COMMISSION MEMBERS:

Ric Williamson, Chairman
John W. Johnson
Hope Andrade
Ted Houghton, Jr.

STAFF:

Michael W. Behrens, P.E., Executive Director
Steve Simmons, P.E., Deputy Executive Director
Bob Jackson, Interim General Counsel
Roger Polson, Executive Assistant to the
Deputy Executive Director

PROCEEDINGS

AUDIENCE: Good morning.

MR. WILLIAMSON: It is 9:03 a.m., and I would like to call the July 2006 meeting of the Texas Transportation Commission to order here in El Paso. I want to welcome all of you who have made your way to the chambers this morning.

And before we begin our morning meeting, know what we're fixing to do, those of you who might be first-time attendees, we always take one minute and give everybody the chance to take their cell phone out of their pocket, the PDA, Spray Berry, whatever they've got, and please join with me in putting it on the silent or vibrate mode so as to not disrupt proceedings as we move through the morning. Thank you, we appreciate you helping us do that.

It's truly a pleasure to be here in El Paso, Texas. It's our practice to take the commission meetings on the road three or four times a year, subject to where the legislature is in their semi-annual event, biannual event. It gives us a chance to see firsthand how local communities are solving their own transportation problems. It also permits us to listen to local and regional officials, share their insight and their vision for how to deal with the future. It also gives everyone in El Paso who might not have the opportunity to drive to Austin or fly to Austin to see how we conduct our business.

This is the sixth time the commission has met in El Paso. The first El Paso meeting was in May of 1958. That was John's first year on the commission.

(General laughter.)

MR. WILLIAMSON: At that special meeting, the Highway Commission -- as it was then called -- authorized the purchase of a little over two miles of right of way for the building of Interstate 10. The cost of that two miles in 1958 was $2 million which was a lot of money then but not near what it would cost today.

The city of El Paso is such a great example of the importance of transportation in our state, that it is, in fact, this location with the river crossing and the mountain pass caused the area's first inhabitants to settle.

We were studying the history of this area, as we always do, prior to taking one of our commission meetings on the road, and we found that only a few hundred people lived in the El Paso area when the railroad first arrived. Within a decade after the railroad's construction, the population was over 10,000. It was, of course, at that time the wild west, and I suspect that bringing the railroad here didn't do anything but do anything but create more of that. We that grew up in central west Texas and west Texas note with fond memory the great song of El Paso written by Marty Robbins about this wonderful city.

At last month's commission meeting in Austin we recognized the 50th year anniversary of the creation of the interstate system. There is little doubt that the interstate here in El Paso has had a huge impact on this city and on this region. Imagine if the interstate corridor had first stayed north and not moved through the pass. This would be a much different town and a much different area today.

Please note for the record that public notice of this meeting, containing all items of the agenda, was filed with the Office of Secretary of State at 2:33 p.m. on July 19, 2006.

Since our last meeting was held in El Paso in February of 2000, several new faces have joined the commission, one appointed from this area, one appointed from the great town of San Antonio, and we like to begin our meetings with comments from each commissioner and most particular from the commissioner from El Paso. So Mr. Houghton, if you would, take it away.

MR. HOUGHTON: Thank you, Mr. Chairman, and welcome, fellow commissioners, to El Paso where I get to play a home game. It's been a little over 2-1/2 years since I've been appointed to the commission and I have looked forward to this day for a variety of reasons. We truly are a part of the great state of Texas, we've demonstrated that over the last many years, we've come together on a lot of various items regarding the growth and economic opportunity in this community.

I particularly at this time want to thank all of those who have taken their precious, valuable, I call it free time, to engage in the transportation debate that we have had going on here for the last couple of years to the creation of the new Border Mobility Coalition, to the creation of the Camino Real Regional Mobility Authority, and those people that got engaged in that, the leadership at the city and the chambers, the El Paso Chamber of Commerce, the Hispanic Chamber, I want to thank you for that.

And again, welcome for those who have come from out of town to the Pass of the North and I look forward to an interesting meeting today. Thank you.

MS. ANDRADE: Good morning. It's great to be in El Paso and it's great to be in Ted Houghton's hometown. Certainly I have seen El Paso through Ted's eyes, and now that I'm here and have gotten a tour yesterday, can understand the challenges that you and he face. But you've got some great leadership, I think El Paso has some great opportunities here, and I'm looking forward to working with you all.

Thank you very much, and thank you for the great hospitality and spent a great evening with our staff last night, so thank you.

MR. WILLIAMSON: John?

MR. JOHNSON: Mr. Chairman, thank you.

MR. WILLIAMSON: Are you trying to think about how you're going to get back at me?

(General laughter.)

MR. JOHNSON: No. As Ric said, this is my second commission meeting in El Paso, and I marvel at what has gone on in the last six years and it's indeed impressive, but as we all know in this room, there are a lot of challenges that lie ahead.

For the last four weeks at least, maybe six weeks, we've been tuned in on the debate about whether a regional mobility authority is an appropriate course of action for this community, this area, and I recognize that living -- according to the map of the state of Texas that I have -- 730 miles away in Houston, the last thing that you might want to hear this morning is somebody that's come from that far away to at least sprinkle a few of his own ideas or at least some of the conclusions that I have about this debate, but I wanted to take this opportunity to do that.

I think there are, in my mind, several pertinent questions or issues that have to be resolved, and the first question is there are six current regional mobility authorities established and active. They encompass twelve counties around this state, and these counties are diverse, both geographically and demographically, so this is not something that's cut out of a cookie cutter and is just intended for one part of the state or one area of the state.

The City of El Paso has made this request and it's been approved, but there needs to be coordination between the RMA and the MPO, so that's where the debate centers now. And so I ask you as these other counties have embraced the concept of a regional mobility authority as a solution to some of the mobility challenges that they have in their respective areas, why have they done that? I think you ought to ask them why they've done that because I don't think anybody on this dais knows the answer specifically, but as I say, they're very diverse and they're very well situated or differently situated geographically, so that would be a good question to ask.

The other thing that I asked myself, has this become a toll/no-toll debate. Consider this, what would be tolled are either new location or new capacity situations. If you have a new capacity situation, we're expanding a given corridor and adding capacity, and only the new capacity is going to be tolled. So people are going to have a choice: they can take the existing lanes that there is no toll, or they can move into what will probably be less congested lanes and pay a toll, and that's the choice that people would have.

Same thing with new location: to get from where you are to where you want to go, you are currently driving an existing route, there are no tolls on that route and you will continue to have that choice of driving that way, or if there is new location that will get you quicker and more timely to where you want to go, you have a choice of paying a toll and going that way. So there's always going to be a choice of whether you take what we would call a tax road or a toll road, so I don't think the debate between there being tolls and no tolls is really one that is well understood.

So when I draw the bottom line, the conclusion that I've come to is this debate is centered not on mobility issues and what's best for a given community but it's become a political debate, and my fear is that when it gets to that realm, the possibility exists that there's somewhat of a standoff and nobody wins. And the progress that this community has made in the last six years since the commission met here but that progress creates challenges, and there are going to be economic opportunities, it's going to bring more people, it's going to bring more congestion, and by creating a regional mobility authority and using the leverage that it has, we can do projects together a lot more quickly, and time is the most precious asset we have because we all have a limited amount of time.

Mr. Chairman, thank you for allowing me to kind of vent my feelings.

MR. WILLIAMSON: Well, thanks for your remarks, John, and yours as well, Ted and Hope.

I've got a couple of housekeeping things I need to take care of. Let me just say that I associate myself with the remarks of Mr. Houghton, Ms. Andrade and Mr. Johnson on the hospitality of El Paso and thank you very much for the last few days. From our staff and the citizens of the community, we've greatly appreciated our time here, as we did the last time we were here.

Let me also add a couple of things to John's remarks. I think all of us will tell you individually, and we say it from this dais on a monthly basis, the creation of a regional mobility authority is an option that the legislature has given you. You don't have to take that option and you don't have to go to the next step and choose a project for the RMA to supervise, but if you decide not to follow that option, we hope you'll make that decision based on good information and facts.

One of the things I learned from Pat Haggerty and Norma Chavez, when I was serving with those two great legislators, is don't argue with fools and don't debate bad information, and we tend to not do that. And I can guarantee you, Pat Haggerty practices that. We tend to follow that guidance, so you don't see us standing up and getting in a lot of local and regional fights because it's not our position to do that. We shouldn't put ourselves in that position but make your decision based on the correct information.

From now until the year 2030, based on the population statistics that we believe are accurate in the state, the transportation infrastructure world faces an $86 billion shortfall. That means that congestion in no part of the state will get better, air quality in no part of the state will get better, safety will degrade, jobs will continue to go to Tennessee, potholes will develop on our interstates if we don't find $86 billion over the next 24 years. That's just a fact.

The second fact that you should always keep in the back of your head is that no road in this state pays for itself. And I want to say it again because later on I'm sure there's going to be some disagreement from certain quarters. I want to tell you again, if you take your motor vehicle registration fee and your gasoline taxes and you apportion your miles per gallon of your vehicles driven across your roads, and if you take your audited cost and your audited maintenance, no road in this state pays for itself.

We have three options: we can raise the gasoline tax to $1.40 a gallon, we can implement this series of local, regional and statewide toll roads, or we can do nothing. Now, I guess the fourth option is that we can do something in between. But don't run and don't hide from the truth. The truth is there isn't a pot of money in Austin, Texas, the truth is El Paso does get exactly its proportionate share. Do you know how I know that? Because four years ago this commission stopped approving projects in Austin, Texas for El Paso and we allocated the state gasoline tax revenue to each region of this state on a ten-year basis. Dallas and Fort Worth and Houston and Galveston and El Paso and Corpus Christi and San Antonio know how much money each year is budgeted to them for their transportation projects.

I guarantee you, you get a flat amount of money, you don't get out-politicked, you don't get under-politicked, you have your budget to work with because that's how we think. There are four business people up here and that's how we solve problems in our business life. We forecast our revenues, we set our budgets and we rely on local and regional government to make decisions.

So whatever you end up doing about the project with your regional mobility authority, that's your choice, Pat, that's not us. But there are differences between how an RMA can act and how we can act, and the most significant is if you form your RMA and do projects and do toll roads, all that money stays right here in your county, it's not going back to Austin, Texas. That's the law. That's the law that the House and the Senate and the governor insisted be passed as part of this brave new world.

If you let us do the road, we'll try to keep the tolls or the concession fees in this area, but I can't promise you that the legislature, the governor, or commissions in the future won't decide that it's a state toll road and that state toll money needs to go someplace else. So the wise thing is to do it yourself, keep the money in your community. I see the day in my lifetime when RMAs will be paying for local transit systems, local road repairs, local safety measures. It's probably 25 years away but I plan on living that long. You and me want to see our great grandkids.

MR. JOHNSON: That's right.

MR. WILLIAMSON: That's just my view.

I want to announce that an organization which is near and dear to this department, because they do a lot of work for us, the Texas Association of Mexican-American Chambers of Commerce and their members who do a lot of work for us begin their convention here in El Paso, I think today. Isn't it today? And they have a reception between 6:00 and 7:30 this evening.

The Texas Department of Transportation has been the leading state agency on matters of historically underutilized business and minority recruitment into our professional ranks, we lead the state in our hiring practices and in our contracting practices, and we're very proud of that. And many of the members of the Mexican-American Chambers are our contractors, subcontractors, vendors, engineering firms or our employees. So we encourage each of you, if you've got the time, the reception tonight begins at six o'clock, I think that it's here in the convention center, and you're all invited to attend.

Whether you support the tactics of the war on terror or not, I think everyone in this country supports those who surrender their time and potentially their lives in the service of their country. The Texas Department of Transportation is blessed to have many employees who are part of the war effort, some in the military in matters of combat, some in the military in matters of non-combat, and some in non-military roles.

We want to take just a moment to recognize generally all of our employees who have left, gone to war to defend our liberty and returned home and returned to work for our agency, and we want to specifically recognize three who are with us today. And if I could ask you to stand as I call your name, and then we're going to come back here and take a picture, if you don't mind. Corporal Oswaldo Lopez, Specialist Hector Granados, and Command Master Chief Gilbert Jordan.

We want to recognize these very special TxDOT employees. They are called to active duty, they answered the call. Not only do they risk their life but they know of the disruption that will occur in their personal life while they're gone. Now, these men are thankfully returned safely from duty and we pray every night that all Americans are returned safely from duty, but we particularly thank these men for their service to our country. Thank you.

(Applause and pause for photos.)

MR. WILLIAMSON: Okay, Mike, one more housekeeping matter before we return to agenda. I know we have one House member. Someone said Norma Chavez might be here. Patrick, are you part of the El Paso layout, and if not, do you wish to chew on us for anything? Legislators always get first shot around here.

MR. HAGGERTY: Thank you, Ric. I just want to say welcome to all of you and we're very, very happy to have you here in El Paso. It is vitally important, I think, that all of the boards, all of the commissions in Texas do get around the state so that people do have the opportunity to see how things do occur.

You know, you were talking, Mr. Johnson, about the fight between RMAs and MPOs. The RMA concept, this whole bill would never have passed the legislature had there been a directive from Austin telling us how to do everything that is going to be done. The idea of local control, the idea that the local people should have some say in what is going to happen is very, very important.

It came to El Paso, the county passed on it, the city did make a decision, and they have made the decision to go ahead with an RMA. It was not given to the MPO, there was never any indication in the legislation that the MPO would have anything to say about what was going to happen in the city of El Paso.

I grant you that the arguments are that you're going to have an agency that is not elected, but the nine members of the city council here in El Paso made that decision and they will have to live with that decision, and I think that the people do have the right then to come back and say you made a mistake and we're going to un-elect you, or we think that the decision you made was good and therefore we're going to re-elect you, and that should be their decision and it should be local.

And I thank you for pointing out the differences. We do not want to allow politics to get involved in this, it is too important to our future that there be decisions made that are correct.

Again, welcome to El Paso. We're glad to have you here. For all of you that come to El Paso from other parts of the state to see this, I would like to point out that there are only three counties in the state of Texas that do not have oil or gas reserves, El Paso is one of those. We are very poor because of that, so while you're here, please spend as much as you possibly can, sales tax is our major source of revenue. Thank you.

(General laughter and applause.)

MR. WILLIAMSON: Well, Patrick exited too quick, I had a thank you for him. Some things do get by me. I went up on the tram last night. I've been to El Paso nine times now but this is the first time I've ever gone up on the tram, and while I was up there I was just blown away. I was thinking of things you could do to generate income like put a practice driving tee up there and put a green down in the middle of that quarry and make people pay ten bucks to hit the ball and pay a thousand for the first person that got there, or something like that.

MR. HAGGERTY: Actually, if you allowed that to happen, there are a lot of people that are upset about that quarry being there, that would be a way to get back at them.

MR. WILLIAMSON: But I was told, Patrick, while I was up there that that was a personal mission of yours.

MR. HAGGERTY: It was a personal mission. Actually, It was a mission with Richard Pierson who is not here this morning, but when KTSM had to close that down for lack of insurance, it became kind of a thing of how do we get that reopened, and the only way to do that was to turn it over to the state and Parks and Wildlife took it.

We have done some good things, we've done some bad things. Number one, the income from that was going to go to take care of Hueco Tanks, the Magoffin Home, and of course, the tramway itself, but what has happened is the Appropriations Committee, in one of those wonderful years, we said all of the sales tax from sporting goods in the state will go to Parks and Wildlife, a couple of years we capped that at $30 million, and now we've got some Parks and Wildlife facilities in the state that are in bad need of repair.

So yes, it's a wonderful place, yes, we're trying to expand it, but as soon as we give it to Parks and Wildlife to do that, then we take away their money to do it, and we've made pretty much a mess of that as well.

MR. WILLIAMSON: Well, I just personally thank you for taking interest in it. I think it's a wonderful resource of the state. Maybe we've got some ideas about how to help, we'll be thinking about that.

MR. HAGGERTY: If we could toll the road going up to the tramway, that's a possibility.

(General laughter.)

MR. WILLIAMSON: Let's see, I've been told that Representative Pickett is here. Joseph? If I didn't see you, I apologize.

MR. PICKETT: No. I came in late, Mr. Chairman. Thank you for being here. As Pat said, it's a boon to our sales tax.

And I'm going to say a few comments that are a little contrary to Pat, but I have to tell you we have a lot in common. We're both avid golfers, mine just happens to be on the putt-putt, I'm not quite ready to take the 18-hole links.

There are two issues that are really going to be discussed tomorrow at length, and the regional mobility authority toll authority is just part of it, and I'm on the record supporting the legislation and the use of toll authorities when it makes sense, and when it doesn't make sense, I'm going to oppose them.

And in our case in El Paso, even on TxDOT's website, if you look up RMA, it talks about counties and multiple situations, and when the legislation came before us, it was explained that when three or four or five counties and 16 municipalities were going to be involved in one project, it was going to be impossible for each entity to build their little section and try to get this railroad to meet, so hence, kind of the suggestion of a regional mobility authority, and unfortunately you have to give up sometimes a little to get, and I understand that, and the give up was not going to be elected officials because you really couldn't if you had seven counties and 19 cities, so we're going to get a group of people that kind of oversee it all.

But the comparisons that everything works better that way isn't correct, and I'm glad to see that some of the business community has agreed with part of my argument in this morning's paper. It made it sound like RMAs were the only way to do things but that admitted that myself have been on other boards and committees but I was appointed to those boards and committees by virtue of being an elected official. Our metropolitan planning organization, our MPO, 19 of the 25 are elected officials, and not by appointment, by the virtue of being elected. Mr. Haggerty is on that board when he gets re-elected in November, I will be on that board when I get re-elected in November, if that's the case.

