a roundabout way, and everybody knows that it's hard for me to have a discussion with anybody that I can't segue into public transit. But I'm not going to spend a lot of time doing that this morning, but --

MR. WILLIAMSON: That's because you're such a strong proponent of public transit.

MR. DAUGHERTY: That's exactly right, because most of us probably got over here by public transit today. I do think that we have an issue in this community that we have got to find dollars everywhere we can.

And if I can get from you all that -- two things. Number one, some of these discretionary dollars that we have been told that basically comes from the Commission that we can be made whole, so to speak, if you tell us -- you say, If you will go out and you will put a plan together then these dollars, whether they're Texas Mobility Fund or whatever other discretionary dollars that we have, and if we can have longer than 60 to 90 days.

Now, I'm not talking about taking two years to sell a toll plan in this community. But I think that it is unreasonable to ask some of us elected officials to go and say, Here's the plan before you, and you need to go out and you need to sell this and you need to take it right now because this is a take it or leave it.

And I'm afraid that our CAMPO Board, our MPO in central Texas, is going to have some difficulties with that because there are some of these things that are hard to sell.

We know that tolls are added capacity roads. Generally, that's what people think of toll roads. Now, people get confused when they see a road that has basically been stopped, so to speak, or there hasn't been work on a road -- if you're familiar with the 290 going through Oak Hill as you're going south towards Johnson City. People have waited eight to ten years to see that road completed. It's, you know, probably a little over a mile-and-a-half.

Well, when you tell people that added capacity means that mile-and-a-half stretch that you have been waiting for is really going to be added capacity and it's going to need to be tolled -- I'm not saying that I can't sell that, but I need enough time to go to that community and say, We really do have an issue with funding in this state. And I can sing that song. And I can sing it with conviction because I believe what I am told by you all and I'm involved enough to know that that absolutely is the case.

But I think that we have an issue here in central Texas. And given that we are the first RMA in the state, I am very willing to work with our RMA as a Commissioner. We had three appointments to our RMA Board. And as I told them from the get go, I am supportive of getting with you all and doing whatever it takes to have a plan that we can go out and sell.

So let me end by reiterating and just asking you, if you can tell me before I leave, number one, do you think that, if we don't do this thing in 60 to 90 days, will we still have the opportunity to take the discretionary funds -- or to have the discretionary funds in this community. And number two, will we really have more than 60 to 90 days to work with our CAMPO Board and to work with our community.

Because I think that you will find -- I mean, I would love -- I did a press conference, along with Representative Keel, and came out against the plan as it was, but was very forthright in saying, I'm not against tolls. There are some issues with this plan that I have. But I think everybody knows that I'm going to come back and do another press conference and say, Now, I am supportive of doing this.

And so that's really what I'm -- I mean, thank you so much. It's hard to, you know, stay on script here when there were so many numbers shown me that it really kind of spawned a lot of ideas and a lot of questions that I would have had for you.

But if you would, I mean, is there any way, Mr. Chairman, that we could answer those questions before I leave.

MR. WILLIAMSON: Well, first, I'll allow other Commissioners questions or comments of this gentleman? Comments for him or questions directed towards him? My --

MR. JOHNSON: Well --

MR. WILLIAMSON: Go ahead, John.

MR. JOHNSON: I have an observation -- and it has basically to do with the plan. What my sense is is that we're telling communities -- is they need to come to us with a comprehensive plan. And I recognize that you, as a county commissioner, have a precinct that you represent -- certain area.

And you have constituents that are saying it's a good idea or it's a bad idea and -- on how it affects them and what it's going to cost them. And so you have to listen to that, rightfully so, because you're on the ballot every two or four or six years, depending on, you know, what sort of position you hold.

But what we've asked, you know, is for the community to come together and look at the community as a whole at the projects that are being proposed. And I understand the frustration from, you know, an individual's standpoint as, you know, am I going to use it and how much is it going to cost me if I use it.

But the community, the elected leaders, and the appointed leaders from around the community need, you know, to get on step. And as I mentioned to you yesterday, I think there needs to be some give and take. We can't just say, Well, it's good for your precinct to have these new toll features, but you know, I can't afford it -- I can't have it. I mean -- because economically it's not going to work. We're not going to get anything done in a timely fashion.

And I don't know if you were here. We talked about the goals -- overall goals of the Department. And project delivery timeliness is hugely important. It's important to the users of the system.

So, you know, what I'm imploring you to do is, you know, let's get the community together on a plan that works. And Bob Daigh is a huge advocate -- and a very effective advocate -- of getting that project delivered.

I don't think we can define how many discretionary dollars, you know, this area has versus Tyler versus El Paso versus, you know, whatever, because we have to compile, you know, the efforts of all groups like the Travis County or the Lake Travis-Williamson RMA, the Bexar County RMA -- there are a lot of moving parts here. So I don't think at this point in time we can just say, Well, this is your piece of it. And, you know, you can leverage it or you don't have to leverage it.

MR. DAUGHERTY: Mr. Commissioner, I appreciate that. I think that I just heard, You need to get high behind putting together a plan knowing that there are discretionary dollars that we have that we are willing to give to this area. And I'm very supportive of that.

MR. WILLIAMSON: And John -- you know, we all -- this is our opportunity frequently for us to converse with each other and see where we all stand on things. I share a lot of what John just said.

Any of the other members have anything they want to add to this? Please, Robert.

MR. NICHOLS: I was going to say, first of all, thank you for being here and speaking out. And for -- I do know that you have been a strong transportation supporter in a community at times when there wasn't a lot of support for transportation. For that we appreciate it.

The time line -- one time line I know is there -- that is there is we have asked all the metropolitan planning organizations to have their project list recommendations, priorities, or rearrangements in by the end of August. So that's probably why there's so much pressure -- a short time frame to get that in.

I know that once we get those in that we, and the Department, will be looking at the total rearrangement, the balancing of the allocations, which projects are leveraged, which -- you know, all that type of stuff. So that's probably the initial deadline.

If you're referring to discretionary dollars as -- with reference to like Texas Mobility Fund, you know, I think the Commission members -- I've heard them in these meetings and out when they've gone on records in talks and stuff -- in stating that we -- that money was there to leverage projects -- I mean, to help break congestion and move people, and that it's a one shot deal. So we treat it separately and different than we -- our traditional funds.

So we are certainly going to be looking to those communities and the use of that fund for leveraged projects that help solve preservation long term and help generate new revenue sources.

Tolls is what we think meets that. If communities can come up with a better idea -- we do not claim to have a monopoly on good ideas. That's just the best one we've heard that's been approved by the Legislature.

So I think that's the first deadline. I don't think we're going to go real quickly and yank an opportunity from a community because they miss something by a week or two or 30 days or something. I think there will be some time in there to give communities time to digest this -- because it is new. But that's just me. One is -- but I think we will have that.

But you and I met yesterday morning -- spent an hour together. And one of things I think I pointed out, that in the -- I'm not that familiar with all the individual projects in the regional plan. But I do know that, in a couple of those projects you all were concerned about, that if you don't do a toll on those, because of the leverage effect -- you know, the MPO has the authority and ability to not toll those, and say we don't want to do that.

But there is a list of other projects that are in that proposal that you'll also have to decide which ones you want to remove. Because by removing those from that tolling opportunity, because of the leveraging effect, you'll have to go and also pick from there two or three other projects that you're going to remove. It's just not a matter of removing one; it's a matter of removing multiple pieces. So that's pretty tough also.

MR. DAUGHERTY: Commissioner, that's precisely the reason that I need a little more time. It's really hard to go out and to sell something that a lot of people find very abhorrent. I mean, let's face it. I mean, you know, Texans are pretty proud of being able to get in their cars and their -- you know, for near a hundred years now that's kind of what they've done.

I understand that we've got to have a different mechanism because I'm close enough to this -- and I really do get this. The time is really the thing that I want to implore you all to really give me as an elected official. Because I do think that there are things that we can do -- and I do understand, after you explained to me that if we pull this out it affects something else. I am not going to bore you with my ideas on some other funding capabilities that I think that we have in this community.

But I get it. And I'm willing to go out there and to walk the walk and talk the talk. But sometimes you need more than 60 days. And -- or 90 days. And that was the thing that probably was the most bothersome to me. And I just didn't think that the Commissioners were -- you know, would look at me and say, That's all the time that you've got. Because that's a tough sale. So anyway --

MR. WILLIAMSON: Well, Gerald, we are --

MS. ANDRADE: Mr. Chairman?

MR. WILLIAMSON: Oh, please.

MS. ANDRADE: I have a question. I thank you for understanding what we're also going through. But I have a question. When you're asking for time how much time are you asking for?

MR. DAUGHERTY: I would like to have six months. I mean, I don't think that six months is too much time to sell something like this versus the 60 to 90 days. I think that we can sit down and come up with a plan that the majority of this community -- or at least the majority of our MPO would say, Okay, you all go out and sell this.

MR. WILLIAMSON: And Gerald, I don't -- Commissioner, I don't want to -- I said early -- when the meeting started today we need to all be civil. This is -- and it's been civil and, while intense, but civil conversation so far. And I don't want to violate my own rule. But I -- and I may be fixing to be embarrassed as heck.

But I want to give you an example I think of the dilemma we face. Michael, how fast can you take Mobility Funds and build leveraged assets? How fast are you willing to commit to a plan? (Pause.) And if you want to embarrass me it's okay. You know, I've got a tough hide.

MR. MORRIS: Michael Morris, director of transportation at the MPO in Dallas/Fort Worth. Thank you, Mr. Chairman, for dragging me into this particular thing.

In the Dallas/Fort Worth region, going back three executive directors when you had Arnold Oliver, the Regional Transportation Council in 1993 said, There's no way we're going to fund all the transportation needs without putting toll roads on the table.

Those first six months in 1993 were very traumatic for our particular region. Being drug to congressional offices and arguing, Why are you saying these type of things -- you know, the federal government will have money to build transportation for a long time.

So then Commissioner -- if we go back ten years and six months ago, our region was facing a similar issue of trying to bring a community along. Ten years later it's become a very natural strategy, which you'll see in the presentation today.

We know clearly, starting ten years ago, you will not build the infrastructure of the state without increased user fees from other sources other than gasoline tax. It's very simple. We're beyond it.

The problem though is certain communities are catching onto that situation at different points in their history. So this point in this community's history, you could argue, is similar to the first traumatic six months of 1993 --

MR. WILLIAMSON: And I appreciate your candor, but I'm really not trying to put you in a bad spot. But the dilemma you face and the dilemma Michael faces is a different dilemma than the dilemma we face. The dilemma we face is -- and I could ask Alan to come up here, and I suspect his answer would be very similar to Michael's.

Well, let me ask one of my staff. Amadeo, did you ever do -- go back and rank all the projects in the state? Thank you, Michael, I appreciate it.

MR. MORRIS: Thank you, sir.

MR. WILLIAMSON: Did you ever rank all the projects we know of in the state according to cost effectiveness index, even though we don't use it any more?

MR. SAENZ: Well, since we were not using cost effectiveness index, we're still working on it. We worked on it last night, but we haven't been able --

MR. WILLIAMSON: So we don't know what the 50 most effective projects in the state might be right now?

MR. SAENZ: I may have it sometime this afternoon.

MR. WILLIAMSON: The problem we face is we have communities, Commissioner, that constitute almost 50 percent of the population of our state, that have, by our own numerical history, been more than willing to share -- Austin has been one of them -- a portion of their gas tax funds with other parts of the state the last four years to ramp up the infrastructure.

And while they're all becoming a little bit restless, are willing to stick it out for six more years until the NAFTA plan is fully built out. They're saying, If you're -- if, nothing else, incent us to go build toll roads and we'll go do it. And we don't want to wait. We want to get started like yesterday.

You have leaders in the Travis/Williamson County area -- Mike Krusee, even Senator Ogden in a muted way, saying, We really know what needs to be done. This is uncomfortable for all of us. But we have to move on.

We can spend a lot of time -- I mean, if it's hard for you to sell it in Travis County -- you're my brother-in-law's commissioner -- I can tell you it's not hard to sell it to him. He's ready to pay his toll and go.

Think how hard it is for us to have to sell it across the state every day. We understand. But, you know, at some point somebody's got to act. Somebody's got to stand up and lead. Somebody's got to say, I have a solution. Here it is. Either lead, follow, or get out of the way.

And that's sort of where we're at. And I guess in a way -- I say that to Brazoria County and to El Paso and to everyone else that's present -- Tarrant County. I mean, we have a real transportation -- a real, not fake -- a real transportation crisis in this state. And we are attempting to address it with the tools that are available to us.

We're uncomfortable that you're uncomfortable. We really are. But we've got to make some decisions. We've got to get on down the road. I'm paraphrasing my best friend.

MR. DAUGHERTY: Well, Mr. Chairman, I'm not afraid of that fight. And I apologize if I might have said something that seemed overly aggressive.

MR. WILLIAMSON: No, no, no, no, no, no. You didn't. No, no.

MR. DAUGHERTY: I thought that there was -- you know, that you had intimated that perhaps we had gone beyond the, you know, the being civil. And I didn't mean to be that because I --

MR. WILLIAMSON: No, I was --

MR. DAUGHERTY: -- told everybody -- I said, I'm going to be there --

MR. WILLIAMSON: -- making that comment to myself.

MR. DAUGHERTY: Oh, okay.

MR. WILLIAMSON: I was making the comment to myself.

MR. DAUGHERTY: You know, I will say this and end it here. If you haven't seen our plan that has been put before us you need to see it. It doesn't look like the Sam Houston Tollway. It doesn't look like the Hardy Tollway. It doesn't look like the North Dallas Tollway.

It is a toll system where you drive 3.4 miles in a free road. Then you enter a 1.6 mile or a 2.1 mile where it becomes a toll, unless, of course, you want to get off on the sides. Then you will come into free lanes again. Then you may drive four more miles and enter.

It is a patchwork system that -- Commissioner, I don't think that you could sell it in Weatherford. I don't think that you could sell it in San Antonio. I don't think you could sell it in Houston.

I'm willing to try to sell some of this, but it's going to be a tough deal for me. And for -- if your brother-in-law lives in my precinct -- I got 600 e-mails in three days from Precinct 3 just in that immediate area.

And so I'm just trying to listen to folks that, you know, want to come and really talk to me about this. This is -- and you're talking to a guy that wants to build roads -- I mean, a guy that has fallen on his sword in this community.

I mean -- and I was talking about it before it was even fashionable to talk about -- I mean, how do we garner their dollars to build our infrastructure roads. I've been here 36 years, and I will tell you that no city in Texas has as ridiculous a road system as Austin, Texas.

I love to go to San Antonio. My brother-in-law lives there. Every time I go there my wife says, Don't get excited. I know how worked up you are about 1604, about 410, about 281 because you can get around. You can get around in Dallas. You can get around in Houston because they have a comprehensive road system.

We do not in central Texas. And you all know part of the reason we don't is because we have never been aggressive enough to come to the Commission and say, Here are matching dollars. This is what we are willing to do.

I've known that we were going to be in this situation for a long time. And I will continue to fight for roads, Mr. Chairman, and I will continue to get out there and do whatever it takes. I will continue to work with my MPO members and say, Let's try to come up with something that we can all sell. Because there's no use having blood in the streets in this community like we had over our light rail referendum. It just doesn't get us anywhere.

MR. WILLIAMSON: You'd be for commuter rail, wouldn't you, if it took people off roads? Not light rail, commuter rail.

MR. DAUGHERTY: Well, I mean, I think commuter rail is better than light rail. And the fact that it's grade separated, you bet. I mean -- but is it still bang for the buck? Is it worth 60 to $80 million for me to bring somebody in from Cedar Park and Leander when, for 60 or $80 million I could build the exchange at Loop 1 South, I could finish the road at 290 West? Not a chance.

MR. WILLIAMSON: But --

MR. DAUGHERTY: But, you know what? That's a fight --

MR. WILLIAMSON: But you'd be for it if we could all feel comfortable that it was cost effective.

MR. DAUGHERTY: If it's cost effective -- I mean, that's all I've ever asked. Unfortunately, I mean, passenger rail in the United States of America, unless you're in New York where you dump a million people in Manhattan, is pretty hard to get people, you know, out of their cars.

But I'm willing to try. I'm willing to let the Red Line -- I would be supported of the line that they own. If you can do it for 60 to $80 million -- you've got a transit authority in this community that has $150 million in reserves -- do it. And if you say that you can operate the thing for $5 million a year then I'll do a press conference and say, I'm all for it.

But I don't think that we can get there. And meanwhile, we're stuck in traffic because most of the people elect to get in their cars. I mean, I wish that I could change that. If we could go back and resurrect Henry Ford, maybe we could start this whole thing over. But unfortunately, that's not the case.

MR. WILLIAMSON: I owe you a more direct answer to your question, by the way. I think you got a sense from the Commissioners that we're uncomfortable generally saying it's our way or the highway. On the other hand, we have to give some guidance to all of our district engineers -- not just Bob Daigh, but all 25, 26 -- I keep wanting to add a district -- 26, 25 -- to -- the Weatherford district. That's why I keep saying 26. When are you all going to create the Weatherford district?

We have to give some guidance to all of our district engineers. We have to give them some parameters. They are, after all, engineers. They like square corners.

So don't judge Bob too harshly, nor stay too angry at the local officials who've helped him. We're pressing everybody to tell us how far you think you can go in your communities so we know how to fashion our Mobility Fund Strategic Plan correctly that we discussed earlier.

I think the Commission doesn't have an answer for you, but I think you can derive that we understand it takes time to sell ideas. But for gosh sakes, don't take too much time because there are other parts of the state that don't need to be sold -- they're ready to move.

MR. DAUGHERTY: I understand, Mr. Chairman. And I will work diligently to get there.

MR. WILLIAMSON: And I am so glad that the headline in the Austin American Statesman tomorrow will be, Commissioner Daugherty Endorses Commuter Rail Plan.

MR. DAUGHERTY: As a matter of fact, I hope --

MR. WILLIAMSON: We have made --

MR. DAUGHERTY: -- you know, that Ben Ware --

MR. WILLIAMSON: -- news today.

MR. DAUGHERTY: I hope that Ben Ware says that tomorrow. Thank you very much. Thanks for coming in and for the work that you do.

MR. WILLIAMSON: Thank you.

MR. DAUGHERTY: Be careful going home. Thank you.

MR. WILLIAMSON: Thank you for being here, too. I think we can follow you up with Roger Baker, who's always got a kind comment for the Department. Roger -- now I can laugh and smile because Roger and I were the first two to warn the state on a consistent basis that the price of oil was fixing to double, weren't we, Roger?

MR. BAKER: I've been aware for a long time of that fact. I'm into the oil industry. I want to thank you for the right to be here. And I do have a handout for you all.

MR. WILLIAMSON: No. Another one?

MR. BAKER: The reason --

MR. WILLIAMSON: This is from the recent journal.

MR. BAKER: It's from the -- yes, it's a recent article. The legislation that we have now requires you to develop a Texas Mobility Fund Strategic Plan that determines how the new certified revenue from the Mobility Fund can be used to improve multi-modal mobility.

And your new planning philosophy, with discussion items like this one, encourages openness and public input. And so it's an awesome responsibility, but it's one that I take seriously. So I'm here to try to help out.

As you know, I follow the oil and gas industry pretty closely. And that led me to pass along this article from the April 26 Oil and Gas Journal. This article predicts that world petroleum production will probably peak about 2006 to 2007 or before 2008 at the latest.

Since the gas tax portion of your budget -- and school funding also -- has -- depends on this, it has important and direct implications for your budgeting and also, for the Mobility Plan's Strategic Fund portion of your total spending.

We already have TxDOT planners in the Austin area saying that we need to grab our share of the Mobility Fund before Dallas and Houston get it. Yet, we do not have a Strategic Plan that could establish an orderly process instead of a free for all.

With the gas tax revenue stagnant, and rising fuel prices likely to affect the toll revenues, and the driving habits and bonding capability, I think we need to have a Strategic Plan that examines how you might deal with the various fuel price scenarios that are compatible with this oil production forecast.

If oil production peaks and then goes down by 2008, how are you going to deal with that? You know, it means that we'll be fighting China for the -- for a stagnant -- you know, for a pie that's no longer expanding. This has ominous implications for your whole budgeting, for your Strategic Plan, and for the Texas Mobility Fund, although indirectly.

So I would -- you know, I would just ask you to take this real seriously.

MR. WILLIAMSON: Thank you, Mr. Baker. Does anybody have any questions? (Pause.) All right. Thank you very much.

MR. BAKER: Thank you.

MR. WILLIAMSON: Representative Joe Pickett. I wasn't sure if you wanted to speak now or -- okay.

REPRESENTATIVE PICKETT: Good afternoon. Since we're on the Strategic Plan, I just thought I'd like to bring a few things to your attention as well. I share the same comments as the Commissioner. I guess I can't go on the record enough. I am not against tolls. And I think it should be an integral part of the Strategic Plan.

There is a lot of history given today of how this has evolved and whether the legislation was specific or gave direction to the Commission. And the direction that was given legislatively in my mind was for you to do the best that you can, the way you've been doing it for years.

Chairman Williamson had mentioned Senator Shapiro and Clyde Alexander, and there's a lot of people that say that they're for tolls or they're some people that are against tolls altogether.

But as far as the people in this room know, on a nine-member committee, you need five positive votes to pass legislation. I was on that committee in 2001, and I was the fifth vote to pass that legislation.

It was mentioned about the Ogden Bonds. Well, Senator Ogden and Representative Krusee did yeoman's work on 3588, but there were some issues in that regular session. They lost their vehicle for the constitutional amendment.

I was working on a constitutional amendment for TxDOT at the time. Senator Ogden came to me and asked me what I thought about general bonding authority. I said, I think it's fine. I said, It's been a contention with some of our members. We had a hard time passing the Shapiro bill a session ago, but I'm all for it. Why? We need your help. You have the only vehicle to get this bonding authority out to the general public. And I said, Be more than willing to help.

And I'd also offer some new insight. The bill that you first had, Senator, had a $2 billion cap that was going to be in the Constitution. I feel I have the ability to pass it with a zero cap, and that any caps are put in legislation, so what has to happen in the future is a legislative body meeting, not opening up the Constitution again. And so Proposition 14, that probably everybody in this room voted for, was something that I was dedicated to do and worked on.

So all that goes into this new toolbox -- or the tools that we're hearing. And I know that there's many speakers. I'm going to be short because we're going to come back with the El Paso delegation.

And right now TxDOT is mad at Representative Joe Pickett. Representative Joe Pickett is a little mad at TxDOT. Can we get through it? Absolutely. I don't know how many times I'm going to go on the record saying I'm not against tolls when it wasn't popular to be for tolls. The Commissioner also said that they looked at this earlier -- three years ago in El Paso. We included a toll viability on one of our projects three years ago.

What I object to is the telling us that we have to toll specific projects. Once we can come to a meeting of minds and realize that this mobility plan for Texas is for Texas, it will work. You yourself said, Commissioner, that two-thirds of the Mobility Fund is going to go for, basically, metropolitan areas -- tolls -- one-third is for an area that are not going to do tolls.

So that two-thirds category money, which includes El Paso, Texas -- we're being told if you don't toll you don't participate in that two-thirds amount. Why aren't we included in the one-third amount?

I think that we will find a civil way to handle this. Commissioner Williamson has been very forward and outgoing as far as my participation with TxDOT. In every place that he has been he's been a positive, I guess, note to my transportation background, and I want to continue that. And I believe, Chairman -- Ric --

MR. WILLIAMSON: Hey, Joe.

REPRESENTATIVE PICKETT: I believe that we can get to it. But I don't know any other way, Ric, how to go on the record to prove that I've been working on this, that I'm supporting TxDOT in this, that I can see the big picture, too, before it was popular to do so. I fought a Democratic speaker on the bonding issue in 2001, and we passed it.

MR. WILLIAMSON: You're held in high regard here, Joe.

REPRESENTATIVE PICKETT: And so I think we can get past this as well. But if everything TxDOT says about Strategic Plan has to include the input of the communities, it needs to.

Amadeo mentioned my name about the working groups. I was never prouder in my life of TxDOT during that time because you all did the right thing. Today I felt that you all must feel cleansed that you admitted that some of these projects worked in the best interest of the state.

I took it a different way. You were up here grilling Amadeo when he basically said -- and Coby Chase -- that there were projects that shouldn't have been done. That's also when TxDOT was making 100 percent of the decisions.

MR. WILLIAMSON: This Commission doesn't run from that. We understand that.

REPRESENTATIVE PICKETT: And also, I have supported the Commission and said, I will support you with those tools, but leave them as that -- as tools -- instead of weapons. And some of us feel that they've been turned into weapons, Ric, and I think we can turn it around.

I believe our community can do the same as Travis County and come up with a long-term plan and show some viable projects. But there are certain ones to some of us -- and right or wrong -- to some of us feel aren't on the table. And maybe our constituency will prove us wrong five years, ten years down the road. But I don't think so. I think we can come to a meeting of the minds. I really do.

MR. WILLIAMSON: Well, there's nothing comfortable about the process we're all going through. I -- we divide the working -- only we try to. I spend most of my face time in Dallas/Fort Worth where I'm from. I sometimes must give the impression down here that people in west Fort Worth, Texas, are standing in line to pay tolls, and that's not the case.

But one thing I learned when I was your colleague, best public service is that which is blunt and to the point.

REPRESENTATIVE PICKETT: Absolutely.

MR. WILLIAMSON: And we can either spend the next 20 years telling ourselves we're going to build that road or somebody can make some hard decisions and move ahead and say, We're going to build a road and this is how we're going to pay for it. And you may not like it, and you'll take me out of office and replace me. And that's okay.

But we're going to move that rail out of downtown El Paso. We're going to quit talking about the congestion and the danger, the hazardous materials that go by the schoolhouse every day. And we're going to make some decisions, and we're going to take care of that problem.

REPRESENTATIVE PICKETT: And there isn't anybody who doesn't realize that more than the mayor --

MR. WILLIAMSON: Let the chips fall wherever they fall.

REPRESENTATIVE PICKETT: -- the county judges, the state representatives from those area. But we did get started off on the wrong foot, which I can't seem to understand how that happened. I don't know how that happened after all these years, how I'm now all of a sudden not TxDOT's ally? That is not true.

MR. WILLIAMSON: I don't think --

REPRESENTATIVE PICKETT: That's not --

MR. WILLIAMSON: I don't think we feel that.

REPRESENTATIVE PICKETT: And I know you may have been able to hear what I'd said at the beginning. And I think we ought to err. I said, TxDOT is mad at Representative Joe Pickett and Representative Joe Pickett is mad at TxDOT. And that's okay. That's okay.

But it's on an issue. You guys have got all kinds of things that we deal with, and it's still like the legislative process. The majority of the bills that we pass in a legislation session we have consensus. It's those few we get pretty contentious.

This is the contentious issue for this Commission at this time. It's a new thing, and some people are just afraid of change. I'm not afraid of change at all. Not at all.

MR. NICHOLS: Let me address like your opening comment and one you just touched on in front of you -- in front of people from El Paso who are either in the room or watching some of this.

I want to, you know, make sure I say that you have been a very strong supporter -- I've been on the Commission seven years. You have been a very strong supporter of transportation all the way through consistently. You have been a strong supporter of TxDOT. You've been tough -- I mean, you've been fair, but you've been helpful. You have done many, many things to help pass legislation that's beneficial, not only for the El Paso area, but for the state as a whole.

You're right. We are on an issue that's tough. It's one we disagree on, but we respectfully disagree with it. And we will get through this thing. And it's a tough one. It is a tough one for the whole state.

And I can assure you, as Commission members, we would much rather go around the state and tell people what they would like to hear. It's real easy. But it's tough to tell people what needs to be heard. And that's kind of what you're referring to.

And the word contentious -- yes, it's just tough. But we'll get through it and we'll work on a lot of other things.

REPRESENTATIVE PICKETT: Well, Commissioner, I don't think it's only just what people want to hear. The two projects that we're bringing today wouldn't be the same two that many of the people that are here from El Paso are supporting as their priority.

So it's not always what people want to hear. It's the right ones or it's in timing. And the Chairman's had to make those decisions, and he wouldn't expect any less. I watched him on Appropriations. I saw how Mr. Williamson worked. I'm compared a pussycat to this guy.

And I just had to -- but I still had to air it because I do consider this a working relationship. And in the over 12 years that I've been coming before the Commission I have never felt uncomfortable until today. This is the first time I've been uncomfortable before you, and I want that to change.