So they made my point in the paper saying that, you know, there's good and bad, and I know we talk about the public service board, but one of the things I agree with this body, and I think we can do that after it's all over -- and someday, Mr. Chairman, it will be over and you and I can go duck hunting -- I'm staying behind you, though.

(General laughter.)

MR. PICKETT: Last month our MPO, with its majority of elected officials in this area, said no, we don't support an RMA at this time, and that decision was overridden by an appointed body, so there is a perfect example of where a majority of elected officials can be and are on the record of overriding it by all of you who are appointed.

Again, I don't want to really dwell too much on it. The city is going to do the RMA, I won't be able to stop it. What I am going to try to bring to the community is a better plan, and as I told this body several times over the last couple of years, I'm going to present a plan tomorrow that includes some tolls but my plan also builds more roads, it builds more roads, it's virtually about the same amount of dollar money. So it will be a tough decision for some people to make tomorrow because a lot of people are just looking at this as RMA or not RMA, some people are looking at it as tolls and not tolls, and even myself when I go around talking about, people say we're with you because you're against tolls, we're against tolls. I am not against all tolls, I'm against doing tolls when it's not necessary.

So hopefully, as you've asked me to be open-minded, I ask all of you and the people in the audience and the members tomorrow to look at something that does have all the tools in the toolbox presented as a project, and ultimately it builds more roads.

So again, I thank you for coming to El Paso, and especially during times like this, Mr. Chairman, and we actually did get to serve one term together, I know you and Pat served a little longer. I came in, I believe, it was your last session as you were going out to bigger and better things, and obviously you've got a big job right now, and I appreciate you being here and having to be Solomon and take that sword out, it's pretty tough. So thank you for being here.

MR. WILLIAMSON: Thank you.

Ms. Chavez, are you here? I know you were here earlier. Any other House or Senate member?

(No response.)_

MR. WILLIAMSON: Okay. We appreciate any legislator taking his or her time to be here and share with us their viewpoint about anything, and again, we appreciate the service of all of our TxDOT veterans. And I think that we have all preliminaries out of the way, Michael, I would like to turn it over to you and let's go to the agenda, please.

MR. BEHRENS: Okay. Thank you, Mr. Chairman. As customary, when we go on the road with the commission meeting, we use the first part of the meeting to hear from the local citizens and officials and things, and to introduce those and to kick it off, I'm going to invite Chuck Berry, our district engineer from the El Paso District to come forward and to lead that delegation. Chuck?

MR. BERRY: Welcome, Mr. Behrens, commission members, Mr. Chairman. Bienvenidos El Paso en esta casa. Thank you for visiting us here in our home.

For the record, I am Chuck Berry, the district engineer for TxDOT in El Paso. Today's presentation is going to include some information from the district, we're going to include some information from our newly formed Borderland Mobility Coalition, not the mobility authority but the mobility coalition, the group of business people who have banded together to support transportation in our region, and the mayor of the city of El Paso, the Honorable John Cook.

The El Paso District, as you know, consists of six western counties in Texas, including El Paso, Hudspeth, Culberson, Jeff Davis, Presidio and Brewster counties, approximately 22,000 square miles of land. The area is diverse in land, people and customs. Population centers range from the large populations in the city and county of El Paso to the sparsely populated areas around Terlingua in southeast Brewster County.

The district also has extreme characteristics such as El Paso County with a population in excess of 738,000 people with over half a million registered vehicles and Culberson County with fewer than 3,000 population and less than 2,000 registered vehicles. This land is also a gem of Texas with the natural wonders of the Rocky Mountains and El Capitan and the beauty of the Davis Mountains in the tri-county area. And this land is our home and our responsibility for taking care of the state highway system that you have put under our care.

Highway construction history and future projections demonstrate a large construction program for our region. The highway construction program has averaged approximately $114 million per fiscal year since 2000 and is projected to average about $145 million a year into the next four years. The growth of the program is a result of taking advantage of increased opportunities and programs included in the federal transportation legislation of SAFETEA-LU.

This is very good news for the growth of our program over recent years, but we are also aware of the future and the decreased levels of funding from the federal level that are expected as a result of the current federal program that was designed to spend down the surplus for the purpose of accelerating the construction of transportation projects throughout the United States, including Texas.

This year and the next three years we have programmed 21 projects with an estimated construction cost in excess of $398 million in El Paso County. A total of 131 projects have been planned throughout the district that would include a total construction program of more than $519 million.

Major projects scheduled through 2009 in El Paso County include the rehabilitation work being performed now on State Highway 20/Mesa Road and the intersection of Fred Wilson and Airport Road that you saw on our ride back to the district office last night. A major expansion of US 54 will also begin later this year to widen from Yandell Street to Hondo Pass, adding an additional travel lane in each direction. The next three years are scheduled to bring expansion work on Benton Road in northwest El Paso County and the construction of a portion of the inner loop from Biggs Field to Loop 375/Purple Heart Freeway in east El Paso.

In fiscal 2008 is scheduled expansion of Interstate 10 in northwest El Paso that would complement future work that's proposed on the I-10 Southern Relief Route along Border Highway Loop 375. Expansion of the Border Highway is also proposed from central El Paso at US 54 to the international port of entry at Zaragosa. Additional work is scheduled for widening of Horizon Boulevard interchange at Interstate 10 near the city of Socorro and expansion of I-10 interchange at Horizon Boulevard.

Finally in '09 brings the improvements of interchanges along Loop 375 along that new freeway that Commissioner Johnson was complimenting us on, at Zaragosa Road or FM 659 and also at US Highway 62/180 at Montana Avenue. We also plan on performing major rehab work along State Highway 20 on Alameda between Zaragosa and Loop 375 Americas.

The programs that the district has been involved with include the developing of Colonia Access Program where the county of El Paso has led the state in completing over $9 million, leading the other counties of the state with this accomplishment. We are also working with the El Paso MPO in preparing the State Needs Program study that you have commissioned, known as the Texas Metropolitan Mobility Plan. This plan has identified in excess of $3 billion of need beyond the anticipated funding levels over the next 25 years. Our regular programs with the Unified Transportation Program and the Statewide Preservation Plan, the Statewide Mobility Plan are developed each year to address the transportation needs for our future.

All the transportation programs are being developed to address the statewide goals for Texas, those being the reduction of traffic congestion, improving safety, expanding economic opportunity, improving our air quality, and increasing the value of our transportation assets.

Locally that strategy is translated to address those goals throughout the region by properly maintaining our transportation system while improving its reliability to perform on a day-to-day basis, improving mobility and reducing congestion along our most congested corridor, Interstate 10, completing the construction of our circumferential freeway, the system on Loop 375, and improving interconnection of that system utilizing the inner loop. And this would all be accomplished using the innovative means to accelerate the delivery of those needed projects through the tools provided by the state legislation and partnerships with interested transportation providers.

The El Paso mobility plan proposes completion of the gap in Loop 375 in the southwest part of the region where Texas adjoins Mexico and New Mexico. It also includes expansion of Loop 375 as an alternate route to the heavily used corridor along I-10 where maximum traffic volumes approach 240,000 vehicles a day and the area along I-10 experiencing levels above 200,000 vehicles a day is rapidly expanding eastward and westward each year.

The mobility program includes development of the Northeast Parkway in northeast El Paso in order to complete a relief route around El Paso for traffic that passes through the region from origins and destinations beyond El Paso County. At present the route on Loop 375 over the Franklin Mountains at Trans Mountain Drive are too steep for commercial truck traffic to negotiate with 7 percent grades on the east and west approaches to the summit.

The Northeast Parkway would utilize major portions of Loop 375 but provide access to a different crossing of the Franklin Mountains at the Anthony Gap in the state of New Mexico. Approximately ten miles of new location road would be in Texas and ten miles along existing New Mexico highways to reach Interstate 10 in southern Doña Ana County, New Mexico. The plan also calls for construction of the inner loop between US Highway 54 and Loop 375 providing a much needed interconnection of our highway system in the areas of accelerated growth associated with the growth of U.S. Army's Fort Bliss.

Extension of the Border Highway into southeastern El Paso County would also enhance mobility in the region, providing much needed expansion for highway access for the population growth experienced in El Paso County and the city of Socorro. The route also provides improved interconnection between our ports of entry between downtown El Paso and the newly proposed Fabens port of entry.

And finally, the expansion of Interstate 10 is planned as part of this mobility plan in the northwest and southeast portions of El Paso County to complete the needed increase in capacity to address population growth and increased volumes of thru traffic on Interstate 10.

The U.S. Army's Fort Bliss is an integral part of the El Paso metropolitan area. It occupies a central location in the region that we saw last night from atop Franklin Mountain. It provides jobs and economic opportunity while addressing its mission in defense of the United States of America.

Last year's announcement of U.S. base alignment and closings recognized Fort Bliss as a strategic defense installation. As a result, Fort Bliss will grow by nearly 20,000 more troops in addition to the troops that are already stationed at Fort Bliss, increasing the population of El Paso by more than 46,000 new residents when families and supporting employees are included in those projections. This does not yet include the usual growth expected when defense contractors follow the increasing populations in military installations.

All this is planned to occur between now and the year 2011, just five years away. In support of the military expansion, the Defense Department has scheduled $2.6 billion of infrastructure expansion over the same period until 2011. The expansion brings with it the benefits of added jobs, economic opportunities and growth, along with associated issues of added traffic, the congestion of that traffic, and the expanded population getting to and from their new jobs in the area.

The El Paso District is addressing as much of this needed growth in the system as we can handle with our traditional program, but additional programs could be used to help with that need.

The beauty of the Chihuahuan Desert that surrounds the El Paso region is not that usual beauty experienced by Texans. You don't find sodded fields, dense forests or vast expansive rivers or lakes. You will find, however, the beauty of a southwestern sunset, the flowering desert plants after a summer shower, the mountain peaks that grow from the river valleys, and lots and lots of blue sky and starlit nights.

Because the region cannot place turf grasses, we have focused the beauty in hard scape, limited plantings and the aesthetics of our structures. These photos highlight recent programs that enhance the beauty of our infrastructure by highlighting their components and announcing their existence. The three-dimensional star markers that were placed at the Anthony interchange near the New Mexico state line and smaller markers at selected interchanges and overpasses announce the presence of important transportation connections.

Other projects, such as the interchange of I-10 and Loop 375 that many of you were able to experience last night, welcome travelers to the gateway into our region. Themes have also been addressed in the pedestrian safety fencing of our bridges. These are simple steel fences with minor modifications that highlight railroad crossings and the five-pointed Texas star. The region has also identified native vegetation that is drought-resistant with low water use, while also presenting an aesthetic appeal to the medians and our rights of way.

All of these projects and accomplishments have been made by your employees of TxDOT. Their efforts have delivered the projects and programs that are synonymous with TxDOT throughout the state. The men and women of TxDOT's El Paso District not only work on these projects but they're involved in our community. Special programs and projects at the employee level have resulted in people contributions.

Some special efforts include the creation and organization and support of employee development programs such as our Young Engineers Committee, that help our engineering graduates work together to complete their professional growth and eventual state license. Many of you got to meet some of them that have been shuttling you around town yesterday and today.

Also, the Employee Action Committee, where we don't have any supervisors as members, review charitable requests that are received by our district office for identification of those that can be supported by our employees. The El Paso District employees have donated in excess of 600 units of blood since 2001, and participated in our Clean Air programs that were statewide where the district earned special recognition in 2005 for our participation levels, and the Texas Roundup that is encouraged by our administration where 67 employees completed the program this year. Our state employees charitable campaign for 2005, I'm very proud to say, experienced a 70 percent participation rate and raised over $24,000 for regional charities.

This workforce also supported special programs by the Advocacy Center for Children of El Paso, the Susan G. Komen Race for the Cure, the American Cancer Society Alpine Relay for Life, the American Heart Association Go Red for Women, and special donation campaigns for our military personnel who have been deployed, ill coworkers and hurricane relief, and my personal favorite, the district's Secret Santa Program where nearly 150 children each year are identified in our adopted schools to receive Christmas presents from Santa that are purchased by employees for students that would otherwise not receive presents at Christmas because of their family's inability to purchase those presents for their children.

The employees were also recently recognized by a Senate proclamation for their efforts to beautify El Paso with Senator Shapleigh's Adelante Con Ganas Award, a monthly award that he recognizes various organizations throughout our region. Those men and women of the El Paso District have not only accomplished the work of TxDOT but have also represented it well in our community as involved citizens.

Thank you for bringing your meeting to El Paso, allowing us to show you what has been accomplished. Our next speaker will be Mr. John Broaddus of our Borderland Mobility Coalition; he'll be followed by the mayor of El Paso.

If you have any questions, I can take them now or return to the podium at your request.

MR. WILLIAMSON: Anything now, Ted, or do you want to continue?

MR. HOUGHTON: Continue.

MR. BERRY: Mr. John Broaddus of the Borderland Mobility Coalition.

MR. WILLIAMSON: Don't get too far, though, we've got some questions, Chuck.

MR. BERRY: Yes, sir.

MR. WILLIAMSON: I want to know why you stirred up all this RMA stuff.

(General laughter.)

MR. BROADDUS: Commissioners, Mr. Chair, Mr. Behrens. My name is John Broaddus, and I take great pleasure in representing the Borderland Mobility Coalition. The BMC is the culmination of more than two years of study by a group of like-minded citizens brought together to research our region's transportation infrastructure needs and also to analyze the efforts and successes in other parts of the state.

We were instrumental in building informed consensus on projects such as the extension of the Border Highway west, also known as the Southern Relief Route, and the creation of the Camino Real Regional Mobility Authority which we wholeheartedly support.

The BMC is this area's first regional group to bring together the public and private sectors to offer a coherent advocacy plan for transportation projects. Our intention is to present a unified voice by having representation from El Paso, southern New Mexico and Ciudad Juarez in presenting transportation initiatives in the respective state capitals, Washington, D.C. and Mexico City.

We have a brief presentation that further explains who we are. You'll see this just represents our new logo and we're happy that the organization is formed and operational.

Now, I know I'm singing to the choir when you see this slide, but when we show these facts to elected officials and community leaders, it opens a lot of eyes. The message is that if we don't do anything now and we don't take advantage of innovative funding, we are headed for disaster, and that message is getting out.

MR. WILLIAMSON: That's a good point. I don't want to disrupt your flow, but it occurs to me when I was listening to John on this layout earlier and listening to the welcoming from other elected officials, it occurs to me that it's very important for anyone involved in the world of transportation, whether it's as an employee of TxDOT or an appointee of the governor or a local community leader or whatever, it's very important to repeat to people the pending disaster the state faces if we don't do something. There's a reason why the legislature passed these tools in successive three legislative sessions because that disaster is no longer over the horizon but it's there in our sites, it's 2030, if we don't do these things. And I'm glad to see that you reasonably have adopted that first approach which is understand the problem we face before we start arguing about how we're going to solve it. The problem is very real.

MR. BROADDUS: And we realize that.

MR. HOUGHTON: This is one thing, John, that I don't think many El Pasoans know about is this slide, and it's profound, and I think what the commissioners saw and the staff saw from Ranger Peak last night is the pinch points here on the west side where that river and those mountains get closer and closer and you've got Interstate Highway 10 with no access roads, and if you have an accident on 10, this city is shut down.

MR. BROADDUS: We've seen that in the last couple of years.

MR. WILLIAMSON: But the very most significant thing is to put the population and the vehicle miles together and just say look, as best we can tell, by 2030 we're going to grow 60 percent and the number of miles we're going to consume on our roads is going to grow by 50 percent, we better do something pretty fast or it's not going to be very much fun around here. And it's that way across the state, it's not just El Paso.

MR. BROADDUS: There's just a few words on this slide but it has a big impact.

This just shows that we're aware of the other mobility advocacy groups and we looked at all of them in forming our own and took the best parts of each, and we're thankful that they're up and operational and we've seen the successes that they've had and we hope to duplicate that here.

We will have a website, this is a page out of our website, I understand it will be up and running next week. It will have links to recent news, recent events, it will also have a detailed link to our strategic plan which is very detailed, and I think you'll agree that we wisely decided not to discuss it during this five-minute presentation. So we do have a website that's coming up.

And this shows our proposed organizational structure. As you can imagine, when you try to get an organization that's regional to include Mexico, southern New Mexico, West Texas, it's going to be complicated, but we think we've come up with a really good organizational chart that includes public and private companies/entities as well as non-profit entities that are major contributors in the El Paso area. So we're looking forward to adopting this and building our membership on this basis.

Finally, this is how we see the entities that are in existence now working together. The key words here are, if you look at the MPO, planning, if you look at the right-hand side of the chair we see funding, and if you look at the bottom where the BMC is, you see advocating. We think those three things are very important to work together.

So in conclusion, I want to say thank you for being here, thank you for giving us the ability to make our presentation, and we look forward to working with you.

MR. WILLIAMSON: Wait a second. Ted?

MR. HOUGHTON: I'm extremely proud of this group. They launched this two years ago and it's been painless. Right, John?

MR. BROADDUS: Oh, yes. I have a flak jacket on.

(General laughter.)

MR. HOUGHTON: And I want to thank the members of the organization that have taken the bull by the horns and come a long, long way.

MR. BROADDUS: Well, we've had a lot of help from you and the TxDOT people here, and they've given us a lot of information and we're very thankful for that, so thank you.

MR. WILLIAMSON: Hope?

MS. ANDRADE: I remember, I guess, when we came from San Antonio with a group with our mobility coalition to share our experiences and what we've learned and the mistakes we've made, so you've acted quickly, so congratulations.

MR. BROADDUS: That meeting was very helpful. In fact, I will tell you that the San Antonio Mobility Coalition was our guiding organization. We've adopted a lot of their governance and principles. It's a well run organization, and Victor Boyer has come out and spoken to us on numerous occasions.

MS. ANDRADE: They're great, and I certainly rely on them a lot, so I'm sure Ted will have an ongoing conversation with you all the time. But thank you so much and congratulations.

MR. WILLIAMSON: Anything, John?

MR. JOHNSON: I just wanted to emphasize the importance of that one slide. You know, many of us receive information, all of us receive information and decipher it and interpret it in different ways, and some people are people of words and others think in terms of numbers, and I just think it's so important to get those numbers out of what this area faces, and as the chair says, we face all across the state in terms of population growth, vehicle miles traveled growth. Our road capacity is not growing nearly on those percentages, growing between 4 and 6 percent a year, and those are staggering challenges, and so I think the more people understand that, advocacy groups, planning groups and funding groups, the coordination becomes a lot easier.

MR. BROADDUS: Well, one of our jobs is education to the public so we take that pretty seriously, and there's a lot of information that needs to get out and we plan on doing that.

MR. WILLIAMSON: Well, we think groups such as this are valuable across the state, precisely for the advocacy role you play. You know, we can go out as commission members and advocate in a certain way, but we have to be cautious, like not getting involved in the discussion over the RMA here regionally. You know, we're in a sense a regulatory body or certainly an executive branch agency, and we can't go out and advocate a solution that the community might be in disagreement about. I mean, how does that make both sides feel? It wouldn't be fair.

So advocacy groups are important, and I'll be repetitive because it's important to be, primarily for the reason of getting the information in front of people. It is so critical because any time you're going through great change, it is very easy to pick false arguments to hide behind that disguise we've got to do something about the problem. You know, the argument about appointed versus elected, that shouldn't hide the fact that we've got to do something. The argument about private versus public sector, that's a real easy argument, you're going to ask the private sector to put their money up and pay them back over time, or you're going to raise people's taxes.

The option of not causing any pain doesn't exist anymore. Advocacy groups can put that out in front of people where they can deal with it. Not everybody will believe it but that's okay, as long as the facts are there, people can deal with it. We commend you for your work.

MR. BROADDUS: Thank you. Now I have great pleasure in introducing that famous crooner, the Honorable Mayor Cook, who will make some remarks.

MR. WILLIAMSON: Did he bring his guitar, or is that reserved for Austin?

(Applause.)

MAYOR COOK: Good morning, and you got to meet City Representative Susie Byrd earlier, and I'd like to introduce two of our other members of the city council, and they'd like to say some very brief comments, and then I'll close.

MR. WILLIAMSON: Sure, absolutely.

MS. LILLY: My name is Ann Morgan Lilly, and I'm a third generation El Pasoan and very proud of it, and very proud to be a member of city council, this team that wants to move El Paso forward in every way they can. There's always been a connection between El Paso and Austin, and I'd just like to mention that my grandfather and his sons built the Greer Building that houses TxDOT, and I welcome you to El Paso, and I'm glad you got to go on the tram and see the whole city before you because it is magnificent.

MR. WILLIAMSON: Thank you very much for coming.

(Applause.)

MR. ORTEGA: Good morning, commissioners, Chair Williamson. My name is Steve Ortega; I was in Austin last month, and I welcome you here to El Paso. I represent the east side of El Paso and one of my constituents is our esteemed commissioner here, Mr. Ted Houghton.

I again want to welcome you here to El Paso, and I'm very glad that you all take the time to travel across the state of Texas. When we were in Austin last month, Senator Shapleigh reminded us that the future of El Paso is going to be shaped by what he called the five Ms, and that's manufacturing, medicine, Mexico, mobility and the military, and certainly transportation figures very heavily into each of those areas. So I think it's great that you're traveling across the state to see the unique needs of the region in this very important endeavor, and that is trying to make Texas one of the best states when it comes to facilitating 21st Century transportation.

I want to congratulate you in particular, Chair Williamson. I think in observing you during the course of this very tumultuous and controversial debate concerning RMAs, you've always conducted the debate in a very professional and civil tenor, and I want to congratulate you for that, and I've learned something from the way that you conduct your meetings.

I finally want to thank Commissioner Ted Houghton. I believe he's the first member from El Paso to serve on this commission, and he has certainly been a great public servant, a great advocate for the state of Texas and for the city of El Paso, and I want to thank you again, Commissioner Houghton, for your time and your energy on this very important endeavor. Thanks again, and welcome to El Paso.

MR. WILLIAMSON: Thank you. We appreciate your kind remarks, we really do. Thank you very much.

(Applause.)

MAYOR COOK: I want to join my colleagues in welcoming you to El Paso. I enjoyed spending a little bit of time with you yesterday.

And Chairman Williamson, I really appreciated the remarks that you made last night comparing the different appointed boards and commissions. When the state of Texas was established, it was established realizing that you were going to have elected officials and appointed officials. We have many, many examples of it that you pointed out yesterday: the Appeals Board for Central Appraisal District, the Public Service Board, the El Paso Water Utilities which Mr. Houghton had served on and I currently serve on, so we recognize that there is a place for appointed officials.

I also want to thank the commission for giving us the authority to have our own appointed officials here, not that I don't trust you all in Austin, but we do understand our regional transportation challenges that we have. We understand better than people in Austin and in Houston and in San Antonio that we live right next door to a neighbor that has 1.7 million people, a million of which travel across the border every year and use our highways, our streets, our roads. We realize that we live right next door to New Mexico which provides additional challenges to us for transportation.

And we want to thank you for the projects that you've funded here. You've done very well in making sure that the needs of El Paso have been looked out for.

Two of you have requested that I not show up without my guitar, so I didn't want to let you down.

MR. WILLIAMSON: No. All four of us because this will be two months in a row. No one will ever be able to break this record.

MAYOR COOK: But I do have a question for you. Are you going to let the inner loop soon?

MR. WILLIAMSON: The inner loop?

MAYOR COOK: The inner loop project that we have which is a pass-through toll project. Mr. Berry mentioned how important it is to address the needs of Fort Bliss, and those challenges of the 20,000 troops and 25,000 family members, that challenge will be upon us in five years. So we are in a loop project -- which I'm sure Commissioner Houghton is very familiar with -- and I was really expecting to see it on today's agenda, but I was wondering if you're going to let it soon. I would sing Let It Be.

MR. HOUGHTON: I can address it if you want me to.

MR. WILLIAMSON: As you know, we're not allowed to make those decisions outside of the public eye. Let me just say as mayor you're going to be very happy with the transportation partnership you've established with the Texas Department of Transportation.

MAYOR COOK: Thank you. Well, with that, I'll give you a little historic song about El Paso.

(Whereupon, the mayor played guitar and sang, followed by applause.)

MAYOR COOK: Well, welcome to El Paso, hope you enjoy your stay, and hope you enjoy our hospitality.

MR. WILLIAMSON: Thank you, Mayor. I think your city is blessed to have such a talented guy, and I'm sincere about that.

MAYOR COOK: Thank you.

MR. WILLIAMSON: Ms. Chavez.

MR. HOUGHTON: How do you follow an act like that?

MS. CHAVEZ: I'm going to do the rap version of that song.

(General laughter.)

MS. CHAVEZ: Commissioners, Mr. Chairman, it's good to see you back here in El Paso. I'd like to thank you for your leadership, I'd like to thank TxDOT for bringing this important commission, one of the most important commissions of the state of Texas to the people here in El Paso. You made that commitment and you continue to come to hear directly from the constituents that I represent but also the constituents of the county of El Paso.

The legislature has given TxDOT a variety of funding opportunities for the state of Texas, and I would just like to tell you that it's important for my constituency to have an option to choose whether or not to go through an existing non-toll road or a toll road. That's the main issue that I have, and we've been ensured that the plans and the proposals that have been brought forward are going to ensure that there are non-toll, the existing roads will continue, and then we will have toll roads added to deal with the capacity that's ever growing.

We know that El Paso is going to continue to grow with the 22,000 troops coming in to Fort Bliss. We also know that our basin here with New Mexico, Chihuahua, as well as El Paso, and that NAFTA traffic, 75 percent of NAFTA traffic comes through Texas ports of entry. We know that we should have gotten a big pot of gold at the federal level dedicated specifically to NAFTA traffic and we didn't, and we hope that perhaps we can pursue that in future federal transportation legislation.

And that being said, commissioners, I would just like to tell you that I support the goal of the commission, and that is, of course, to expand capacity here and in other communities so that we can deal with the transportation needs and the transportation growth. Thank you very much.

And Mr. Chairman, the next time you come to El Paso, I can assure you we can get you a Harley-Davidson from Barnett Harley-Davidson so we can go ride the Loop 375 together.

MR. WILLIAMSON: You and me will do it together.

MS. CHAVEZ: Yes, sir. Thank you so much.

MR. WILLIAMSON: Thank you, Ms. Chavez.

(Applause.)

MR. WILLIAMSON: And I held up on this remark, I felt like Ms. Chavez was going to be here and I didn't want to offer these remarks until then, and I don't want to get in the middle of anybody's political fight, but at the commission we have a tradition of recognizing House and Senate members who are committed to solving transportation problems, and we can't proceed to our business without recognizing the fact that the El Paso delegation is pretty dedicated.

Again, I don't want to get into anybody's personal fights, but there's been no stronger senator for transportation than Eliot Shapleigh. Ms. Chavez, Mr. Haggerty, Mr. Pickett have been supportive of the transportation options. They may fuss and fight with us. Ms. Chavez is very direct with me; when we're not doing what she thinks is right, she tells me, and that's okay, we served together and we have the kind of relationship that permits that to happen. Obviously Joseph tells me when he disagrees with me, and Patrick is a close friend and if things aren't going the way he thinks they are, he'll let me know. I don't know Chente very well, I don't think I served with him, I think he came in after I did, but he appears to be a rational guy and that's kind of all you can ask for.

But El Paso is blessed with persons in the legislature who understand the problems that we face. They may not all agree on what those solutions are, but they all understand that we've got to solve the problems and we're very thankful for that.

Michael, I think I'm ready.

MR. BEHRENS: Do you have any questions for Chuck?

MR. WILLIAMSON: Yes. That's what I'm ready for.

MR. BEHRENS: Chuck Berry, can you come back?

MR. BERRY: I'd like to thank Representative Chavez for separating me from following Mayor Cook's presentation.

(General laughter.)

MR. WILLIAMSON: Ted, do you want to start us, or do you want us just to go at it, or what do you want to do?

MR. HOUGHTON: The graph is not up, Chuck, and you alluded the graph, went over it real quickly in your presentation.

MR. BERRY: Yes, sir.

MR. HOUGHTON: What is the future funding allocation looking like for El Paso, and currently where are you from an annual funding on Category 2 money? For those in the audience who don't understand Category 2, that's new mobility. Correct?

MR. BERRY: That's correct.

MR. HOUGHTON: And where are you now and where are you anticipating on being in the out years with what we know going on at the federal level?

MR. BERRY: The construction information that's represented by this bar chart is our entire program that includes our preservation program, taking care of our existing system, and the mobility program. The mobility program is an allocation program now, thanks to the commission's vision for allowing us to plan into the future, and it's been typically on the order of about $28 million a year that we can dedicate towards added capacity projects in our region, $28 million in the past.

The future is showing that we're looking more on the order of about a $17- to $20 million program because of the changes in the federal legislation, changes that we talked about earlier on spending down that surplus in the federal legislation surplus budget, and also changes in how the federal legislation has distributed the funding on those programs, whether they be our surface transportation program and our CMAQ program that are heavily utilized by our local MPO. Those are going to be growing but that mobility part is going to be shrinking to offset the growth in the other areas.

We also have a new funding category that's been opened up with SAFETEA-LU called the Coordinated Border Infrastructure Program that will provide the region another resource for funding, but again, it's not necessarily mobility. So as the other programs are growing with a fixed overall amount, our mobility program is shrinking.

MR. HOUGHTON: With what John Broaddus talked about in the coalition and the anticipated growth, when you talk about $28- going to $20-, what is the project cost of the Southern Relief Route?

MR. BERRY: The district recommended to the El Paso MPO a Phase 1 implementation for the Southern Relief Route with a construction cost estimate a little in excess of $466 million.

MR. HOUGHTON: What's the project cost on the inner loop, your anticipated cost?

MR. BERRY: The first phase is under construction now at approximately $25 million.

MR. HOUGHTON: What kind of money was that? Where did that money come from?

MR. BERRY: Thank you for the question. Phase 1, a major part of that project was funded through I believe it was $16 million out of the Commission's Strategic Priority funding category that Governor Perry came out and announced in support of the growth of Fort Bliss back in 2004, a project that I'm very proud to say that the district was able to deliver from concept to bid in approximately 15 months.

MR. WILLIAMSON: Very good.

MR. HOUGHTON: Very good.

MR. BERRY: But the balance of that project is a $25 million project that was funded with $9 million of local STP funding.

MR. HOUGHTON: And the inner loop, the rest of the project cost?

MR. BERRY: Phase 2 is estimated construction of $55 million. The City of El Paso, through the El Paso International Airport, is offering $10 million toward that cost. El Paso International Airport has also offered to provide the rights of way at no cost to the state, and the federal government and U.S. Army has indicated they would be willing to consider the same offer for rights of way but they cannot make the final decision until an environmental document is cleared. So we have partners trying to help pay for that Phase 2.

The third phase would be approximately $70 million in today's dollars. I can't do the arithmetic in my head with all of you looking at me, maybe some of my staff can help, but I think that's on the order of about $150 million, $135 million range.

MR. HOUGHTON: Now, I'm totaling up $575 million on two projects, and your allocation in Cat 2 money that would build these type of projects is going the other way. Is that an accurate statement?

MR. BERRY: That is correct.

MR. HOUGHTON: I just wanted to point out to the audience what we're facing here in El Paso with the limited resources and shrinking resources but growing demand.

Any other things that you need to point out specifically regarding these projects?

MR. BERRY: As we are seeing statewide, we are seeing in El Paso that our preservation program is occupying larger and larger percentages of our construction program. Just last month at our quarterly managers meeting in Austin, the El Paso District was one of the few that was asked how are we meeting those maintenance needs with the maintenance programs that we've been provided that are separate from our construction program, and one of the very important ways of helping to meet that need has been moving over from our maintenance program into our construction program those heavy maintenance needs because we can no longer afford to cover them under our maintenance budget.

So I think that's a very important issue because as the state continues to grow and prosper and this region grows and prospers, we're seeing people move here at faster rates than we've seen in the past, and that means more traffic, and we need ways of addressing that.

MR. WILLIAMSON: Well, normal people might not understand what you just said because I'm not normal and I almost didn't understand what you said. What you, I think, meant to say was you would normally allocate your budget in your maintenance and spend money in a way that you can't do anymore because the use on your roads is getting hammered so bad you're actually going to have to call it almost reconstruction and pay more to get the same outcome.

MR. BERRY: That's correct, yes, sir.

MR. WILLIAMSON: So a shorter way of saying it for normal people is we're having to spend more and more on our maintenance program and less and less on our construction program, and sometimes we don't even have enough for our maintenance program, we end up having to reconstruct when we shouldn't have if we had have maintained it properly in the first place -- if we'd have had the money to maintain it properly in the first place.

MR. BERRY: That's correct. We're capturing it most times before it's a reconstruction project but we're still having to pay for it out of our construction program.

MR. HOUGHTON: I have another question. John, Broaddus, on your numbers  -- and maybe Chuck and you both can answer this question. Daryl Cole, where are you? Get up too. Daryl Cole is in charge of streets here in El Paso, folks, for the city. In those numbers, are those numbers inclusive of what comes across the bridge in those lane miles traveled? Do we know that?

MR. BERRY: Yes, they are. Vehicle miles traveled in our region captures any license plate that you have attached to your vehicle and probably a couple that don't have any.

MR. HOUGHTON: Doesn't make any difference what it is.

MR. BERRY: Doesn't matter what it is.

MR. HOUGHTON: Daryl, how many cars or can you tell how many cars cross the international bridges on an annual basis?

MR. COLE: Daryl Cole with the Street Department. Total crossings are over 10 million, that's including pedestrians, probably 7-1/2 million or so at the ports of entry, excluding the BOTA, and I can take this from a commercial point of view, about 52 percent of our traffic today goes across the Bridge of the Americas and about 48 percent of our commercial traffic goes across Zaragosa, and that's getting closer and closer all the time. It used to be about 60-40, 60 at BOTA and 40 percent at Zaragosa. So you're seeing a swing out to the eastern part of the community from a commercial traffic standpoint.

MR. WILLIAMSON: Is that because of congestion in the city center or because trade patterns are changing?

MR. COLE: Well, you're seeing a lot of congestion, and the key to any freight going across the border is time, it's not an issue of tolls or anything else, it's an issue of time, getting to that destination as fast as you can.

MR. HOUGHTON: Let me interrupt you. You just said something very important. They're willing to pay to get across faster. Is that an accurate statement?