And I think that we can get around it. And if we stay with what you're saying, is if your community decides their fate, and the whole picture in the Strategic Plan still hasn't been put together -- the Ogden Bonds that you mentioned -- I still want to know how this all is going to figure in, and we have yet to see that policy actually take shape.

We know what you want to do on the Mobility Fund and know it wasn't dictated in the legislation that two-thirds would go to tolls. We did leave that policy up to you, and some of us may object and the policy may change and tweak like you've done with other programs as it's gone along.

But I would like our community to sit down and be able to make those decisions, too, Chairman, about whether or not we bring this project of $150 million and ask that that's included in a bond sale, knowing that our allocation would be reduced on an annual basis for the debt service.

But let us make that decision, too. We might be willing to reduce $150 million letting to 135 million if we have to use 15 million a year for debt service.

MR. WILLIAMSON: Or get Mr. Abrams to finance the road for you.

REPRESENTATIVE PICKETT: Well, that's possible, too, under the current situations that we have.

MR. WILLIAMSON: Boy, I bet they didn't appreciate me saying that.

REPRESENTATIVE PICKETT: But -- and as this Commission stated, too, tolls won't fix everything. And I believe the perception out there now is that tolls is the answer to everything, and it is not. Tolls will still not get you that other two-thirds that TxDOT goes around telling the state we don't have the money for. It ain't going to get the two-thirds anyway.

It will help -- it will help big. I support it. Dallas is going to get up here with their presentation. I'll sit up there and vote aye because I know what they're going to present. I know how they're going to present it, and I supported that in the legislation for that reason.

And there might be some projects in El Paso. We're looking hard, Chairman. We are looking hard. And I think the mayor will echo that, too. We're looking hard for ones that we can sell our public --

MR. WILLIAMSON: Well, you know, let me -- we don't want to ride this horse into the ground. First of all, no one on the Commission thinks you're the enemy. And if you're upset, well --

REPRESENTATIVE PICKETT: Oh, I'm not upset. It's kind of a badge now I get to wear. I get to put a target on my back. And I told the Commissioner just a couple of weeks ago --

MR. WILLIAMSON: Everybody --

REPRESENTATIVE PICKETT: I was on the dais, he was in the audience, and I told him, In a couple of weeks you'll be on the dais and I'll be in the audience.

MR. WILLIAMSON: Everybody knows you've been a strong supporter of the Department.

MR. HOUGHTON: I'd like to say a couple of things, Representative Pickett. We talked about, and I asked the question, you bring to projects and the check and balance of the index congestion buster. And there's going to be -- that's the questions that are going to be looked at. Does those projects that are brought forward meet that index -- meet that criteria? Instead of building something in the sky that looks good and -- but does not meet that index or the criteria.

And secondarily, we had a meeting yesterday -- a Bond Council -- the -- and the financial advisors on Prop 14 bonds, Texas Mobility Fund, and Fund 6. And at -- and I -- and the problematic thing about what you just said about the Prop 14 bonds, if you do take a certain allocation, it will reduce for -- I think, Robert, we talked about a maximum 12 years of funding -- of financing, I mean. It will reduce your allocation for 12 years.

So again, there's going to be a check and balance -- what criteria will be met -- needs to be met to do those sorts of things. I don't think we're arguing the fact that not going to happen. But there's got to be a criteria I think across the state that we just don't build these things. And then you say, Where's the bang for the buck. Amadeo was talking about roads that were built in years past -- didn't need to be built -- didn't meet the criteria today.

Those are the things that concern me about let the communities decide what they want to do -- or the MPOs decide what they want to do. But under what premise do they get to do it. And that's my --

REPRESENTATIVE PICKETT: And again, that decision though was not a local decision. That was a TxDOT decision that built those roads that didn't meet that criteria.

MR. HOUGHTON: But we're changing that now. And that's --

REPRESENTATIVE PICKETT: And I applaud the Commission for doing that. And as far as the bonds, when we presented this to the Legislature it wasn't with blind eye. Someone's got to pay this back. We told the Legislature that this isn't new money, it is a loan. So if we go out and borrow money, which we never did in that capacity before, you're going to have to pay it back from something. So something else was going to have to be reduced.

This was all up front. Everybody knew it. We knew that there's some times where we want to get through a gap. If you look at the plan that we've got for El Paso, we don't program in the same dollar amount every year. There are some projects we're going to pull up, pull back -- the problem with the cash flow that TxDOT had. And you all asked me to work on that.

And I had a hard time passing that bill because the State Auditor's Office comes out with a report, as I'm trying to pass this bill in the Legislature, that TxDOT can't guesstimate their cash flow -- that they're off 254 percent. And I'm the one that's got a name on that bill saying I need to give TxDOT some relief because they don't have the cash. So I mean, I stood up for you guys and I took a lot of flak for trying to pass -- I did pass that legislation.

So all I'm saying is, we still need to make this a joint effort and -- I haven't heard anybody but a few people -- just individuals who are just opposed to tolls who -- just I don't want to pay a toll -- just I don't want to pay a toll -- I don't like whole milk -- I don't like tolls.

That is not the majority of the constituency. That is not the delegation's presentation. It's which tolls. That's it. And I know that I've taken up a lot of time. We've got a lot of people waiting and --

MR. JOHNSON: Well, I want to make a final -- the final point is, is there's got to be a significant financial plan -- a financial plan for communities that they understand what they're getting themselves into.

REPRESENTATIVE PICKETT: That's fine.

MR. JOHNSON: And that's the working relationship.

REPRESENTATIVE PICKETT: That's fine. But coming into a community and saying, You toll or you lose money is not the way you get people at a table that will be rational and will listen to ideas.

We need to have a rational approach so people will listen to ideas and how we can both get to where we want to go.

MR. WILLIAMSON: Well --

REPRESENTATIVE PICKETT: That's not bedside manner.

MR. WILLIAMSON: Excuse me just a second, John. I understood what you just said, Joe, but we haven't gone into a community and say, Toll or lose money. Others have said that. Perhaps even you have said that to some people in the press.

What we've said is we have two programs. We have our tax program -- gas tax and motor vehicle registration. And we have now allocated that on a dollar basis to every community.

We have a second program called the Texas Mobility Fund, which the Legislature has authorized, the people have endorsed, and we're responsible for figuring out how to distribute.

It is our judgment right now that we should at least talk publicly before we make a decision about maximizing that second program towards transit alternatives to road or leveraged roads. We haven't made our decision yet. But we don't feel like we serve the public by not throwing this out and talking about it in terms of we think this is the best way.

REPRESENTATIVE PICKETT: And that's why I'm here, because you --

MR. WILLIAMSON: You characterize as it is we're using it to -- as a weapon. And we don't characterize it that way. We're trying to speak candidly to the state. We're one state. We have roads in Houston, Texas, that have a congestion index of, what, Amadeo?

MR. SAENZ: [indiscernible] and 3.

MR. WILLIAMSON: Is there any road in Weatherford, Texas, that has that kind of congestion index that you're aware of?

MR. SAENZ: We don't get measurements from Weatherford. It's not big enough.

MR. WILLIAMSON: I'm trying not to pick on El Paso, but is there any road --

REPRESENTATIVE PICKETT: No. Two tractors is a problem in Weatherford.

MR. WILLIAMSON: Is there any road in El Paso that has a congestion index that bad?

MR. SAENZ: Overall for El Paso I think right now it's running about 1.

MR. WILLIAMSON: And the point we've got is, here's this Mobility Fund, which is new money, not our old program --

REPRESENTATIVE PICKETT: Right.

MR. WILLIAMSON: -- which we have guaranteed the El Paso MPO they now have the flexibility to make money decisions. No threats implied -- none.

REPRESENTATIVE PICKETT: Well, I disagree with that. I do believe that there has been threats implied.

MR. WILLIAMSON: Then we just disagree. And --

REPRESENTATIVE PICKETT: And I'm glad I said it because maybe it won't be said again, if nothing else. Maybe we'll all get together and say we're not going to go out and say those kind of things or have them interpreted that way. But that's the way I feel, Commissioner -- Chairman.

REPRESENTATIVE PICKETT: I'm sorry, John. I interrupted.

MR. JOHNSON: I just had one thing -- and I don't want this to be the final word. And Joe, please pardon the informality, but I want to echo something that Robert said and everybody's implied.

I mean, what you have done in terms of your service to this state is remarkable. But also the coordinated effort that you have shown this Commission and this Agency in support -- certainly the three of us are very familiar and David Laney, who preceded Ric, was well aware of. And I'm very grateful.

And, you know, I hear what you're saying, and I'm confident that, you know, collaboratively, we can work through these issues. Right now it's a difficult one. As you've noted, we're trying to bring some discipline and some method to the madness. As Coby referred to, there have been some projects that, for one reason or another, have gotten let that, you know, have not been effective in their purpose.

And we need to be responsible for what we do, and we're trying to bring discipline to what we're doing. And you're going to see it in the preservation program, which is more than half the money. You know, the tax money, if you will, that we spend is on the statewide preservation program.

So, you know, I think that's what we're trying to bring. And we're trying to get everyone, you know, on the same page and work collaboratively. And I'm confident by doing that that we'll come to the results that we need to.

Now, will everybody be 100 percent pleased? I don't think so because you can tell just from the numbers that some people feel shortchanged and others, you know, are not talking about getting more than, quote, their share. And that's a poor illustration -- or choice of words. But some people are overserved and some people feel they're underserved. And that's just the way things happen when you have limited resources.

But, I mean, what I want to echo the most is I'm grateful for what you've done, and I know that everyone here in this building is grateful for what you've done. And please don't lose sight of that, in spite of your uncomfortable feeling of being here today.

REPRESENTATIVE PICKETT: Johnny, I won't. And that's, again, why, because I do think I have a close enough relationship to tell you a personal feeling. Everything today was numbers and documents. And it's a personal feeling.

And because of the comfortability that I've had with TxDOT is -- and it may be my fault -- is why I did support so many things these last couple of sessions, because I felt you would do the right thing. So I'm just going to remind you all of that and leave. And let's get on to the delegation presentations. Thank you.

MR. WILLIAMSON: Are there other -- is there any other comments on what was intended to be the shortest Commission item of the day? (Pause.) I'm going to seek the counsel of my members right quick, if you'll bear with me.

Members, it's 12:20. Judge, we have three hours left. We can either take a 15-minute break and wolf down the sandwiches that are in the back, or we can trade out and continue going on. What do you prefer?

MR. NICHOLS: Me? I would think that if you've got a delegation here we ought to hear the delegation before we do anything else.

MR. WILLIAMSON: John?

MR. JOHNSON: I think that, out of equity and fairness to most of the people gathered here, we ought to --

MR. WILLIAMSON: Move on?

MR. JOHNSON: -- get that part of the portion -- the program. And we can, before we die of hunger or thirst or other needs we can take care of that individually.

MR. WILLIAMSON: As we need to. Well, that would mean we would skip item 4 for a moment?

MR. BEHRENS: Yes. And go to item 6.

MR. WILLIAMSON: And go to item 6? Okay. I'll tell you what we're going to do. First of all, Coby, Amadeo, Steve, James, thank you very much for, on short notice, putting together so much information. You all performed admirably. I expect nothing less when we take up the mayor's bridge in a month or two -- my buddy the mayor -- one of my mayors.

We're going to take a two-minute break to allow the Brazoria County delegation to prepare -- to go back and revise their remarks and prepare their layout.

(Whereupon, a short recess was taken.)

MR. WILLIAMSON: So we're going to skip Brazoria and put them on next month? (Pause.) I'm sorry. I'm told we're having technical difficulties with the Brazoria layout. You all should have borrowed a little more money on that toll issue -- spent a little more money on your software.

(Pause.)

MR. WILLIAMSON: Appearing for various reasons, it would be appropriate for the Chair to advise those travelers and our staff, after we hear from the three delegations, we are going to take 20 minutes to allow everybody to have a quick bite and to compose themselves.

So if you're not one of the three presenting delegations -- Brazoria County, Dallas/Fort Worth/Weatherford or El Paso -- and you feel like you need to leave for a little while to get -- catch a bite and don't want to miss anything, let me just assure you these delegations' presentations will probably take about 45 minutes, then we'll take an additional 20.

So this would probably be a good time for you to go get a bite or do what you need to do if you need to go do that. We won't start without you, I promise.

The first of our three delegations here today will be the Economic Development Alliance for Brazoria County. My former colleague and good friend, Mike Jackson, who's now in the Texas Senate, will start us off. I feel like it's old home week for me. I look around and all my buddies are here -- couple of my classmates. Mike -- Senator?

SENATOR JACKSON: Thank you, Mr. Chairman. Good morning to you and all of the Commission. We were here with Brazoria County about 18 months ago and made a presentation before the Commission. And at that time there were 3 Commissioners. And I'd like to say welcome especially that you have a couple of new faces there. And we're looking at other areas of the state -- El Paso and San Antonio. And Commissioners, I look forward to working with you as we go forward.

I want to say greetings from the great Gulf Coast -- southeast Texas. Things are really going well down there -- lots of economic development going on. And we appreciate the opportunity to appear before the Commission today.

I was -- we were all listening a little bit earlier in the other room to some of the discussions that you've had here and know some of the issues that you're dealing with. And this group is ready to work with you, I guarantee you, to achieve some common goals that will do good things for the state of Texas, not only on the transportation front, but the economic front, which feeds off one another, obviously.

And we have an issue in our area, more so with being prepared for hurricanes, that's more important down there than it is for any other areas. And those all tie together as well.

We have from our delegation -- Senator Kyle Janek is here today. We also have Representative Glenda Dawson and Dennis Bonnen that are not here today, but are here today in spirit. And I don't know if you all know it or not, Mr. Chairman, but there's another very small Dennis Bonnen that's about to be running around with the arrival of a new child that they had just late last week. So he's taking care of those duties today.

We also have County Judge John Willy here, County Commissioner Dude [phonetic] Payne, Commissioner Jim Clawson, Jack Harris, another familiar name for the Chair, I'm sure, and County Commissioner Larry Stanley. We also have -- or had here before the county judge from Fort Bend County, who we're working with closely on this project -- it's County Judge Robert Hebert. And he did have to leave and go back into the district. Also from Fort Bend County is Commissioner Tommy Stavinoha that is here today.

The cities that are represented here, Mr. Chairman -- Alvin, Angleton, Brazoria, Clute, Danbury, Freeport, Iowa Colony, Jones Creek, Lake Jackson, Liverpool, Manville, Oyster Creek, Pearland, Richwood, Sandy Point, Sweeney, and West Columbia.

Our Chambers of Commerce are also here and represented today. We have the Alvin-Manville Chamber, the Angleton Chamber, Brazoria, Brazosport, Pearland, Sweeney, and West Columbia.

This group is also working with the Economic Development Alliance for Brazoria County, along with Houston/Galveston Area Council, and the Port of Freeport, which I think you will hear today, has some very, very exciting news to bring before the Commission.

If I could, I'd like to have everybody from our delegation please stand up.

MR. WILLIAMSON: Welcome back.

SENATOR JACKSON: We've got quite a group here today. To address you today we'll have Senator Janek in just a moment talking about the collaborative efforts of our general area and our region. John Willy will give us the growth in economy. Jack Harris on our mobility issues. And then, again, Judge Willy will close the presentation.

We'll be on time and nice. And we're not mad at anybody up here. And we just feel glad to be here. And we know, again, the issues that you face with the amount of money that the state has to deal with. We know, not only do we have the issues in the transportation arena, you know that we have issues in the educational forefront that we have spent quite a bit of time on over here in the last 30 days or so. I feel like I just got to go home, and now I'm back. But I understand I may be back a little bit later as well.

But for that, and to keep on our time schedule, I'd like to introduce our next speaker, who's going to be Senator Kyle Janek, who needs no introduction. And I think he has some new and innovative -- well, I'd better not say that. He's -- he and I share Brazoria County. He has kind of the west side and the coastline in his district that runs south from Harris County through Brazoria, then Galveston, then over to the Louisiana border.

And he's going to address some of the issues that we have in Fort Bend -- our whole area. We're looking at one project that really goes through several counties there and would be a great issue to deal with for, not only economic purposes, hurricane evacuation purposes, and general betterment of transportation. So Senator Janek.

SENATOR JANEK: Thank you, Senator Jackson. Mr. Chairman and members, good morning. Thanks for the opportunity to be here. I usually preface my remarks by saying I'll be short, and then people laugh. And I'm not sure what's so funny. So let me say I'll be brief.

I'm going to make an argument to you today, not based on the specific merits of any one project that we're requesting for Brazoria County, but, rather, I will tell you that one of the pleasures I've had in going from the House to the Senate was in covering a larger geographical area. I've come to appreciate just how much the various counties and cities work together.

We, here in Austin, like to think that we drive everything, and that, of course, is not the case. My dad is a County Commissioner in Galveston County, and I've made friends with a great number of the Commissioners in the cities, the mayors and the city councilmen in my district.

I will tell you this. I have great hope for the process of regionalization. And that's not just in transportation. But when we talk about health care needs and many other needs to be met in this state, I've come to realize that some of the answers lie not at the precinct or the city level, and certainly not at the state level, but rather, in a regional effort.

And I've been so proud and so pleased to see Commissioners Courts in the counties I represent, as well as the city councils and mayors, who have come to work together through the Houston/Galveston area council in a formal fashion and through the informal relationships that take place between Commissioners Courts, for example, and see that the proposals they've come up with are generally far better than what we sometimes dictate from Austin.

It is a shame that County Judge Bob Hebert had to leave, but it is a pleasure that he was up here in support of the needs in Brazoria County. The needs that we have -- and let me back up and thank you so much for all the work you've done and -- not just in my district, but our neck of the woods.

The district staff, the engineers, the folks that we have to work -- get to work with -- on a daily basis for the 610 project, Interstate 10 project, 45, and others have been such a pleasure. They're extremely responsive. I want to thank you for all the work that they do on your and my behalf.

The needs that we have specifically in Brazoria County -- I will leave you with this. You're going to hear the measures that are needed and the needs that we're trying to meet with those transportation dollars.

I am as much concerned about evacuation of this area from disaster. I don't want to overhype it, but whether it's manmade or natural disaster, we do have significant needs regarding evacuation from certain parts along the Gulf Coast.

One of the things you may not see in today's presentation, but on the far western end of Galveston Island, Centex Homes is poised to place half a billion dollars in new residential on the western end.

Now, there's a big sign that says that's not the preferred evacuation route off the western end, over the bridge that leads into Surfside and Brazoria County. But I can tell you, for those people who live in that new big development that is coming, that will be the way that they will evacuate in the event of a natural disaster on Galveston Island.

This will immediately tie in because that bridge leads into County Road 257, which leads into another road, which leads into State Highway 36. Whether we intend it or not, that will be the evacuation route.

That's just one of many reasons why what we're doing, we think, is very important for the economic vitality of the county, and certainly of the state. But I will leave with that same note, that I'm so pleased to see the counties that I get to represent working together, whether it's my dad on Commissioners Court in Galveston County, the terrific court that we've got in Brazoria County, and the high growth area that you've seen with its transportation needs in Fort Bend County, all working together.

If we give these local officials the opportunity to craft transportation solutions that work for the people in their area, I think they will do a far better job than something I could come up with.

Again, for the time that you serve -- and I know this is a lot of time and a lot of grief that you have to take with this job -- I will say to Commissioner -- Chairman Williamson, you deserve all the grief. And the rest of you I want to thank you for all that you do. Thanks for your attention today.

JUDGE WILLY: Again, thank you for allowing us to be here. Mr. Chairman, members, and particularly the new members, welcome aboard. And now, you all can go have lunch with each other without violating the Open Meetings Act. So that would be good.

I would like to take about three minutes and show just a quick video clip, if you all would give me that time -- if our technology is going to work today.

(Whereupon, a videotape was viewed.)

JUDGE WILLY: Brazoria County is indeed unique. With the success and economic development via business and industry and residential growth, Brazoria County has grown to become a modern area, complete with the urban issues and the challenges that go with those issues.

As the numbers depict, Brazoria County has seen 30 percent increase in population from 1980 to the year 2000, and is forecasted to see an additional 64 percent growth by the year 2030.

For example, the city of Alvin will double the number of homes it has over the next five years. In fact, we should exceed those projections with everything that's on the ground now and in the planning stages.

Brazoria County has grown 8 percent since the 2000 census, from 241,700 people to 263,000 at this point. We're the eleventh fastest growing county of our size in the state.

One of the key elements of our state and the economy of Brazoria County and that of the state is the port of Freeport. And basically, we have the nearest port to deep water on the Gulf Coast. In fact, we're the only mainland coastline on the Texas coast. We're the second largest container port in Texas Gulf Coast. And we also handle both cargo and petroleum terminal services.

The port not only brings economic value to Texas, but it's planning for the future. We already see $7.6 billion annually tied to the port. And, like I said, we're the sixteenth in the U.S. and foreign tonnage at this point. We've shipped over 25 million tons of material in the year 2003. And the future expansion that's in -- that's on the plans now and moving forward is a 1300 acre multi-modal facility and container terminal.

The Freeport L&G Plant project is underway in Freeport and will certainly be beneficial to Brazoria County and our state in our fuel crisis that we're in now, particularly with the petrochemical industry.

All of the L&G to be brought in to the L&G Plant has been contracted for already. And that's a billion-and-a-half cubic feet per day capacity with plans in progress -- in process to go to 3 billion cubic feet per day capacity.

And the port's widening project will provide much needed capacity for deeper vessels and access -- more access to the economy. This will be a 60-foot depth, going from 45 to 60 feet, and the widening to be able to take the larger ships coming in with the -- particularly for the L&G materials and the other materials coming in and out of Brazoria County and the Port of Freeport.

The port project -- the 60 foot depth has the benefit of a 23 to 1 cost to benefit ratio -- and we're working on that on the Washington scene now.

The petrochemical industry is one of the state's largest economic engines. One-third of the petrochemical industry in the United States is located in our eight-county region. Two-thirds of the total petrochemical industry in Texas is in the three-county region -- the Brazoria, Galveston, and Harris Counties.

You can see listed some of the major industry leaders that -- in Brazoria County -- that make up 42 percent of our tax base in the county. Texas Chemical Exports Group -- 42 percent -- from 1999 to 2003 accounted for $17 billion to our economy. The Texas chemical sector was Texas' largest exporting industry in 2003.

With our beaches and our rich history as being the cradle of where Texan began, in Brazoria County, Brazoria County accounted for over 168 million in destination travel spending in 2002, with the associated air transportation adding another 19 million to the equation. Employing over 3,000 people, tourism generated state sales tax receipts of over $11 million in 2002.

At this time I would like to introduce our former colleague, Ric, and member of our Commissioners Court, Commissioner Jack Harris.

COMMISSIONER HARRIS: Thank you, Judge. And thank you, ladies and gentlemen, for allowing us to come before you today.

As you noticed in the clip, our county has 2,300 miles of roadway. About 1,100 of that is county roads and 1,180 miles of state roads. We have over 500 bridges -- we're a very low area, as you know. And the vehicle miles traveled are increasing rapidly. By the year 2025 we'll be seeing seven-and-a-half million vehicle miles a year that we'll travel.

We have many mobility issues for you to be aware of -- and some of those you see on the map -- that we are very happy that we're doing, that you're doing, and we're doing also -- the State Highway 35 and 288 Corridor studies. Those are our life blood. With an increasing population and business and industry we just have to have that north-south commuter lanes to be addressed.

But we have a couple of problems temporarily that I think are major issues for us. And one of those is the State 288 traffic growth that's been so rapid. The segment between Farm-to-Market Road 518, which is in the Pearland area, and the Beltway, has become extremely crowded.

And there really are some technical reasons for this -- engineering reasons, if you will -- that has caused this to happen. And if you'll look at the numbers, you'll see we've had an 80 percent growth in traffic on that stretch of 288 in the last ten years. The level of service, of course, in increasing also and becoming a very tough situation for us all.

If you'll take a look you'll see that the traffic on State Highway 288 that goes off at the Beltway, 31 percent of that entered at Farm-to-Market 518. It did not come from further south. The Farm-to-Market 2234 exit, which is at the -- an area of high growth, 48 percent of those entered at Farm-to-Market Road 518, which is simply two miles or so south of that.

The reason for this is because there is no access road to -- off -- take that extra traffic, and there's no bridge over Clear Creek on either side. If that were taken care of, a good portion of that traffic would not clog up there and would allow a much easier situation for commuters. So that's one that we are concerned about.

You'll see that the north-south commuter traffic is the life blood of our county. And these were also the umbilical cord that links the county's income in the NASA area, adjacent counties, and the Texas Medical Center. These are links that drive our economic engine. We've got to have those routes and have them open and have them functioning properly.

Also, for your consideration, we'd like to talk about supporting the five grade crossings down through the Lake Jackson area on State Highway 332. If you've been down there lately you know that that's a very clogged area -- a very short space. And it's not a huge project, but one that would certainly free up the traffic flow in that area. It's a very rapidly growing area also.

So let me let Judge Willy finish this up for you, if you will.

JUDGE WILLY: Thank you, Jack. One of the -- with regard to our pressing needs -- and, of course, everybody has pressing needs in the State of Texas -- I know that. Currently that need is the State Highway 36 project, which is broken up currently in segments.

We would like to see those segments 1 and 2 to be let concurrently and consecutive as a corridor. Segment 1 includes two projects in Fort Bend County, which Judge Hebert and his group support. Segment 2 includes six projects in Brazoria County.

And as you might recall, originally the project was scheduled for 2007. It was moved up to 2012 in the last couple of years. And we would request that that be moved back to 2006, 2008 funding.

The -- we would like to see the State Highway 36 completed as a corridor from Port of Freeport to U.S. 59 in Rosenberg, and request that the project be accelerated, as I said, from 2006 and 2008 letting from the current 2012 to 2014, I believe, and request the upgrade from priority 2 to priority 1.

Hurricane evacuation routes are essential for safe evacuation of people in Brazoria County and the adjacent counties. This is even more important as it relates to Homeland Security and with the threats associated with our petrochemical industry in the south.

The -- depicted on the screen you'll see the flooding that occurred in Houston during Tropical Storm Allison in 2001. We have not had a major storm -- a category 3 or more storm -- in more than 40 years. Yet, one day we're going to find ourselves in the midst of it.

You'll see in this slide U.S. 59, into which our State Highway 288 feeds -- and part of our current evacuation system -- also experienced flooding in Allison in 2001. This truly corroborates the need for State Highway 36 to move people around the Houston area, not through Houston and Harris County.

And on the next slide you'll see Brazoria County itself is not immune to flooding. We're a low-lying area on the Gulf Coast. And depicted in this photo is Green Tea Terrace there in Pearland. With early warning systems in place our people can evacuate safely using 36 -- and again, not through Houston, which would just cause a bigger mess for everybody, but around Houston and to Interstate 10, 59, and further out.

There is added value to State Highway 36. It would be taking as many -- taking a portion -- or at least some of the 585,000 truck trips a year out and away from the Houston/Harris County highways and -- that needs much relief due to just traffic, the air situation in our part of the country, and everything else. It would begin to cause traffic to move logically.

The State Highway 36 is a major link to U.S. 59 first, and then later to Interstate 10. Eventually, it would hopefully be a spur to I-69 or Texas Trans-Texas Corridor, which I feel very strongly that all of the ports along the Texas coast should be -- have spurs to this corridor when it is completed. It just makes sense. That causes the economy to have an engine that runs.

It's a vital link to rail. Rail is important to Brazoria County. And it fits in -- the project that we ask for fits in where we're offering to partner with TxDOT. We're not here saying we want something for nothing. We're willing to work with you and we're willing to partner.

We're ready to do our part. Brazoria County's taken a lead role. We're ready to bring dollars to the table. We have a countywide mobility study that is completed. We'll go to the voters in November and from whence we will have money to come to the table and say, Come on, let's do business.

Brazoria County -- we have the Brazoria County Toll Road Authority in place and ready to go. We have the Gulf Link Rail Transportation District in place and ready to go. We have the support from the surrounding counties -- Fort Bend, Austin, Harris, and Galveston -- in our endeavors. The resolution of support from cities and public entities -- the TCP and the HGAC.

And of great significance, as I said, is the toll road -- I mean, the bond issue that we're putting in place to bring money to the table. In summary, we're experiencing unprecedented growth. Improvements to the major transportation corridors is very important to the state's economic base, as well as that of Brazoria County.

Brazoria County is being proactive on many fronts related to transportation, and there is a need for the continued partnership with TxDOT.

In conclusion, State Highway 36 provides a critical hurricane evacuation capacity around, not through, Houston. State Highway 36 provides a commerce corridor contributing to the state's economic base. And Brazoria County has undertaken a mobility study to prepare a referendum to bring dollars to the table and to the equation.

And again, let me just thank you, Commissioners, for what you've done for Brazoria County over the years. And we extend an invitation to each one of you all to come to visit Brazoria County and see what progress is really all about in the smaller counties. I know you see it in Dallas, Houston, et cetera, et cetera.

But come down and see what we can do and see what we have on the table and what we're willing to do. And we're going to continue our partnership with TxDOT and use this -- use our regionalization in the area to its fullest extent. And I thank you all for giving us this time today. If you have any questions, I'd be happy to answer them. If Ric asks it --

MR. WILLIAMSON: Members, what's your pleasure?

JUDGE WILLY: If Ric asks them I'm going to let Harris answer.

MR. WILLIAMSON: Questions or comments.

MR. NICHOLS: I have a couple --

MR. WILLIAMSON: Please.

MR. NICHOLS: -- couple of questions.

MR. WILLIAMSON: Yes, sir.

MR. NICHOLS: First of all, I'd like to thank you all for the reception you all had last nice. That was very nice.

JUDGE WILLY: You're welcome, sir.

MR. NICHOLS: The -- in the -- you heard us earlier talking about allocations.

JUDGE WILLY: Yes, sir, I did.

MR. NICHOLS: And in the MPO -- you all fall inside the Houston/Galveston --

JUDGE WILLY: We're in the 13-county area of the Houston -- basically the Houston/Galveston Area Council is our Council of Governments. And that's the Harris County and the County --

MR. NICHOLS: It's in the Council of Governments, but not inside the MPO?

MALE VOICE: Yes, yes.

JUDGE WILLY: Yes, we are.

MR. NICHOLS: We are inside. Okay. Inside the MPO. Okay. Is the MPO trying to -- in the allocation of funds and prioritization of projects in that area, are -- they're looking at these projects?

JUDGE WILLY: Certainly. We go through HGAC and work with the -- with our regional planning to cause these projects to be brought forward, as we have in the past.

MR. NICHOLS: Do you know -- is the MPO going to make funding for those?

JUDGE WILLY: I have Alan Clark here. And Alan is our local expert with HGAC. Alan, would you like to address that, please?

MR. CLARK: Thank you. My name is Alan Clark, and I'm with the Houston/Galveston Area Council, the director of the Metropolitan Planning Organization.

The Transportation Policy Council has identified this as a high priority corridor. Our issue is much like the issues you face. When we selected this project last -- initially for funding -- it is actually in our current TIP -- portions of this project. The cost experience on other projects have required the district to make decisions about what it could advance and what it could not.

So it wasn't for lack of priority within the region that this project has not yet been able to move forward. It's just really a financial issue.

I think that we are going to continue to try to promote this project and see how we can bring additional financial resources to it.

MR. NICHOLS: Thank you.

MR. WILLIAMSON: That's the one and only Alan Clark. I love the way he puts things.

MALE VOICE: I do, too.

MR. WILLIAMSON: We face the same problems you do.

MR. NICHOLS: The second question is, I understand you all have formed a Turnpike Authority.

JUDGE WILLY: We have a Brazoria Toll Road Authority.

MR. NICHOLS: Toll road authority. Okay.

JUDGE WILLY: Yes, sir.

MR. NICHOLS: Have they selected -- or come up with a plan for a project?

JUDGE WILLY: Our Toll Road Authority Board has just been put in place this year. The Harris County Toll Road Authority is doing a study in Brazoria County, which the only thing I think we're waiting on now is Wilbur Smith and Associates to finish the numbers. They will have completed that plan -- of course, we have the Grand Parkway coming through as a tollway, which we've talked about before.

Those projects will go to the Toll Road Authority when the studies are complete to determine what route we should go. And that's where we are on that right now, Commissioner.

MR. NICHOLS: Okay. Thank you very much. I've driven on 288 quite a bit, all the way down to Angleton. I have an aunt who's in a nursing home down there, so I've traveled that route quite a bit. I have not traveled on 36 though.

JUDGE WILLY: Well, come on down anytime and we'll take you for a ride.

MR. NICHOLS: Okay. Might do that.

MR. WILLIAMSON: Further questions? If not, again --

MR. JOHNSON: I had a question about --

JUDGE WILLY: Yes, sir.

MR. JOHNSON: -- hurricane evacuation routes.

JUDGE WILLY: Yes, sir.

MR. JOHNSON: Clearly, if there is a serious storm, 288 and 45 are going to be congested to beat the band. In fact, I mean, I remember the storm that came through Corpus. And we made I-37 I believe one-way as a hurricane evacuation route, and it was even congested unbelievably.

So, I mean, putting 36 as an alternative to get some of the population off of 288 and -- you know, might not get them off 45 -- I mean, is an excellent thing. Tropical Storm Allison was -- came sort of unannounced, and not too many people evacuated until they were caught by rising water. And it was really -- caught people by surprise.

You know, in a situation like that, which, if you're a creature along the Gulf Coast, those do happen from time to time --

JUDGE WILLY: Right.

MR. JOHNSON: -- this wouldn't be that effective. But certainly, in terms of a major storm, having the alternative and getting people off of 288, which will likely become a parking lot, if you will -- and it goes right through the middle of Houston, which is going to be congested because of the -- where 45 and 288 intersect -- I think's a very logical solution to giving people an alternative. And, you know, in baseball parlance, we're due along the Gulf Coast for something serious.

JUDGE WILLY: Yes, sir. Characteristically, people will not leave when they should.

MR. JOHNSON: I think that's human nature.

JUDGE WILLY: And because we haven't had one in 40 years there's a generation-and-a-half of people who have never seen a hurricane. They've seen the little Tropical Storm Francis and they've seen a couple of others. But, you know, you cry wolf, you cry wolf, and all of a sudden there is a wolf at the door.

The problem with Houston is similar to that of Brazoria County. It was built in a marsh. It was on a ditch that goes to the Coast. It's low. And when you have a hurricane come in -- when you have the advance rains, which sometimes are 150 miles out from the storm, you're going to flood at -- I mean, at the south loop -- you're going to flood on the Southwest Freeway. So you might as well forget about routes through Houston.

And besides that, even if you had the routes through Houston and everybody decided, yes, it's time to go, you're going to have a parking lot in Houston anyway.

This is the reason why we feel it's so important to move the traffic around Houston, get them on the freeways going out, up 36 to 10, and let them get out of harm's way. And particularly, with -- and the other thing -- and I can't let this go by without mentioning it, Commissioner.

With the Homeland Security threats that we have -- you have a prevailing south wind in Brazoria County -- south and southeast wind off the Coast. If something would happen at our ammonia plant -- at Dow -- at one of the other plants, we've got to get people out of there. I can't send them through Houston. They'd hit the five o'clock traffic and be sitting there and be inundated. We need to get them out and around, and that's the importance of the issue that we're talking about today.

MR. JOHNSON: In terms of the hurricane evacuation routes, do you coordinate or collaborate with Judge Yarborough in Galveston County --

JUDGE WILLY: Very much so.

MR. JOHNSON: -- and Judge Echols in Harris County. Because I know 146, which is obviously farther to the east, Judge Echols is very supportive of expanding its capacity, especially with the closer to the Coast it is, for the exact same reason.

JUDGE WILLY: Well, we need to get those squeaked out to the north and east, because you can't bring them across Harris County in the conditions we'd be talking about.

We have -- our regionalism works a little bit different from other parts of the state of Texas. The three and four judges of that area, myself, Judge Yarborough, Judge Hebert, and Matagorda County Judge, we meet at least quarterly and discuss issues. We work and have regionalized our communication system with Harris County.

The only way that we're going to be able to accomplish projects in the future, be it highway projects or be it emergency situations, is work on a regional basis. And that's what we're trying to do in Brazoria County.

MR. JOHNSON: Thank you.

MR. WILLIAMSON: Again, thank you all very much. Yes, ma'am.

MS. ANDRADE: I'd just like to thank you for coming before us -- all of you that came today. I'm sorry it's this afternoon now. But I congratulate you especially. I can see how proud you are that you've come as a community of working together. So I'm sure you'll be successful, and I look forward to visiting you and working with you.

JUDGE WILLY: I look forward to you coming down. Let me know and I'll have the coffee hot.

MR. WILLIAMSON: Thank you all.

MS. ANDRADE: Good. Strong.

MR. WILLIAMSON: Ted, anything? Yes, sir.

MR. HOUGHTON: Again, it's the combined effort and coming together of communities that make these projects work. And I said that to you last night. I've said it to all the groups that I have visited with. It's going to make these projects get moving down the right road.

MR. WILLIAMSON: Right.

MR. HOUGHTON: Thank you very much.

MR. WILLIAMSON: One of the great pleasures I have on this Commission is the opportunity to see so many of my good friends and my former colleagues. And this is kind of an unusual situation in that all four of the presenters I served with, and two of them were in my class.

MALE VOICE: And we were office mates.

MR. WILLIAMSON: And we were office mates. And I think we might have even voted together a few times, even though you were a liberal Republican and I was a conservative Democrat -- oh, no, no, wait a minute -- the other way around. I'm sorry. You were a conservative Republican and I was a liberal Democrat. John, if you'll bear with me just a second --

JUDGE WILLY: Sure.

MR. WILLIAMSON: -- we have a Commissioner from Fort Bend County, Tom -- is it Stavinoha? Because I met Tom before. I did pronounce it correctly.

COMMISSIONER STAVINOHA: Yes, sir.

MR. WILLIAMSON: I want to give you the opportunity to speak. Please.

COMMISSIONER STAVINOHA: Just a few words, Commissioners. I've always lived within three miles of Highway 36. I've been in Fort Bend County all my life. And we've grown from, what, 100,000 people when I was a kid to 430,000 people now.

I can remember back in the middle seventies when there was as minor storm out in the Gulf -- it wasn't Hurricane Carla, but it was about half that scale. We could not cross Highway 36. I mean, it was impossible. It was that much traffic.

Even if you made Highway 36 one lane -- only one-way traffic, like you all did with 35 [sic] out of Corpus, it's not going to work. We have got to have another route for the folks to get out of Freeport. And I think just with their port expansion and other things -- their natural growth -- 36 is going to need all the relief it can get.

36 cuts my precinct in half. I'm splitting south of Brazos River. Precinct 1 is about 65 percent of Fort Bend County -- of the land mass. And so 36 is very important to the growth of my precinct.

So I really look forward to you all taking some action and then move this thing up from 2012 to 2006. We'd appreciate that a whole lot.

MR. WILLIAMSON: Thanks for your comments, Tom. We all travel quite a bit -- each of the Commissioners. And I was actually in your part of the world just two weeks ago in Sugar Land. And I went ahead and drove west and kind of checked some things out in preparation for this meeting. And you're right. There's a lot of growth going on.

Mike, Kyle -- you all have been great supporters of the Department, and we really appreciate it. Like the words we had for Mr. Pickett earlier, we don't let an opportunity pass to say thanks to those who've supported transportation.

And as you know, we don't make decisions about these things here, but what you have to say and the strength of your arguments and people showing up and making their case makes a difference as we deliberate and do make final decisions.

I really appreciate you guys showing up. You all did a good job. Do you need to close, John, or is that it?

JUDGE WILLY: I'll just close, Commissioner, by saying thank you all again. And you all come see it.

MR. WILLIAMSON: It was good to see you again.

JUDGE WILLY: Thank you.

MR. WILLIAMSON: We're going to take about a three- to five-minute break and let everybody switch out and get the software programs done. We'll be taking up Dallas.

(Whereupon, a short recess was taken.)

MR. WILLIAMSON: We're ready for north Texas. And welcome --

MAYOR MILLER: Good afternoon.

MR. WILLIAMSON: -- to a great mayor.

MAYOR MILLER: Thank you, Mr. Chair. Nice to see you in that seat since we were here last year. And hello to the Commissioners. Mr. Houghton and Andrade, thank you for coming on May 5 to Dallas/Fort Worth and meeting us and hearing about our projects. We appreciate it. And Commissioners Johnson and Nichols, thank you. And executive director Behrens, thank you very much for hearing us.

We are the Dallas/Fort Worth Area Partners in Mobility. We are public and private sector leaders from throughout Dallas/Fort Worth. By coming together as a single entity and acknowledging Weatherford as our capital city we believe that we speak with a larger voice and a stronger case and purpose than we could if we came individually to see you.

I would like our delegation to stand and be recognized. We are mayors, city council members, county judges and commissioners, city managers, transportation professionals, chamber of commerce presidents and board members -- leaders from nearly every community in north Texas. If you would all stand, please.

MR. WILLIAMSON: What a group. Great.

MAYOR MILLER: Thank you. As a cast of thousands it is very complicated to get us all down here once a year. This is our tenth consecutive year that we have come to see you. And we believe that our presence today, repeatedly over these ten years, is indicative of the importance that we in north Texas place on our mobility needs.

I want you to know that we are a region that works extremely well together. We are a true partnership. And, more and more, we have a regional approach to planning and to funding.

I want to thank all of our delegation members for being here and thank you for the time that you are giving us. We have notebooks for you. There will be copies of our presentation, graphics, and an executive summary in your notebooks.

We come every year to discuss challenges and opportunities. But there's one theme that we always bring with us -- and that is that we need continued surface transportation improvements in order to sustain our quality of life in north Texas and also to continue to be a great economic engine for the State of Texas.

But we also know that we can't just rely on you to get us there. Dallas/Fort Worth has proven time and again that we are leaders in finding innovative strategies to fund our projects.

We stretch our dollars, we pool our dollars, and I know that's what you like us to do. We show a strong willingness to raise revenues locally through sales taxes, local government bond programs, and toll revenues.

And the passage of H.B. 3588 has provided us with additional funding sources and strategies that we are now pursuing to expedite our major road projects and transit projects.

Our presentation to you will focus on how we propose to use these different funding sources and strategies in a number of multi-modal regional corridors. We do not have a Hawaii 5-0 video for you, but we think we have a very streamlined and important message to give you about our needs in Dallas/Fort Worth.

We also have identified opportunities to continue to be strong partners with the Commission and with TxDOT to help build our transportation system.

Luckily for you, Mr. Chairman, I have been tightly scripted and will not discuss the Interstate 30 Trinity River bridge -- perhaps at another time. And for now I would like to introduce to you the chairman of the North Texas Tollway Authority, Dan Dillard, to make the first presentation.

MR. DILLARD: Thank you, Mayor Miller. Good afternoon. I had good morning, but it's good afternoon. Commissioners and Mr. Behrens, appreciate the opportunity to speak.

Mayor Miller has highlighted for you the passage -- with the passage of House Bill 3588 our efforts are now focused on integrating these new tools into our project funding strategies.

One of the first steps in that process has been the identification of specific projects needing immediate attention and immediate funding.

During the last 18 months, through the leadership of the Regional Transportation Council, and in cooperation with our transportation providers and local governments, the region has established a list of priority projects as shown in this map.

These facilities represent the region's highest priority near-term roadway investments. And as you can see, they are located in areas of our region with high levels of daily traffic congestion. With the help of TxDOT and the Transportation Commission, we are ready to move out on these improvements.

We've also taken inventory of the universe of funding strategies now available to us, which are listed on page 2 of your executive summary brochure, and are applying this list of strategies against our funding needs. We've estimated that these strategies will generate an additional $3 billion of available revenue for transportation projects in the short.

Our challenge now is to work with you, TxDOT staff, and our transportation providers to identify the right combination of strategies and funding sources to best fit the needs of each project. We will have this process completed by August 1, in time for the Unified Transportation Program.

The ten-year Regional Transportation Council policy that all new freeways on new rights of way will be evaluated for toll feasibility, the toll road emphasis of House Bill 3588, and your Transportation Minute Order 109519 all center on the recognition that toll financing must be a part of our overall transportation funding strategy.

We are very fortunate in the Dallas/Fort Worth to have in place a Regional Tollway Authority, a four-county organization consisting of Dallas County, Collin County, Tarrant County, and Denton County -- the North Texas Tollway Authority -- that serves as our region's toll provider -- system provider.

A decade ago -- and I think I was here with you folks then -- when the Dallas/Fort Worth Area Partners in Mobility first appeared before this Commission, we had only begun taking steps toward our first -- expanding our region's toll facilities.

Today, thanks to the efforts of our partnership with TxDOT, the local and county and governments, more than 150 new toll lane road miles have been put in place at a cost of $725 million. Daily tollway transactions in early May of this year were around 890,000. And we have more than 815,000 toll tag users.

NTTA, the North Texas Tollway Authority, is actively pursuing an additional $2.5 billion of new tollway projects. Each of these projects will continue to require close cooperation and collaboration between TxDOT and NTTA in the design funding and construction phases. We remain committed to studying toll feasibility in each of our new freeway corridors.

NTTA is also working actively with your staff, Bill Hale and Maribel Chavez in the TxDOT Dallas and Fort Worth offices, to evaluate the toll feasibility of all freeway system projects -- expansion projects. I understand in the Dallas area we're getting close to giving you a report on that first round of projects. In Fort Worth we're beginning to get information to begin those studies.

But we're working in coordination with that, and completion of these ongoing and planned tollway projects will result in a regional tollway system that will provide sustained mobility and a transportation revenue stream that will serve north Texas residents for decades to come.

On behalf of NTTA, and consistent with the Commission's objectives regarding accelerating projects, we presented in your packet a letter that basically is a formal proposal from NTTA regarding one of the projects we've just reviewed.

For a number of years TxDOT, working with NTTA, has been working on the extension of the George Bush Turnpike on the east, State Highway 78 to Interstate Highway 30. This extension, when completed, will provide a northern -- vital northern outer loop for traffic, connecting IH--30 to IH--635 via the Bush Turnpike.

The proposal represents a commitment by NTTA to bond as much as possible this extension and request a contribution from TxDOT in the form of toll equity or other means to allow the project to move to construction as early as this December. We hope you will consider and accept this proposal as soon as possible. But -- and I mentioned the letter is in your packet.

We want to thank you for your time and efforts and service to our state and looking at our transportation challenge. The NTTA and our region looks forward to continuing to work with you and meeting the transportation needs of our great state.

At this time Bob Estrada will continue our presentation. Thank you.

MR. ESTRADA: Thank you, Don. My name is Bob Estrada. I'm chairman and CEO of Estrada, Hinojosa and Company in Dallas. But I'm here today wearing my hat as a member of the board of the Greater Dallas Chamber of Commerce and very pleased to be here.

I wish I had known you were going to have to work through lunch. I would have brought some of my mother's handmade tamales and we would have a much better meeting going here. But next time.

Chairman Dillard highlighted our success that we've had in prioritizing these corridors and the progress that we're making with toll road construction. On behalf of the business community of the whole north Texas area, and particular greater Dallas area, I would like to take this opportunity to thank and to commend, of course, TxDOT, as well as NTTA and all of those agencies and organizations throughout north Texas that have helped established the toll financing as a viable mechanism for getting projects built very quickly.

House Bill 3588 has now provided us an additional tool that will further enhance our ability to expedite road construction. Total equity financing, which allows state highway funds to be combined with other public and private sources to increase tollway feasibility, is an exciting opportunity that we're ready to make the most of.

On page 4 through 7 of your executive summary brochure we've illustrated candidate toll road corridors in our area that we believe will fulfill your criteria for toll equity funding. Building these facilities as toll roads will expedite their construction and provide needed congestion relief.

But of equal importance is the amount of traditional highway funding that has been dedicated by you on many of these projects that can now be made available for other needed regional roadway improvements.

The first of these tollway projects is going to be the Southwest Parkway in Fort Worth, extending on into Johnson County. Through a partnership among NTTA, TxDOT, the Regional Transportation Council, and the City of Fort Worth, a large portion of this project is already fully funded.

State Highway 161 in Grand Prairie that you see serves as a north-south linkage in the western portion of Dallas County that will provided needed congestion relief to State Highway 360 and also serve as an extension to the President George Bush Turnpike.

Tolling State Highway 161 will free up construction funds that can be used to improve interchanges at Loop 12, additional improvements to Interstate 30, as well as frontage roads on portions of Interstates 20 and 30.

State Highway 121, the Lewisville bypass up in Denton County, when combined with downstreamed improvements in the whole Highways 121 and 114 funnel, will serve to address one of the most rapidly growing and highly congested areas in our region. The state funding originally dedicated to the bypass can now be made available for improvements to the adjacent Interstate 35 East corridor.

The Trinity Parkway in Dallas is an important project for relieving traffic congestion in the Interstate 30, Interstate 35 E mixmaster, a known and historic regional and downtown traffic bottleneck that we hope to improve dramatically. Funding is proposed for this tollway -- the Trinity Parkway -- from the City of Dallas, the Regional Transportation Council, NTTA, and, of course, TxDOT.

Finally, the President George Bush Turnpike eastern extension completes construction of the last original portion of the once-named State Highway 190 Loop that would connect Interstate 35 E in Carrollton over to Interstate 30 in Mesquite. This extension will provide relief to the heavily traveled Interstate 635 corridor.

With that, let me turn the podium over to my colleague Mike Berry to discuss other strategies for our region.

MR. BERRY: Thank you, Bob. Good afternoon. Commissioners, Mr. Behrens, appreciate the opportunity to be here. I'm Mike Berry. I'm president of Hillwood Properties in Fort Worth. Today I'm speaking as chairman of the Fort Worth Chamber of Commerce. And I am very much appreciative of having the opportunity to represent that delegation and the business community interests from the western portion of our region.

New tollways along new rights of way are providing us with tremendous opportunity to generate needed revenues and expedite project construction. The companion opportunity in many of our existing congested corridors is the construction of toll express lanes, referred to in our plans as High Occupancy Vehicle managed toll lanes. As with toll roads, our ability to construct these facilities will now be greatly enhanced by the tools provided in House Bill 3588.

Our Metropolitan Transportation Plan calls for 150 miles of candidate High Occupancy Vehicle managed toll lane facilities in the Dallas/Fort Worth area, as shown here in red. Future levels of congestion in these corridors will require design and operational features that accommodate both high occupancy vehicles and single occupant toll vehicles.

Value pricing strategies that manage the flow of traffic, along with advances in toll collection technology, will be key aspects of these facilities. On pages 8 and 9 of your brochures we have highlighted four freeway corridors that are ready to move forward with this concept.

The first of these is the west to east corridor of Interstate Highway 820, State Highway 121, and State Highway 183. The Interstate 820 segment of this corridor is one of the last remaining original four-lane sections of our outer loop. In the mid cities State Highway 121 and State Highway 183 is the heaviest volume and most congested freeway in the Fort Worth district.

State Highway 183, continuing through Irving and Dallas, is in desperate need of reconstruction. Toll revenues generated from this project will be vital in offsetting the cost of this expensive reconstruction effort.

Interstate 35 W from downtown Fort Worth to State Highway 114 is also a critical artery in need of improvements to meet the growing needs of both north Tarrant County and the NAFTA corridor. Reconstruction of this corridor to include additional main lanes and High Occupancy Vehicle managed toll lanes is proposed.

I might also add, in the executive summary of your book there is a letter from the I-35 W North Corridor Coalition, which is a newly-formed organization of public and private sector stakeholders along the 35 corridor.

In the eastern portion of our region, on Interstate Highway 635, planning and environmental clearance are now complete for the construction improvements that include High Occupancy Vehicle managed toll lanes. These improvements will complement the ongoing High 5 Interchange Project that is moving along ahead of schedule.

Finally, the Interstate Highway 35 E and Loop 12 corridor is a north-south artery that connects with a number of high volume east-west facilities needing extensive interchange improvements. The toll links proposed for this corridor will help offset these costs.

Expediting the improvements in the Interstate Highway 820/Airport Freeway, and Interstate 635/LBJ Freeway corridors are vital to the region. Both of these corridors have been identified as potential locations for the use of comprehensive development agreements.

As outlined in House Bill 3588, this innovative project delivery method that rolls the design and construction of a toll project into a single contract is yet another tool that is now available to accelerate construction.

We encourage your support for examining the feasibility of comprehensive development agreements in these corridors, including the use of CDA firms as project funding sources.

House Bill 3588 has also provided the funding for the Texas Mobility Fund, which was designed as a way to leverage bond funds and build revenue-generating projects. We believe that the tollway and High Occupancy Vehicle managed lane projects we have presented today are also strong candidates for Texas Mobility Funds.

We appreciate the strong working relationship we have with TxDOT, and we look forward to continuing this partnership as we move forward in these critical regional corridors.

I would now like to call upon Mayor Mike Moncrief to continue our presentation.

MAYOR MONCRIEF: Thank you very much, Mike, and Mr. Chairman, fellow Commissioners. I'm delighted to be here today and to be a part of a unique partnership -- an ongoing partnership.

I'm also pleased to be able to tell you that I'm joined by two members of our council, Wendy Davis and Becky Haskin, who join me. And I'm delighted to have them with me as well.

Funding partnerships between the Transportation Commission and the Regional Transportation Council have been a key part of our delegation appearances since 1995. I'd like to continue our presentation today with several proposals for continued partnership opportunities with the Council.

Our remarks to this point have largely been focused on finding innovative funding strategies for roadway improvements. However, we are also focusing on strategies to expand our transit systems in north Texas. Currently we are evaluating the need to expand transit options in many congested corridors throughout our metropolitan area.

As part of this evaluation we're examining financial, institutional, and legislative actions needed to implement transit on a larger scale. Transit is successful in north Texas because it provides reliable options for the commuters to save time and save money. And that's what we're talking about here today -- providing the public some options.

As shown on page 10 of your brochure, with the expansion of our rail transit system we now have a strategic opportunity to create seamless passenger rail service at DFW International Airport and Dallas Love Field. This system can literally become the circulatory system of people movement in our region.

The Regional Transportation Council has committed $20 million of congestion mitigation air quality funds to the direct connection. It is requesting that the Transportation Commission allocate 100 million in Texas Mobility Funds to assist in constructing this seamless inter-modal rail system. We expect to leverage these funds with $700 million of Federal Transit Administration, Federal Aviation Administration, and airport user fees to augment the process.

Since 1995 the Texas Transportation Commission/Regional Transportation Council partnership program has resulted in the funding of over $2 billion of regional transportation projects that would likely have been delayed or have gone unfunded. Last year at this time the Regional Transportation Council presented to the Texas Transportation Commission a check for $300 million of surface transportation program metropolitan mobility funds to assist TxDOT with expediting project construction in north Texas.

Now, with the passage of the previously mentioned House Bill 3588, we are more confident than ever that these partnership program funds will allow for even greater leverage of our combined resources.

Our final point speaks to consideration we would ask you and TxDOT staff regarding funding levels and projects for consideration in the 2005 UTP. The use of performance-based programming in TxDOT Unified Transportation Program for the allocation of Category 2 funds will lead to increased levels of funding to the TxDOT Dallas and TxDOT Fort Worth districts.

We believe that, by re-prioritizing TxDOT's UTP priority 2 projects, that we can expedite additional projects or add funding to existing underfunded regional transportation priorities. We encourage your continued support of these strategies in the 2005 UTP development process.

Mr. Chairman, you and I are both what's known as housebroke. We've served in the Legislature. I've been able to visit a number of my former colleagues this morning. And I don't envy the job that you and your fellow Commission members have ahead of you.

This is a big state, and we're growing rapidly. We are in one of the fastest growing regions of the entire country. So we do face tremendous challenges, and we need your help to meet those challenges.

With that, I would now like to introduce Commissioner Glen Whitley to conclude our presentation. Thank you, Mr. Chairman, members.

MR. WILLIAMSON: Good to see you again.

MR. WHITLEY: Good afternoon Commissioners and Director Behrens. I'm Glen Whitley, Tarrant County Commissioner and chairman of the Regional Transportation Council, the MPO for the Dallas/Fort Worth area.

We appreciate the opportunity and time you've given us this afternoon, and we extend our thanks to you for all the support you've given our region in the past years. We look forward to working with you in a continued partnership. What I want to do is summarize our specific suggestions and requests.

Last year we said to you that big problems required aggressive solutions. This year we still have big problems, but I think you can see from our presentation that we -- that with the tools provided in House Bill 3588, the cooperation of our transportation providers, and your help, we're ready to move forward with a number of aggressive solutions.

First, the North Texas Tollway Authority is moving forward with funding and construction of $2.5 billion of additional tollways. Your support for the toll equity funding in these projects will be critical to ensure toll feasibility and expedite construction.