MR. COLE: We just had a border improvement plan study and we believe those are the results of that study. It's location of where you are in Mexico compared to location in the United States is one thing, but the key issue is how fast can you get across, how fast can you get processed from a Homeland Security issue across our ports to clear to your destination. If you have more traffic at the BOTA, they're going to move to Zaragosa, north- or southbound, even if they have to travel on our interstate system to get across. It's really a time element more than it is a cost element because that time is money. When you have a million dollar cargo, it's critical to get to that destination as fast as you can.

MR. HOUGHTON: When you said vehicles, does that include trucks, semi trucks?

MR. COLE: I'm talking about commercial traffic. From a city standpoint, the commercial traffic does more damage to our streets and our infrastructure than anything else because we have not historically our roads to handle the loads that we have and the amount of commercial traffic. We have a lot of vehicle traffic, granted, but it doesn't cause the distresses that commercial traffic does.

MR. HOUGHTON: It causes delays, though.

MR. COLE: Yes, it causes delays, and we're in a unique situation, as you've noticed. We talk about 700,000 people in El Paso but we don't talk about the 1.7 million across the border and the issues that go along with that, as well as New Mexico. We're in a very unique situation.

And again, thank you for being here in El Paso.

MR. WILLIAMSON: Thank you.

Now I need to see the chart with the maps, the roads on it. I think it was the one following the bar chart that you presented, Chuck. Now, last night after we left the employee dinner -- once again, Chuck, to all employees, it was a great dinner; thank you very much, we enjoyed it -- I got on Loop Road and returned to the downtown area that way. Where on this map does Loop Road come out and cross under the interstate east of the downtown area?

MR. BERRY: Loop 375 is listed on this map, part of it is on the red section in this area, number 17, that's most of the route that you took last evening.

MR. WILLIAMSON: And the two black lines that I see going under -- I went past 54.

MR. BERRY: Right. It reconnects on the east side at Joe Battle and I-10 and follows a route along that red dotted line.

MR. WILLIAMSON: But it didn't look to me like I had an option of continuing up the river, it didn't look to me like I could keep going.

MR. BERRY: As you were headed downtown you reached the point where the loop ended.

MR. WILLIAMSON: So are you on that right now?

MR. BERRY: This point right there was at that point, and Loop 375 ends at a city street named Santa Fe.

MR. WILLIAMSON: So how are you going to get the red line over and connected back up to the green line, or are you?

MR. BERRY: We have made a proposal to utilize a portion of the river floodway with an elevated structure along the U.S. Mexico border inside the United States, and using the old highway that came into our region, US 85 West, Paisano Drive along this route to reconnect to I-10 on the west side of El Paso at Sunland Park Drive.

MR. WILLIAMSON: Is that the portion that the RMA is interested in doing?

MR. HOUGHTON: Yes, Southern Relief Route. That's your gap, that's the $450 million project.

MR. WILLIAMSON: And then up on the north end of the map --

MR. BERRY: We're going to switch maps to the mobility map that might show that information a little bit better.

MR. HOUGHTON: There you go.

MR. WILLIAMSON: Okay. And in fact, this is the other question I want to ask. So taking 375 up through the Anthony Gap -- last night you spoke of an existing two-lane road -- or I guess you spoke of it, Ted -- am I looking at that existing two-lane road right now that goes through the Anthony Gap?

MR. BERRY: Existing two-lane road through the Anthony Gap is here on the New Mexico system to the state line.

MR. WILLIAMSON: But it doesn't continue down into Texas?

MR. BERRY: It continues into Texas along a state highway on this route.

MR. WILLIAMSON: So to help my memory, a few years ago I came down into El Paso from Hobbs, New Mexico, would I have come down that road, or would I have been on 54?

MR. BERRY: Most likely not. You would have come down through US 54.

MR. WILLIAMSON: I'm just curious. Eliot at one time suggested that we take a look at rerouting the whole interstate around through the north side.

MR. BERRY: That's correct. That would have been Interstate 10 to Loop 375, using the proposed Northeast Parkway and reconnecting to 10 at a point in New Mexico.

MR. WILLIAMSON: And the only reason we wouldn't do that is because money, because New Mexico doesn't want us to, because the military won't let us go through, all the above?

MR. BERRY: All the above and the issues with changing the interstate designation and trying to take something away from the areas through the central part of El Paso.

MR. WILLIAMSON: Well, surely that can't be any harder to sell than the RMA. You've been practicing, you're ready.

(General laughter.)

MR. BERRY: There were also issues with federal rules that were not in place to be able to do that yet.

MR. WILLIAMSON: But everyone would agree that ultimately that would be the best solution for downtown congestion and downtown air quality. Yes? No?

MR. BERRY: There were concerns expressed with the business community removing an interstate designation, kind of like our bypass or relief route issues in rural Texas, concerns that the traffic would no longer come through the city, there were some of those concerns expressed.

MR. WILLIAMSON: Would it be better if we called Interstate 10 North and Interstate 10 South?

MR. BERRY: That was one of the options that was discussed a few years ago.

MR. WILLIAMSON: That's all the questions I've got.

MS. ANDRADE: Chuck, thank you again for last night. It certainly proved that you do have a great staff and they have a great leader, and it's great to hear all the things that your staff does in the community to give back to this great community.

Congratulations on landscape and aesthetic-wise what you're doing to the structures. I think that when we pass by and see the beauty of it, it does make people appreciate to be Texans, and so thank you for that.

My questions to you are on the formation of the RMA, what I'm hearing is that it's not that the community is against tolls. I think they've understood that there's a gap there and that somehow we have to address it.

MR. BERRY: There's a growing number of people that understand the need for tolls, but there are still people in the community that don't believe that tolls are necessary at all.

MS. ANDRADE: So we have to keep on and educate the community.

MR. BERRY: That's right. We need to keep informing those people of why that need exists.

MS. ANDRADE: And Mayor, to you, thank you for entertaining us. I think it's going to be difficult for any community to top that, but I want to extend once again, an invitation. I know that when you formed the mobility coalition here, San Antonio participated in helping you when you were exploring that, but please look at our Alamo RMA and invite our executive director who is a former city manager, and our board chair who is a former mayor, to share with you what they're going through and to share with you some of the successes they've already accomplished because they're well on their way on moving forward. So I extend that invitation to you and your staff and your city council people to do that.

It's different from us telling you that it can work and that it is the right thing to do for a community. I guess I do a little more strong encouraging because I live in a community that has one and that it is working, not without problems, but it really is setting the future, and it's great when you have an entity and a group of business people that understand how important transportation is to their community and to this state. So I hope that you take me up on that. Thank you very much.

MR. BERRY: Thank you, Commissioner.

MR. HOUGHTON: Chuck, one more question. What's the cost of the Northeast Parkway, both sides, if you do interstate highway quality?

MR. BERRY: We have two versions of the Northeast Parkway.

MR. HOUGHTON: Full loaded interstate highway.

MR. BERRY: In Texas the cost estimate was in excess of $250 million, $250 million construction cost, and that's ten miles of new right of way. I believe the right of way cost estimate was somewhere about $50- or $60 million.

MR. HOUGHTON: And New Mexico's portion?

MR. BERRY: It would be approximately the same as our expectation but the work we were able to accomplish in New Mexico was very, very preliminary, so we're just saying it would be approximately the same, although New Mexico already has right of way and a two-lane road system along the route that we're proposing.

MR. HOUGHTON: So you're talking about another half a billion dollars, so if you start adding and you have a tally and you wanted to build these types of assets in El Paso, you're up to a billion dollars.

MR. BERRY: In excess of that because the Southern Relief route that we talked to you about was only Phase 1. That's about an $800- to $850 million proposal. The Northeast Parkway was going to be $400- to $500 million. So we wound up getting to in excess of a billion dollars really fast, and with $30 million a year, it became impractical to think we could ever accomplish that on a pay-as-you-go basis.

MR. HOUGHTON: Chuck, I want to thank you and your employees for making this district if not the best, close to the best in the state of Texas.

MR. BERRY: We thank you for your support and the support of this commission.

I did want to emphasize with you that we talked about 240,000 vehicles a day coming through El Paso. At the extreme ends of our county, we have 45,000 vehicles a day coming in from New Mexico and 30,000 at the county line to the east, so the most that that through traffic could possibly be is about 30,000 vehicles a day today, and yet we're still experiencing 240,000 ADT. Most the traffic that we experience on Interstate 10 is ourselves getting back and forth to work and our business and our pleasure trips in the region, and it's growing faster than what we're going to anticipate over the next five with the growth of Fort Bliss.

Thank you for coming to visit us.

MR. JOHNSON: Chuck, there's one more voice up here.

MR. BERRY: Yes, sir.

MR. JOHNSON: I'm curious as to why you're so shy about appearing behind the mayor. Those in the room -- and there are only a few of us -- of my generation remember Chuck Berry to wail out a few verses of A Brown Eyed Handsome Man or A Memphis, Tennessee.

MR. BERRY: Commissioner, let me reassure you that if I were to pick up Mayor Cook's guitar, you would pay me to stop.

(General laughter.)

MR. JOHNSON: I want to thank you, but also everybody in El Paso. The hospitality here has been five star and it's extraordinary. One of the great things, more pleasurable things about the job that I have and my colleagues have is to make visits like this and to have commission meetings out, but the hospitality here has just been extraordinary. And from seeing this community in a three-dimensional view from the top of Franklin Mountain just goes to show some of the complex issues that you face and you've made extraordinary gains but you're going to have continued extraordinary challenges that we've discussed, a lot of them financially based because we just don't have the money as we have been saying for a long time, and people hopefully are getting that message.

I want to salute you for your leadership in this district, and I want to compliment the district on how engaged they are, both on the job and off the job, within the community. It's a great pleasure to see. They're meeting the challenge of their jobs but they're engaged off the job with so many good causes, and it just brightens my day to see the results of that.

MR. BERRY: Thank you, sir. I'm very proud of that workforce and they work tirelessly for the department each and every day, and then some.

MR. WILLIAMSON: Thanks a lot. This has been a great visit and we've learned a lot, and I'm kind of interested in going around the north side of El Paso, so maybe we'll explore that a little bit more in the next year or two.

MR. BERRY: Yes, sir. Thank you.

MR. WILLIAMSON: Thank you for the good job, and we're going to approve our minutes and then we're going to take about a five-minute break and let everybody kind of reorganize themselves.

We appreciate, once again, the presentation by the City of El Paso, Mayor, we appreciate your city council persons who were here.

Members, you have before you approval of the minutes from the last meeting. Do I have a motion?

MR. HOUGHTON: So moved.

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. Thank you. We will take a five-minute recess.

(Whereupon, a brief recess was taken.)

MR. WILLIAMSON: We are going to return. When we were receiving comments from elected officials, I neglected to ask if the current county judge was in the audience or the county judge-elect, and I at this time ask is the county judge in the audience? County Judge-Elect Cobos, is he in the audience? I am sorry that I overlooked you at the time, sir.

JUDGE COBOS: Commissioner, I apologize, I was running late, I just got here. I appreciate you recognizing me. If I can delay for just two seconds, we have one of the media stations who needs to run in here and record everything that is transpiring here today, and here they are. They're fast, aren't they? Very efficient.

Commissioner Williamson. Good morning, commissioners. Welcome to El Paso. Commissioner Houghton, native El Pasoan, good morning. Anthony Cobos, county judge-elect, El Paso County.

In the El Paso Times today there was a story that read A Fifty-eight percent of El Pasoans polled the last two years do not support toll roads. Not once but two years in a row they said they do not support toll roads. I am here to speak on behalf of the majority of El Pasoans who participated in that poll who said they don't support toll roads. When people don't support toll roads, they're saying we're not going to pay to drive on a toll road. I obviously am opposed. I know most speakers this morning are for it, I am clearly against toll roads and the creation of a regional mobility authority.

I have a question, Commissioner Williamson. Why does Lubbock get a free outer loop, why does the city of Dallas-Fort Worth get a free outer loop, when the city of El Paso does not? Why does Houston have a free inner loop? Why do these communities in Texas, these large communities have a free loop when what you're saying is El Paso has to create a regional mobility authority to toll a road to pay for it when it's obvious that El Pasoans do not want to pay for a toll road, they want a free outer loop just like the other communities in El Paso.

Toll roads are more expensive to build than regular freeways, and I will yield a couple of seconds if anyone wants to challenge that, I welcome them up right now. Okay, no one is going to contest that.

Toll roads are more expensive to build; toll roads do not give us any free money; toll roads let us borrow money but they do not give us any free money. And I am very surprised at a lot of the elected officials. We had elections just recently in May, very contested elections, and some politicians were asked clearly: Do you support toll roads? The answer: No. And now we have an about-face.

And I also would like to point out and I would like to call on Senator Shapleigh who has always said where's our fair share. Where's the senator now and where does the senator stand? He's for toll roads. And I think that we need to recognize that as a community, the elected officials, appointed or elected by the populace, where do elected officials stand.

So the majority of El Pasoans are against toll roads, and even though it is a moot issue, you all have clearly made up your mind. Most of the audience is either going to make money on the toll roads, they're architects, engineers, those types of organizations who are going to make money on it, but the average-day El Pasoan who is at work right now who is going to be using the toll road does not want it. And I want you to know that this is an ongoing battle here in El Paso; by your action last month, you have sparked a fuse, and this is going to be ongoing, by no means is this item going to rest.

Thank you for your time, and welcome to El Paso.

MR. WILLIAMSON: Well, we appreciate you sharing your remarks. Thank you.

Let's move on to our agenda.

MR. BEHRENS: Okay. Thank you, Chairman. We're going to start out with agenda item number 6(a) instead of going to number 2, and agenda item number 6(a) is going to be a recommendation to the commission to consider allowing us to issue requests for qualifications to develop various proposed toll projects in the state, and Amadeo Saenz will present that minute order recommendation.

MR. SAENZ: Good morning, Mr. Chairman, commissioners, Mr. Behrens, Roger. For the record, Amadeo Saenz, assistant executive director for Engineering Operations.

Item 6(a), the minute order before you authorizes the department to issue requests for qualifications, RFQs, to develop, design, construct, finance and maintain and operate, as necessary to achieve optimal traffic solutions, toll managed lanes or toll roads for various state projects to the extent necessary to ensure that we have increased mobility, increased safety, and have financing for those particular projects.

A little bit of background. Staff has been working on developing a toll road program, a CDA program, where we have been evaluating projects across the state. This minute order is the first of several minute orders that we will bring to you where we will outline and put together a program.

Currently we are working on seven CDAs in the state of Texas. The majority of those CDAs are in the Dallas-Fort Worth area. We do have our two statewide CDAs that are under development, the TTC-69 and the TTC-35, and we've also been, like I said, evaluating additional projects across the state, and this minute order before you brings you six more potential CDAs that we want to get your permission to move forward with requests for qualifications.

The projects are projects that have been under development, and we have been working with both the NTTA in the Dallas area and also the Harris County Toll Road Authority in the Houston area and are coming up with a mechanism to develop these projects, but in the essence of time and efficiency, we also want to have the opportunity and the flexibility that should we not be able to come to an agreement with those two public entities on the development of those projects, that we can pursue a CDA.

In the next two months we will bring you some additional projects on a statewide basis of other potential CDAs that we would like to get your permission.

Our rules require permission from the commission to: one, go out for competing proposals; and then, of course, at a later time, once we have short-listed, we have to come back to the commission requesting permission to go out for requests for detailed proposals with the short-listed proposers; and then, of course, at the very end come back to the commission with our recommendation on the selected CDA candidate.

The projects that we bring before you today are two projects in the Dallas-Fort Worth area in the Dallas District. It is the State Highway 190, it's called the Eastern Extension. It is to propose to build a toll road. In the Fort Worth District it is a project in Tarrant and Johnson counties, it's what's called the Southwest Parkway State Highway 121; it is also a project that proposes to build a new toll road.

In Houston we have identified four projects. All of these projects are currently under development as far as environmental studies. The first project is State Highway 288 in Harris and Brazoria counties.

The second project is a project that kind of runs parallel to US 290 and also Hempstead Highway which are running in parallel. That project will propose a toll road and some managed lanes concepts.

The third project in Houston is a variety of projects in Harris, Liberty, Chambers, Montgomery, Fort Bend, Brazoria, and we inadvertently left out Galveston County but that has been corrected in the minute order, but Galveston County is also a county where the Grand Parkway State Highway 99 will go through, so we're asking for that project also to be able to move forward.

And the fourth project is an extension of a portion of Beltway 8 in Houston. It is also a project where we will add some new toll lanes and with the possibility of future managed lanes on portions that have already been built.

As I mentioned, this would start the process and will allow the staff and also the development industry out there to know what potential projects the department is looking at so that they can start planning and looking at what potential projects they should be able to compete for.

With that, are there any questions?

MR. WILLIAMSON: Oh, yes, there will be some questions. I'll have several, members, and I'll yield to each of you. Ted?

MR. HOUGHTON: Amadeo, this does not preclude the private sector from going out and identifying projects around the state that they believe are ready for development and unsolicited.

MR. SAENZ: No, sir, this does not.

MR. HOUGHTON: So we're allowing the private sector to continually look at projects across the state and see if there's something out there that we may not be seeing.

MR. SAENZ: We have two mechanisms for potential CDAs. Under the unsolicited proposal format where the private sector will bring projects to us, and then, of course, in us trying to develop a program of potential CDAs that we want to move forward and develop, we have been trying to put together a program where we identify these projects as projects that we think are good to develop and we'd like to move forward. It gives the private sector out there the opportunity to know what projects we're already looking at, and of course, they're welcome to look at for any other projects.