Second, over 150 miles of High Occupancy Vehicle managed toll lanes are planned for construction on Dallas/Fort Worth roadways during the next 10 to 15 years. We are relying heavily on TxDOT as a partner with the North Texas Tollway Authority and our transportation authorities in design, construction, and operation of these projects.

House Bill 3588 promotes the use of comprehensive development agreements for the design and construction of toll facilities. We have two corridors, and at least one proposal, identified as candidates for CDAs. We need your continued support for evaluating the feasibility of this innovative technique in these corridors.

Number four, the Texas Mobility Fund was created, in part, to leverage additional funding for toll revenue and other partner resources. We hope that, as you adopt the Strategic Plan that you discussed earlier, that you will allocate unused Texas Mobility Funds to regions with aggressive leveraging programs.

Number five, rail connections from passenger rail lines are being planned to connect directly into DFW and Dallas Love Field terminals. The Regional Transportation Council has committed $20 million of CMAQ funds to fund the Dallas Love Field connection. We are requesting your support for $100 million from the Texas Mobility Fund to assist in funding these rail projects.

Six, our region has committed $300 million of STPMM funds to be -- to the TxDOT Dallas and Fort Worth districts to construct freeway and tollway system improvements. As a part of this partnership the Regional Transportation Council is requesting 400 million in the Commission's Strategic Priority Funds.

Finally, we need your continued support to re-prioritize -- to the re-prioritization of funding the high priority projects and the performance-based allocation of category 2 metropolitan area corridor funds as a part of the 2005 Unified Transportation Program.

Again, I want to thank you for the opportunity to meet with you today. We'll stand ready for any questions that you may have.

MR. WILLIAMSON: Members, who's first? Mr. Nichols.

MR. NICHOLS: Our youngest member doesn't want to go first?

MS. ANDRADE: No, the most experienced can go.

MR. NICHOLS: First of all, thank you all for an excellent presentation. I will tell you I am excited and I'm very optimistic in the direction we're going.

Many of you all, and other people around the state, have worked together over the last few years to put together, not only work with the Legislature on legislation to give us some of these tools and opportunities, it all is starting to come together.

When I see a presentation like this that incorporates all these pieces I know that we're doing the right thing and want to appreciate -- thank you all for the cooperation you all have given.

You've got rail components, you've got toll road components, you've got managed lanes -- HOV lane components. You've got every element in there. It's extremely leveraged and extremely aggressive.

I guess I had a couple of questions. You've got two-and-a-half billion in toll road plans here. And, you know, they're in this package -- I was flipping through looking at them. But in addition to that, you've 150 miles of managed toll lanes.

MR. WHITLEY: Yes.

MR. NICHOLS: That's in addition to the two-and-a-half billion of toll roads.

MR. WHITLEY: That's correct.

MR. NICHOLS: Without the ability -- like 3588 or toll equity that gave us the ability to put funds in on something like that -- the -- that two-and-a-half billion in toll roads probably wouldn't even be a reality or something that's reasonable to discuss.

MR. WHITLEY: Oh, I think that's definitely true.

MR. NICHOLS: So the creation of the legislation and that tool makes this a reality today. And -- yes. The -- I think the flexibility the Commission -- when we redid our UTP planning document so we can allocate funds to the MPOs -- the metropolitan -- so that you all can take those monies and blend them together, and we allocate projects, obviously, you all have come up with an amazing package from that ability to readjust those things.

You've got rail lines. I remember I was up talking to the MPO the other day or -- to Michael Morris on some of the rail stuff. And that's really the first time I'd heard about the rail plan to connect Love Field to DFW with a --

MR. WHITLEY: Well, yes, it's to take -- basically from Fort Worth you're going to connect into the north side of DFW, and then you're going to come up and connect from Dallas into Love Field --

MR. NICHOLS: Okay. So you come two different directions.

MR. WHITLEY: -- and I believe from Love Field on around. Mike, you may want to --

MR. NICHOLS: So it's not just an airport to airport.

MR. MORRIS: Mr. Chairman, thank you very much. The two investments are to commit to the citizens of the Dallas/Fort Worth regions seamless connections at our airports. It honors your policy position of March and -- but we told the voters when they passed the Texas Mobility Fund these funds are coming out of the general revenue. Because they're coming out of general revenue they shouldn't necessarily totally 100 percent be dedicated to the roadway side like your Fund 6 funds are.

In this particular case these particular projects are moving ahead now in partnership. We think we -- your policy of leveraging Texas Mobility Funds, which are applying to the roadway side, we think you should apply to the transit side. Because you have several members of the Dallas City Council behind us that are ready to put in seat charges at Love Field in order to help leverage local funds to do this, as well as with Federal Aviation Administration at our airports.

In addition to the two connections the chairman has told you about, you will literally, in the term in aviation, air carrier plan, is called weigh ports. You will literally be able to get on a plane at Love Field and go into the seamless rail connection in the basement of that building and take rail directly to the 13 station, which is where the people mover is being built at DFW Airport, and you never go outside.

And we think the future of aviation in our region -- because of the proximity of those two airports, we can now get synergy between those airports similar to what Kennedy and La Guardia have been trying to do for 50 years and haven't been able to be successful.

These decisions about these rail lines are being made today. So with the Texas Mobility Fund as a tool, it gives us the incremental funding to now make these seamless so we're not forcing a transfer at the Love Field site or at the DFW site. You force two transfers with luggage you've lost them to transit.

This now can have people literally flying in on Southwest Airlines and then taking an international flight out of DFW Airport. And the notion of a weigh port, or the ability of these airlines over time of changing their business plan in the Dallas/Fort Worth region, is now created. If you continue to keep to your support, which you have since March --

MR. JOHNSON: Michael, I --

MR. MORRIS: -- the Texas Mobility Funds are multi-modal.

MR. JOHNSON: I'm fascinated by this partnership created and the $20 million CMAQ. And part of the equation is $700 million of federal transit money. Is that money already committed, if you will, or programmed as opposed to being special FTA money?

MR. MORRIS: No, sir. The -- those are new start funds that Congress has. They're very, very competitive. There's no guarantee the Dallas/Fort Worth region will get them.

We are arguing, through DART and the City of Dallas to our Congressional representatives and Federal Transit Administration, that with this added seamless opportunity, and for the Federal Transit Administration to be able to work with the Federal Aviation Administration to create this notion of weigh ports, and to use Texas Mobility Funds as the leveraging component to do it, we think it will create a greater chance -- and part of the leveraging amounts you heard the chairman talk about -- it will create a greater chance of us getting the $700 million to begin with.

So we're not asking for 100 million to go build a rail line eight miles. We think more strategically, as you see what we do on the roadway side, is to leverage it into the critical components of other funding sources to get Texas back a fair share of those discretionary funds in the rail program. That's why we purposely in our region are proposing it to be seamless connections at our airports.

A, it gets agreement on the body of people behind me on why you're not doing our rail line. Well, everyone goes to the airport. It's part of our economic generator. It creates a new business plan for aviation in the future, helps us with our air quality, and gets us the multiplier by creating new partners that's your vision through the Texas Mobility Fund has to bring other resources to the table.

MR. JOHNSON: Robert, I'm sorry to --

MR. NICHOLS: That's okay.

MR. WILLIAMSON: I think -- plus it's a great strategic move because everyone in the state -- or everyone involved in transportation in the state is aware that we're approaching a final decision on our developer for the I-35 corridor.

And with this proposal it almost forces us to have to consider taking the high speed rail component, if not the road itself, smack through the middle of the Metroplex because it would only make economic sense to do that. It's brilliant. There's no other word for it. It's just great.

MR. NICHOLS: Anyway, on my comments, I was just thrilled to see all these things we've been talking about and working on together come together at TxDOT in a very short period of time. You all, as a region, have been able to pool every piece of those tools -- or almost all of them. It's an amazing package of leverage and expansion in different categories. So I --

MR. MORRIS: You know, and I might add, it wasn't too long ago that I was here talking with you about the 183/121/820 corridor. And we were talking about our willingness to look at managed lanes. And I believe that, as a result of that, we very quickly had a vendor there that believes that it's something that's an excellent project for the CDA. And I think there are two or three other people who will also come forward and bid on that.

MR. WILLIAMSON: Oh, I imagine at least two or three.

MR. MORRIS: And so we're excited about moving that on. And we're sitting here at a time when we were talking about that project being pushed to 2012 before we could even hope to get it funded and started. And these people are talking about having the project completed by 2008. And that is just a tremendous incentive.

And it's what had made our people -- I mean, no one is real happy about saying, Okay, I'm going to start paying tolls. But they look at the quality of life and the way that they want to maintain that quality of life in realizing that the funds aren't here. And as a region, we've got to put some extra money up in order to make it happen and be able to maintain the quality of life we've enjoyed.

MR. WILLIAMSON: It's the no road, the toll road, or the slow road.

MR. JOHNSON: Can you get to the airport from Weatherford via this mechanism?

MR. MORRIS: Alliance is thinking about having a special little runway just for the Weatherford traffic.

MR. WILLIAMSON: Well, maybe I'll move over to Fort Worth. Members?

MS. ANDRADE: I'd like to thank all of you for being here this afternoon. Mayor Moncrief, Mayor Miller, thank you so much for having us over several weeks ago. We had a very successful trip and enjoyed -- and I think we understand your needs better.

But I'd like to congratulate you for working together. And I'd also congratulate you for including everything that we go around talking about. You've included all modes of transportation in your plan. So that's very visionary.

But most of all, I know that, Mayor, you had my home town, San Antonio, there about a month ago to share information about your successful light rail system. And thank you. Thank you for sharing that. We seem to learn from you all. And so thank you very much. We seem to also have a very successful ten-year partnership, and we look forward to that.

MAYOR MILLER: Thank you.

MR. NICHOLS: I predicted a high watermark day, and it met the expectations. The seamless nature of the rail means securitize from when you get off the airplane at Love until you get on the airplane at DFW. That means you don't go back through security. Is that what you mean by seamless? Can you --

MR. WHITLEY: That's going to certainly be the eventual intent. I don't know that it will start off that way. A lot of times when we're talking about -- that's one part of the connection. We're also studying in the entire region a seamless rail transit system that will link -- we currently have three different authorities. And our hope is that when someone gets on the rail, whether it be in Fort Worth or if it's in Irving or if it's in Dallas, or wherever it may be, that they'll be able to move throughout the region and not really know when they're leaving the DART area, the T area or the new Denton County.

MR. NICHOLS: Who would operate the rail? DART?

MR. WHITLEY: We're in the process of trying to figure that out. So we had -- one year ago -- well, really, I guess last August we were challenged to come together as a region and to propose a solution. And we've been working with -- really, everyone in this room has been working since that time to come forward with a proposal.

We had a mid-course workshop, in fact, over here this week where we're looking at the results of that, and again, moving toward a -- what we hope to be a solution in an August time frame again, and then have it prepared for presentation to the Legislature by the time they begin their session in 2005.

So the big thing is how do you fund it, which is always the big question, and then how are you -- what's the institution going to look like that oversees all of it.

MR. MORRIS: For the record, Michael Morris again. I apologize, Commissioner. I didn't explain that very well. By seamless I mean minimizing transfers on public transportation. If you have luggage going to a airport, or you're a business traveler going to an airport, we will lose them to public transit if there's a transfer.

So I don't mean to imply that that will be a secured rail trip between the two airports. You would go back through security at Love Field, and you go back through security at DFW Airport.

And just for the record, the people mover that is being built at DFW Airport, that is all on the secure side. So the people mover is all on the secured side. This would be on the non-secure public side of transportation.

MR. WILLIAMSON: Other questions or comments, members? (No response.) Well, let me exercise my prerogative by recognizing my former colleague, Mike Moncrief, who's doing an excellent job on the west side of the Metroplex. And I think everyone knows of my affection for the great mayor of Dallas and her husband and her kids.

Having said that, it's a remarkable proposal. I just -- this is what we meant. And it would be silly to hide it particularly in light of the remarks of the other Commissioners. This is exactly what the Governor, the Legislature, and the Commission wants -- this kind of regional approach. It will be awful hard I think to keep me from advocating for this from the first second. It's very pleasing -- very pleasing. Makes me proud to be from north Texas. Is that it? You want to close, or are you done?

MAYOR MONCRIEF: Let me close, Mr. Chairman, real quickly by saying that we appreciate the attitude of this Commission. I know how tough your job is, and I know how many stickers you see every time you have large delegations come before you.

But I don't think you see this kind of teamwork very often. And I don't think you see this kind of effort to try and think outside the box as often as you would like to. A lot of that comes from the direction that this Commission has established.

Now, you put into process the mold. You gave I think a sense of where that mission should be addressing, and it was --

MR. WILLIAMSON: Never mind.

MAYOR MONCRIEF: That's one way to cut me off. That's all right, Mr. Chairman.

MR. WILLIAMSON: No, it was somebody from Houston.

MAYOR MONCRIEF: I can take a hint, Mr. Chairman.

MR. WILLIAMSON: No, no, no. We didn't do that. We don't know what happened. But Mike, listen. We appreciate the remarks. And it really is -- it's not possible without aggressive, thoughtful leadership at home, and in Dallas and in Fort Worth and in Plano, in Collin County, Weatherford, and Parker County. We just --

MALE VOICE: Arlington.

MR. WILLIAMSON: We are truly blessed in north Texas right now with an unusual dynamic of local leaders. But I'm just real pleased with this, and I think you'll be glad you took the time to put it together. I really believe that.

MAYOR MONCRIEF: We look forward to working with you, Mr. Chairman.

MR. WILLIAMSON: Sorry it took so long this morning. It was longer than we intended, and we appreciate your patience very much.

(Whereupon, a short recess was taken.)

MR. WILLIAMSON: But I would say to you that we did not intend for the time to be as long as it was. The discussion this morning on the Strategic Plan impacts everybody. It was necessary to have that discussion. For any plans of yours we disrupted by our lateness, we do apologize for that.

I would also say that this Senator is always welcome in this building. We had the opportunity to serve a few years before I moved on. You're truly one of the long-term thinkers across the street, and I appreciate that in you.

SENATOR SHAPLEIGH: With your permission, Mr. Chair?

MR. WILLIAMSON: Please.

SENATOR SHAPLEIGH: First, thank you so much for hosting us here. We're here on two very exciting projects.

But what we're seeing is the most exciting time in TxDOT's history. When you look at the tools that you got from 3588, when you look at the progress that we can make in mobility, really, in all modes in the state of Texas, what you're doing here is the most exciting work I think that this Commission has ever done.

Ms. Andrade, our own Mr. Houghton, welcome to this Commission. We've come many times over the last ten years to visit with you.

I think, as an MPO, as a transportation area, we've come great strikes into the transportation era. We have an exciting, but complex, set of issues in the border. And when you talk about -- I was visiting with the Dallas delegation. I said, Imagine your MPO, as complex as it is, sitting down in a bi-national, three-state jurisdiction visiting about international issues when you're talking about transportation.

What we're going to do today is visit with you about two projects. The first deals with, really, what are brack issues at Fort Bliss and development around that area by the City of El Paso and Fort Bliss, which we think is very important to the future of our community, and particularly, what's going to happen with Fort Bliss' future in base realignment and closing.

As chair of that committee in the Senate, I can tell you we have a stake in that. Your Commission has legislation written last session with respect to brack, and we need to stay focused on these military bases, not only as economic generators, but force projection bases for the United States military in Texas.

The second has to do with our loop. We are the only major city in Texas not to yet have a completed loop. And we're asking you to participate in the funding of that loop in the future so that, really, we can reroute the kind of traffic that we have in El Paso through the I-10 corridor, through the mountains, and have a dramatically different transportation scene into the future.

We'll have a ten-minute video, then the mayor will visit with you, and Representative Pickett will have comments at the end. And we truly appreciate you hosting us here today. And thank you so much.

(Whereupon, a videotape was viewed.)

MAYOR WARDY: Commissioners, I know it's been a long -- very long day, but very productive and very interesting, especially for those of us coming from the far west part of Texas.

First of all, I'd be remiss if I didn't congratulate our new Commissioner from El Paso that we're very proud of. And it's a great honor to stand here in front of the Commission. I've done it before as a private citizen. Today I get to do it as an elected official.

You saw both projects today. And, you know, we know it's a fact of life that NAFTA is here to stay. But El Paso is prepared to take full advantage of the benefits of this trade instrument.

And given that, as you saw, approximately 25 percent of commercial crossings from Mexico into the U.S. go through El Paso's ports of entry, we have fully realized the challenges of the NAFTA traffic, infrastructure pressures, environmental issues, and health concerns.

In El Paso our attitude is to take lemons and make lemonade. We're determined to capture the benefits of NAFTA so that many other communities throughout the state and country have been able to do this, and we want to be able to continue to be able to do this.

El Paso has taken an aggressive role in creating the border's largest and most modern air cargo center, as you saw in our video. Over the last five years the City of El Paso has invested over $60 million in our new air cargo center.

Addition, the city's proceeding with substantial industrial commercial infrastructure to encourage and support new industry and economic development for our city and state. Currently under design is a creation of a new 150-acre industrial park. This project will allow the city to capitalize on our existing air cargo infrastructure developments, and is being promoted as a magnet for additional business activity in El Paso.

This proposed connector to the Loop 375, is a vital and critical component of El Paso's continuing economic development efforts. The loop connector, just to go back over it, will do the following.

It will remove substantial commercial traffic and congestion from the city's major thoroughfares like Montana and Yarborough. Will also create a safer environment for El Paso International Airport's patrons and traveling public. We have a huge traffic congestion problem right at the front of our airport. I think, Commissioner Nichols, you're pretty aware from your history, and it's only gotten worse. It faces the busiest intersection in our community.

Provide a critical secondary access to both Fort Bliss and Biggs Army Airfield. These two facilities are vital to our future, as far as our history, and our future as far as economic development with Fort Bliss and the military. This would accentuate our supportive position for the Army in the next brack ground.

It would also encourage directed and efficient border-to-border transfer of goods. We continue to have challenges. We know that everybody is jealous of Texas' position as the leader in international traffic, and we want to protect our position.

Would expedite vehicular traffic to our new transportation hub. Would increase El Paso and Texas' attraction as an efficient industrial commercial business location and gateway to Mexico.

And most importantly, would mitigate air emissions and help El Paso to secure and keep its attainment status for air quality. That's really important.

But Commissioners, as you can see, this project is part of an economic development and military enhancement program in which the city has invested a great deal already.

We're asking for your partnership in funding the $91 million for phase one of this project. The City of El Paso will provide a cash and right-of-way match of $23,886,000, which represents 20.73 percent of this total project cost.

This match represents a percentage larger than the toll feasibility of most of the projects that we're looking at in El Paso right now. And I say that only to illustrate that the City of El Paso is coming to the table with a significant investment in the mobility and economic prosperity of El Paso. We respectfully request your partnership.

And I would like to thank you for your time and welcome any questions you may have regarding this project. Mr. Chairman, I think you have a question?

MR. WILLIAMSON: Yes. Mayor, as you no doubt had the opportunity to hear me say earlier, one of the pleasures for me in this position is I get to see so many men and women with whom I served in the Legislature -- Mr. Pickett and Mr. Shapleigh. I served with Ms. Chavez. I don't see her, but she may be behind you. I served with Mr. Haggerty.

I also served, and actually officed with -- and my first mentor in the Legislature was actually Frank Madla who was a House member at the time I was elected. Frank called me this morning. He said, I've run into something. I'm not going to be able to make it I don't think. And I said, Well, Senator, you'll be here in spirit.

I want to point out to you that he doesn't contact me perhaps as frequently as others, but he stays in regular contact on matters of his district. And he considers the furthest western reach of his district as important as the eastern reach.

MAYOR WARDY: Well, I'll go ahead and yield the podium to Representative Pickett. Thank you for allowing me to make this presentation to you today.

REPRESENTATIVE PICKETT: Good afternoon, Mr. Chairman, Members. Since I had a lot of discussion about generalities earlier, I'm just going to say that the second project -- this interchange -- is something that, as in the past has happened when delegations bring projects to the Commission, what we're looking for is some inclination of support and in working with our district.

With all the discussions about all the tools that are available now -- the leveraging of funds, the tolls -- and you saw in our presentation that we included all those as something that we want to work with.

So I would ask the Commission if they would look at this project and let us work with the district, as you have done in the past, and come up with some recommendations as to how to fund this. In the past a lot of times delegations come up and they just say, Here's our match, we want you to put in the rest of it. Chairman, Commissioners, we want to look at some other, maybe new, things that we haven't in the past.

Earlier, when I had mentioned that the community of El Paso had actually been looking at tolls up to three years ago, I do want to mention that that was at the behest of Senator Shapleigh -- that Senator Shapleigh had been looking at this Northeast Parkway -- so I want to make sure that that's mentioned.

I also want to bring up that we're not afraid to leverage and use tolls. The City of El Paso came to this body some time back and was looking for to structure bank loan for some improvements to our bridges. And we put up our toll revenues as collateral for that project.

So again, this isn't something that we don't think is possible and viable. We do. This project is something that's become more important than it had been maybe five or six years ago with the advent of the expansion of the main lanes on 375. This is not something that we have currently planned in the category 2 funds going out to 2015. We have decided as a community and MPO that this does need to move forward. And that's why it does show up at this time.

As you heard in the video, April of 2005 we should be completing phase one. And we'd like to work something out so that we can start phase two fairly soon. We know that we're talking out into the future.

The other thing about the delegation presentations, I think a lot of people in the audience that are here thinking that a lot of this money that we talk about is the end of this year or the beginning of next year. And it's not. We know that this is some time out into the future.

So we believe that we can come up with a plan, working with our district, and working with the tools available, to not only do this project, but the one at the airport really is a great leverage project. And I know how much TxDOT has been pushing leverage, regardless of where it came from.

Before the tools about the toll and the toll equity, it was always a selling point if there was leverage. And we've got some great leverage on that project, Mr. Chairman. And if there's any other questions, that's all I have for the Commission.

MR. WILLIAMSON: I'm going to have some staff questions that are on point to your projects. But I need to ask, Do you know, Joe, is Ms. Chavez, Mr. Haggerty, or Mr. Quintanilla --

REPRESENTATIVE PICKETT: Representative Chavez did have to leave. Representative Quintanilla called me last night. He was going to a graduation. Representative Haggerty is -- should be about this time on the seventh or eighth green, but he supports the projects. Don't get me in trouble with Pat. And Representative Moreno -- I saw him at a school dedication on Friday, and he just could not travel. But the other House members are all in support, and Representative Chavez did have to leave.

MR. WILLIAMSON: I think you're being charitable if you think Pat's made it to the eighth green.

REPRESENTATIVE PICKETT: Well, he does have an eraser on the pencil he uses.

MR. WILLIAMSON: Well, if that's the case, if you'll indulge me, Amadeo, I've got a couple of questions I want to put to you, the answers of which I think I already know, but I want to -- this is designed to stimulate thought with our friends from El Paso. For the record you are?

MR. SAENZ: For the record, I'm Amadeo Saenz, assistant executive director of engineering operations.

MR. WILLIAMSON: Amadeo, there's not any doubt that segment 6 and 9 of Loop 375 is going to be advanced as soon as we work out some technical problems we ran into. Is that correct?

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: And when we suggested -- and I should say we and not any one individual -- that 375 be looked at as a potential stop, relook, and rethink as a toll road, we didn't mean to suggest stop the construction project so much as we suggest to stop and think about what you're doing from your perspective.

MR. SAENZ: That's correct. We want to just take a look at everything to see how it would fit into the bigger picture.

MR. WILLIAMSON: The mayor has forcefully and politely made it clear that that would be just not a comfortable thing at this time. And that's fine. It's our goal to never force tolls on anyone.

But one of the dilemmas we face in trying to figure our toll equity partnerships is, we sort of know by our traffic counts which roads would generate the most debt. We try to suggest to our DEs and to our partners locally, You know, you may not want to make this road a toll road, but the truth is if you do you can borrow 700 million to finish the interchange and this interloop and this bridge and so on and so forth.

Whereas, if you wait and only encumber a high speed lane on a road not yet built, the debt ability of that particular asset may only be a tenth as much --

MR. SAENZ: Yes.

MR. WILLIAMSON: -- and so you can only do a tenth as much. So our purpose was to say, Stop and think about the fact that you're fixing to build an asset here that, once it opens as a tax road is never convertible to a toll road, as hard as one might argue otherwise.

Is that the case with 375? Is that what we identify as being, other than Interstate 10 itself, which we're going to talk about in a moment.

MR. SAENZ: Okay. That's the case with 375. Once we move forward and the project were to get built then it's -- it would be very, very difficult to be able to take that and convert that from a tax road to a toll road.

MR. WILLIAMSON: All right. And I say again segment 6 and 9 is going to be approved. We're going to move forward. No one's going to force anything on anyone, including El Paso.

MR. SAENZ: Right.

MR. WILLIAMSON: But is it possible -- in the era of electronic tolls, is it possible to envision the interior lanes of that four-lane asset as perhaps being an express lane and the outside lane of these new lanes to be envisioned as a non-express, non-toll lane. Is that possible?

MR. SAENZ: It can be looked at. We would have to see what impact that would have on traffic. And since you do have two lanes now -- they're only building two lanes in each direction on Loop 375. By taking and making the middle ones express lanes -- and then you only have one lane, so traffic would not be able to pass each other. So it would make it difficult. We'd probably have to do some kind of changes to the configuration that would allow passing lanes within those lanes that are on -- especially the ones that are the non-toll lanes -- non-managed lanes.

MR. WILLIAMSON: And is it possible in the era of electronic tolling -- if, for example, El Paso formed a Regional Mobility Authority and took complete responsibility for these activities, would it be possible for them to design their own unique citizen subsidy of tolls?

MR. SAENZ: Right. In fact, what we were looking at is that we were trying to look at almost 100 percent electronic tolling mechanism for the Loop 375. And then, by having that, then El Paso could, depending on their electronic tolls -- where their toll tags could give either credit or give exemption to certain people within El Paso based on when they signed up -- if they lived in El Paso or if they were certain categories -- certain groups of people that they wanted to exempt, they could do that.

MR. WILLIAMSON: Now, let's expand our conversation just a moment to an idea that the Senator had years ago which has never left my head. And that's the notion of trapping the flow-through traffic that contributes so heavily to stacking up the interior.

Is it possible in this era of electronic tolls, with the cooperation of the federal government, to propose split Interstate 10 on the west and north -- I mean, east and northwest side of El Paso into an Interstate West and Interstate East and going ahead and collecting tolls on all traffic moving to and from, and use that cash flow to make that split and take Interstate 10 through the mountains?

MR. SAENZ: It is. As you said, we've got to do some coordination with the Federal Highway Administration, one, to redesignate Loop 375 as Interstate 10 -- I would say as north, and the other would be south because 10 is an east-west -- I mean, it would be east and west -- I'm sorry. And so we would have to have that in place.

And then after that then we would have to go through either a value pricing or a special pilot project, very similar to what we did on Interstate 10 in Houston, so that we could go out there and toll Interstate 10. And from the tolls that you collect on Interstate 10 you use that to build the asset of the -- the new redesignated Loop 375.

MR. WILLIAMSON: But again, using electronic tolls, assuming the creation of a Regional Mobility Authority -- but local appointees to the authority could make the sociological decision to issue a certain level of credit with each toll tag --

MR. SAENZ: Yes.

MR. WILLIAMSON: -- or issue credit based on water bills or electric bills or whatever --

MR. SAENZ: They could. Yes, sir.

MR. WILLIAMSON: -- in order to -- you wouldn't be able to borrow as much -- wouldn't be able to build as much --

MR. SAENZ: It will impact the amount of money that you can borrow. It will impact the amount of project that could be built. It may take longer to build the overall project.

MR. WILLIAMSON: But it would certainly permit local leaders -- and they're the better judges of what can be absorbed locally. We know that, Joe. We really do. We understand that local leaders know better than we do about that stuff. That's what this whole evolution of authority is about. That's what we're trying to accomplish. Let them decide how much to borrow, how much to build, and how much to subsidize in order to push the ball further a little bit.

I'm very intrigued, and I've always been intrigued about this notion of a loop through three states and two countries. I think it makes a lot of sense, not only from a transportation perspective, but from an environmental perspective.

MR. SAENZ: And we have made --

MR. WILLIAMSON: Perhaps this will contribute to that.