MR. HOUGHTON: And 121 is just the extension on the western side, isn't it?

MR. SAENZ: 121 is the extension on the western side. We're doing a CDA right now in the Dallas District on 121. This project does not immediately abut to that project, some of that 121 project has already been built, but this is an extension off on the western side in the Fort Worth District.

MR. HOUGHTON: Okay. That's it for me right now.

MS. ANDRADE: Amadeo, my only question is so we, the department, are doing this, but these communities already know this.

MR. SAENZ: Right. The projects have already been identified as toll projects by the metropolitan planning organizations. We have been working in the past in the Dallas-Fort Worth area with NTTA to jointly develop this project, and we're going to continue to work with NTTA to come up with a fair and equitable solution where we're participating in the project as well as they're going to provide some funding for the project, and then we will have some kind of revenue-sharing mechanism. If for some reason at a later time we cannot get to that point, we want to have the flexibility to then pursue this project as a comprehensive development agreement.

MS. ANDRADE: So we're giving them that opportunity.

MR. SAENZ: Yes, ma'am.

MS. ANDRADE: And they will choose whether they want to work with us or not.

MR. SAENZ:  Yes, ma'am.

MS. ANDRADE: Okay. Thank you.

MR. JOHNSON: Amadeo, in Exhibit A there are six projects, actually some of them are multiple projects. Can you just sort of roughly lay out the time element that some of these are going to occur more quickly than others in terms of arriving at a conclusion?

MR. SAENZ: Yes, sir.

MR. JOHNSON: But roughly, what's the time that we're looking at to arrive at a conclusion on the ones listed in the Exhibit A.

MR. SAENZ: I think from arriving at a conclusion to bring forth and either have the project developed by either NTTA or HCTRA or through the CDA process can vary somewhere between about eight months to a year to about a year and a half, depending on which direction we finally follow. As I mentioned, we are currently working with the two public entities to see if we can reach an agreement, but if we can't, we will start the process, and the process of the CDA, I think in what we've developed now under our program, it will take us about a little bit over a year.

MR. JOHNSON: Well, my impression is this mechanism is illustrative of the challenges that we face all across the state, and especially in our more populated areas, of how we're going to deal with the mobility challenges that we have.

MR. SAENZ: Right. What we want to do here is we are, in essence, running two processes in parallel so that we can gain in efficiency whichever direction we go so that we don't have to come back and restart the process all over again.

MR. JOHNSON: Good.

MR. WILLIAMSON: My colleagues have done a lot to clarify, Amadeo, but I just need to restate because we have people here who represent various parts of the world of NTTA and HCTRA and they obviously have to report back, not only to their respective boards or county commissioners but to interested people such as state senators and state house members.

It is our intention to continue to discuss with NTTA how either they can offer the best value for the citizens of North Texas or we can permit the private sector to do that. It's not our intention to take this away from them

MR. SAENZ: That's correct.

MR. WILLIAMSON: It is our intention to impress upon the decision that discipline of the private sector marketplace.

MR. SAENZ: That's correct.

MR. WILLIAMSON: And the same way for HCTRA.

MR. SAENZ: Exactly. We're treating both entities exactly in the same fashion.

MR. WILLIAMSON: And we wouldn't want to represent here that they've agreed necessarily with the CDA approach, we would only want to represent that we have been in contact with them, they are aware of our belief that we need to move forward while we continue to negotiate.

MR. SAENZ: That's correct.

MR. WILLIAMSON: Because if we don't move forward, we're losing time.

MR. SAENZ: That's correct. I personally contacted NTTA and the Houston District engineer has contacted HCTRA.

MR. WILLIAMSON: So while we don't expect them to give us glowing headlines tomorrow about doing this, I shouldn't expect to be blasted either. Correct?

MR. SAENZ: I hope not. We have been in contact and everyone knows exactly what we're trying to accomplish.

MR. WILLIAMSON: Between the county judge-elect in El Paso County and some senators in Dallas and Houston, it's going to be a pretty rough week on us if we're not paying attention to what we're doing.

MR. SAENZ: Like I said, we have been working closely with both NTTA and HCTRA in trying to reach a mechanism to how to bring a project that brings the best value to the region and we're going to pursue that, but then if for some reason we can't, then we have an alternate mechanism that can, and if that is the better one, then we will agree which way to go.

MR. HOUGHTON: Amadeo, could we put the Southern Relief Route on a CDA path?

MR. SAENZ: Yes, sir, we could. The Southern Relief Route is currently in the very early stages of environmental.

MR. HOUGHTON: Right.

MR. SAENZ: What we normally want to do, we have a mechanism to do a CDA called a pre-development agreement where we bring on a developer partner and then as the project evolves through the environmental process, and then at that point when we do have environmental clearance, then that is when we start looking into what is the best project to build. So it can be started so that, again, we don't have delays in the project, and it can be transferred over.

MR. HOUGHTON: And other projects across the state.

MR. SAENZ: Yes, sir, the same thing. It's very similar to what we're doing in San Antonio with 1604/281. We're carrying forward the CDA and then at some point we plan to transfer that project over to the Alamo RMA. We include the Alamo RMA in our project selection process and evaluation process, as well as get information from them with respect to business terms and evaluation criteria that they will recommend to the commission so that we can add into the documents of the consultants that the developers will be proposing under.

MR. WILLIAMSON: What's your pleasure, members?

MR. JOHNSON: So moved.

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. Thank you.

MR. SAENZ: Thank you.

MR. BEHRENS: We'll now go back to agenda item number 3, and that's our presentation by Coby Chase on our Strategic Plan and this is for your consideration to approve the text on what will go into that Strategic Plan for '07 through '11. Coby?

MR. CHASE: Good morning. For the record, my name is Coby Chase and I'm the director of TxDOT's Government and Business Enterprises Division.

Agenda item 3 is a minute order for the formal adoption of the text to accompany the Texas Department of Transportation 2007-2011 Strategic Plan. A proper strategic plan begins with a vision of how you would like your world to be at a defined moment in the future. It then identifies goals that when reached in total will result in that vision becoming a reality. In order to reach your goals, you define strategies and buttress them with unlimited tactics. The plan before you today actually does just that.

The official Strategic Plan -- let me separate this a little bit from the official Strategic Plan -- that you submitted to the Legislative Budget Board and the Governor's Budget Office on July 7 provides data about the department's projected performance in terms of the adopted budget structure prescribed by the Legislative Budget Board, or the LBB. The primary purpose of the official Strategic Plan is to measure an agency's performance from year to year using measures and objectives essentially identified when the system was created in the early 1990s -- it is antiquated.

Given the rigid structure of that approach in directing agency strategic planning, TxDOT, for the second period in a row, is suggesting a new approach. While the official Strategic Plan contains a brief summary discussion of the agency's mission, vision, goals and strategies, the body of that document focuses incorrectly on its rigid budgetary reporting structure. However, in order to truly express the agency's goals and strategies, we have developed a text before you today.

This text which will be published for public distribution expands upon and explains the agency's goals and strategies and tactics in ways that more directly address the public need. This corporate plan, so to speak, speaks more effectively to the public, our private sector and public partners, and state and federal legislators regarding what we really are about as an agency and how we plan to tackle the transportation challenge facing Texas over the next 25 years.

This text focuses on the five goals the commission adopted in April for the agency: reduce congestion, enhance safety, improve air quality, expand economic opportunity, increase the value of our transportation assets. These over-arching goals which we see as the true measure of progress for the department are supported by four strategies which are: use all financial options to build transportation projects, empower local and regional leaders to solve local and regional transportation problems, increase competitive pressure to drive down the cost of transportation projects, and demand consumer-driven decisions that respond to traditional market forces.

With your approval of this minute order, the department will produce a simple but compelling document that we will use to discuss our Strategic Plan with the public. We believe that this is the model for state agency strategic planning. I recommend approval of the minute order before you. I'll take any questions you may have.

MR. WILLIAMSON: Members, you've heard the staff's explanation and recommendation. Questions, discussion, dialogue?

MR. HOUGHTON: How do we plan to get this disseminated to the greater public, Coby?

MR. CHASE: The first step is Mr. Behrens asked the districts at the last management team meeting to build this into just about every single presentation they make to the public, first and foremost. So the first line of defense will be our districts as they meet with Rotary Clubs and so forth and so on. Every single metropolitan planning organization will know about this, every single legislator will be told by our office about it, and of course, our commissioners will be asked to incorporate it into just about every single speech and presentation that they make and we'll work with our partners out there on other levels, and they're hungry for this and they want to do it.

And we have a set of tools. This is, I would say, probably the last tool that they will need to actually have something to grasp onto and start speaking, but we have the Texas Transportation Challenge handout, that very nicely produced video from the Texas Transportation Forum, and some other materials prepared for use by all levels of the agency. And I am willing to do anything else too.

MR. HOUGHTON: You're going on the road is what you're saying.

MR. CHASE: Absolutely. The agency is going on the road.

MS. ANDRADE: Coby, would it be possible if we accompany it with a letter, especially in the communities that we've been working, just to send them to the local chambers that we work with and local groups like the mobility coalitions that we work with, just so that they can also -- I don't know that they would distribute it to the membership but at least have it available for their membership.

MR. CHASE: Oh, yes, ma'am. We have two things that we are going to get into the hands of that community, so to speak, and when I say that community, I'm talking large. We're going to have some big bangs. It will be the new Strategic Plan, or our public version of the Strategic Plan and TxDOT Open For Business because they go hand in glove with each other. It's like okay, we want to accomplish this. Well, then how do you accomplish it? And a couple of years ago we did something similar and it worked extremely well when 3588 was first passed, explaining to chambers, MPOs, local leaders, county commissioners, I mean, we will hit everybody.

And our marketing section is also, if I might brag on them a little bit, launching a new campaign to keep people always informed through electronic media and through newsletters, and big commission decisions are immediately put into something that's distributed statewide, and things of that nature.

MS. ANDRADE: Good. Thank you.

MR. JOHNSON: Coby, I don't necessarily have a question but I do have an observation. Earlier today the chair talked about this huge challenge before us, $86 billion shortfall in the next 25 years in terms of getting done what we need to get done, and he emphasized right after that that we have a plan, and this document, I think, is sort of the nucleus of the plan, if you will, and I think it's well done and I wanted to congratulate your department for the work that they've done on this document, and everybody else who's had a hand in it -- which there are many. It's to the point and I think that's the way you need to deliver messages.

MR. CHASE: Thank you, Commissioner Johnson, and to kind of say back at you a little bit, the commissioners and the commission offices and the administration have been deeply involved in this too, public discussion and other means. And Chairman Williamson asked us to look at all other state agencies and we deeply respect everything that all of our other state agencies have to do, but this one pretty much stands alone. There was one that's a wider version of this but this one is very, very clear-cut and it is very different and it is a wonderful tool, and thank you for your help in making sure we stay focused on it.

MR. WILLIAMSON: Well, it's just important, and I echo the compliments from John, but it's real important to have a piece of paper to hold up that's to the point that says, Look, we've got a problem, we've got a plan.

Now that the media cameras are off, I've been pondering the county judge-elect's wonderings, and it occurs to me that the most important thing we can do is identify the problem, identify a plan to solve the problem, and then say to anyone who wishes to offer an alternative: If you've got a better idea, advance it; if you don't, we're going to solve the problem, by 2030 this problem is going to be gone; if you've got a better idea, we're open to it.

MR. CHASE: And as these ideas are taking root -- and the roots are growing deeper every day -- this is the next logical step in what we need to do, and it is actually working. You're exactly right.

MR. HOUGHTON: Wait a minute, Coby, I'm not going to let that one go. When you say it's working.

MR. CHASE: Better understanding is what I mean by working.

MR. HOUGHTON: In what ways around the state?

MR. CHASE: Well, in a non-scientific manner, my division, we work with people all over the state. I mean, what is necessarily happening in El Paso is not what is happening, for instance, in Sugar Land, where Jefferson and I spent the day with them day before yesterday discussing some of the things in here, and there is less allergic reaction to things as people are trying to understand them better. And if you're following the media reports on the Trans-Texas Corridor 35 DEIS hearings, it is very interesting to see how local leaders are understanding better how these things work and how to take advantage of them, and you don't even have to read that deeply between the lines.

I mean, sure, we're having some issues, of course, with people who just don't like the Trans-Texas Corridor in the first place and are worried about what it will do to their land, or whatever the case may be, but you can see local leaders in a lot of those articles and a lot of the discussions that we have with them that aren't public, per se, are trying to make this work because they're understanding the message.

And we hosted, along with the NETMOB in North East Texas, in Commerce, Texas a conference, and what was great about that is we had a day with them -- Chairman Williamson was there, Amadeo was there -- that we had set up a day-long seminar on these things with them, and they were actively engaged. And they will be the first to admit to you a year ago, a year and a half ago they were not thinking about these things, and now they understand there is no more Road Fairy, it was shot or something.

MR. HOUGHTON: Somewhere in South Texas, I think.

MR. CHASE: Yes, exactly, laid to rest in South Texas. And they are actively understanding how to put these tools to use.

MR. WILLIAMSON: I think he must have been resuscitated somewhere in the El Paso area.

MR. CHASE: I've got to put that one back with you, Commissioner Houghton.

(General laughter.)

MR. HOUGHTON: I've just been thinking along the same line as Chairman Williamson, and it ties in with what you've been doing, Coby, and you're talking about sometimes the transmission lines and the microwave towers and news reports do not get this far west on really what's going on in the state of Texas. It's a magnificent situation. Sure, there are nay-sayers, but how many toll roads -- can I ask, Amadeo, how many toll roads are being planned in the Dallas-Fort Worth Metroplex, just roughly?

MR. SAENZ: We are working on four, two more that we discussed today. There's about ten to twelve toll roads that are being worked on in the Dallas-Fort Worth area.

MR. WILLIAMSON: Twenty-one, there's a total of twenty-one.

MR. HOUGHTON: And how about the Houston-Harris County metroplex?

MR. SAENZ: I'm trying to remember the map.

MR. WILLIAMSON: Seventeen.

MR. HOUGHTON: Seventeen. How many free roads are we building out there, new mobility?

MR. WILLIAMSON: By that he means tax-supported roads.

MR. SAENZ: Tax-supported roads, I would have to count, but what they're looking at, they're looking at establishing some funding mechanisms to be able to build more roads in the future. Some of these toll roads that they're building will generate concession fees that they're able to go out there and build some of the roads that are not toll-able. You've got principal arterials that can't be tolled because of access. Because of this, they're going to use these resources to help supplement that part of the program.

MR. HOUGHTON: How many toll roads does San Antonio have now?

MR. SAENZ: San Antonio has no toll roads right now. They're developing right now 1604 and it's going to be several segments on 1604 and also 281. They're also looking at three others within San Antonio.

MR. HOUGHTON: How about Austin?

MR. SAENZ: Austin, of course, CTRMA is building their first one in that 183A project, they're also looking at a project on 290, and of course, they've got their Phase 2, I think had about seven toll roads that they're looking at.

MR. HOUGHTON: Thank you very much.

MR. JOHNSON: Well, Amadeo, what about Cameron and Hidalgo counties?

MR. HOUGHTON: And I'm sorry, my good friends in Cameron and Hidalgo counties.

MR. SAENZ: Cameron County and Hidalgo County -- I'll just cover all the RMAs -- Cameron County is right now looking at two toll roads: one is what they call the West Loop, that was their initial project; they're also looking at a second access to South Padre Island.

MR. HOUGHTON: A toll bridge.

MR. SAENZ: As a toll bridge. And the Hidalgo County has identified several projects that they're looking at bypasses around some of the major areas and providing a more direct route to the border off of 281, they're trying to find a location, but they're also looking at doing some relief routes around La Joya, as well as building what very similar to this Southern Relief Route that El Paso is looking at and trying to get a special route from the international bridges parallel to the other roads but over to the foreign trade zone and to provide better access to their loop system. And in the long term, Hidalgo will be looking at a loop system for them as a toll road, Hidalgo County RMA.

The North East Texas Regional Mobility Authority in the Tyler-Longview area has increased the number of counties. They started with two counties, and they added, I believe last month, four counties, and their initial project was what they call the Hourglass which is Loop 49, and then, of course, it loops under the southern part of Tyler and then east towards Longview, and they're looking at that project. The Loop 49 initial project is the first one, they're moving that one pretty well. They're also looking at trying to improve their connections to TTC-69 so that this loop will provide them an access to TTC-69. So they're looking at trying to get these projects that will help them generate traffic, not only local but through traffic.

MR. HOUGHTON: You and I were in Lubbock. How did Lubbock come up with its match on Texas Mobility Fund money to build their road?

MR. SAENZ: Lubbock was mentioned earlier, but Lubbock has come up and put together a utility fee that they're charging to all new utility installations, and with that they're pledging that money.

MR. HOUGHTON: How much money?

MR. SAENZ: Something to the tune of about $70 million over a period of time that they will be pledging that to be able to leverage the Mobility Fund. And then, of course, in the long term they're looking at their next loop which will be probably a project that will be developed as a toll road.

MR. HOUGHTON: So Lubbock made a choice to, in essence, toll its people through utility franchise fees.

MR. SAENZ: Yes. Instead of tolling the users of the road, they toll the people through the utility franchise fee, and now they're applying that towards the toll road, or towards the development of the road system.