MR. SAENZ: We have made some contact with Federal Highway Administration to kind of pass on the idea and to see what it takes. So we will be talking to them just to make sure that we're not going in a direction that then they come back and say, no, we can't do that.

MR. WILLIAMSON: One other question of RMAs. When an RMA is set up and the board is formed -- TxDOT's role is in approving the project at the final end, but we don't have anything to do with selecting the contractors, do we?

MR. SAENZ: No, sir. The RMA would then put in place their own consultant selection procedures, and then they would select the contractors.

MR. WILLIAMSON: And I just want to be sure I'm clear about this, because I've kind of forgotten since the law was drafted. The board is appointed by the Commissioners -- County Commissioners?

MR. SAENZ: Uh --

MR. WILLIAMSON: The board is designed by the County Commissioners.

MR. SAENZ: The board is designed by the County Commissioners. Now, the legislation allowed one RMA to be formed by a city -- and that is in El Paso. So in El Paso there is the possibility of having an RMA formed at -- within the City of El Paso. And then, of course, you could have one formed in the County of El Paso.

MR. WILLIAMSON: And so those board members who are selected by the city and the county, not by TxDOT or the Governor, those board members take full responsibility for the terms and conditions of the contracts and whom they will select to build their assets.

MR. SAENZ: That's correct, sir.

MR. WILLIAMSON: And is there an ethics code embedded in that law concerning who can be selected to those board positions?

MR. SAENZ: They have to -- the RMA would have to put in place a consultant selection procedure and --

MR. WILLIAMSON: I'm talking the board members themselves. Is there --

MR. SAENZ: Oh, yes, sir. There is an --

MR. WILLIAMSON: Is there -- are there restrictions on --

MR. SAENZ: There is an ethics clause that's requires -- that is in place that has certain requirements that board members that are on an RMA board need to make sure they follow.

MR. WILLIAMSON: And it's been characterized by at least one member of the free press in Texas as the most restrictive ethics covenant appearing anywhere in state government. Do you concur with that conclusion?

MR. SAENZ: I think I heard him mention it at the meeting when we were asking for public comment. Yes, sir.

MR. NICHOLS: Before you sit down could I ask him a question?

MR. WILLIAMSON: Oh, sure.

MR. NICHOLS: El Paso is unique in the fact that it has -- the legislation applies to having a city RMA or a county RMA --

MR. SAENZ: That's correct.

MR. NICHOLS: -- or I guess you could academically have both. You could have the city and you could have the county.

MR. SAENZ: That's correct.

MR. NICHOLS: I don't know that you would want to do that. I think I went out there and actually encouraged that not to occur -- that to form together as one or whatever.

But if the community chose -- you know, was concerned about forming an RMA -- because when you take on the bonds certain liabilities are -- you know, putting all that together -- if the community, in trying to work out all the options to come up with a package, if they chose to have TxDOT through our Texas Turnpike Authority --

MR. SAENZ: Yes, sir.

MR. NICHOLS: -- do those projects, that's possible also, isn't it?

MR. SAENZ: That is possible also. In fact, there's some efficiency in that it, by it being a TxDOT turnpike project or toll project, we could use the same tolling mechanisms and the same tolling systems that we're using for existence on the projects that we're designing in Austin.

MR. NICHOLS: So there may actually be some savings --

MR. SAENZ: There could be some savings.

MR. NICHOLS: -- based on that and the staffing and things like that. But the -- if you -- the leverageability would be basically the same either way. Actually, it might be slightly better with the TTA.

MR. SAENZ: Yes, sir.

MR. NICHOLS: The -- I know when we considered these type of situations around the state a number of -- a year or so ago the communities were concerned, if they did it that way, that excess revenues would flow back to Austin. But the Commission passed a minute order --

MR. SAENZ: Last December.

MR. NICHOLS: -- last December that, in effect, stated what?

MR. SAENZ: Stated that the revenue collected -- if it's done through an RMA, or if an area chooses to toll, the revenue that's collected above and beyond what's needed for operation, maintenance, and debt service would stay in the area to do other transportation projects within the area.

MR. NICHOLS: Okay. And if there was any doubt about that, if one was formed in a community, we would reissue a similar minute order just for the same thing?

MR. SAENZ: That's correct.

MR. NICHOLS: Okay. So we could accomplish the same thing, if the community wanted to, through the TTA and the revenues -- the leveraging would be the same -- maybe slightly better.

MR. SAENZ: Uh-huh.

MR. NICHOLS: And then the revenues, as they develop, would go back to the community.

MR. SAENZ: Right.

MR. NICHOLS: Okay.

MR. SAENZ: We would then be working directly with the community to identify what projects we could do with the surplus revenues.

MR. JOHNSON: Not necessarily road projects. They could be transportation projects of --

MR. WILLIAMSON: We could bury the railroad through the middle of El Paso.

MR. JOHNSON: Yes.

MR. SAENZ: Probably we would have to use Mobility Fund money and identify a public transportation project so that we could use that. But we could do that. Yes, sir.

MR. WILLIAMSON: Or we could use some of that 10 billion we're going to ask them to give us here in about six months to move UP and BNSF out of nine cities.

MR. SAENZ: Okay. Yes, we could do that.

MR. WILLIAMSON: Wonder where we'll get that money.

MR. JOHNSON: Amadeo, one question --

MR. WILLIAMSON: No, wait a minute. You're supposed to say, I don't know, Ric, where do you think we'll get that money. Go ahead and say it.

MR. JOHNSON: Ric, I don't know. Where should we ask for that money?

MR. WILLIAMSON: We're going to declare a one-year holiday on public education. We're going to take all that money and put it in transportation. Then we're going to send all the kids back to school and we'll have good roads.

MR. JOHNSON: I should have known that you had this figured out. Amadeo, a specific question about 375. You mentioned it being a two-lane -- or two lanes each way. Should the event occur that we need to add capacity or change the makeup of the feature, is there sufficient right of way within the present scope to do that?

MR. SAENZ: Yes, sir. I think -- Chuck is here, and he can correct me. But there's enough right of way. What we're building right now is two lanes in each direction. There will still be a grass median between the two new lanes that are being built. So then in the future you could widen to the inside and add an additional lane to the inside of both the eastbound and westbound lane. So you do have additional capacity to go to a six-lane facility.

MR. HOUGHTON: It's obvious you come from Pharr.

MR. SAENZ: Astroturf.

MR. HOUGHTON: Amadeo, it's obvious you come from Pharr. There's no grass in the median.

MR. SAENZ: I understand. Senator Shapleigh said that they were going to put Astroturf, so I called it grass.

MS. ANDRADE: I have a question for Amadeo.

MR. WILLIAMSON: Please.

MS. ANDRADE: Amadeo, so what you're saying is the project is -- it's got enough feasibility that we'd be interested in doing it.

MR. SAENZ: Yes, ma'am.

MS. ANDRADE: And if we did it then the cost over and above, you know, would come back -- I mean, the revenue would come back to us if we did it -- the TTA did it?

MR. SAENZ: No, no. If the project -- if it was developed as a toll project --

MS. ANDRADE: If we did it.

MR. SAENZ: If we did it --

MS. ANDRADE: Uh-huh.

MR. SAENZ: -- whether we did it or the RMA did it -- the city RMA or the county RMA did it -- the way that -- with the minute order that you all passed last December -- or I guess that was before --

MS. ANDRADE: Before my time.

MR. SAENZ: -- before your time, the Commission has said that any revenue collected after you pay off operation and maintenance and any debt service would then remain in the area. So even if we did it, that money that would be what I would call a surplus would then remain in the El Paso district working with the El Paso district and the MPO --

MS. ANDRADE: For future projects.

MR. SAENZ: -- to identify future projects.

MS. ANDRADE: So regardless, they're going to get the money.

MR. SAENZ: Yes.

MR. WILLIAMSON: We anticipated when we were fighting this -- through this -- not fighting it, but fighting through it, that one criticism that would be leveled at us at some point -- and it has been recently -- is, well, you're going to make us pay tolls, and we don't get anything out of it that we would have gotten anyway. So why don't we just wait two years or wait four years or wait six years and we'll finally get our road built.

And we have to credit Brother Nichols for this. He came up with the concept of, Well, let's just pass a minute order and just tell people it's not our goal to take money out of El Paso. It's our goal to help El Paso empower itself. And to the extent that it generates positive cash flow, just keep building.

And I have to tell you, Hope, it's my hope in north Texas that 20 years from now we're not spending sales and property tax on roads and rail at all -- that we're paying tolls to use our road and rail system, and that's what powering our expansion. That's my hope for north Texas.

MR. SAENZ: See, the beauty we have beyond -- in that, Commissioners, is, for example, if we had a project that was already funded in our current UTP -- I'll just take Loop 375 -- the segments 6 and 9 that are scheduled to be let in fiscal year 2004.

Those are already funded. So if those projects were to be built as toll roads -- there's no debt service that was issued for that project. So immediately upon opening, the tolls that would be collected would go towards paying the operation and maintenance. If you put in an automated system for collecting the tolls your operation costs are minimized. So it's just to pay for operation and maintenance. And any money above that then would become a revenue stream that you could use to build more projects.

MR. WILLIAMSON: And would have no impact on the distribution of the state allocation system. El Paso would continue to receive that same allocation, plus they'd have a new toll revenue. And, of course, I'm in favor of the creation of the RMA and us not doing it because then they appoint their own board and make their own decisions.

MS. ANDRADE: Uh-huh. Thank you.

MR. WILLIAMSON: Thank you, Amadeo. Who closes? Who's next? Who wants to dialogue?

SENATOR SHAPLEIGH: I'll be glad to do any of the above. First of all, we're going to come back to you with a vision of tolls in our region. At our next MPO we'll appoint a commission to go and study that in our region and come back with various options.

You and I have shared for four years the idea of having tolls in Anthony and Fabens or Tornillo and using the Mississippi River that flows on I-10 to assist us in paying for our infrastructure.

In my view there's another parallel issue, which is you're having 78 trains a day, which is the NAFTA traffic on rail lines, coming through our community, particularly HAZMAT issues in downtown El Paso that I think we need to put on the map and deal with, too. This can do both.

We will make this commitment, and we're coming back. And I think Representative Pickett -- I know the mayor's on board in doing that, and you'll see a product back from us, I'm hopeful, in 60 days.

But let me put this issue in front of you because it's a parallel issue to school finance. Our community is dealing with issues of NAFTA trade burdens, and we don't have the tax base, nor the toll equity potential, to deal with it. You met that issue when you sat as a legislator in school finance to try and design a system for the whole state.

And I hope as you look at these toll issues emerging on the border -- because you're seeing these issues where communities with very low property tax bases -- resistance to adding a family tax of $40 per family to move in their own region are having to deal, not only with the issues of mobility for themselves, but NAFTA mobility issues.

And I hope you'll participate and work with us on how we can design that where we have a statewide toll equity system that is, in fact, fair. And we'll come back with our own presentation to you of what we want to do and how we want to proceed. And we have many tools in 3588 that our office used to put in there that are unique to our region and the border, and we will have a proposal to bring back to you.

But I hope as you move forward, particularly those of you that are near the border -- Mr. Houghton and Commissioner Andrade -- realize that this isn't the Metroplex. Now, you don't have five-and-a-half million people with disposable incomes at 45,000 and above to deal with mobility issues.

And as we talk about how you fund these projects, we're going to have to get even more creative when we use the federal government and others, particularly when you look at the truck traffic that I-10 is going to produce in the next 15 years.

With that, we're open to any questions or dialogue you might have. We're going to come back with our part of the equation done. We certainly appreciate -- and I want to particularly thank Ms. Andrade and Ted for being in our region and working with us on some of these issues.

Mr. Johnson, when you came to our conference -- international conference and saw what these issues are in border regions, it was a day that we won't forget. We appreciate that. And Mr. Nichols, you have put on more miles than anyone in the state in looking at these transportation issues, so we want to thank you for your participation.

But I did want to put those issues on the table as you move forward in your deliberations about what this vision of transportation looks like in the future.

MR. WILLIAMSON: We thank you, sir. Any other questions or comments? (Pause.) We appreciate the presentation by the entire El Paso delegation represented by Mr. Pickett and Mr. Shapleigh.

REPRESENTATIVE PICKETT: Could we have a moment of dialogue?

MR. WILLIAMSON: A moment of dialogue.

REPRESENTATIVE PICKETT: Just a moment of dialogue part. As I said on this interchange project, we'd like to look at some creative ideas. But making the choice, a Regional Mobility Authority or TxDOT as the toll, wasn't what I meant.

A little more creative than that because it's -- what sounds like is being proposed is we're still going to toll. Do you want us to collect it or do you want to collect it. And I still think we need to go a little farther beyond that.

It's like prayer. You know, growing up my mom said that, you know, all prayers are answered. Sometimes it's no. Well, I don't think we can just flat toll everything. I mean, we looked at this already. I know your district is doing some numbers out there. And just right now, if we were to keep both lanes in both directions and present this as a toll project, it's still a 35 percent toll viability.

And the payout on this one is a little bit longer -- well, quite a bit longer than some of the other proposals around the state because, you know, the driving -- all the stuff that we anticipate. So I still want to leave the thought that we will look at anything, but I still don't want to choices to be an RMA -- you toll it or we'll toll it. Maybe just a little more than that.

MR. WILLIAMSON: Well, you don't have to toll it at all. I mean --

REPRESENTATIVE PICKETT: Well, that's --

MR. WILLIAMSON: -- it's your choice.

REPRESENTATIVE PICKETT: Well, yes. I kind of hear that. And to put this in perspective, we had a meeting at the airport the other day. And when we finally got some numbers out of our district as to what the tolls could be for the citizens in El Paso it happens to be it's the same rates that the airlines charge to fly on the airlines. It's the same rate.

MR. WILLIAMSON: I meant to ask the mayor --

REPRESENTATIVE PICKETT: That's interesting, isn't it? It's a -- the toll that's being proposed in El Paso, Texas, would be the same as if I wanted to fly on American or Southwest Airlines. And most of us feel that that's, you know, a luxury, not necessarily something that's inexpensive to do. It breaks down the same.

And as the Senator said, coming up with a toll and how many people will utilize that toll is going to be very local, as politics are, and real estate. And so I think we ought to add a third one -- politics, real estate, and tolls are very local in their nature.

Just bear with us. We want to see this happen. And I think we can find a way to make it happen. But I don't want the dialogue to stop at we toll or you toll. Let's keep working on this one. This is something that we've decided to move up in priority.

MR. NICHOLS: I think the proposal where you all are going to go back and really take a look at all these tools and try to come up with a plan is a great one.

REPRESENTATIVE PICKETT: Because, Robert, I still --

MR. NICHOLS: Look forward to --

REPRESENTATIVE PICKETT: I am still wondering what your policy is going to be on that $3 billion Ogden Bond proposal, because we still haven't been able to factor that in. Because we might come back with a proposal that says half of the 156 million we'd like to see in a general bond sale against our allocation.

MR. NICHOLS: We had a meeting --

REPRESENTATIVE PICKETT: We still don't have that in there.

MR. NICHOLS: We had a meeting -- or some of us had a meeting yesterday with the Bond Councils, bond advisors -- you know, that whole group -- trying to work our way through those issues -- or some of them -- at least logistics standpoint.

And it's a little more problematic -- I think is the word Ted used -- than it appears on the surface. But we haven't got it all worked out yet, but we're striving to get that worked out here shortly.

MR. HOUGHTON: Joe, that's the financial plan that I mentioned earlier in the -- when you start thinking about all those things, and there's so many moving parts on how it affects a community and a strategic priority of using -- I mean, there's -- one project could suck up that entire allocation. So it's strategic to the State of Texas as one thought.

And then the congestion buster is another thought. And then what it does -- so again, you know, I think we're all willing to work together to see how we make these things happen.

REPRESENTATIVE PICKETT: Because I heard your finance guru, Mr. Bass, who is exceptional, by the way, mention earlier that the question came from the Commission -- do you mix the bonds, are the bonds separate with the Mobility Fund bonds and the Ogden Bonds be separate issuances. And the answer I believe was yes.

MR. HOUGHTON: Yes.

REPRESENTATIVE PICKETT: But again, that policy hasn't been decided to TxDOT either. So I will reserve any more comments until we see a policy come from this body as to the Ogden Bonds as well. I think that's important.

MR. HOUGHTON: Well, I'd like to ask James -- is he here? I think that's a matter of law that they have to be separate.

MR. WILLIAMSON: They can't be sold otherwise.

REPRESENTATIVE PICKETT: Well, that --

MR. HOUGHTON: They can't be sold otherwise.

REPRESENTATIVE PICKETT: And I agree.

MR. JOHNSON: Now, we can pool the funds --

REPRESENTATIVE PICKETT: Right. And I agree.

MR. JOHNSON: -- I think is where you're heading.

REPRESENTATIVE PICKETT: Right. And it's just that there still hasn't been a policy statement on that $3 billion of issuance -- a billion a year -- knowing that 600 million goes for safety. So that still is something that the Commission hasn't taken a position on.

And the toll aspect about it -- we live with tolls in El Paso now, especially people who commute are not new to this. I just think that our community is sensitive to the fact that we all are already tolling certain aspects of the community. And this adds a little bit more than we're willing to do on certain roadways, you know.

And I try to figure it out, too. You guys have been running numbers; I've been running numbers. The numbers that I get from my district -- if I live -- and I do live near Loop 375 -- it would cost me $100 a month.

MR. WILLIAMSON: Yes, but Joe, you can no longer reach that conclusion than you -- than we can reach the conclusion about what we're going to do until we take a vote, because that depends on how much toll equity we're willing to send into a project.

REPRESENTATIVE PICKETT: Well, if it's a 35 percent toll viable project --

MR. WILLIAMSON: Well, hey, guess what? What we've been trying to say to you is we're willing to do some 35 percent deals.

MR. JOHNSON: Absolutely. I mean, it pays -- probably pays the maintenance.

MR. WILLIAMSON: It takes local leadership saying, Well, okay, in that case we'll bring you a proposal.

REPRESENTATIVE PICKETT: We propose a $100 a month tax on the people that want to use it. I understand what the proposal is, yes. I understand it very well.

MR. JOHNSON: It's not necessarily a tax. It's a user fee in its purest form.

REPRESENTATIVE PICKETT: A user fee. I understand that. A user fee of $100 a month. I understand it.

MAYOR WARDY: Commissioners, just to close -- look, we want to be part of the solution. And I know these are difficult times. You have our commitment from our community to find a solution to work hand-in-hand, because we know this is the future for Texas.

MR. WILLIAMSON: How do you do city streets? How do you pay for your city streets?

MAYOR WARDY: We just had a bond issue.

MR. WILLIAMSON: So you borrow money --

MAYOR WARDY: Yes, sir.

MR. WILLIAMSON: -- against your tax base?

MAYOR WARDY: Yes, sir.

MR. WILLIAMSON: And do you do like school finance -- you have a special -- I mean, I don't live in the city. In fact, I've never lived in the city, so I don't know. Do you have a special property tax rate for -- and I'm glad I don't. A special property tax rate for your bonded indebtedness?

MAYOR WARDY: Well, we have a debt portion and, you know, part of our tax base -- part of our tax rate goes to debt, some goes to operating funds. And so we leverage, and we just passed $115 million bond issue for primarily street and drainage improvements and some capital expenditures without raising our tax base. So we're trying to stay balanced and trying to stay away from the easy mechanism, which is to raise taxes.

We know that these are challenging times, and we're committed to go forward and look for the solutions so that we come forward with a project that works for the Commission and works for El Paso.

MR. WILLIAMSON: You all don't assess by lot line or frontage road in the city when you --

MAYOR WARDY: No, sir. On new construction it's a part of the developer's responsibilities. But you know, in our last bond issue 60 million of it goes to streets and drainage. And, you know, it's the first time that we did. We were successful in doing it that way.

MR. WILLIAMSON: We are -- anything else, Ted?

MR. HOUGHTON: Yes. I would just -- I'm going to wrap up my portion of this. I'd be very remiss not to thank Representative Joe Pickett for his leadership. I didn't do that earlier. He -- and these aren't hollow words. He's been a friend of this Agency, as I have been reminded of that. And he is an advocate for TxDOT -- Texas Department of Transportation -- and for his leadership.

And Mayor Wardy, you and I have known each a long time and --

MAYOR WARDY: Too long maybe.

MR. WILLIAMSON: -- we had -- yes. A long time. And your leadership -- it's a new day in El Paso, and your leadership is also working. And I offer, again, my personal time to work with both Joes in this issue -- try to get the issues resolved.

I call the Interstate Highway 10 redesignation the Shapleigh-Behrens proposal, since Shapleigh came up with it and Behrens came up with the redesignation. I think you and I talked about that, Mike, at one time.

But there's other opportunities. There's U.S. 54 at the New Mexico-Texas border. So -- and I think everything needs to be put on the table.

MAYOR WARDY: I just think my personal belief from my background in transportation, although limited, is the fact that I think that the I-10 redesignation could be a great coup for TxDOT and the City of El Paso -- could set the stage for a lot of things in the future and is the one thing I think we could garner tremendous public support for.

MR. WILLIAMSON: I bet we're going to look at it.

MAYOR WARDY: Yes, sir. Absolutely.

MR. WILLIAMSON: We'll look at it together.

MAYOR WARDY: Thank you all very much.

MR. WILLIAMSON: Thank you for patience today. It's been a long day. You can stay for the rest of the meeting if you want to.

MAYOR WARDY: I think we'll leave that up to you, Commissioner.

MR. WILLIAMSON: Members, we were going to adjourn -- I mean, not adjourn -- strike that. We were going to recess and have lunch.

However, it's come to my attention that we have some dissension about the approval of the bridge application in Laredo, and we're going to have to defer -- oh, no, no. I'm sorry. That wasn't what it was.

MR. JOHNSON: I saw somebody perk up.

MR. WILLIAMSON: Hope has asked that we go ahead and act on the bridge application for the Laredo bridge. And I think that's appropriate because the mayor probably would like to go back home. This has been a long day for everyone who thought they would be here until about 9:30 and go home. So Mike, let's go ahead and bring 4F up and not even take a break.

MR. BEHRENS: We'll go to agenda item 4F. And Amadeo will present the minute order on the Laredo bridge application for the international bridge.

MR. SAENZ: Good afternoon, Commissioners. I'm playing Jim Randall right now. Oh, there he is.

MR. WILLIAMSON: Have to raise the podium.

MR. BEHRENS: Jim Randall. We're going to do 4F now, Jim.

MR. RANDALL: Yes, sir. I just ran down the stairs. Just a second.

MR. WILLIAMSON: Coach Royal would be proud.

MR. RANDALL: No, I shouldn't be out of breath. Good afternoon, Commissioners. Jim Randall, director of Transportation Planning and Programming Division. Item 4F -- this minute order provides for the approval of the City of Laredo Fifth International Bridge.

Transportation Code, Section 201.612, requires Commission approval of a new highway bridge over the Rio Grande. Title 43, Texas Administrative Code, Section 15.70 through 15.76, provides that a political subdivision or private entity authorized to construct or finance the construction of a bridge over the Rio Grande --

MR. WILLIAMSON: Hey, Jim, are you okay?

MR. RANDALL: Huh? Yes, sir.

MR. WILLIAMSON: Are you okay?

MR. RANDALL: I'm just out of breath. I just came down --

MR. WILLIAMSON: Why don't you sit down?

MR. RANDALL: Okay.

MR. WILLIAMSON: You sit down. You're breathing a little bit too deep, buddy.

MR. RANDALL: I'm fine.

MR. WILLIAMSON: You sure?

MR. RANDALL: Just out of breath. Okay.

MR. SAENZ: Good afternoon, Commissioners. For the record, I'm --

MR. WILLIAMSON: We don't take out of breath lightly.

MR. SAENZ: This minute order -- for the record, I'm Amadeo Saenz, assistant executive director, engineering operations -- minute order provides for the approval of the City of Laredo Fifth International Bridge. Transportation Code, Section 201.612, requires Commission approval of a new highway bridge over the Rio Grande.

Title 43, Administrative Code, Sections 15.70 to 15.76, provides that a political subdivision or private entity authorized to construct or finance the construction of a bridge over the Rio Grande must obtain approval from the Commission prior to requesting approval from the federal government.

The Department received an application from the City of Laredo on September 22, 2003, to construct this proposed bridge. The Commission considered the City's request, but on December 18, disapproved the application when it issued Minute Order 109521.

By letter dated April 23, 2004, the City of Laredo submitted its response to Commission's rationale for disapproving the application, followed by a copy of a diplomatic note from the Embassy of Mexico to the U.S. Department of State.

The City requested the diplomatic note be made part of the City's application. The City has requested that their application be reconsidered based on the following.

Diplomatic note EUA-01157 expresses the Mexican government's interest in conducting necessary feasibility studies on both sides of the border. The diplomatic notice, based on a proposal made by the cities of Laredo and Nuevo Laredo for the construction of the new international bridge that will provide a connection between the two cities from U.S. 83 to Mexico 85.

On March 19, 2004, the two cities entered into a memorandum of understanding regarding their commitment to partner in the construction of the proposed bridge. This information provides the necessary written commitment from the appropriate jurisdictions of the United Mexican states to provide adequate roadway connections for the proposed bridge.

A fifth international bridge is contained in the Metropolitan Transportation Plan indicating that there is a need for the bridge. The Metropolitan Transportation Plan cannot indicate which entity would construct or own the bridge or the bridge location until the competing bridge applications are resolved and the federal environmental review and approval process is completed.

Sufficient information exists to indicate that the bridge is consistent with the Regional Transportation Plan developed by the MPO having jurisdiction over this project.

The third item -- the City has provided letters of support for the construction of the bridge from Municipal President of the City of Nuevo Laredo. At the October 29, 2003, public hearing regarding the bridge application various persons expressed support for the project.

The City also provided documentation for the proposal of -- to Webb County to share the revenues of the unrestricted infrastructure -- for an unrestricted infrastructure fund comprised of revenues from the City of Laredo's Fifth International Bridge in lieu of the competing bridge applications.

These -- this establishes evidence of local support and that the bridge construction will be constructed to result in a positive effect on the economy and the free flow of trade.

Based on this additional information provided, staff recommends approval of this minute order.

MR. WILLIAMSON: Feeling okay?

MR. RANDALL: I'm doing fine.

MR. WILLIAMSON: Okay, Amadeo --

MR. SAENZ: I'd be happy to answer any questions.

MR. WILLIAMSON: -- you can have a seat and Jim can answer a question. Okay, members. Mr. Randall's back at the podium and got his breath. And we're sorry we caused you to have to run so much.

MR. RANDALL: Shows you what --

MR. WILLIAMSON: Questions or comments for Mr. Randall.

MR. JOHNSON: Question. Mr. Randall -- Jim -- are you aware, is there any ongoing litigation between the City of Laredo and the Department over any matters?

MR. RANDALL: I'd probably have to defer that to OGC, but my understanding there is -- I believe there is some litigation going on.

MR. WILLIAMSON: Is OGC present?

MR. JOHNSON: He's back there. He's behind you.

MR. WILLIAMSON: It's going to be Mr. OGC.

MR. MONROE: Yes, sir, there is ongoing litigation.

MR. JOHNSON: Is there one piece of litigation? Are there multiple matters?

MR. MONROE: They started out as two. They have since been consolidated into one in federal court.

MR. JOHNSON: And this is the issue on the bridge -- on the --

MALE VOICE: Inspection.

MR. JOHNSON: -- inspection station --

MR. MONROE: Yes.

MR. JOHNSON: -- border inspection station.

MR. MONROE: Border inspection station, yes, sir.

MR. JOHNSON: That answers question one. Jim --

MR. WILLIAMSON: Thank you, Mr. Monroe.

MR. JOHNSON: -- the other question I have has to do with the City's -- there are two applications here, one city, one county. The county was approved last month in Waco. Do these applications -- or is there a final permit -- does it come back before this Commission at some point in the future?

MR. RANDALL: The process is -- if this is approved by the Commission, it will move forward up to the U.S. Department of State to make the decision to issue the permit. Part of that process is that the State Department will go back to the Governor's Office and ask for opinions from the Governor's Office. And generally, the Governor's Office comes back to us for an opinion. But I don't believe it would go back to the Commission.

MR. JOHNSON: But in all probability we'll be asked for an opinion.

MR. RANDALL: Yes, sir.

MR. JOHNSON: It doesn't necessarily carry any weight or authority.

MR. RANDALL: Correct.

MR. JOHNSON: Thank you.

MR. WILLIAMSON: Other questions or comments for Mr. Randall?