MR. HOUGHTON: And this begs a bigger question. Like I said, sometimes the wave lines out here and the newspapers, we don't get all the right information disseminated out here in far West Texas and what's going on in the greater state of Texas, and folks, it's magnificent what's going on in this state, truly magnificent.

MR. SAENZ: What has happened, when you all took the step that, in essence, moved the allocation of resources out to the region and empowered those regions to go out there and find a way to solve their problems, identify their needs, apply your resources, and then go out there and see how you can solve whatever you need to be able to get to where you need to be, has really helped and has really spurred a lot of innovation by all the entities to look. The biggest thing, the most important thing, they're willing to figure out a way to solve their problems, and then, of course, the ones that are developing toll roads, the other thing is as those toll roads start to put out monies, then that additional resource will remain in their area for them to do more projects.

The Dallas-Fort Worth area, through the CDA process with the concession fees, has identified what they call Near Neighbor, Near Term projects, and they're able to address some very short term needs that the communities needed. Those projects were not toll-able, they've had a lot of issues with access, more principal arterials, major streets but they were not capable of being tolled, well, through the mechanism that they're looking at, they're able to generate revenue early on to take care of those early needs, and still they're going to protect themselves by sharing in the revenue based on their investment to address future needs.

So it's brought in a lot of innovation across the state and we're real excited about seeing how the dynamics are working.

MS. ANDRADE: Amadeo, I have a question or ask you to support something that I've heard. The great thing that's happening throughout the state of Texas, also, is that these RMAs, Ted, some of the discussions that are being held is how are we going to re-invest the excess revenue that we get in the concession fees, and some of those discussions include investing in their public transportation systems, include investing in rail.

MR. HOUGHTON: Like in county transportation systems?

MS. ANDRADE: Yes, and isn't that wonderful because they're the ones that are going to decide where they want to put their excess revenue, but also the RMAs are trying to bring in integrated transportation systems to include these other modes of transportation, such as rail and public transportation. Which leads me to thank you, Coby, for including public transportation which is so much part of our transportation system.

MR. SAENZ: And that's exactly what's happening across the state.

MS. ANDRADE: That's the good news is that we're starting these discussions. Thank you so much.

MR. HOUGHTON: Thank you, Amadeo.

Coby, thank you for the tremendous job.

MR. CHASE: And Commissioner Houghton, you and I have talked about this at great length many times, and you will not be disappointed, trust me.

MR. WILLIAMSON: Okay. Anything else, members?

(No response.)

MR. WILLIAMSON: What's your pleasure?

MR. HOUGHTON: So moved.

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. Thank you.

MR. CHASE: Thank you.

MR. WILLIAMSON: Good job.

MR. BEHRENS: Speaking of public transportation, we'll go to agenda item number 4 which we have two Public Transportation minute orders that will be before you in the allocation of state funds to our providers and also some funding for non-urbanized areas in different parts of the state concerning bus projects. Eric?

MR. GLEASON: Good morning. For the record, my name is Eric Gleason, TxDOT director of Public Transportation.

This minute order awards $28.7 million in state funds to small urban and non-urbanized public transportation providers for Fiscal Year 2007. This amount is the second half of over $57 million for small urban and non-urbanized public transportation systems approved by the 79th Legislature.

There are 30 small urban and 39 non-urbanized or rural public transportation systems eligible for state funding. These systems carry over 19 million passenger trips traveling over 39 million revenue miles per year. The allocation among these systems, shown in Exhibit A, is the result of applying new formula rules adopted by the commission at its last meeting.

These funds will be used to provide service and purchase needed capital equipment to sustain or expand access to service in urbanized and non-urbanized areas of Texas. They contribute directly to achieving the commission's five goals, particularly in the areas of: improving air quality through modernization of fleet and use of alternative fuels; expanding economic opportunity through services and providing access to jobs and job training; and increasing the value of our transportation assets through improved coordination and utilization of scarce public transportation resources and preventative maintenance programs that extend the useful life of existing fleet investments.

Increasingly, we are finding these systems also playing a role in reducing congestion as demands grow for services from less densely developed areas of the state into our metropolitan areas. And then finally, these systems are a direct reflection of the values of the communities that they serve, providing basic mobility options to the transit-dependent members of the population and contributing to the overall quality of life in our rural and small urban areas of the state.

We recommend your approval of this minute order.

MR. WILLIAMSON: Members, you've heard the staff's explanation and recommendation. Do you have questions, comments or dialogue?

MS. ANDRADE: Mr. Chairman, the only thing I have to say is Eric, I certainly enjoy hearing how you've incorporated our goals into public transportation. I want to thank you for that.

MR. HOUGHTON: So moved.

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.

Eric knows that really the only way we can ever get public transportation at the same level of attention as highway construction or the other things that we do is to do it the way he's doing it.

MR. GLEASON: That's exactly right.

MR. WILLIAMSON: And once we get it there, then people have a very clear choice. I was tempted to comment on your comment a while ago, Ted, about people not focusing in on using their mobility funds or their regional mobility authority's excess cash flow to support their public transportation systems. That's something TxDOT can't do with gas tax money, but regional mobility authorities can do with concession money or toll collections, and it's very important to elevate public transportation to the same discussion level as highway construction so local leaders can make rational choices between expanding the bus system, laying rail lanes, laying concrete lanes or building bicycle lanes, the Mike Behrens Bicycle Lane.

So that's a good comment, Hope, you're right.

Go ahead, Eric.

MR. GLEASON: This next minute order approves the award of $2,982,929 of Federal 5311(f) Program funds for projects that enhance intercity bus service in Texas. Federal program regulations require that the department set aside 15 percent of the annual Non-urbanized or Rural Public Transportation Program apportionment to enhance and improve intercity bus service within the state. The objectives of the federal program are to: one, support the connection between non-urbanized areas and larger regional and national systems of intercity bus service; two, to support services to meet the intercity travel needs of residents in non-urbanized areas; and three, to support the infrastructure of the intercity bus network through operating assistance and marketing assistance and capital investment in facilities.

A competitive call for projects was issued on March 17, 2006. Thirty-two project proposals were received, totaling over $13.7 million. Proposals requested funding for operating assistance, facility construction and renovation, capital and planning. There were a combination of single-year and multi-year proposals. The projects listed in Exhibit A are recommended for funding at this time.

For the most part, the projects included in Exhibit A are single-year projects. The department did receive a number of multi-year, relatively large scale project proposals that we will continue to work with the proposers and to evaluate. We anticipate an award for the multi-year projects towards the end of calendar year 2006 that will recommend appropriate funding levels for these projects.

Intercity bus is an important component of the overall mix of public transportation options offered throughout the state. While it contributes to the five goals established by the commission in the same fashion as other public transportation providers, intercity bus services bring an emphasis on access to employment and on coordination as a result of construction and operation of multimodal facilities.

We recommend your approval of this minute order.

MR. WILLIAMSON: Members, you've heard the staff's explanation and recommendation. Questions, comments, dialogue?

MS. ANDRADE: So moved.

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. Thank you, Eric. Thank you for a great job you continue to do.

MR. BEHRENS: We'll go to agenda item number 5. It's proposed rules for this month. 5(a), though, however, we're going to defer this month. We have a little bit more work to do and we'll bring that back to you in the month of August.

Agenda item number 5(b) is Motor Carrier rules. They involve the insurance requirements for vehicles under 26,000 pounds, and I ask that Carol Davis present those rules to you.

MS. DAVIS: Good morning. For the record, I'm Carol Davis, director of TxDOT's Motor Carrier Division.

The agenda items before you propose the withdrawal of previously proposed amendments, and a simultaneous proposal of amendments concerning changes to insurance requirements for household goods carries operating vehicles weighing 26,000 pounds or less. These amendments are necessary to implement provisions of House Bill 2702, passed during the 79th Legislative Session and effective September 1, 2005.

House Bill 2702 amended the Transportation Code to require all household goods carriers to register as motor carriers, regardless of the weight of the vehicles that they operate. Alternative registration options for household goods carriers, formerly known as Type B carriers, were eliminated. These amendments resulted in Type B carriers no longer being exempt from motor carrier insurance requirements as the provision that Type B carriers are subject to the Motor Vehicle Safety Responsibility Act were deleted.

As you know, these amendments were initially proposed at the November 2005 commission meeting and final adoption was deferred at the February 2006 commission meeting. The amendment relating to automobile liability insurance requirements was removed from the package during the April commission meeting to allow TxDOT time to study the impacts of liability insurance levels.

The proposed rules before you establish a minimum liability limit of $300,000 combined single limits for vehicles weighing less than 26,000 pounds operated by household goods carriers. This figure was selected based on research conducted by MCD, the Motor Carrier Division, which found the following: national statistics support the contention that vehicles weighing 26,000 or less incur as high an incident rate as larger trucks; the death rate for occupants in light trucks is increasing which indicates that light trucks are involved in serious accidents that result in significant losses; and that previous insurance requirements under the Safety Responsibility Act of 20-40-15 are inadequate for regulated commercial activity.

We've reviewed the requirements for 16 states and that revealed that only Florida has lower requirements than those previously required for the Type B household goods carriers, and that several states have set their minimum limit using existing federal requirements which are $300,000 combined single limits for vehicles weighing under 10,000 pounds, and $750,000 combined single limits for vehicles weighing over 10,000 pounds.

With regard to the fiscal impacts of the proposed amendments, TxDOT's research shows that there may be a moderate economic cost for those required to comply with the proposed sections. The full information concerning the study is outlined in the preamble, but basically, what we anticipate is that during the next five fiscal years annual liability insurance premiums will increase 39 percent over current rates. Due to the many factors that affect insurance premiums, it's difficult to come up with a firm number of the cost.

In addition, it is also unknown if the affected carriers currently carry only the minimum level or if they carry insurance in amounts above that required by rule.

There have been some questions in the past about identifying the economic effects on small businesses and we have found that it's not feasible to change the rules to change the effect on small businesses, considering that the purpose of the statute under which the rules were proposed was for everybody to register the same way. To provide an alternate reporting system or establish a separate compliance process or exempt small micro-businesses would, in effect, be returning to the process that was used before the statutory changes.

Based on available information concerning household goods carriers registered with TxDOT, the cost to the smallest business required to comply is estimated at $8.09 per $100 of sales gross revenue based on a gross annual revenue of $4,500 for a carrier operating one vehicle. One of the largest companies, a Type A carrier who also operates smaller vehicles, with an annual gross revenue of $12 million, he operates 30 vehicles affected by the proposed rule, and will experience a cost of 9 cents per $100 of sales.

The public benefit of adopting these rules will be the implementation of House Bill 2702 and also increased protection for the traveling public.

The Motor Carrier Division will be holding a public hearing to receive comments on the proposal, and at this time we're recommending approval of the amendments as proposed.

MR. JOHN JOHNSON: Colleagues, we have one person who has signed up to speak on this matter. Would you have any questions of Carol first, or do you want to hear the testimony?

MR. HOUGHTON: I think hear testimony.

MR. JOHN JOHNSON: Rod Johnson has signed up to speak. He's the president of The Apartment Movers, and Rod, I believe you live in Dallas. Is that correct?

MR. ROD JOHNSON: That is correct.

MR. HOUGHTON: Welcome to El Paso.

MR. ROD JOHNSON: Thank you. It's good to see you again.

My name is Rod Johnson. I own a small local moving company called The Apartment Movers. We move people from one apartment to another one, using normal pickup trucks and small enclosed trailers. This is not an unusual practice but it has become the most common way that small moves are accomplished in Texas today. These pickup trucks are operated and they're owned by independent contractors.

Today there are still classes of movers in the state of Texas; these are distinguished by the size of vehicles they operate: you have Class A that's typically considered large van lines, these are your semis, your trucks over 26,000 pounds; and your Class B, people like myself with pickup trucks, small trailers, small box trucks, and there are twice as many of those small moving companies as there are large moving companies.

Today, the proposed rules before you attempt to implement two laws. The first one is House Bill 2702 which eliminates the classes based on weight, and the second one is Government Code Chapter 2006 and that requires the Texas DOT to study the rule's impact on small businesses, report that impact to you, and to mitigate the impact if legally and feasibly possible, and that's pretty broad terms. Now, this is to be accomplished before the rules are ever published for the first time.

Today is the fifth time that I've come before you to ask that you study the severe economic impact of these new rules and the impact on small businesses in particular and that it be mitigated. This is the fourth time that these rules have been put forth with very different statements of the economic impact on small businesses, and yet there are still no solutions to mitigation of these economic impacts. This is not because anyone has done anything wrong, if anything, it's my fault for not being more familiar with the laws and not being more convincing to you and the Texas DOT.

The first time the rules were published, there was a statement that there would be minimal economic impact on small businesses. I asked for that study because I found that to be unbelievable. It was unbelievable, there wasn't any study, there wasn't a single word on a single piece of paper anywhere in Texas DOT.

The second time the rules were published, rather than do the small business impact study, they took out the statement, equally unbelievable. You just don't do it. It's Texas law. You just don't do it?

The third time -- which was last month -- the new rules were published, they started the required study, and I applaud them for that, I think that's commendable. This is an agency that is understaffed, underbudgeted, and extremely short on time. They have no intention of doing anything wrong, these are excellent people, some of the finest I've ever dealt with. But the study didn't comply with the standards -- they're very specific -- I know they said they thought they did, but they didn't. The good news is between then and now they've done another study, and that study does comply with these standards and that's what Ms. Davis was talking about.

Let's talk about what those impacts really are. You heard those numbers come out there but let's get them down to some specifics and the real impact and real solutions today that you can implement.

So what was that impact? Texas laws require that they compare the cost for the additional $100 of revenue for the largest versus the smallest company. There are three of those mentioned. So what was the difference between the small businesses and the large businesses? Was it 10 percent more, 20 percent, 30 percent, 50 percent, 100 percent? We aren't even close. Was it 3 times, 5 times, 10 times? We're still not close. Was it 20 times? The numbers you just heard her read off is 32 times more expensive for small businesses than the large enterprises. And when I say large, I mean really big; the biggest was $688 million in income; these are big enterprises. They have the very smallest costs and we small businesses have the very largest costs, 32 times greater.

And the unfortunate thing is those aren't the real numbers. Those are the best numbers they had available to them. Texas DOT did not have the time and the staff to actually ask the movers what their costs were and what were the costs going to be for them, but I can tell you what mine are.

The additional cost for me -- and I already carry three-quarters of a million dollars of liability coverage on all the trucks that I own -- that's far in excess of the $300,000; I carry a million dollars on anything that I hire or any independent contractor, so we're covered already. The additional increase for me for a pickup truck is $4,452 each per year. That translates for me, with the cost of administration, into $350,000 additional cost per year. That's devastating, that's not minimal, that's not moderate, that is an incredibly devastating impact. If any one of your small businesses had an additional $350,000 increase in insurance cost for no coverage, no increase in coverage, I think it could be mitigated, and it can be mitigated. And whether you take my cost at $350- or Texas DOT at 32, it's still significant.

I asked the Texas DOT for the most recent study and their study on mitigation, because it's required by the law. The word mitigation wasn't even in it; there wasn't one single piece of paper, no attempt that I could see at any mitigation.

The current Texas DOT rules have sections that can mitigate the adverse impact on small business. This is a fact that's acknowledged in the preamble. They can't say that these are not legal and feasible because they're the current rules today in operation. All it takes to solve this is for the committee to tell Texas DOT to apply these alternative filing and reporting to small businesses.

All this takes a little time, and I think today the Time Fairy may have shone down upon us. The rule before you today should be the April 27 meeting rules that you passed and have now withdrawn with corrections. It appears that someone accidentally took the June rule that incorporated the past rules in April and fixed them. An example of this error is found in the Definitions section for commercial motor vehicles. The proposed rules before you do make it look like the new definition is an existing definition, and that's simply a clerical error, no one meant that to happen, but they shouldn't be published that way.

The proposed rules should not be published with this error, they should not be published without some attempt to study and mitigate the impact on small businesses, especially when the mitigating tools and the rules are already there. All it requires is your direction for small businesses to be affected by them.

Please direct Texas DOT to correct the rules to mitigate the economic impact on small businesses using the existing provisions in the rules. Thank you.

MR. JOHN JOHNSON: Thank you. Any questions of Mr. Johnson?

(No response.)

MR. JOHN JOHNSON: Thank you for being here.

Carol, would you please return. Clearly Mr. Johnson has brought up some points, several of which we've heard before and attempted to address. I think the most important one or the most current one is the study of the impact on small movers, small businesses. He used one number of 32 times. What I heard from you was the difference between 8-1/2 cents per $100 valuation and 9 cents, and I'm having a little trouble moving from 8-1/2 and 9 cents to 32 times.

MS. DAVIS: It was actually $8.09 for the smallest carrier that had one vehicle, and this was just one of the carriers that we researched.

The problem with this is is this information that a lot of companies are willing to share with us, and we've done our best to get this information. We have called carriers and gathered information on their costs.

MR. HOUGHTON: It's $8.09 per $100?

MS. DAVIS: Yes.

MR. JOHN JOHNSON: Any other questions or observations? Ric?

MR. WILLIAMSON: I would just ask if our general counsel might approach, and if he wishes to comment into the record about anything Mr. Johnson had to say, give him the opportunity to do that. He may not wish to.

MR. JACKSON: Mr. Johnson has become an expert, I think on the Administrative Procedure Act, and I applaud him for that, thank him for his graciousness. I just have some technical disagreements on the history of it.