MR. NICHOLS: Let's move.

MS. ANDRADE: Second the motion.

MR. WILLIAMSON: Have a motion and a second. All those in favor of approving Item 4F will signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed?

(No response.)

MR. WILLIAMSON: Motion carries. The application moves forward. We take 20 minutes for lunch finally. We're back in here at 3:40. We'll start Item 4.

(Whereupon, a short recess was taken.)

MR. WILLIAMSON: We're now on the record. We're back from recess. Mike, we finished Item 3, which didn't require any action, as best I can tell.

MR. BEHRENS: That's correct.

MR. WILLIAMSON: And why don't we return to Item 4A and see if we can go ahead and turn down Cabella's and tell him to go someplace else.

MR. BEHRENS: All right. We'll go to Agenda Item 4, Transportation Planning. We already took one of those minute orders, so we have -- Jim will propose five minute orders under Transportation Planning, starting out with Hays County.

MR. RANDALL: Yes, sir. Jim Randall, Transportation Planning and Programming Division. Item 4A -- this minute order authorizes construct authority for a two-phase project near the City of Buda to reconstruct frontage roads and to replace overpasses on I-35 from Loop 4 North to south of FM 2001, a distance of approximately 1.4 miles, at an estimated construction cost of $10 million in Category 12 of the Strategic Priority of the 2004 Statewide Mobility Program.

Several national retail outlets have developed plans for investment properties along the I-35 corridor near the city. The Department and the local community business leaders have determined that these improvements are needed in order to safely accommodate the anticipated increase in traffic that would occur as a result of these business developments.

Phase one from Loop 4 North to south of FM 2001 includes the reconstruction of the southbound frontage roads to two lanes with auxiliary lanes and the replacement of the 2001 -- FM 2001 overpass.

Phase two from north of Loop 4 to south of FM 2001 includes the reconstruction of the northbound frontage roads to two lanes with auxiliary lanes and the replacement of the Loop 4 overpass.

The total construction cost for both phases is $20.5 million. This minute order will authorize 10 million from Category 12 Strategic Priority Funds, with 5 million going to each phase. The remaining ten-and-a-half million will come from interstate maintenance funds and from Hays County. We recommend approval of this minute order.

MR. WILLIAMSON: Members, are there questions of Jim about this minute order?

MR. JOHNSON: So moved.

MR. HOUGHTON: Second.

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

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. RANDALL: Okay, sir. Item 4B. This minute order approves the 2005 Statewide Preservation Program of the Unified Transportation Program. The Unified Transportation Program, which is updated annually, is a basic transportation planning document that guides and controls project development for the Department.

Statewide Preservation Program represents the Department's efforts to maintain the existing transportation system. Statewide Preservation Program contains annual program amounts from Category 1, prevention maintenance and rehabilitation, specific Category 6 projects that address structure replacement, structure rehabilitation, and railroad grade separations.

Additionally, the program contains information on two highway maintenance funding strategies, along with information on upcoming waterway and railroad preservation projects.

A 20-day comment period regarding the draft 2005 Statewide Preservation Program ended April 20 with three comments received. Staff has reviewed these comments and submitted copies to the Commission and administration. Based on these comments staff recommends no revisions.

With the approval of this minute order the Department may continue project planning and development of FY 2005 and beyond. Staff recommends approval of this minute order.

MR. WILLIAMSON: Members, are there questions of Mr. Randall about Item 4B?

MR. JOHNSON: I have an observation and maybe a request.

MR. WILLIAMSON: Please.

MR. JOHNSON: The observation is this. I think bringing -- I guess I mentioned earlier -- discipline to a lot of these processes is an excellent step. And we're utilizing pavement scores in a lot of our ratings to be able to determine where the needs are. We're also using lane miles as one of the criteria in which we judge the various areas in terms of their needs also.

Here are the observations that I have. One, in an earlier chart today, which Amadeo presented and showed total spending for the period from 1970 to 1998, and then another column showing the spending from 1999 to 2003, and working through the percentages, and then what it's programmed for the years 2004 through the year 2007 and the resulting percentages.

And what, as the Chairman noted, appears to have happened is that the two largest districts we have in every category -- people, vehicle miles traveled, et cetera -- the metros -- the Houston and Dallas -- their percentages declined over that period of time compared to the 1970 to 1998 period, and also as compared to what call this calculated percentage. And whether that's an equitable marker I'm not here to debate that case. But there is definite notice that they have declined.

And then if you look at pavement scores you'll also notice that the -- two of the three -- well, the two lowest districts in pavement scores are Dallas and Houston. And so -- and what I'm sensing here is that the struggle that they're having on their mobility issues are -- they're having the same struggle on their preservation issues.

And in talking with some of the active people who work in those districts, their off-the-hip observation is that the difference is the freeways that -- one, they're more expensive to maintain, secondly, sometimes getting them to do the work necessary is not easy because they're so congested so much of the time.

But it occurs to me -- and I might be incorrect in this conclusion -- that if we score a lane mile of I-10 and let's say Colorado or Austin County the same as a lane mile of I-10 in Harris or Bexar County, there is something out of whack there. And what's out of whack is a huge difference in the amount of traffic that goes over that lane mile.

So what I'm suggesting is that hopefully we can take some of these issues to heart and look at what is happening in -- you know, it's -- I don't think any district -- you know, our goal is to have everybody at 90 or better on pavement scores.

And, you know, we've got probably two-thirds of our districts, you know, in the eighties. And we -- that's a very challenging, daunting goal, but we need to get there somehow. But certainly, the ones in the seventies we need to gear up by the nape of the neck and help them along.

And I believe that there's a financial issue here in the funds that we're allocating, you know, on their preservation programs to those areas.

MR. RANDALL: Yes, sir. As you know, in FY '08, that's our first year that we're transitioning into the new formulas based on the work groups that we've been called together the last year or so.

We're going to take a close look at how this -- you know, how the allocations are based on that new formula. And if we need to go back and take another look at it we will. But we're going to have to get a couple of years under our belts to see how the trend is based on our new formulas.

MR. JOHNSON: Well, the sad thing between now and 2008, the two metros I mentioned, Dallas and Houston, they're either going, in all probability, to stay at the depressed level they are or even to decline, which is, you know, in my mind, a pretty sad commentary.

MR. RANDALL: Yes, sir. I guess it'd be up to the administration. But if some way we -- we want to look at a -- some kind of supplemental program or something like that, looking at the scores, then that could -- you know, we could come down, Mike.

MR. BEHRENS: Well, in listening --

MR. WILLIAMSON: There's nothing like asking a question that requires an answer of, this is yours, Mike.

MR. BEHRENS: Well, I don't have the authority, but I --

MR. RANDALL: No, in listening --

MR. BEHRENS: -- I'll run with it if you want me to, sir. No, in listening to the conversation, you know, Commissioner Johnson, you know, thought of an idea. And I think there's a way that we can accomplish that with the tool that we have. And give us a chance to put something together, and I think we can -- got a solution for it.

MR. RANDALL: Okay, sir.

MR. WILLIAMSON: I think one of the benefits of this morning, John, is -- not only for people that were out there, but for ourselves -- we had a chance to kind of air out and admit to ourselves that -- I don't know if admission's the right word -- to discuss the fact that we have basically routed money from Dallas and Houston, less to Fort Worth, and perhaps San Antonio and Austin, to other parts of the state.

And finally, the objective measures we use -- quality of our system has proven that we've got to swing that pendulum back the other way. And I think Mike's already developing some ideas to recommend to us in the next few months to correct that.

MR. JOHNSON: Well, you know, my observation is is that we're -- it was an excellent discussion and very illuminating. And we're sort of looking at money for new construction, expansion, et cetera. And, you know, I think this paints to me in a pretty vivid picture that, you know, we need to include preservation in that consideration. Because, you know, these pavements scores -- when you're in the seventies that's --

MR. WILLIAMSON: Pretty bad.

MR. JOHNSON: That's bad.

MR. BEHRENS: Well, and when you do have the pavement declining, it also -- to me, it increases congestion because --

MR. WILLIAMSON: Sure.

MR. BEHRENS: -- it just slows everybody down, plus also it impacts safety. And I think we can -- we've got some ideas and I think we can supplement some of these programs.

MR. WILLIAMSON: It's a safety issue from this point forward.

MR. BEHRENS: Thank you, Jim.

MR. RANDALL: Yes, sir.

MR. WILLIAMSON: Other questions or comments for Mr. Randall on this item? (No response.) Do we have a motion?

MR. HOUGHTON: So move.

MR. JOHNSON: Second.

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

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. RANDALL: Okay, sir. Item 4C. This minute order authorized 5.5 million of federal discretionary funds for project development along the state-owned South Orient Railroad. The United States Congress appropriated these funds to be used for the rehabilitation of the South Orient.

The line is being operated by Texas Pacifico Transportation Limited. To date, this company has spent in excess of 5 million toward the initial rehabilitation of the line in order to restore service along its entire limits.

Department staff has worked with Texas Pacifico, the Brewster, Pecos County, and Presidio County Rural Rail Districts, local citizens, and elected officials from the region, to determine the best use of the 5.5 million federal appropriation.

It's anticipated that these federal funds will be applied for bridge rehabilitation, track rehabilitation, grade crossing improvements not on the state highway system, and other associated work.

This rehabilitation work should enable rail operations between the United States and Mexico at Presidio rail crossings. The registration of the rail service line of this line is expected to provide economic benefits to the west Texas communities located along the line, as well as relief to other international rail crossings. We recommend the approval of this minute order.

MR. WILLIAMSON: Jim, have you had any luck getting us out of that deal?

MR. RANDALL: No, sir. We --

MR. WILLIAMSON: But we can take complete control of it now that we're legally authorized to do so?

MR. RANDALL: What we're looking at with this appropriation is that we're looking at maybe reopening our negotiations with Texas Pacifico to take another look at our agreement with them. This 5 point million will be administered by TxDOT. We will not pass this along to the operator. We will let the contracts for these improvements and things like that.

So I guess it was last Commission meeting at Waco -- we just got the tools through the rules to be able to operate and maintain a rail line. So we're still at the very beginning of this, but we're willing to work with Texas Pacifico at this time.

MR. WILLIAMSON: Well, do the best you can because I want to be there at the naming of the Robert Nichols Rail.

MR. RANDALL: Sure.

MR. WILLIAMSON: Members, questions or comments.

MR. JOHNSON: Question. How much money have we spent on the South Orient?

MR. RANDALL: TxDOT?

MR. JOHNSON: How much has been spent, counting what Texas Pacifico alleges they have spent, and the original -- I believe it -- wasn't it a $6 million appropriation that --

MR. RANDALL: Yes, sir. It was --

MR. JOHNSON: -- acquired the line?

MR. RANDALL: Yes, sir. From -- when we acquired the line we had a $6 million appropriation from the Legislature. When we entered into the long-term lease agreement with Texas Pacifico that was for 3.5 million. So that's 6 and 3.5 we used to buy the line for 9.5 million.

Texas Pacifico has put in 5 million to date for rehab. They're scheduled for another 4 million. And then we'll take this 5.5 million. So I haven't added it all up, but that's what -- and what you're looking at is about 75,000 ties that we're replacing, in addition to the bridge rehab work and stuff like that.

So it's a -- got to remember, it's a 391-mile line that was not in very good shape when we acquired it. So it's going to take us a while to get it up to a shape where we'll be able to really move some traffic on it.

MR. NICHOLS: [indiscernible].

MR. WILLIAMSON: Please.

MR. NICHOLS: The -- two things. Number one, the partnership between the group that has it right now and the Mexican connection on the Mexico side, Feromex, they are -- they had some of the common partners. The primary value of that line is not to go to Presidio and come back, but to actually run back and forth down to Chihuahua. Having somebody in a partnering position with the Feromex is really going to be very important long term.

Secondly, the federal appropriation we got -- the 5.5 million -- for improving this line -- if we had not received the legislation from the Texas Legislature just a few years ago for the authority on rail that we have, no one in the state would have had the authority to spend this money. With that, I'll so move.

MR. HOUGHTON: Second.

MR. WILLIAMSON: I've got a motion and a second. All those in favor signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. RANDALL: Okay, sir. Item 4D. This is the third quarter program for economically disadvantaged counties to adjust matching fund requirements. In your book is Exhibit A that lists the projects and staff's recommended adjustments for each of them.

The adjustments are based on the equations approved in earlier proposals. There are 14 projects in seven counties. The total reduction of participation for these projects is $1,110,736. We recommend approval of this minute order.

MR. WILLIAMSON: Questions or comments, members?

MR. JOHNSON: So move.

MR. NICHOLS: Second.

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

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. RANDALL: Okay, sir. Item 4E. Minute Order 109664 dated April 29, 2004, authorized the executive director or designee to negotiate and enter into any necessary agreements to acquire the Camino Colombia Toll Road. This minute order authorized the executive director to purchase this facility at a cost not to exceed 20 million, to be funded in Category 12, Strategic Priority of the 2004 Statewide Mobility Program.

Additionally, this minute order designates the Camino Colombia Toll Road as a turnpike project on the state highway system as State Highway 255 from the intersection of FM 1472 and FM 255 eastward to Interstate 35 of a distance of about 21 miles. This designation would become effective upon acquisition of the facility.

Acquiring this toll road would facilitate the efficient operation of the state highway system, including filing system continuity with Mexico and benefit the state and traveling public. We recommend approval of this minute order.

MR. WILLIAMSON: Question or comments, Members.

MR. JOHNSON: I have a question. Assuming that it's passed when do we anticipate closing?

MR. RANDALL: Closing?

MR. JOHNSON: Closing the transaction with --

MR. RANDALL: I'm going to have to probably defer to Mr. Saenz.

MR. SAENZ: For the record, Amadeo Saenz, assistant executive director for Engineering Operations. What we have been doing, Commissioners, is that we have sent our people out there who have done a complete survey of the whole facility.

We have found that the highway's in very good shape. It does need a little bit of preventative maintenance work. We're looking at probably resurfacing and restriping. Of course, we need to do some routine maintenance and maybe some crack pouring and some mowing.

In going to the building, it's like -- the people were there a little while ago. They're just out for coffee. All of you -- you almost get to see a cigarette still lighted up there when they smoke. But we've also checked their toll system, and we're trying to find out its -- how good it is.

Everything has shown to be very good environmental wise. We don't have any environmental problems. Our bridges are all in good shape. Roadway's in good shape. Traffic -- we've got to change some signs.

We've done a property appraisal. We've gotten some titles from the vendor people we're going to buy it from. We have run into one issue dealing with right of way and some reversionary clauses that were part of the Camino Colombia, Inc. And our position, going back to John Hancock, is that they need to give us clear title. That's probably the only stumbling block that we have.

We think that this can be resolved. They told us that that should not be a problem for them to give us clear title. We think we can probably resolve this in the next 30 days. And then I assume that, soon after that, within another 30 days we should be able to open it.

We will probably be able to open it -- our plan is to open it -- it's going to be a toll road. It will be State Highway 255. Probably have some kind of a contract with a vendor to help us with the collection of the tolls, and then put it in place. So I would think within 60 days we could have Camino Colombia open.

MR. JOHNSON: This was not a part of the Statewide Preservation Plan which was previously adopted, was it?

MR. SAENZ: No, sir. It -- the Statewide Preservation Plan is a bank balance program. So we can identify a project within that plan to be able to do the seal coat. Be happy to answer any other questions.

MR. WILLIAMSON: Other questions or comments, Members? (No response.) I assume that you're working with Hope and her ongoing discussions with the City of Laredo and Webb County about various matters --

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: -- of interest to the Department. I'm assuming Hope is using our ownership of this asset to our best advantage.

MR. SAENZ: We will be using it. In fact, we had questions asked about it today.

MR. WILLIAMSON: Do I have a motion?

MS. ANDRADE: So move.

MR. WILLIAMSON: Second?

MR. NICHOLS: Yes.

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

(A chorus of ayes.)

MR. WILLIAMSON: All opposed?

MR. HOUGHTON: Abstain, Mr. Chairman.

MR. WILLIAMSON: And the record will reflect --

MALE VOICE: Oh, yes. One abstain.

MR. WILLIAMSON: Record will reflect that Mr. Houghton did not participate in the discussion of the Camino Colombia Toll Road today or at any point in the past. Mr. Houghton has elected to abstain from the discussions and from any vote based on a business relationship in the past with a person who's involved in the sale. And on this vote in particular, where we finalized our decision to buy the asset, Mr. Houghton abstained.

MR. JOHNSON: Mr. Randall will start his exercise program tomorrow.

MR. BEHRENS: Agenda Item 5 is a discussion item. Recently we had outreach meetings across the state of Texas in all 254 counties concerning the Trans-Texas Corridor. Some of those meetings were small; some were large. But Randall Dillard will facilitate the discussion on that item.

MR. DILLARD: Good afternoon. For the record, I am Randall Dillard, director of TxDOT's Public Information Office.

In February and March TxDOT held a series of public hearings across the state regarding the Trans-Texas Corridor. The hearings were part of a long-term collaborative public involvement program for the Tarns-Texas Corridor that were designed to provide the public with preliminary information on the Corridor and get input from the public. The hearings were also required as part of House Bill 3588.

The Trans-Texas Corridor is our transportation blueprint for the future. Introduced by Governor Rick Perry, the Corridor is being planned to improve mobility, safety, and the quality of life in Texas. The idea recognizes that we are limited on the long-range improvements we can make along many existing highway corridors. It also recognizes that we can improve safety by separating cars and large trucks, and that rail can play an important role in the movement of people and goods, and in reducing the congestion on our highways.

The Corridor also provides a way to get the transport of hazardous materials out of our heavily-populated areas.

The public hearings earlier this year allowed us to get a better understanding of what the public knows about the Trans-Texas Corridor, what they like about the Corridor, and what concerns they have about the Corridor.

Meetings were held in every Texas county. They were attended by more than 4,000 citizens. Citizens were invited to provide input regarding their knowledge and opinion of issues related to the Trans-Texas Corridor through a short survey. They were asked to indicate general areas where the Corridor should be located, and to provide written and oral comments regarding the Corridor. More than 5,300 pieces of data were collected at these public hearings.

I think it's fair to say we had a mature audience. 56 percent of the attendees were over the age of 54, and 92 percent of the attendees were over the age of 34. The majority of attendees were homeowners; many were landowners. Nearly one-fourth of the attendees were elected officials.

As I mentioned, attendees were given the opportunity to fill out a brief survey. I need to emphasize that this was not a survey of the general public. It was a survey of those that were interested enough in the Corridor to attend a public hearing. Still, there were some very interesting results.

Ninety-three percent said that transportation is very important or somewhat important for economic development in the creation of jobs. Ninety-two percent said separate lanes for cars and trucks were very important or somewhat important. And nearly 70 percent said that they would be willing to pay a toll to drive in a car-only lane. Seventy-seven percent said rail was very important or somewhat important as a way to help reduce traffic congestion on our state highways.

While those taking the survey were interested enough to attend a public hearing on the Trans-Texas Corridor, less than 10 percent said they had extensive knowledge about the Corridor. That's the same percentage that said they had no knowledge -- no prior knowledge of the Corridor.

Of those that had prior knowledge, the feature they were most familiar with was the separate lanes for cars and trucks. That was followed by corridors connecting the state, but not cutting through the heart of our urban centers.

Increased use of rail to reduce congestion on our highways, the idea of using tolls as a way to help fund transportation improvements, and the inclusion of utility corridors.

We asked people to prioritize seven issues related to the Corridor plan. As you see, they want reduced traffic congestion, improved safety, economic development and the jobs that it creates, and they want safe transport of hazardous materials.

It's interesting to note that the safe transport of hazardous materials was ranked even more important than improved air quality, which was ranked number six.

We also asked for input on what routes should be included in the Trans-Texas Corridor. We did this by providing a blank map of the state and asking them to draw a line where they thought the routes should be located. Nearly 70 percent of the routes they drew reflected the Department's conceptual map. But they did have some other ideas as well.

Take a look at the routes as they were provided to us on these maps. Fifty-nine percent of the maps returned to us included a route parallel to Interstate 35 from Oklahoma to Mexico and said that that should be part of the Corridor. Twenty-nine percent drew a line that was parallel to the current Interstate 20 corridor. And we drew that one in dashed lines on the map in front of you because the lines that they drew did very slightly -- in that the lines that were provided, many of them drew a more direct route from El Paso to the Metroplex area.

Twenty-eight percent drew a line for the corridor parallel to Interstate 45, 23 along the corridor of Interstate 10. Twenty-two percent drew a line parallel to the proposed I-69 corridor, 16 percent along the proposed Ports to Plains corridor. And then 15 percent drew a line that was really more direct from the Panhandle down to the Valley. So we put that one in a dash as well.

Seven percent drew a line from the Panhandle to northeast Texas, 5 percent from Oklahoma to the Presidio-Big Bend area.

There were also two new alignments suggested on the -- that varied from the conceptual map. Sixteen percent of the people drew a new line from El Paso to southeast Texas, essentially splitting the difference between Interstate 10 and Interstate 20. Many of those lines ended up in east Texas north of Beaumont. Some of them ended up south of Beaumont.

Then the second new alignment that they suggested was from the Panhandle down to -- more directly to Houston. And 14 percent of the people drew that line on the map for us as well.

What are some of the things they liked about the Trans-Texas Corridor? According to the comments we received they support, number one, the fact that rail was being included and emphasized as part of the state's future transportation plan. They realize that highways alone will not solve our transportation challenges, and that we must have a true multi-modal transportation system.

Many attendees showed support for TxDOT's effort to plan for the future. They realize that there are increasing demands on our existing transportation system. They also realize that transportation is key to economic development. And while nobody loves the idea of paying tolls, a number of attendees recognized the usefulness of tolls to help pay for transportation improvements in the future. They recognize that toll roads are an option that need to be considered.

The role of the Corridor -- or the role the Corridor can have in the safe transport of hazardous materials was something frequently mentioned at the public hearings. People are concerned about the hazardous materials that are running through their town, near their neighborhoods, and near their schools. They commented to us that improving safety in that area is a priority.

Without a doubt, there are many concerns about the Trans-Texas Corridor as well. Many were voiced to us at the public hearings. There were concerns about the amount of property that will need to be acquired to make room for the Corridor. How that property will be acquired was a question frequently asked. There were concerns about acquiring private property and then leasing it to private interests.

Many concerns were also raised about the economic impact to rural Texas. If rural communities are bypassed would it pull economic development away from those communities? Will land acquisition by the state take property off the local tax roll?

There were issues raised about the role local governments will play in the development of the Corridor. What will be the costs local governments may incur due to the Corridor, and will local communities have a significant role in the planning of the Trans-Texas Corridor?

Other questions and concerns that were raised include, how will me pay for the Corridor, what is the benefit of public/private partnerships and how will they work, how will the Corridor connect to the existing transportation system. That was a question raised from both rural and urban citizens. And many people asked, why can't we just continue to expand along our existing corridors.

Those are just some of the questions that were raised at the public hearings that we must do a better job of answering. We are doing that in part through an interactive web site that is being developed for the Trans-Texas Corridor and through direct communication with interested parties. That effort is ongoing.

Citizens did appreciate the public hearings that we held. Our districts received high marks on the evaluation forms. Citizens said the hearings helped explain the transportation challenges facing Texas, and they helped them better understand the Trans-Texas Corridor. They also made comments that the presentations were very well done. And many people said that they wanted to become more involved in the Trans-Texas Corridor project as it's being developed.

The public hearings have given us a better understanding of public opinions and attitudes regarding the Trans-Texas Corridor. That information will not only allow the Department's engineers and planners to make better decisions, it will allow us to communicate more effectively.

The hearings emphasized to us that the public is interested in the Trans-Texas Corridor and that they want to know more about it. We will continue our public outreach efforts to listen to the public, to involve the public, and to be responsive to the public. I'll be happy to try and answer any questions you might have.

MR. WILLIAMSON: Question or comments, Members?

MR. NICHOLS: The only comment I have is you all put in a lot of work, I know -- the whole project to get around to all the counties, every single county in the state. And it's amazing -- it's an amazing outreach. I realize that it's required by the Legislature, but it was still an amazing outreach. And I think hat's off to those who worked on the project.

MR. DILLARD: I think the credit goes to the districts and the area engineers in those districts that put on the majority of the hearings

MR. WILLIAMSON: Mr. Houghton.

MR. HOUGHTON: I just wish we'd have had this prior to the delegations' presentations on the acceptance of paying a toll -- being separated from the truck traffic, and what we're getting from -- in our outreach around the state -- what the public is thinking.

MR. WILLIAMSON: Randall, first of all, have we made this information available to the public yet?

MR. DILLARD: No, sir. We were waiting for the presentation today.

MR. WILLIAMSON: And when we make it available to the public how will we do it?

MR. DILLARD: We will put some of the information on our web site. We will also provide this information through the news media. We are planning some newsletters that will go out to many of the interested people that have already signed up to give us their contact information.

I might also mention that numerous letters have also gone out recently. Mr. Behrens sent letters to many of the people that attended the hearings. And so we're trying to have more direct interaction.

We'll also provide this information to our districts, which I think will be able to use it as they make presentations about the Corridor throughout their district.

MR. WILLIAMSON: So Mike, if you're so inclined, it might be a good thing to send Coby and his team across the street with this information to make sure legislative staffs have it. They know --

MR. BEHRENS: We can do it.

MR. WILLIAMSON: -- this has transpired. Now, what will be the next step, Randall? I know we've got a contract -- not a contract. We are negotiating with three potential developers. Is this information of value to them, or will they be doing different types of surveying, or do you know?

MR. DILLARD: I don't know the answer to that on how we'll coordinate exactly with those. I do know that it has been information we have shared with -- of course, the Turnpike Authority Division is there conducting their scoping meetings on both the I-69 project and the Oklahoma to Mexico corridor as well. And we'll continue to share that information with them.

MR. WILLIAMSON: Okay. Anything else? (No response.) Good job, Randall.

MR. DILLARD: Thank you, sir.

MR. WILLIAMSON: I echo Robert's thoughts. You all did a good job on this one. Appreciate it.

MR. BEHRENS: We'll go to Agenda Item Number 7, which is our aviation item for the month of May. And Dave will recommend some projects for funding out of the Airport Improvement Program.

MR. FULTON: Thank you. Commissioners, for the record, my name is Dave Fulton, director of the TxDOT Aviation Division.

This minute order contains a request for grant funding approval for nine airport improvement projects. The total estimated cost of all requests as shown on the Exhibit A is approximately $10.5 million -- approximately 6.7 federal, 2.8 state, and approximately $1 million in local funding.

A public hearing was held on April 20, 2004. Two individuals provided comments regarding the grant requested by the City of McKinney. Written responses to those comments were mailed to the respective parties on April 26, 2004. We would recommend approval of this minute order.

MR. WILLIAMSON: David, all the Commissioners wanted me to ask you one question.

MR. FULTON: Yes, sir.

MR. WILLIAMSON: When will we quit involving McKinney in our airport decisions?

MR. FULTON: Well, I don't think for the foreseeable future. The airport's very rapidly growing, and so I think there will be a demand for increased infrastructure for some time to come.

MR. WILLIAMSON: So should we suggest to Mr. Keithly and Ms. Kaminsky that they get like an apartment in Austin or --

MR. FULTON: I won't comment on that, sir.

MR. WILLIAMSON: Seems like old good times. You want the for's or against's?

MR. BEHRENS: You're the Chair.

MR. WILLIAMSON: Make a decision? Let's hear the -- for's go first. Mr. Ken Wiegand. Did I say that right, Ken?

MR. WIEGAND: Yes, sir. It's Wiegand. Thank you very much, sir. I'm Ken Wiegand. I'm director of Collin County Regional Airport, formerly McKinney Municipal Airport.

And I'd just like to say that our airport has probably the most growth potential in the Dallas/Fort Worth Metroplex for a general aviation airport. We're one of one -- one of eleven general aviation reliever airports. Last year we had a number of operations. We had 120,000 operations, and those operations are growing.

Mr. Chairman, that's 120,000 less operations than -- that DFW and Love Field didn't have to contend with. That's, of course, our reliever designation.

As far as the projects we're asking for funding for, the Taxi Way Project is on a fast track. We're working with a new tenant -- a new corporate tenant, one of the largest employers in north Texas. And we're looking at a deadline of December 1.

This is one of three taxi ways that are being constructed on the airport this year to open more than 43 acres of airport property to be developed. And we have the demand to fill it.