I believe it's been published twice. There was a preamble that takes away all of this analysis. When you adopt rules, you don't publish the analysis the first time, and we never published one of the final preambles that he's counting. We did adopt some rules where we took a lot out, as required by the Texas Register. On the definition, I'm not aware of any definition that is missing. That may relate to what we adopted in I guess it was April. Several months ago we proposed many rules that did many things and we came back and we adopted much of that, but not much of what Mr. Johnson was objecting to, so we did make many changes that are there now, that are in the Code that we wouldn't put back in this time. I don't know if that is it or not.

MR. HOUGHTON: Let me ask a question. It seems to me -- and Bob, this may not include you in the conversation -- Carol, this seems to get down to a safety issue and a liability issue, and then the other testimony I heard from you is that you researched 16 states as to their minimums for an average of $300,000 of liability and that's what we're proposing, $300,000 of liability, so we're kind of in the area, in the range as other states are concerned.

MS. DAVIS: Yes, sir.

MR. HOUGHTON: And you gave testimony that said something to the effect that we've got a problem in the state of Texas with fatalities/injuries.

MS. DAVIS: Those were national statistics.

MR. HOUGHTON: Those are national. Okay. Excuse me. National statistics. So this boils right down to insurance costs, and we're requiring the carriers to carry $300,000 of insurance.

MS. DAVIS: Yes.

MR. HOUGHTON: And the cost of that insurance is whatever the market may be.

MS. DAVIS: Right. Depends on, also, your drivers, your records.

MR. HOUGHTON: Your driving record, right.

MS. DAVIS: What county you're in.

MR. HOUGHTON: Right.

Have I summed it up enough, Mr. Johnson?

MR. ROD JOHNSON: I think there's a great deal more to it than that.

MR. HOUGHTON: Well, I mean -- excuse me -- you've gotten down to cost. You talked about $4,000 worth of cost added on to each vehicle. Is that because of the liability insurance or are there other requirements? Just a yes or no, real quick.

MR. ROD JOHNSON: No. It's because it doesn't exist, that's what the problem is.

MR. HOUGHTON: There's no insurance for it?

MR. ROD JOHNSON: You're trying to insure a pickup truck like a semi because it costs that much to insure a semi. That's really part of the problem.

MR. HOUGHTON: But we have safety issues too.

MR. ROD JOHNSON: Absolutely. That's why we already carry the insurance. We already have a million dollars, not $300,000, I have a million dollars on everything, I have three-quarters of a million on everything I own. It's not that I'm not covered, I'm not running around without insurance, it's that in addition to that it's going to cost me $350,000 to comply with the rules the way they're structured. That's what the issue really is. Of course I've got the insurance.

MR. HOUGHTON: I'm at a loss then, I don't understand, Mr. Chairman.

MR. ROD JOHNSON: What's that?

MR. HOUGHTON: I'm at a loss as to what rules are going to add that additional cost.

MR. ROD JOHNSON: Basically what happens is we have hired and non-owned vehicles. Anything that we hire out there is your independent contractors, that's 100 percent of what we do, we carry a policy on those. The way the rules are structured, they're going to make us start individually insuring each one of those people's vehicles as though we owned it. We don't own it, and so it is extremely difficult. If it was like $300, like they say in the study, I wouldn't be standing up here. It cost me more than that to fly back and forth and to keep talking to you, wasting your time, and I don't want to do that. This is $350,000 additional cost to my company. We have zero liability losses, we have none, we have an outstanding safety program. Those aren't the issues at all.

MR. HOUGHTON: Carol, what are the issues in the state of Texas regarding what are we currently seeing in this market area as losses as to insured versus non-insured, accidents?

MS. DAVIS: I don't have that information, but what I can tell you that our research has shown is that losses for light trucks have increased and that vehicles involved with these types of vehicles in accidents incur significant damages and loss of life.

MR. HOUGHTON: And are we finding that they're not insured?

MS. DAVIS: Under-insured.

MR. HOUGHTON: They're under-insured. Okay.

MS. ANDRADE: Carol, I have a question for you, and I guess we discuss this month after month, and if I was in the industry and it was going to affect my business in this manner and we've posted it, we've made this public, why is no one else complaining?

MS. DAVIS: I really don't know.

MS. ANDRADE: So my question to Mr. Johnson is is it because of the way you operate your business that you're going to get more affected? I understand that what you do is you take the calls, you advertise for them, and then you contract it out versus an individual who owns the trucks, employs the people that move, and my question is is this just you that's getting affected or why is no one else responding to the concern that it's going to increase their costs?

MR. ROD JOHNSON: Communications is a major issue. I know you have trouble communicating with the public. I will tell you that the average person we've talked to -- and we've done our own surveys -- they have no clue this hearing is going on, and the times that we've tried to get them to come forward, they've come forward. Sure, we're the higher volume on the end of that, these guys are largely they own one, two, three trucks, they're working right now. This is the end of the month, this is their peak season, they can't show up. They call me, we talk to them. There's no way this guy who has maybe three trucks, it's him, maybe his brother, they can't even afford to show up, they don't even know this is happening, they have no clue that this is going down. And that's really sad because those are the people that we're supposed to be protecting, those are the small businesses this is all about.

We're a small business too under the category but we're probably the highest volume in the state, we move more people than anybody else.

MS. ANDRADE: And Mr. Johnson, I feel that we've done everything we should and we do have a responsibility to the state to protect people on the road and people that move, and so, Mr. Chairman, I'm ready to move on. I feel comfortable with what the state has done.

MR. JOHN JOHNSON: Rod, a question. The reason we've had multiple discussions on this issue is because we were statutorily charged to do this, to enact these rules. Is that a fair and accurate statement?

MR. ROD JOHNSON: That is correct. There's two parts to that, though. The other one is the mitigation on small businesses.

MR. JOHN JOHNSON: Well, I recognize that, and I think we've made an effort to do that. I'm a business person too and I have great sympathy for rising costs, and especially rising costs that were enacted by something that you don't have direct control over. Those are very frustrating but they're part of running a business.

We've had this discussion on numerous occasions. These are still proposed rules, they are not final, they are going to be posted, assuming they're agreed to at this meeting, there's still time to act. My suggestion to you, and I think you recognize, the bottom line solution is going to be found at the legislature and not before this commission.

MR. ROD JOHNSON: I think that there are both some solutions. If I thought that there was an easier solution, we could have very easily let these rules be passed, contested them on the back that they didn't comply with 2006 and said let's just have them overturned, because that's what 2006 says, you don't comply, you don't try to mitigate, they're just voidable. And I don't think that's the right forum for this, I think this is the right forum for this because you're charged with mitigating those impacts on small businesses.

It doesn't make any of the coverage for the public go away. There's structures in the rules right now to mitigate the impact on small businesses, they're right there. The Class B is typical of what it's all about. That's what they tried to do before there was a 2006, they mitigated it by saying gee, those are the little guys, let's give them an alternative reporting process, let's not just kill them with this stuff. They don't make $688 million like the biggest company in this state does.

They tried. They did it before the rules were ever out there for mitigating impacts on small businesses, they're in the rules today, all that has to be done is someone has to say just try, just study, try to mitigate that impact.

Sure we're the biggest, but $350,000 additional for no coverage. Where's the logic to that? I can't find it and it's not because we've done anything wrong, we have a zero loss history, it's because the product they're talking about doesn't exist, they're trying to get me to insure a pickup truck like a semi.

MR. HOUGHTON: Do you own that pickup truck?

MR. ROD JOHNSON: No, I don't.

MR. HOUGHTON: Therein lies part of the problem.

MR. ROD JOHNSON: That is a huge part of the problem.

MR. HOUGHTON: And I think our charge is to protect the public.

MR. ROD JOHNSON: Absolutely. I agree with you totally.

MR. HOUGHTON: And Carol hit the nail on the head: under-insured.

MR. ROD JOHNSON: I don't think that's true.

MR. HOUGHTON: Well, that's her --

MR. ROD JOHNSON: Her opinion. But the numbers don't reflect that. When they tell you there's 57 percent higher incidents but what's rolled into those light trucks is SUV. There's a huge increase in the number of SUVs. No one believes that pickup trucks are 57 percent more dangerous than they were five years ago, I don't believe that. It's just that there are 57 percent more SUVs out there that are classified as light trucks. That's a number that is misleading to some people.

MR. HOUGHTON: Well, we'll go back to Carol's statement that we have an under-insurance problem, it seems to me.

MR. ROD JOHNSON: Undocumented.

MR. HOUGHTON: And I'm going to go with my staff member.

MR. ROD JOHNSON: I understand that. But just like that person told you that they were pretty sure that study was done a month ago and it wasn't, I can tell you that there's not going to be anything that substantiates that, and we will ask for it. It doesn't exist, there's no reason to keep leaning back on something that's not there. We can move forward and mitigate these damages to small businesses, it's already in the rules, the structure is already there, it's not impossible, and there's errors in the way that they're published now. The definition that I pointed out, taking those April rules, simply made a mistake, there's nothing intentional there, for that reason alone it shouldn't be published. And I'll be glad to give the information over on that so they can really look at that in detail.

MR. WILLIAMSON: Chairman, could we ask Mr. Jackson to return?

MR. JOHN JOHNSON: Certainly. Mr. Jackson?

MR. WILLIAMSON: Mr. Jackson, my final question was are you comfortable moving forward with publishing these rules?

MR. JACKSON: Yes, sir.

MR. WILLIAMSON: Thank you.

MR. JOHN JOHNSON: Rod, I appreciate the time and effort and passion that you've put into this issue. I still think the answer lies with the legislature and not with this commission. I've heard my colleague, Ms. Andrade, say that she's ready to move on with the proposed adoption of these rules, and I'm of a like mind, and I haven't heard Mr. Houghton.

MR. HOUGHTON: I've said that.

MR. JOHN JOHNSON: I'll entertain a motion to that effect.

MR. HOUGHTON: So moved.

MS. ANDRADE: Second.

MR. JOHN JOHNSON: All in favor of the motion, please signify by saying aye.

(A chorus of ayes.)

MR. JOHN JOHNSON: Those opposed, no.

(No response.)

MR. JOHN JOHNSON: Thank you for your effort.

MR. HOUGHTON: Than you, Rod.

MS. DAVIS: Thank you.

MR. JOHN JOHNSON: Mr. Chairman, I'll pass this on to you.

MR. WILLIAMSON: Thank you, sir.

Let me just say, Rod, we actually understand completely what this is all about, and as I commented earlier in the year, this is a great example of the changing economy in our country, the transition from small business, large business and now the breaking up of large business into basically contractor business. I just make the observation that the reason these things occur is because government tries to pass rules to regulate everyone's behavior about everything, and inevitably -- I did it when I was in the legislature, I'm sure Mr. Pickett has seen it in other areas of legislation -- we try to pass things that are good for people and we look up two years later and we've made it more complicated in some instances than it was intended to be, and I think this falls here, and I think you'll find us to be allies in your legislative battle when the time comes.

We clearly understand the difference between a pickup truck mover and Allied Van Lines, we understand on a business level that difference. We'll do all we can to help.

MR. ROD JOHNSON: Thank you.

MR. BEHRENS: We'll go to item number 5(c), our last proposed rule for adoption. Eric, if you'll come forward. This rules deals with Public Transportation and two federal programs, one the Job Access and Reverse Commute Program, and the other the New Freedom Program.

MR. GLEASON: Again for the record, my name is Eric Gleason, TxDOT's Public Transportation director.

This minute order proposes the adoption of new sections concerning the implementation of Job Access and Reverse Commute and New Freedom programs created in SAFETEA-LU. Job Access and Reverse Commute, or JARC, is an FTA work transportation program that also funds transportation to support activities such as trips to workforce centers, job interviews, training locations, and daycare, and there's really two pieces to that program.

The first piece is Job Access which is oriented toward our welfare recipients and low income individuals to get them to work anywhere in the area where they are. The second piece, the Reverse Commute piece, is really oriented toward moving anyone from an urban area out to a suburban employment location, or from a rural area to a suburban employment location, and it's a reaction to the historical development of public transportation systems that focus on the center cities as opposed to our suburban areas, so that's what the Reverse Commute portion of this recognizes.

New Freedom is an FTA program that targets new public transportation services and services that go beyond ADA, American with Disabilities Act, requirements for persons with disabilities. SAFETEA-LU makes JARC a formula program. Previously JARC involved the national competition that had transitioned into congressional earmarking. SAFETEA-LU creates the New Freedom Program. States are designated recipients for urbanized areas under 200,000 in population and rural areas. In Texas, the governor has delegated project selection and grant administration for these programs to the commission.

The rules propose that projects must be derived from a local coordinated public transportation human services plan developed with public involvement, and that's a federal requirement. These rules link that federally described planning processes to Texas's ongoing regional planning process. The FTA also requires the state to use a competitive selection process for projects in both programs, and our selection process will select projects based on the potential of the project to contribute to the goals of the commission.

The Public Transportation Advisory Committee has reviewed the proposed rules and is in agreement with them.

If the commission adopts these proposed rules today, a public hearing is scheduled for August 30. Final action is scheduled for October. We anticipate a call for projects immediately following final adoption.

We recommend your approval of these proposed rules.

MR. WILLIAMSON: Members, you've heard the staff's explanation and recommendation. Questions, comments or dialogue, please?

(No response.)

MS. ANDRADE: So moved.

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. Thank you again, Eric.

MR. GLEASON: Thank you.

MR. BEHRENS: We'll go now to agenda item number 6. We've done 6(a); we'll go to 6(b) which will be to ask your acceptance of the General Engineering Consultant quarterly progress report for the Central Texas Turnpike System projects.

MR. SAENZ: Thank you, Mike. Again for the record, Amadeo Saenz, assistant executive director for Engineering Operations.

Item 6(b) seeks your acceptance of the General Engineering Consultant quarterly progress report for the Central Texas Turnpike project as of May 31, 2006. In accordance with the indenture of trust, the commission covenants that at least quarterly during the construction of the 2002 project it will cause the General Engineering Consultant to prepare a progress report.

Section 406 requires copies of this quarterly progress report be filed with the commission, the U.S. Department of Transportation, and the trustee, and then made available by the trustee to the owners of the obligation of the 2002 project. The quarterly report for the period of May 2006 has been prepared by PBS&J in accordance with this section, and that report is included in your packet.

Kind of in summary, the project is well underway, it is ahead of schedule and under budget. When we look at the estimated completion cost of about $439 million in our original estimates, so we are under budget. Also, the project is well in advance of construction and portions of the project, it was announced last month by Governor Perry, the sections of 45 northeast from Loop 1 to the east and the top north two sections of the 130 project are going to be open, some sections, over a year ahead of schedule by this winter.

The report provides a lot more detail. I'll be happy to answer additional questions on the report, but staff recommends acceptance of this report.

MR. WILLIAMSON: Members, you've heard the staff's explanation and recommendation. Questions, comments or dialogue?

MR. HOUGHTON: $400 million under as of right now?

MR. SAENZ: As of right now we are about $439 million below our original estimate. And as I mentioned, the projects are ahead of schedule. The final two projects on 130 are still scheduled to be completed, as was originally planned, by December of 2007, but the other projects will be completed ahead of schedule and we look to be able to open portions of that facility by this winter.

MR. HOUGHTON: Congestion relief on the way.

MR. SAENZ: Congestion relief on the way.

MR. JOHNSON: I think that's an excellent report. I'm pleased to make the motion to accept.

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. Thank you.

MR. SAENZ: Thank you.

MR. BEHRENS: Under agenda item number 7, we have two minute orders concerning Finance. One would be another quarterly report, this is our Investment Report, and it's required by our Public Funds Investment Act, and then 7(b) would be the annual review of our investment policy, and James Bass will present those to you.

MR. BASS: Good afternoon. For the record, I'm James Bass, chief financial officer at TxDOT. Item 7(a) presents the Quarterly Investment Report of the third quarter of Fiscal Year 2006, ended on May 31. The investments covered in this report are associated with the 2002 project of the Central Texas Turnpike System, and also with the lease with an option to purchase for the Houston District headquarters facility.

The details of those investments have been provided to you in the report, and I would be happy to answer any questions you may have. If no questions, staff would recommend your acceptance of the report.

MR. WILLIAMSON: I think we've all read it, so you've heard staff's explanation and recommendation.

MR. HOUGHTON: So moved.

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.

MR. BASS: Thank you.

Item 7(b), as Mr. Behrens said, the commission is required by the Public Funds Investment Act to review and re-adopt the investment policy and investment strategy at least annually. Through this review process there were a few minor modifications made to add clarity, some changes to the listing of qualified financial institutions, and one to add the Debt Management director position in the Finance Division as an investment officer.

Staff recommends your approval.

MR. WILLIAMSON: Again, members, I think we've all had an opportunity to read through this ahead of time.

MR. HOUGHTON: So moved.

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. Thank you.

MR. BEHRENS: We'll go to agenda item number 8.

MR. BASS: Agenda item 8 seeks your preliminary approval of a loan to the City of Center in the amount of $475,000 to pay for water line relocation and upgrade on State Highway 7.

Staff recommends your approval so that we may begin negotiations with the city.

MR. HOUGHTON: So moved.

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.

MR. BASS: Thank you.

MR. WILLIAMSON: You want to go ahead and do Thomas's contracts?

MR. BASS: Sure.

MR. WILLIAMSON: If we don't do that one, we'll probably have some people a little anxious.

(General laughter.)

MR. BEHRENS: Agenda item number 9 is our contracts for the month of July, both our Maintenance and Building Contracts and also our Highway and Transportation Enhancement Building Contracts. Thomas?