The city's doing its part. We've invested 60 percent in the total cost of the three projects. So we're here today after $520,000 -- I believe that's the number and -- in federal funds to help us with one of those taxi ways.

And I'd also like to close by saying I can't tell you how much we appreciate the work of TxDOT Division of Aviation and, of course, our director, Dave Fulton, for everything that he's done. Thank you very much, sir.

MR. WILLIAMSON: Members, questions or comments for Ken? (No response.) We'll hear next from Larry Robinson. But Ken, don't get too far away because they're going to want to call you back up.

MR. WIEGAND: Yes, sir.

MR. ROBINSON: Mr. Chairman, may I have my council members speak before I do?

MR. WILLIAMSON: Well, certainly.

MR. ROBINSON: Thank you.

MR. WILLIAMSON: I always like to hear from Pete Huff.

MR. HUFF: Thank you, Mr. Chairman, fellow Commissioners. I'm an elected city council member from McKinney. I've been associated with our airport since the early nineties, both as a pilot and as a city official and on the Airport Board. I'm currently the liaison from our city council to this particular board.

There's very strong support for this airport in our community. You heard earlier that we renamed it Collin County Regional Airport. We're the only airport in the county there, and we've become kind of the darling of the business community there. So we're trying to broaden our support base and our service base throughout Collin County and even further.

You may not realize this now, but McKinney is almost 90,000 people. Maybe 12 years ago we were under 20-. This airport's important in transportation and economic development. We had to pay for a lot of roads and streets since the airport is really an economic engine, not only for transportation, but for building the tax base that we need. And it's operated safely and under every federal and state guideline that any of us know.

Elected officials do a lot of door knocking and e-mailing and things you have to do. And I'm not a politician; I'm a business guy. But I've been out -- I've knocked on several thousand doors in the campaign. We know where our citizens are. We always have some that disagree on every issue. It doesn't matter what the issue is, there will be some people against it.

But the vast, vast majority of our citizens support this airport, and they know it's important to the economic viability of the whole region. We'd like your support on this project. Thank you.

MR. WILLIAMSON: Questions or comments for Pete? (No response.) Stand by, Pete. Okay. Now, Larry.

MR. ROBINSON: Yes, sir, Mr. Chairman. Lawrence W. Robinson, the city manager for the City of McKinney. Mr. Chairman, members of the Commission, Mr. Behrens, I guess for the sake of the newer members, Collin County Regional Airport has been in operation since 1979. It was located and planned for future growth in mind. We are safe. We are well managed. You've met Mr. Wiegand.

We operate in accordance with all state and federal rules, regulations, and also guidelines. Our business aviation demands have increased in the last five years, only because we're the general aviation reliever airport in the county -- in Collin County, as Mr. Huff mentioned.

CCRA is a regional economic engine. We base aircraft at our airport that have corporate offices or make contacts with corporate officials in Plano, Richardson, Allen, McKinney, and Frisco as well.

We also work very closely with the private sector -- one of our private partners is here today -- to make sure that we can stretch some of our dollars to improve our airport.

We have international business connections. Some of our clients are flying nonstop to Beijing and other points in the world to close multi-million dollars business deals, which, again, strengthens our business position on a regional effort.

We're also supported by our Chamber. Many of those members drove down last night to the reception. And I'd like for them to stand, as well as representative from Mr. Paxton's -- Representative Paxton's office. I believe they're still here. So they came down to enjoy, again, not just the festivities last night, but to also hear all the issues today and support us.

With that said, I respectfully -- and we respectfully -- request and appreciate your support for our request for this grant for this taxi way which will help us reach our newest tenant, EDS Corporation. We hope to put those jets in the hangar by December.

This will also give us access to 52 more acres for future aviation development. Be happy to answer any questions.

MR. WILLIAMSON: Members, questions or comments for Larry Robinson at this time? (No response.) Okay. Let's hear from --

MR. ROBINSON: Thank you.

MR. WILLIAMSON: Thank you, Larry. Okay. Cynthia, Don -- which one?

MS. KAMINSKY: Cynthia.

MR. WILLIAMSON: I don't say tongue in check it's good to see you again, but you haven't spent a lot of time down here.

MS. KAMINSKY: I always enjoy talking with you guys. My name is Cynthia Kaminsky. And a couple of quick comments. Mr. Huff forgot to express that he is also a businessman on the airport property. And the airport traffic is down by approximately 30 percent.

On May 21, 2004, the McKinney Courier Gazette reported on a groundbreaking attended by TxDOT's Dave Fulton. The groundbreaking was for a taxi way that, to date, has not had funding approval.

The fact that TxDOT attended the event raises serious issues of procedure. The impression has been strongly made that funding is assured behind the scenes, and that this meeting, despite protests to the contrary, is nothing more than a rubber stamp for projects that have already been put in motion.

There exists many federal grant assurance violations at McKinney that TxDOT has refused to investigate. I'll discuss one.

At issue today is over half-a-million dollars in funding for the City of McKinney's airport. As you know, the FAA director's determination of 2000 found McKinney in violation of federal grant assurances and prohibited McKinney from applying for and/or receiving any federal AIP funds. AIP funds are being asked for again today.

AIP funding is to be denied until all landfill milestones are met. McKinney's council has written that landfill closure is a milestone. The city has missed all milestones. The landfill is still open. The McKinney Airport is ineligible to receive AIP funds. Thank you.

MR. WILLIAMSON: Wait. Stand by.

MS. KAMINSKY: Thank you.

MR. WILLIAMSON: Don?

MR. KEITHLY: Good afternoon, Mr. Chairman, council, and Mr. Behrens. Don Keithly, citizen from the unincorporated area of McKinney.

It was interesting to hear the earlier comments by the folks from McKinney. None of them mentioned to you that they are in an ineligible status. We have brought this to their attention many times. Mr. Fulton brought the attention to you that we were in attendance with the public hearing.

I brought that to that meeting and asked that Mr. Fulton and his team look into this one issue. There are other issues, but this is a key issue, and it is a very easy readable issue.

The City of McKinney was given a written determination on remand by David Bennett. And until that landfill closes, they are ineligible to request or receive any federal AIP funding. It's real simple, gentlemen. And I've asked that the TxDOT Aviation Division simply investigate this and get the answer from the person who wrote the determination on remand.

We've been to FAA. None of those folks want to make that request, so I have to say that there's no other written document that can be presented that shows that they have met or exceed or have solved this problem. They did get an extension for the closure, but the closure to June 30 only extends the ineligibility.

So I simply ask that you deny this funding based on the fact that the City of McKinney is ineligible. Thank you. And if this continues I guess we probably will have to get an apartment. Any questions?

MR. WILLIAMSON: This is the last and fifth witness on this matter. It's now time, if members so choose, to ask questions or receive direct comment to do so. Who wishes to go first?

MR. NICHOLS: I will.

MR. WILLIAMSON: Mr. Nichols, our in-flight -- I mean, our residential flyer.

MR. NICHOLS: Mr. Fulton --

MR. FULTON: Yes, sir.

MR. NICHOLS: -- to your knowledge, and in your communications with the FAA, do they feel that everything is up to snuff?

MR. FULTON: I've had numerous comments -- communication over the years with FAA, and the city has always been eligible.

I would reference an April 6 letter of this year from Ms. Naomi Sanders, that I believe you've been provided a copy. Ms. Sanders is the manager of the Airports Division of FAA for the five-state Southwest Region. I'll just say one sentence in this five-page letter that states, The City of McKinney is eligible to receive federal funding through TxDOT and the State Block Grant Program for eligible airport development projects.

I think it's very clear they're eligible. And we -- FAA determines the eligibility, and they have stated that they are eligible for funding.

MR. NICHOLS: That letter is just a few weeks old --

MR. FULTON: Yes, sir.

MR. NICHOLS: -- and the FAA is saying they are eligible.

MR. FULTON: Totally.

MR. NICHOLS: So the questions of whether they are or are not eligible have been answered by the FAA themselves.

MR. FULTON: Completely in my mind. Yes, sir.

MR. NICHOLS: Okay. Thank you.

MR. WILLIAMSON: Next?

MALE VOICE: That was my question -- if they were eligible.

MR. WILLIAMSON: Next?

MR. JOHNSON: Almost mine.

MS. ANDRADE: Me, too.

MR. WILLIAMSON: Please.

MS. ANDRADE: That was my question.

MR. WILLIAMSON: Oh. Well, my question -- I guess the obvious one is -- they leave it up to me to ask these questions, Dave. I like your hairdo, by the way.

MR. FULTON: I thought you might say that.

MR. WILLIAMSON: Don't you think it's classy?

MR. FULTON: I think my barber was mad the other morning about some issue when she attacked me.

MR. WILLIAMSON: Oh, that's great. But how can Ms. Kaminsky, who's been here before -- she's always pleasant, she always has her paper and her letter, and she's always prepared. How can she be so sure that the city's not eligible?

MR. FULTON: I'm not sure of that, sir. And I will provide -- if she and Mr. Keithly do not have this letter, I intend to make sure they have it. And hopefully, that will provide the clarification that they need. Mr. Keithly said he'd like something in writing, and I don't know how it could be any clearer than this. So I will commit to making sure they personally receive this letter.

MR. KEITHLY: May I make more comment, sir?

MR. WILLIAMSON: Oh, please. We don't want to make an ill-informed decision.

MR. KEITHLY: If I'm not mistaken, TxDOT is responsible for the eligibility of an airport. Is that not correct? Under the --

MR. WILLIAMSON: I don't think so, but we'll look.

MR. KEITHLY: Under the Block Grant Program isn't TxDOT responsible in their agreement with the federal government that they have to qualify and notify that these airports are eligible?

Mr. Fulton is referring, and has always referred, back to FAA. My quest to him was, it's his responsibility as TxDOT to make sure that these airports are eligible. And all you have to do -- read the documents. And he continues to refer back to FAA. And I have to say FAA lives in a protected environment, so they want to build airports. The responsibility, sir, lies here with TxDOT.

MR. FULTON: May I respond?

MR. WILLIAMSON: Please.

MR. FULTON: First of all, Congress determines primarily the specifics of the FAA Airport Improvement Grant Program. What isn't decided by Congress is supplemented by the FAA. We act as agents to carry out the FAA programs as they are given to us to carry out.

Now, the issue of being eligible for funding comes from whether an airport community owner -- in this case, the City of McKinney -- is in compliance with FAA grant agreement assurances from previous grants. The FAA has sole authority in determining that -- whether a city is in compliance. They've determined that the City of McKinney is.

We have no authority to state that they are or are not in compliance. If FAA says they are eligible for funding, then it is up to the Commission to determine if you want to give the grant to this community. There's no question that they are eligible for this grant. The Commission's discretion is in whether you choose to award a specific grant.

We'd like to add, too, that I've always made clear -- and I think the City would tell you I did attend that groundbreaking, but they know clearly that the only people who make funding decisions for TxDOT is this Commission. And I think they would reinforce that statement.

MR. WILLIAMSON: Did Nichols go?

MR. FULTON: He was not there, no, sir.

MR. NICHOLS: Did I go where?

MR. FULTON: To the groundbreaking recently.

MR. NICHOLS: No.

MR. FULTON: We make sure all communities understand that the Commission has the authority, not the TxDOT Aviation Division, to make these grants.

MR. WILLIAMSON: Please, Ms. Kaminsky.

MS. KAMINSKY: I guess since you asked why I keep making these statements I should really answer for myself. And I hope I have these dates right, and I will double check them for you in case I give you the wrong one.

On October 23, 2003, we had a meeting with FAA Southwest's Naomi Sanders. And we broke the meeting down into two different date sets -- before October 15, 2003, and from October 15, 2003, after. And the significance of that date is, on October 15, 2003, David Bennett at the FAA in Washington, D.C., issued a letter extending the deadline for McKinney to be able to close the landfill.

When we talked with her about the dates before April 15, 2003, Ms. Sanders replied, that, yes, McKinney was ineligible up to that time. Funds had been given to McKinney, and she agreed that those funds were given during a period of ineligibility.

We documented this in a letter to her on October 31, 2003, and made sure to ask her, if we were incorrect in what we were documenting to her to please give us, you know, where the corrections need to be made. We have never received anything. So those words that were heard by -- I think there were six of us in the meeting -- stand that McKinney was ineligible up to April 15, 2003.

Then we started talking about the dates from April 15, 2003, afterwards. There the FAA started being confused, I guess is the easiest way to say. They weren't sure exactly what Mr. Bennett meant. Our interpretation, based on the July 26, 2000, director's determination on remand, making these [indiscernible] June of 2000, and then the April 15 meeting, and Mr. Bennett, being a lawyer, his very specific wording of that April 15 letter leaving off all mention of milestones, when, before, he had specifically mentioned them, we wanted to know if the milestones had changed. We knew that the deadline had changed, and therefore, the period of ineligibility had been extended.

But the questions were about the milestones, the deadline being one of the milestones. She wasn't sure. She promised us she would get with David Bennett. She never did, and never has gotten back to us. We do have a copy of the April 6 letter, but it does not state that she talked with David Bennett.

Now, in the meantime, because this is a question of which words are what, and we know that we are not in the aviation industry -- although we may have technical background -- there are still questions as far as what a word means legally as compared to what it may mean technically.

So we went out and asked a lawyer to give an opinion. All we did was give him the set of documents. And we said, give us your legal opinion. Were the milestones changed? Is McKinney ineligible or are they eligible?

The response that came back in a five-letter opinion -- or a five-page opinion -- I'm sorry -- was that McKinney was ineligible for all receipt of and application for all funds until the landfill is closed. There was no mention of the milestones, so therefore, ineligibility was not an issue that was touched on legally, and McKinney was still ineligible to apply for funds.

This is part of a Part 16 complaint that is currently active at FAA in Washington, D.C., right now. What we're asking -- we're not asking you to close the airport. We're not asking you to do anything but table this item until that Part 16 ruling comes through and until McKinney can prove, beyond a shadow of a doubt, with an independent oversight committee, that they are, in fact, eligible and in complete compliance.

MR. NICHOLS: Could I ask a question?

MS. KAMINSKY: Yes.

MR. NICHOLS: Oftentimes when we have people -- citizens who are concerned about procedures in a process --

MS. KAMINSKY: Uh--huh.

MR. NICHOLS: -- is because they have a concern greater than the process itself. In other words, the reason I say that, is your primary concern to make sure that they followed a procedure in a manner that you think is correct, or is your primary concern you don't want to see the airport expanded because you live in the neighborhood?

MS. KAMINSKY: No. Our concern is, we have explained to everyone -- and obviously, I didn't explain it to you well enough, so I apologize. Our concern is that this airport be run according to all rules, regulations, directives, and orders. If it was run in that way this would be a different airport and I wouldn't be here.

MS. ANDRADE: I have a question.

MS. KAMINSKY: Yes.

MS. ANDRADE: Forgive me. I'm new on the Commission.

MS. KAMINSKY: Uh-huh.

MS. ANDRADE: So would you identify yourself as to what your role is?

MS. KAMINSKY: I'm a citizen.

MS. ANDRADE: You're a citizen.

MS. KAMINSKY: Yes.

MS. ANDRADE: Okay. And then, second of all, so what you're saying is that you don't think that the letter that they have in their hand from April 6 is --

MS. KAMINSKY: I do not think that it expresses the official Washington, D.C., FAA opinion on it because it doesn't reference David Bennett and it doesn't reference anything about the letters or the milestones. It's a blanket statement, in my opinion.

MS. ANDRADE: So regardless if the letter says that they are eligible, you're saying they're not eligible.

MS. KAMINSKY: I'm saying until we hear from the FAA, and that they show that they have met all rules for eligibility -- and that is part of the Part 16 complaint that's active now --

MS. ANDRADE: The last thing I'd like to say is that you have said that I'm part of a rubber stamping commission. If we were that I don't think I'd spend eight hours in a meeting.

MS. KAMINSKY: No. It's the impression that was given.

MS. ANDRADE: But, you know, I mean, we have spent over -- almost eight hours so --

MS. KAMINSKY: Yes.

MS. ANDRADE: -- I don't think that that's --

MS. KAMINSKY: No. I think what you do here is very important. And like everyone else has said, I understand the magnitude of this. I've spent -- I hate to tell you this because then it gives away my age, but I have spent close to 20 years in the engineering areas where transportation and logistics is a huge factor.

So I understand the importance of what you're doing and the difficulty of fitting all of this in. And what I'm saying is, in order to help, please make sure that everything is following rules, regulations, orders, and directives so that we have the best possible transportation system instead of something that can be -- have holes in it because of a slipshod management style.

MR. WILLIAMSON: Somebody else down there have a question or comment?

MR. HOUGHTON: I just -- I guess this letter means nothing in your opinion?

MS. KAMINSKY: No, it's not that it means nothing. It's that, until we get something from FAA in Washington, D.C., who actually created the directive in the first place --

MR. HOUGHTON: Well, this is from the FAA.

MS. KAMINSKY: It's from FAA Southwest. And we had --

MR. HOUGHTON: Well, it's from the FAA.

MS. KAMINSKY: We had requested that she go to FAA, Washington, D.C., because there is a gap between --

MR. HOUGHTON: That's not --

MS. KAMINSKY: -- the thinking there.

MR. HOUGHTON: That's not part of the FAA?

MS. KAMINSKY: It's part of the FAA, but they're -- one is a subdivision of the larger. And we had asked, please go ask the larger entity.

MR. JOHNSON: You asked that of Naomi Sanders.

MS. KAMINSKY: Yes.

MR. JOHNSON: And did you get a response?

MS. KAMINSKY: Never.

MR. JOHNSON: Was that -- what was the timing of your request?

MS. KAMINSKY: We didn't put a timing on there. We --

MR. JOHNSON: I mean, no, when did you do --

MS. KAMINSKY: October --

MR. JOHNSON: -- when did you --

MS. KAMINSKY: We asked --

MR. JOHNSON: October 23 --

MS. KAMINSKY: -- October 23, 2003.

MR. FULTON: Maybe I could try, just very quickly -- I know it's been a long day -- to provide a little additional clarification on funding eligibility. There are about 180-some airports in the national airport plan -- general aviation airports in Texas. They are all eligible for federal funds until the FAA makes a formal determination -- a formal determination that they are no longer in compliance. That's a formal process. So you are eligible until proven otherwise.

There have been issues that McKinney's had to discuss with FAA over the years. But I came to work here in 1992. McKinney had never been in formal non-compliance since the day I came to work. So until they are in formal non-compliance they're eligible for federal funding. There's a process that has to be gone through.

MR. NICHOLS: Mr. Chairman?

MR. WILLIAMSON: Mr. Nichols.

MR. NICHOLS: Let me say that I very much appreciate the citizens -- you all coming. You all have been here before. I hope you feel like you were treated courteously by us, and felt comfortable making your presentation.

I just happen to disagree. I feel like that the FAA has considered this airport eligible, as well as these others. I feel like these airports need these rents to expand it and provide the services that are necessary in the state. And I will so move that we accept this minute order.

MR. WILLIAMSON: Yes, I want to -- oh, go ahead, please.

MS. ANDRADE: Second it.

MR. WILLIAMSON: And, Don and Cindy, if I -- you know, if I can't say that, then, Ms. Kaminsky and Mr. Keithly -- you all have been here many times before. And you know we are a fairly lighthearted bunch. We try to keep things light and moving along. But we do take very seriously any citizen that comes here, and probably more so than most state agencies.

I appreciate the fact that you will continue to argue your position, and I hope that we'll hear from you again. My conclusion is that we're a pass-through agency. It's not our position to make those decisions that you ask us to make.

MR. JOHNSON: Could I ask basically same question of Mr. Fulton?

MR. WILLIAMSON: Second's withdrawn? Motion's withdrawn?

MR. NICHOLS: No. I'm not --

MR. JOHNSON: Commissioner, before we vote, if that's all right.

MR. WILLIAMSON: I don't how much -- how much text can we have before we vote, Richard? Much as I want?

MALE VOICE: [indiscernible].

MR. WILLIAMSON: Go ahead, Mr. Johnson.

MR. JOHNSON: David, the Chair mentioned his perception -- and it is mine also -- that we are basically a conduit of federal funds in this case, and that the responsibility of compliance does not fall within TxDOT, but instead, with the Federal Aviation Administration. Is that --

MR. FULTON: Absolutely. We have no authority to determine which airport is eligible and which airport is not eligible.

MR. JOHNSON: Thank you.

MR. FULTON: That's a federal jurisdiction.

MR. JOHNSON: I just wanted to confirm that. Basically, I feel the same way that the Chair does.

MR. WILLIAMSON: That's been my perception the last four or five times we've been through this. And we're going to listen to them every time they show up, and if I ever get thrown out I guess we're going to say no the next time.

So I have a motion and a second. All those in favor signify by saying ayes.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. FULTON: Thank you.

MR. WILLIAMSON: Thank you.

MR. BEHRENS: All right. Agenda Item Number 8, our rules for proposed adoption. We have one rule for proposed adoption concerning some revisions in our travel information rules. And, Doris --

MR. WILLIAMSON: Man, that so upset Robert he had to leave.

MS. HOWDESHELL: Good afternoon. For the record, my name is Doris Howdeshell, and I'm the director of the Travel Division here at TxDOT. In the interest of time I'll be brief, but I'll be glad to answer any questions.

The minute order that you have before you today proposes the adoption of various amendments to update Chapter 23, which would improve customer service in advertising, update rules regulating businesses that participate in travel programs, and clarify the distribution of multiple quantities of travel literature.

The amendments will also allow for the distribution of travel safety literature. And it proposes the repeal of 23.11 concerning InfoBords, which is a program that we no longer have. It's been discontinued. I recommend approval of the minute order.

MR. WILLIAMSON: Are you still mad that we're making you take advertising?

MS. HOWDESHELL: Oh, no, we're not mad at all. At the end of fiscal year 2003 we had sold $625,000 of advertising net in Texas Highways Magazine. That's after the commissions were paid to a contractor and ad agencies.

MR. WILLIAMSON: Maybe we ought to just hand over all the State's publications to you.

MS. HOWDESHELL: Well, we also made $325,000 in the Texas State Travel Guide. So our take was a little over a million dollars in ads.

MR. WILLIAMSON: This Agency's all business. That's one of the reasons I love it. Members, do you have any questions for or comments directed to Doris? (Pause.) Robert, what about you? (Pause.) Robert doesn't have anything to say. Do I have a motion?

MR. HOUGHTON: So move.

MR. WILLIAMSON: Do I have a second?

MS. ANDRADE: Second.

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

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: The motion carries. Thank you, Doris.

MS. HOWDESHELL: Thank you.

MR. WILLIAMSON: Keep that cash flow coming.

MR. BEHRENS: Agenda Item B(1), rules for final adoption. This concerns contract management.

MR. WILLIAMSON: Plus we made Doris wait almost nine hours.

MR. BEHRENS: And Amadeo will present this proposed -- or this rule for final adoption concerning contract management.

MR. SAENZ: Good afternoon, Commissioners. For the record, I'm Amadeo Saenz, assistant executive director for Engineering Operations.

Minute order before you has final adoption of amendments 9.11, 9.12, 9.15 through 9.17 concerning improvements to contracts. Texas Transportation Code, Chapter 223, subchapter A, prescribes the method by which Texas Department of Transportation receives competitive bids for improvement of highways that are part of the state highway system.

Pursuant to this authority the Texas Transportation Commission has previously adopted Sections 9.10 through 9.17 to specify the process by which the Department will administer and manage the highway improvement contracts.

The Department recently revised definitions in its standard specifications for construction of highways, streets, and bridges. This Commission -- this minute order -- the Commission, by Minute Order 109576 dated February 26, 2004, proposed amendments to 9.11, 9.12, 9.15 through 9.17. No comments were received. Staff recommends adopting this.

MR. WILLIAMSON: Is the matter last month that Tommy Bohuslav brought to us?

MR. SAENZ: No, sir. This is just -- that will come to you next month as proposed.

MR. WILLIAMSON: Questions or comments, Members, on this agenda item? (No response.) Do I have a motion?

MR. JOHNSON: So move.

MR. WILLIAMSON: A second?

MS. ANDRADE: Second.

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

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion passes.

MR. BEHRENS: Agenda Item 8B(2), another rule for final adoption concerning travel information and an MOU that Doris will present.

MS. HOWDESHELL: Again, for the record, my name is Doris Howdeshell, director of the Travel Division. And the minute order that you have before you repeals 23.40 concerning the Memorandum of Understanding with the Texas Department of Economic Development, the Texas Parks and Wildlife Department, the Commission on the Arts, and the Texas Historical Commission.

And when you are repealing this you are actually repealing a memorandum of understanding which was signed in 2000. But that memorandum of understanding has been updated, and Mike signed a new memorandum with these entities in December of 2003. And it is not required to be adopted by rule. So this takes the old one off the books. There were no comments received during the comment period, and we recommend approval.

MR. WILLIAMSON: Members, are there questions or comments about this minute order?

MR. JOHNSON: If we don't do this does it mean that we have two memorandums of understanding in conflict with one another that are outstanding at the same time?

MS. HOWDESHELL: I may have to refer to legal counsel on that but --

MR. JOHNSON: I'll withdraw the question.

MR. WILLIAMSON: Do I have a motion?

MS. ANDRADE: So move.

MR. WILLIAMSON: Have a second?

MR. JOHNSON: Second.

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

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MS. HOWDESHELL: Thank you.

MR. WILLIAMSON: Thank you, Doris.

MR. BEHRENS: Agenda Item Number 9 concerning right of way acquisition. This will be to authorize the use of options to purchase right of way on FM 1460 in Williamson County, which will be the first opportunity that we've talked about it.

MR. WILLIAMSON: Do we have the Sony videocam? I mean, this is like a family picture photo moment -- our first option.

MR. JOHNSON: Who is this guy? I haven't seen this.

MR. WILLIAMSON: John Campbell -- Mr. Option.

MR. CAMPBELL: Aging steadily since last I visited. Good evening everybody. For the record, my name is John Campbell --

MR. WILLIAMSON: Good evening.

MR. CAMPBELL: -- the director of the Right of Way Division. I'd like to present for your consideration Minute Order Agenda Item Number 9 to authorize the first pilot use of an option contract for the potential future purchase of right of way required for FM 1460 in Williamson County.

This minute order provides the authority for the Austin District Engineer to negotiate the execution of option contracts and to expend funds for option fees and expenses.

The timely execution of option contracts will effectively purchase the development rights during the interim period before regularly scheduled right of way acquisition commences in approximately two years.

It should result in lower cost, less complicated negotiations, and therefore, more efficient acquisition process. Staff recommends your approval.

MR. WILLIAMSON: This is great. I'm not kidding you. This is great. Questions or comments for John?

MR. NICHOLS: I had a comment.

MR. WILLIAMSON: Please.

MR. NICHOLS: This being new to all of us -- I mean, I've done options on real estate before -- but I would just request that, as we go through a couple of these -- or you all go through and get them locked in, I'd kind of like for you to report on what the deal was and what the -- what amount for the option and the time periods and -- the key ingredients. I don't want to see the option, just some of the key bullet points related to it.

MR. CAMPBELL: Sure. The terms and the methodology for developing the fees?

MR. NICHOLS: Yes.

MR. CAMPBELL: Certainly.

MR. WILLIAMSON: John, I can't -- don't move. I just can't see. Steven -- is Randall Dillard back there, Steven? Is Randall Dillard back there? (Pause.) Boy, that man walks fast for five o'clock in the evening. Did you see that?

MALE VOICE: You ought to see him on his motorcycle.

MR. WILLIAMSON: Okay.

MR. CAMPBELL: We could have Jim Randall run up here if you'd like.

MR. WILLIAMSON: Boy, you are on a roll today, Campbell. You'll be buying dinner for everybody before tonight's out. Any other questions or comments?

MALE VOICE: That won't be long from now.

MR. WILLIAMSON: No, it won't. Okay. Well, I'm real excited about this, John. I know it's been tough getting here, but this is a good tool I think. Do I have a motion?

MR. JOHNSON: So move.

MR. WILLIAMSON: Do I have a second?

MR. HOUGHTON: Second.

MR. WILLIAMSON: I have a motion and a second. All those in favor of the motion signify by saying aye. (A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries. Thank you, John.

MR. BEHRENS: Item Number 10 is a donation and exchange of real property in Rusk County. This concerns mining operations where they're asking for us to move one of our roads and will build another one for us. Richard?

MR. MONROE: Yes, sir. Good afternoon, Commissioners. For the record, my name is Richard Monroe. I'm General Counsel for the Department.

If you approve this minute order, which I would urge you to do, TXU Mining will be able to expand its mining operation. Concurrently with that, they will build us a new road which is better than the old one, and then will transfer to us the new right of way. We will then transfer formally to them the former right of way, which will allow them to expand their mining operation.

So even though I'm not particularly fond of the phrase, this seems to be a win-win for everybody.

MR. WILLIAMSON: He doesn't think there was such a thing as a win-win.

MR. MONROE: My previous view was if there is a win-win solution to the situation there was never a situation to begin with. But this seems to qualify.

MR. WILLIAMSON: Okay. Members, are there questions or comments for our esteemed general legal.

MR. JOHNSON: Question.

MR. WILLIAMSON: Yes, sir.

MR. JOHNSON: Are there any private landowners other than TXU --

MR. MONROE: No, sir.

MR. JOHNSON: -- who are involved as adjacent to the road or --

MR. MONROE: No, sir. They are the adjoining landowner.

MR. JOHNSON: Either old road or new road?

MR. MONROE: Right. That's correct.

MR. JOHNSON: So this is entirely on their fee-owned surface?

MR. MONROE: Well, not --

MR. JOHNSON: The new road will be --

MR. MONROE: The new road. Yes, sir.

MR. JOHNSON: And then the old road will be transferred to them.

MR. MONROE: Yes, sir.

MR. JOHNSON: And there are no neighboring tracks to the old road that -- where other landowners might be affected by this transaction.

MR. WILLIAMSON: Just your old family place in east Texas where they're cutting you off.

MR. MONROE: No, sir.

MR. JOHNSON: Okay.

MR. WILLIAMSON: You won't have access to your place anymore. Okay. Is there a motion?

MR. JOHNSON: So move.

MR. WILLIAMSON: Second?

MR. HOUGHTON: Second.

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

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. MONROE: Just before I leave -- and I know it's late, but I -- speaking of TxDOT dedication, there are some people from the district who have stayed here all day. They might want to hold up their hands or something.

MR. WILLIAMSON: Well, now, are they from our district or are they from TXU's district?

MALE VOICE: Tyler district.

MR. MONROE: They have a TXU representative, but two people from the district that just wanted to make sure this got done today. And they're still here.

MR. WILLIAMSON: East Texas. Jackson territory.

MR. BEHRENS: Okay. Agenda Item Number --

MR. WILLIAMSON: Jacksonville territory. I'm from Jacksonville.

MR. BEHRENS: Agenda Item Number 11 --

MR. WILLIAMSON: So you got what you wanted. And now you're leaving?

MALE VOICE: If they wait 30 minutes it will be an hour shorter drive.

MR. WILLIAMSON: Are you sure you want to leave? Just as long as you know, until we adjourn we can always withdraw and back out of -- okay. Carlos.

MR. LOPEZ: Okay. Item 11. Good afternoon, Commissioners. My name is Carlos Lopez. I'm director of the Traffic Operations Division.

The minute order before you authorizes the creation of a left-lane restriction for trucks on I-35 in Hays, Williamson, and Travis Counties. The restriction would prohibit trucks from operating in the far left lane on I-35 in those three counties. Trucks would be allowed to use this lane to pass other vehicles.

The Austin District conducted a traffic study and determined that such a restriction could be beneficial to safety and mobility. TxDOT believes that the safest driving conditions exist when vehicles are not traveling in widely different speeds.

Typically, large trucks take much longer to accelerate than passenger cars. And when this happens lane changes and -- tend to be more frequent and exaggerated as faster vehicles try to pass slower-moving trucks. A similar lane restriction in Houston resulted in a 68 percent reduction in crashes.

The Department published a notice requesting public comment in the February 13, 2004, edition of Texas Register, and held a public hearing on March 4, 2004. The Department received 31 written and verbal comments, and a summary of these comments in included in your briefing material.

We believe that this restriction can be beneficial to safety and mobility and recommend approval of this minute order.

MR. WILLIAMSON: I don't know, Carlos. We've all got some doubts about this one. Questions or comments, Members. This is Carlos' idea. If it doesn't work it's his fault.

MR. NICHOLS: I think I've got most of my questions answered. I talked to him on the phone and sent mail -- and respond to my e-mail. A lot of my questions dealt with -- if we implement -- when we implement it, or if -- once implemented I wanted to make sure we had some point in time where we went through and did a full review or analysis of the result of this.

Because we're -- although I'm sure it's very favorable to passengers, you know, it's obviously making a pretty good inconvenience to the trucking industry. And if we're saving people and reducing accidents I'm sure it's worth it.

If, on the other hand it increased accidents, because of the extra weaving or whatever, I want to make sure that we're in a position that the executive director can step in and take whatever actions are necessary, if something goes awry.

MR. LOPEZ: Yes. And Mike can do a temporary suspension if something were to go really wrong. And then you all could come back and officially rule on it.

MR. NICHOLS: And at some point in the future we're going to get a study or a report on --

MR. LOPEZ: Yes.

MR. NICHOLS: -- what actually --

MR. JOHNSON: And Carlos, I would assume we would do the same monitoring we did on Houston.

MR. LOPEZ: Yes, we will. We will do this on all our lane restrictions around the state -- do a one-year after study and see how things are going.

MR. NICHOLS: But we have to wait a whole year to find out how it's going?

MR. LOPEZ: That's typically a good time period to get a good snapshot of what's really happening. But it's been the baseline that we used in Houston. At this point we hadn't seen to go any shorter intervals.

MR. JOHNSON: Carlos, specifically, how does this compare to the specific action that was on I-10 East in Houston?

MR. LOPEZ: This one's going to be a little different because it's going to be a 24/7 operation. The one we had on I-10 East in Houston was something like 6:00 a.m. to 8:00 p.m. That's been a lot of discussion here locally about that time period. And the law enforcement agencies locally say they prefer to do it in the 24/7.

MR. JOHNSON: Well, my impression is that one of the reasons that the program was so successful on I-10 East in reducing accidents was because it was enforced. Is there a commitment from law enforcement agencies in Hays, Travis, and Williamson Counties that this likewise will be enforced?

MR. LOPEZ: Yes.

MR. WILLIAMSON: I'm telling you there's some problems with this thing. Any other questions or comments?

MR. JOHNSON: The fines that are collected for violations, any of that money go into the Mobility Fund?

MR. WILLIAMSON: It's going down, Carlos. I'm telling you, it's going down. This will be the first minute order to fall in six years.

MR. LOPEZ: Wherever the traffic ticket fines go at that time, that's where they would go.

MR. BEHRENS: If they get multiple violations it would goes to the Mobility --

MR. LOPEZ: Yes.

MR. WILLIAMSON: Oh, you got that down pat, don't you? In studying that money.

MS. ANDRADE: I have a question.

MR. LOPEZ: Yes.

MS. ANDRADE: Carlos -- I think you can hear me. There's not anybody left. Besides the fact that we're going to post signs --

MR. LOPEZ: Yes.

MS. ANDRADE: -- what other means to we use to let the truckers know that this is going to happen?

MR. LOPEZ: That is the main means of letting them know. We'll do a lot of advance signing prior to the beginning of the limits. We'll say, No trucks left lane one mile, no trucks left lane half-a-mile ahead. And then we'll periodically post signs saying, No trucks left lane, about every mile along this route. So it will be very apparent to the whole driving public that no trucks are allowed in the left lane.

MR. WILLIAMSON: And Carlos, you're sure that you want to be the Department employee who advanced this idea to shut down trucks on Interstate 35.

MR. LOPEZ: I can already claim a 68 percent decrease in crashes, so I'm starting ahead I think.

MR. WILLIAMSON: Okay. Any other questions or comments, Members?

MS. ANDRADE: So move.

MR. NICHOLS: Second.

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

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries. Mr. Houghton left so that he wouldn't be associated with that particular minute order.

(General laughter.)

MR. LOPEZ: Thank you, Commissioners.

MR. BEHRENS: Agenda Item Number 12. We have our SIB applications.

MR. WILLIAMSON: James Bass, good to see you again.

MR. SIMMONS: Good evening, Commissioners.

MR. BEHRENS: And I don't know who's going to present this minute order, but somebody will.

MR. WILLIAMSON: That's not James Bass. That's Steve Simmons.

MR. SIMMONS: For the record, I am not fast Jimmy Bass; I'm steady Steve. And I'm here to present Agenda Item 12(a) for Mr. Bass, who had to leave the meeting to go to another meeting. But he has been able to come back after that meeting because of the time limits there.

But I'm here to present Agenda Item 12(a) which seeks final approval -- oh, and he also said that this was so simple that even I could make the presentation. So --

MR. WILLIAMSON: Steady Steven can do it.

MR. SIMMONS: Agenda Number 12(a) seeks final approval of a loan to the City of Atlanta in the amount of $1 million to pay for the relocation of utilities made necessary by the reconstruction of FM 249 from US 59 to FM 785.

Interest will accrue from the date funds are transferred from the State Infrastructure Bank at a rate of 4.7 percent, with payments being made over a period of 15 years.

I recommend approval of this minute order and that you not ask me any difficult questions.

MR. WILLIAMSON: Members, questions or comments?

MR. NICHOLS: Comments. Mr. Chairman, the -- I'm supportive of both of these, so I will move that we approve these. But on the comment area, I want to remind the Commission and administration that where our State Infrastructure Bank balance continues to drop -- is rapidly reaching the bottom, and we're going to be faced with making a decision that falls in one or two or three categories.

Either, number one, we put some fresh money in it, which, then, on the negative side, we have to reduce construction spending to put money in it. And then we taint all the rules of our -- the money that's in the State Infrastructure Bank because we will fall under the T-21 provisions, which are not very favorable. So that doesn't look like a good option.

Number two, we have to keep waiting until T-21 or T-23 or whatever it's going to be called -- T-20 --

MALE VOICE: Safe T.

MR. NICHOLS: Safe T. Well, whichever name -- they haven't even decided on a name.

MALE VOICE: That's correct.

MR. NICHOLS: And hope that it has favorable rules, which I'm not too hopeful that it will, or quit -- suspend loaning or something. We're going to have to make a decision.

MR. WILLIAMSON: Let me ask you something. And maybe I should be asking Steve Simmons this question, but I'll ask you instead.

MR. NICHOLS: Me?

MR. WILLIAMSON: Could we just set up our own like little mini-SIB -- like a TEX-SIB?

MR. NICHOLS: It might be possible that we can look -- can we loan money straight out of Fund 6 to communities?

MALE VOICE: Basically, we don't -- the only authority we have to do that is under the provisions of the Legislature and the State Infrastructure Bank, as I understand it.

MR. WILLIAMSON: So we can't sell like a million dollars of Pickett Bonds and loan that?

MALE VOICE: No, sir.

MR. WILLIAMSON: How about Mobility Fund?

MALE VOICE: Don't do it. There may be at some point a chance under the Mobility Fund to establish it at some point in the future.

MR. WILLIAMSON: Well, what do we do, Robert, because we can't stop making these little loans?

MR. NICHOLS: I've been waving this flag for six to nine months.

MR. WILLIAMSON: I know, but you're also a solutions guy. Quit waving the flag and pick up the sword. Let's go.

MR. NICHOLS: Well, there's three options. We can taint the funds -- we can run out of funds and quit loaning the money.

MR. WILLIAMSON: Well, find a fourth because there's got to be a way of doing it. Pick up the sword of righteousness. Let's go.

MR. NICHOLS: Well, we kept hoping the federal government would re-establish our six-year program.

MR. WILLIAMSON: Those guys?

MR. NICHOLS: Which they still may in the next month or two, but I doubt it.

MR. WILLIAMSON: So what's the answer? Is there any way we can loan some money?

MR. SIMMONS: We still have money in the SIB right now.

MR. WILLIAMSON: Steady Steve?

MR. SIMMONS: And we are still being reimbursed for the loans that have -- that are outstanding.

MR. WILLIAMSON: What part of the -- hey, James, have you got a list of everybody we've got loans to? Not with you. Send me a copy, will you? Work on an idea.

MALE VOICE: We get one every month.

MR. WILLIAMSON: Not the book though. I just want just a piece of paper and it's got the names on it. But it's the brown book. I know that. I read my stuff.

MALE VOICE: It's in that book.

MR. WILLIAMSON: Sir?

MALE VOICE: It's in that book.

MR. WILLIAMSON: Right. I read my stuff, I'm thinking if you've got just the page you can send it up to me.

MR. NICHOLS: What's the long  --what's the terms -- what's the longest term of the -- of any one loan in years or months?

MR. WILLIAMSON: Don't let Steve off the hook. He wanted to do this.

MR. SIMMONS: I believe it's 35 years. There's one with the City of Laredo where there was a five-year period delayed on one of their international bridges to allow for their ramp-up period. And then there's a payback of 30 years when they --

MR. NICHOLS: That's a $28 million loan, too --

MR. SIMMONS: Correct.

MR. NICHOLS: -- the second largest loan we have in the portfolio.

MR. SIMMONS: Correct. And the -- and another one with the long term of around 30 years is to North Texas Tollway Authority in the neighborhood of 145 million.

MR. NICHOLS: Which is the largest loan in the portfolio.

MR. WILLIAMSON: I thought they paid that back.

MR. SIMMONS: No. That loan initially -- you know, originally had been made out of the State Highway Fund operating dollars.

MR. WILLIAMSON: Okay.

MR. SIMMONS: And what we did is transferred that to the State Infrastructure Bank.

MAKE VOICE: This could be a Prop 14 bonds.

MR. NICHOLS: There's a couple of long-term -- real long-term ones that gobble up a lot. Overwhelmingly, the great majority of the actual loans, like you see every month, are in the, you know, to threeB to probably fiveB or six-year range.

MR. SIMMONS: One of the things that may be helpful -- I know a lot of it's, as many things we do at TxDOT, are timing or cash flow issues, the NTTA loan -- the first payment received off that that we'll get is due in -- this October of $3 million, which could help fund several of the smaller community loans.

And then, beginning in January of '05, they move to a January cycle where they begin making annual payments, and as you might imagine, rather significant. I think January '05 it's another 5 million that will be coming in from that.

MR. NICHOLS: Counselor, you said we could only -- we can't loan money out of Fund 6 to communities, but we can for toll roads? Okay. So like the NTTA loan, that originally was loaned to them out of Fund 6, we turn it around and swap that loan out of State Infrastructure Bank -- would that be a possible -- hey, I almost hate to bring this up. But is that -- there a possibility we switch it back, and, in effect, replenish the SIB Bank? Reloan part of the NTTA fund that's out of the SIB --

MR. WILLIAMSON: Or -- let me add to that question. This is why he was afraid to bring this up. What if we bought 10 percent of NTTA's equity and then had them pay us back our SIB loan? Wouldn't that go back into the SIB Bank?

MR. NICHOLS: It's a capital call.

MR. MONROE: It could. I would hasten to add that what we do with that loan would involve the other party to the loan. I mean, we can't necessarily just do whatever we like. They would have to agree to it.

MR. WILLIAMSON: I guess you're right. See, I told you we needed to buy NTTA. Okay. What part of the state do these two -- Steve, what part of the state do these two things involve? Where are these?

MR. SIMMONS: Well, Item 12A is the City of Atlanta.

MR. WILLIAMSON: And where is that?

MR. SIMMONS: That is in our Atlanta district.

MR. WILLIAMSON: Just north of --

MR. SIMMONS: That's northeast.

MR. WILLIAMSON: Of -- and where's Linden?

MR. SIMMONS: Linden is close to the Atlanta district -- to the City of Atlanta.

MALE VOICE: That nails it down.

MR. WILLIAMSON: Okay. Are there other questions or comments for Steady Steve Simmons? (No response.) Do I have a motion?

MR. JOHNSON: So move.

MR. WILLIAMSON: Do I have a second?

MR. HOUGHTON: Second.

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

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries. Now, you've got Linden.

MR. SIMMONS: Yes, sir. Item 12(b) --

MR. WILLIAMSON: Don't even know where Linden is.

MR. SIMMONS: It's just east of Atlanta.

MR. WILLIAMSON: You don't even know where Linden is.

MR. SIMMONS: It's south? What's the city --

MR. WILLIAMSON: Oh, you don't even know where Linden is. Linden's on the northern outskirts of Tyler. Yes.

MALE VOICE: That's Lindell.

MR. WILLIAMSON: Well, where is Linden?

MALE VOICE: In Cass County.

MR. SIMMONS: Next to Atlanta.

MR. WILLIAMSON: It's not east of Atlanta.

MALE VOICE: See the county?

MR. WILLIAMSON: Yes. Are you going to explain this or are you going to sit up there and let me roast?

MR. SIMMONS: I'm waiting for you all to finish discussion. Item 12(b) seeks final approval of a loan to the City of Linden in the amount of $400,000 to pay for the relocation of utilities made necessary by reconstruction of US 59.

Interest will accrue from the date funds are transferred from the State Infrastructure Bank at a rate of 4.1 percent, with payments being made over a period of seven years. Once again, recommend approval.

MR. WILLIAMSON: Questions or comments for Steady Steve Simmons?

MR. JOHNSON: So move.

MR. HOUGHTON: Second.

MR. WILLIAMSON: I've got a motion and a second. All those in favor of the motion signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries. East of Atlanta is Bloomburg, Arkansas.

MR. SAENZ: Everything is -- it's southwest of Atlanta, but everything is southwest of Atlanta.

MR. BEHRENS: Agenda Item Number 13, our contracts for the month of May.

MR. SAENZ: Good evening, Commissioners. I saw you this morning, I saw you this afternoon, and seeing you this evening. For the record, I'm Amadeo Saenz, assistant executive director for Engineering Operations. And I'm playing Thomas Boshulav.

MR. WILLIAMSON: Boshulav.

MR. SAENZ: No, no. Boshulav. And I've got to fix the podium so that it thinks it's him. Agenda Item 13A(1) is -- the minute order before you authorizes the award of highway maintenance contracts that were let on May 11 and 12 of 2004, whose engineer estimates are greater than $300,000 or more.

We had a total of eleven projects. We had an average of 3.7 bidders per project. Our bids came in at 8.35 percent under engineers' estimates. Staff recommends award of all maintenance contracts that's shown on Exhibit A.

MR. WILLIAMSON: Questions or comments for Amadeo on this motion, Members.

MR. NICHOLS: I so move.

MR. JOHNSON: Second.

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

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. SAENZ: Thank you, Commissioners. Item 13A(2). Minute order before you authorizes the award or rejection of highway construction contracts that were let on May 11 and 12, 2004, as shown on Exhibit A.

We had 83 projects and we had 4.27 bidders per project -- let over $294 million. The bids came in at 1.8 percent above our engineers' estimates. Staff recommends rejection of one project. This project provides for the replacement of two off-system bridges in Scurry County. I hope you don't ask me where Scurry County is.

MR. WILLIAMSON: I know where it is.

MR. SAENZ: It's for a structure on County Road 302.

MR. WILLIAMSON: I'll bet you John knows where it is.

MR. SAENZ: Quantities for Item 425, pre-stressed concrete beams Type C was inadvertently left out of the contract proposal. This caused some errors to be caused and bidder confusion. Therefore, we reject that -- we recommend that this contract be rejected and be -- relet the contract in July of 2004.

In addition, we had one bid error allegation received on a project in Harris County on State High 249. Staff has reviewed the information submitted by the contractor, B. C. Fields, in accordance with our procedures that are -- that we use for analyzing planning bid errors. Staff has determined that the contractor did not submit a bid error as defined by Texas Administrative Code, Title 43, Rule, Subsection 9.16. Therefore, staff includes this project as one of the projects that we are recommending for award. Staff recommends that we award all the remaining projects as shown on Exhibit A.

MR. JOHNSON: Amadeo, how much was the contract where the bid award -- bid error was alleged?

MR. SAENZ: It was 188 -- our estimate was 188,000, and the contractor had bid 169,000. It's a small contract for some installation of some storm sewer -- making storm sewer improvements in Houston.

MR. WILLIAMSON: This the first time in quite a while we've been over?

MR. SAENZ: This is the first time. Part of it probably may be attributed to the rising steel prices and --

MALE VOICE: Or it could be the fuel also.

MR. SAENZ: And also the fuel prices.

MR. WILLIAMSON: But this is the first time in quite a while we've been over. Right?

MR. SAENZ: That's correct.

MR. WILLIAMSON: I've got a memo from Thomas. Since you're playing Thomas I'm sure you can answer this. It's to you and Stevie -- Steady Stevie on the public notice format.

MR. SAENZ: Yes, sir. I sent that to you for comments.

MR. WILLIAMSON: And have we provided this to all the Commissioners?

MR. SAENZ: No. I sent it to you for comments first. I figured I would work with you and then I'd work with the other Commissioners.

MR. WILLIAMSON: Okay. Well, I am only one of five in this regard. This is okay with me, but we need to see --

MR. SAENZ: I will forward it to the other Commissioners. That's kind of the format --

MR. WILLIAMSON: To me, it's a lot clearer, but it may not be -- Robert sees things I don't see sometimes, so it --

MR. SAENZ: We will forward it to the other Commissioners to get some comments. This will be what the Attachment A would look like and what will also be put out in this format.

MR. WILLIAMSON: As I said, I'm only one of five in this matter -- regard. I did ask Amadeo to do something for me to make --

MR. SAENZ: What we tried to do, we combined the projects by district and also ran a tabulation so that we have at any -- we know how much was let in every district --

MR. WILLIAMSON: And I'm also not a fan of this. I'm a fan of being able to --

MR. SAENZ: We will circulate that memo among the other Commissioners and get some comments.

MR. WILLIAMSON: Okay. I -- are there others questions or comments for Amadeo, Members? (No response.) Do I have a motion?

MR. HOUGHTON: So move.

MR. WILLIAMSON: Do I have a second?

MR. JOHNSON: Second.

MR. WILLIAMSON: I've got a motion and a second. All those in favor of the motion signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries.

MR. SAENZ: Thank you, Commissioners. Item 13B. The minute order before you approves a contract between the Texas Department of Transportation and Halff Associates, Incorporated. Halff Associates, Incorporated employees Mr. Charles W. Heald, a former executive director for the Texas Department of Transportation.

Government Code 669.003 requires that, in order to enter into a contract with a company that employees a former executive director -- in this case, Mr. Heald -- within the first four years after he has served in that position, the Texas Transportation Commission must approve all contracts in an open meeting.

The Department advertised for engineering services and has -- and Halff was chosen to be the provider in accordance with a competitive selection and negotiation procedures set forth in our Government and Administrative Codes.

The contract is a standard $250,000 contract for engineering services to be performed in all counties in the Fort Worth District. Staff recommends approval of this minute order.

MR. NICHOLS: Let me ask a question. I mean, I'm going to support this because we've been doing this before. But we've got, like, several other former executive directors who are employed --

MR. SAENZ: We have to do for the first four years after they have --

MR. NICHOLS: Just for four years.

MR. SAENZ: Yes, sir.

MR. NICHOLS: So like Bill Burnett doesn't count because he works for a contractor.

MR. SAENZ: Right. And --

MALE VOICE: His four years are up.

MR. SAENZ: And his four years are already --

MR. NICHOLS: His four years are up. And Bob Cuellar doesn't count.

MR. SAENZ: Right. And his four years would have been -- he was acting executive director for a short time. But his four years are up also. So the only one that we --

MR. WILLIAMSON: I don't ever remember having approved these things on like Bob.

MALE VOICE: Well, Richard might -- he was just appointed as interim director.

MR. WILLIAMSON: Oh, interim didn't count?

MR. JOHNSON: Well, and those were all probably won by bid also as opposed to --

MR. SAENZ: Bob Cuellar works for an engineering consulting firm.

MR. WILLIAMSON: I can assure you an engineering firm --

MR. SAENZ: We have to do it I think for about -- we have to do these for Mr. Heald for about one more year I think.

MR. WILLIAMSON: What gets me is that I don't know that we want to approve this because we never see that guy anymore. He never comes around here, he never calls on it, he never -- you know. So we need to put a hold --

MR. SAENZ: I don't care if you put it on the record that you'd like to see him the next time we award one of those contracts, and he would be here.

MR. WILLIAMSON: No. It looks like a former executive director would come around and check on his crew every once in a while.

MR. SAENZ: He might be out playing golf.

MR. NICHOLS: Mr. Chairman, I so move that we accept this minute order with -- and also add with an addendum that we request a visit from Mr. Heald.

MR. WILLIAMSON: That got the lawyer up.

MR. NICHOLS: Oh, you want me to take that part off? Is that a real problem?

MR. MONROE: It could be.

MR. NICHOLS: All right. Let me say, informally, you all -- it might be nice if you see him to ask him to come by.

MR. WILLIAMSON: Not part of the motion.

MR. NICHOLS: Do what?

MR. WILLIAMSON: Not part of the motion.

MR. NICHOLS: Not part of the motion. That make you feel better?

MR. SAENZ: Thank you, Richard.

MR. MONROE: It might make Mr. Heald to feel better if he happens to get called in front of a judge, yes.

MALE VOICE: We miss him.

MR. NICHOLS: Anyway, that's my motion.

MR. WILLIAMSON: Okay.

MR. HOUGHTON: Second.

MR. WILLIAMSON: The Minute is printed. It has been moved and seconded. All those in favor of the motion signify by saying aye.

MALE VOICE: What is the motion?

MR. NICHOLS: The motion is to -- as written in the book.

MR. WILLIAMSON: We've got a motion and a second. All those in favor signify by saying aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries. Now, informally, tell Wes we gave you quite a bit of grief because he never shows up anymore.

MR. BEHRENS: Commissioners, Agenda Item 14 is our routine minute orders. They are listed in your briefing book. They were duly posted. To my knowledge, none of them have any impact on any properties or anything that the Commission might have. And I recommend approval.

MR. WILLIAMSON: Now, this traffic control signal -- State Loop 431 and Bibb Street in Eagle Pass -- we're not doing anything with the Indian casino here, are we?

MR. BEHRENS: No, sir.

MR. WILLIAMSON: We've got the National Asphalt Pavement people taking Robert to some ranch.

MR. NICHOLS: No.

MR. WILLIAMSON: Department of Energy taking John to some ranch. What is this?

MALE VOICE: Yellowstone Park.

MR. WILLIAMSON: Do I have a motion then?

MR. HOUGHTON: So move.

MR. WILLIAMSON: Do I have a second?

MS. ANDRADE: Second.

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

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries. Are we through with the regular agenda?

MR. BEHRENS: That concludes our business portion of the agenda.

MR. WILLIAMSON: Do we have a blue card comment?

(Pause.)

MR. BEHRENS: I think you outlasted it.

MR. WILLIAMSON: We are in the regular -- we are now in the open comment period of our meeting. Are there any speakers signed up for open comment?

(Pause.)

MR. WILLIAMSON: Sal Costello, are you here? (Pause.) Sal Costello. (Pause.) Sal, are you here? (Pause.) Sal is not here. Okay. Is there any other business to come before the Commission this evening?

MR. JOHNSON: Mr. Chairman, in light of it -- the rush hour traffic having not subsided, I would request maybe that we go into executive session so we could spend a little bit more time here.

MR. WILLIAMSON: Have I canceled my hotel reservation?

MR. HOUGHTON: Would somebody like to drive me back to El Paso? Did I miss the 5:10 flight?

MR. WILLIAMSON: Well, it was a difficult meeting, but there were some good things done today. Is there any other business to come before the Commission? (Pause.) There being none, I'll entertain a motion.

MR. HOUGHTON: So move.

MR. WILLIAMSON: And second?

MS. ANDRADE: Second.

MR. WILLIAMSON: I have a motion and a second. John --

MR. JOHNSON: I guess that means no executive session?

MR. WILLIAMSON: No executive session. All those in favor say aye.

(A chorus of ayes.)

MR. WILLIAMSON: All opposed, no.

(No response.)

MR. WILLIAMSON: Motion carries. Please note for the record that it is 5:34 p.m. and this meeting stands adjourned.

(Whereupon, at 5:34 p.m., the meeting was concluded.)

C E R T I F I C A T E

MEETING OF: Texas Transportation Commission
LOCATION: Austin, Texas
DATE: May 27, 2004

I do hereby certify that the foregoing pages, numbers 1 through 356, inclusive, are the true, accurate, and complete transcript prepared from the verbal recording made by electronic recording by J. Ben Bynum before the Texas Department of Transportation.

__________06/01/2004
(Transcriber) (Date)
On the Record Reporting, Inc.
3307 Northland, Suite 315
Austin, Texas 78731