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

Item 9(a) is for the consideration of the award or rejection of Highway Maintenance and Department Building Construction contracts let on July 6 and 7, 2006, whose engineers' estimated cost were $300,000 or more.

We had 32 projects, average number of bidders is 3.1 bidder per project. We have three projects recommended for rejection.

The first project is project number 4026 in Bexar County. It was 29 percent over; we only had one bidder on this project; the low bid was $904,000. It's a traffic signal maintenance and repair work and prices are high and we only had the one bidder, so we'd like to go back and re-bid the project and see if we can get more bidders, get better competition and hopefully reduce prices.

The second project recommended for rejection is project number 4030 in Bexar County again. It was 57 percent over; we had one bidder only; and the low bid was about $1 million. This is a sweeping contract, and again, the prices are very high here and we'd like to see if we can get additional competition and get better prices again and re-let it.

The third project recommended for rejection for a maintenance contract was project number 4009 in Potter County. It was 34 percent over; we had three bidders; it was $416,000 low bid. This is a two-year litter contract and we think we can get actually additional bidders if we reduce it to a one-year contract and reduce some of the risks for fuel and other things that might escalate during that period of time, so we'll go back to one year, make it a smaller contract, and get more bidders, hopefully, on it.

Staff recommends award with the exceptions noted.

MR. WILLIAMSON: John, we're on item 9(a), the Maintenance portion.

MR. JOHNSON: Got it.

MR. WILLIAMSON: Thomas has recommended the rejections noted in the documents you've already read.

Thomas, I just note, giving John a chance to review his notes, that when you pull out the recommended rejects, we're slightly below our estimate compared to the actual, and that's the first time that's happened in a while. Have we increased our estimates to reflect higher fuel, or are we seeing a little more competition on the maintenance side?

MR. BOHUSLAV: On the maintenance side, I don't know exactly and I don't know if Zane is here. Probably a little bit of both. But I know on the construction side there's been a concerted effort by the districts and I believe the division to look at the prices right before the letting to hopefully reflect the previous month's prices so that we catch up our estimates to what's happening very current.

MR. WILLIAMSON: We weren't trying to be critical, but I think the commission has tried to voice to staff, you know, we would much prefer the most accurate. We can't advocate for our plan if we can't represent to policy-makers that we're staying right on top of the cost of things as they go up and as they go down, and inevitably some of the stuff will go back down. But it appears to me that would be the case.

MR. BOHUSLAV: I think you may still see a few projects where we just missed our estimate again, but we're working hard to try to correct those.

MR. WILLIAMSON: Members, you've heard the staff's explanation and recommendation.

MR. HOUGHTON: So moved.

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. Thank you.

MR. BOHUSLAV: Item 9(b) is for consideration of the award or rejection of Highway Transportation Enhancement Building Construction projects and Highway Improvement contracts let on July 6 and 7, 2006, and also the deferred project from the June 29 commission meeting. We had 111 projects, an average of 3.3 bidders per project this month. Staff has recommendation for rejection as follows.

The first one here is the deferred project from last month, project 3226 in Fort Bend County. It was 37 percent over; we had two bidders; the low bid was about $389,000. This is a restoration of the SP Railroad Depot there in Richmond, and we have had additional discussions -- in fact, we have a letter from the city that they would like to go back and do some redesign to take some components out of the building to try to save some costs since they were going to have to pay for the additional overruns on the project. So we maintain the standing that we do want to reject that project and go back and make changes to the design and re-let it.

The second project recommended for rejection is this month -- and the rest of them are for this month -- project number 3053 in Grayson County. It was 49 percent over; had one bid; the total low bid was about $1.5 million. It's a ramp reversal project on US 82. We only had the one bidder again and we had some restrictive milestones in the project that made it very difficult for the contractor to meet. We'd like to go back and adjust those or remove them, depending on what we think we should do there, so redesign and re-let it and hopefully we can get more bidders for it as well when we do that.

The next project recommended from this month for rejection is 3046 in Johnson County. It was 72 percent over; had one bid only; low bid was about $9 million. This is for rehab work on FM 4 in Johnson County. Prices are high and we want to look at a redesign to reduce some costs and hopefully solicit more bidders on the project.

Project number 3226 in Live Oak County was 186 percent over; only had one bidder; $124,000. We've got to go back and rebid this job and see if we can get more interest. In fact, I think we're aware of another bidder that was interested, just was unable to get their bid together in time.

Project number 3223 in Lynn County was 73 percent over; only had one bidder; the low bid was about $374,000. This is for some landscape and rehab work on a picnic area on US 87. Again, prices are high and we'd like to go back and solicit more competition for this project in hopes that we get some reduced costs.

Project number 3204 in Walker County was 45 percent over; only had one bidder; it was $33 million low bid. This is rebuilding frontage roads on IH-45, and again, we'd like to get more competition for a project this size for sure and see if we can't get better prices when we rebid it.

The last project recommended for rejection is project number 3220 in Williamson County; 85 percent over; only had one bidder for this project; it's $1.8 million low bid. This is an enhancement project on some city streets for landscape work and the local entity there will have to participate in the overrun, they just won't be able to do that, so we need to go back and see if we can either redesign or consider something else for the project.

Staff recommends award with the exceptions noted. Any questions?

MR. WILLIAMSON: Same observation about the Construction side, we continue to be a little bit higher than our estimates, so let's keep emphasizing to district staff and the divisions that we're aggressively building all over the state, we need to manage our cash flow very carefully. Managing our cash flow means if we see a trend that we just can't stop because of the cost of oil or maybe all the construction firms are full up for a while and it may be the case we're going to have to start easing back on some projects so that inflation doesn't eat away detrimental to our long term goals.

I'm not saying we don't need to build, Mike, I'm just saying we need to be real cognizant that this is a cash flow world that we live in now and we've got to be careful.

MR. BEHRENS: I understand.

MR. BOHUSLAV: I don't know. Mike, you might speak better to this but I haven't seen anything like this before. Mike, you might know better.

MR. HOUGHTON: When you say you haven't seen like this before.

MR. BOHUSLAV: Where our prices are increasing so rapidly.

MR. HOUGHTON: Let me dovetail on that, Mr. Chairman. We haven't seen it mentioned in the meeting today, but the rescissions that we've received by the Federal Government. I think we just got another one recently.

MR. WILLIAMSON: We're now up to, Coby, 305?

MR. CHASE: 305.

MR. WILLIAMSON: $305 million that our apportionment has been reduced since the passage of that law that some of our congressional delegation is so proud of.

MR. BEHRENS: We're hearing rumors there's probably going to be another one.

MR. WILLIAMSON: There's no question in my mind there will be more and more.

MR. HOUGHTON: So this, coupled with the increases, has kind of compounding effect.

MR. BEHRENS: I think when you look at the fuel costs and material costs and things like that, that's probably been the largest since I've been around, 15 to 20 percent in a year to 18 months.

MR. WILLIAMSON: Well, it seems to me there's four factors that contribute that affect our business greatly. Obviously the price of steel is going up, obviously the price of oil is going up, probably the price of labor that our contractors are having to pay is going up because they're having to compete with the steel and the oil and gas business for the same skilled labor.

MR. BEHRENS: And like you said earlier, the large program we have out there.

MR. WILLIAMSON: And then the fourth item is we have a huge program. We've got orange cones from El Paso to Texarkana, from Amarillo to Brownsville. I mean, that's going to have a little bit of pressure on things.

MR. HOUGHTON: Coby, have we communicated that to the greater public of our $305 million rescission?

MR. WILLIAMSON: I think that because of the areas we've chosen to reduce our budget in, I think we've tried to.

MR. HOUGHTON: Or at least the legislators.

MR. WILLIAMSON: Well, we need to be respectful of our House and Senate masters. It's public record but there's no reason to make a big deal out of this, it's just one of those uncomfortable things. But I do think we need to be aware our world has changed so much in the last six years and there's still people that we deal with that haven't caught up yet. I still find people in my travels across the state every day, Thomas, that don't realize we allocate money to districts now, we don't pick projects. Clearly, I think, the county judge-elect isn't aware of that.

And I don't think everyone is aware of how aggressive we are in using all the tools because we're now taking a cash flow management approach to our construction program as opposed to a project approach, so we just need to be really cautious. We see these cost run-ups but we're going to have to regulate back some of our projects to let the cash flow catch up, I think. And we ought to be able to do that, we ought to be able to talk to the DEs and say if you're on a six-month deal here, extend it to eight months and let's regulate ourselves so that our cash flow stays right above zero but not below.

Okay, you've heard the explanation, the recommendation and the discussion.

MR. JOHNSON: So moved.

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. Thank you.

MR. BEHRENS: Agenda item number 10 deals with Building Construction. We have two minute orders that deal with area engineer and maintenance facilities where we're asking you to consider letting us go out and see if someone is wanting to give us some proposals to help us rebuild these facilities. Zane?

MR. WEBB: Good afternoon, commissioners. I'm Zane Webb, director of the Maintenance Division. Item number 10(a) is a proposed property exchange in Comal County for the New Braunfels area office and maintenance facility that would authorize the department to issue a request for qualifications and proposals, then select, rank and negotiate a development exchange agreement with the top-ranked design-build firm for a new site and the design and construction of a building in exchange for existing properties.

Now, if we do get a good proposal on this and staff recommends to the administration and the administration accepts, we will come back to the commission for final approval on that proposal.

Staff recommends approval.

MR. WILLIAMSON: And Zane, we've done this in the past. Correct?

MR. WEBB: Yes, sir.

MR. WILLIAMSON: So we're developing a certain expertise in the upgrade of our facilities in this way.

MR. WEBB: It's an attempt to do a private-public sector cooperative development on a piece of our properties maybe we shouldn't be on anymore, they've become very expensive, other developers would like to have them, and if we can move out and become better neighbors someplace else and get a new facility for that, it's in the best interest of us and the private community.

MR. WILLIAMSON: Lets us serve our public better and lets the local tax rolls expand to reflect the value of that land we're on.

MR. WEBB: Yes, sir.

MR. WILLIAMSON: Members, you've heard the staff's explanation and recommendation. Comments, questions, dialogue?

MR. HOUGHTON: So moved.

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. Thank you, Zane.

MR. WEBB: Thank you. Item 10(b) is for the authorization to the department on a property exchange in Kerr County, Kerrville area maintenance engineer office. It authorizes the department to issue a request for qualifications and proposals, and then select, rank and negotiate a development and exchange agreement with the top-ranked design-build firm for the design and construction of a building on state-owned property in exchange for existing properties.

Staff recommends approval.

MR. WILLIAMSON: And same as item 10(a) above?

MR. WEBB: Yes, sir.

MR. WILLIAMSON: What's your pleasure, members?

MR. HOUGHTON: So moved.

MR. JOHNSON: Second.

MR. WILLIAMSON: I 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. Thank you, Zane.

MR. WEBB: Thank you, sir.

MR. BEHRENS: Agenda item number 11 concerns Right of Way and this would be a recommendation to use one of our tools and that's the advance option to purchase right of way and this would be for a roadway in the Austin District on FM 973. Amadeo?

MR. SAENZ: Thank you, Mr. Behrens. Good afternoon, commissioners. Again for the record, Amadeo Saenz.

I would like to present for your consideration the minute order under agenda item 11 which is to authorize the department to use the option contracts for potential future purchase of right of way along the proposed route for the extension and widening of FM 973 relief route around Manor in Travis County.

The minute order provides the authority for the Austin District engineer to negotiate and the execution of option contracts and to expend funds for option fees and related expenses with willing property owners. Timely execution of option contracts to effectively purchase the development rights during the interim prior to the scheduled right of way acquisition provides strategic opportunity to realize lower acquisition costs, less complicated negotiations, and a more efficient acquisition process.

Staff recommends your approval of this minute order.

MR. WILLIAMSON: Members, you've heard the staff's explanation and recommendation. Questions, comments or dialogue?

MR. HOUGHTON: So moved.

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. Thank you.

MR. SAENZ: Thank you.

MR. BEHRENS: Agenda item number 12 is our Routine Minute Orders. They have all been duly posted as required. I've reviewed all of these minute orders; I don't see any that would affect the commissioners or anything that they may have in their holdings. I'd be happy to discuss any of them at your pleasure if you wish to; other than that, staff would recommend approval of the Routine Minute Orders.

And for the record, if you'll look at 12(a)(3), that particular minute order considers a donation from SEMPRA Energy to relocate 3.3 miles of State Highway 87 to accommodate the construction of the Port Arthur LNG Project. We have a letter from Senator Tommy Williams that supports that minute order, and ask that you consider favorably that particular project. We also have a representative, I understand, if he's still here, from SEMPRA if you might have any questions about that particular project.

MR. WILLIAMSON: Do you want to come up and let us bombard you, or do you want to just sit down and hope it gets passed?

MR. IVEY: My name is Marvin Ivey; I represent SEMPRA Energy and the Port Arthur LNG Project.

MR. WILLIAMSON: Well, we wouldn't approve this if Tommy Williams hadn't sent us a letter.

MR. IVEY: Well, actually I have several other letters with me if you need more influence.

MR. WILLIAMSON: Tommy is all you need; he's a friend to this commission.

MR. IVEY: Okay, good.

MR. JOHNSON: Does this contribution offset the entire cost of the relocation?

MR. BEHRENS: Yes, sir, I think it does.

MR. WILLIAMSON: Is the Port Arthur LNG Project a new project?

MR. IVEY: It is, sir. It's a $700 million investment in Jefferson County. That portion of the waterway there is restricted by the existing highway, so this will open up the waterfront well beyond our project so that it allows for additional economic development along that section there in Jefferson County.

MR. WILLIAMSON: If you'll build another one of these, we might build you a highway.

MR. IVEY: Well, you know, keep talking.

(General laughter.)

MR. BEHRENS: Commissioner Johnson, as you see in the minute order, this is a $2.85 million donation.

MR. JOHNSON: But is that what the cost is going to be?

MR. BEHRENS: Yes.

MR. WILLIAMSON: We're glad you're doing this.

MR. IVEY: It's our pleasure.

MR. WILLIAMSON: It's important to our state and important to our nation. We can't have energy independence without investing some money.

MR. IVEY: Absolutely.

MR. WILLIAMSON: Okay, members, you've heard Mr. Behrens's explanation and you've heard his recommendation and you've heard that he's checked as best he could, but we don't hold him to it, if any of you have a conflict, now is the time to say it. I see none that I'm aware of. What is your pleasure?

MR. HOUGHTON: So moved.

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.

MR. BEHRENS: That completes our portion of the business.

MR. WILLIAMSON: Let's see, we've got a legislative presentation, do we not?

MR. BEHRENS: You're right. I forgot that. We need to go back to agenda item number 2.

MR. WILLIAMSON: And Bob Jackson, are you aware of any reason for us to be in executive session today?

MR. JACKSON: No, sir.

MR. WILLIAMSON: Thank you.

MR. BEHRENS: Thank you for correcting me, Chairman. We're going to agenda item number 2 which is our Discussion Items. We've had these for the last several months. 2(a) will be a discussion of our legislative agenda and what we can put on there to help improve the operation of the department, and then that will be followed up by agenda item 2(b) where we're looking at our Legislative Appropriations Request for the upcoming session. Coby will lead off and be followed by James Bass.

MR. CHASE: Good afternoon. For the record again, my name is Coby Chase and I'm the director of TxDOT's Government and Business Enterprises Division. Today I will further discuss the formulation of your legislative agenda for the 80th Session of the Texas Legislature.

As has been said before, the Transportation Commission is authorized by law to make recommendations to the Texas Legislature on statutory changes that would improve the operation of the department. The purpose of this ongoing dialogue is to make these issues public and to invite any participation. If anybody has any comments on what we're presenting to you, we certainly invite those.

Last month I went through an exhaustive listing of statutory changes to improve department operations. I'll review those issues now. The list is not different than last month, it will be the same list that I'm repeating, but of course, feel free to stop me with any questions you might have.

MR. WILLIAMSON: And in repeating the list, you'll be repeating the sections and not going through the entire explanation?

MR. CHASE: Yes. Would you prefer that?

MR. WILLIAMSON: Well, I think there's a plane to catch. I think most people, I look around, Vic Suhm, for example, if he hasn't got this memorized by now, there's no hope for him.

MR. CHASE: He has no excuse, quite frankly, Chairman.

MR. WILLIAMSON: There will be some questions that some of us are going to have about some as we go through.

MR. CHASE: I am just going to basically discuss them just by topic, not any depth, but if you have any new questions or new wrinkles or new suggestions, I'll certainly take them.

One is we need to make it clear in statute that the Texas Department of Transportation is not in the social services business when it comes to providing medical transportation; we are, however, in the scheduling and transportation-providing business.

We'd like the opportunity to share the cost of purchasing billboards with cities when they do not allow us to relocate them.

There is a continuing evolution in the point of collection, changing the point of collection of motor fuels taxes. We're still diving deep into that issue.

Regarding the Texas Mobility Fund, we are, at your direction, looking at the fees that are collected from the trucking industry that now go into General Revenue to put those in the Mobility Fund.

We are conducting research on a safer temporary dealer tag.

Regarding the project development process, first is to grant counties transportation planning authority, the authority to acquire rights of way from a willing seller earlier in the process, and third, we believe there's a better method of procuring engineering services and recommend a quality-based, best-value approach to obtaining this vital service.

In addition, we are stating the department's authority to enter a property for the purposes of conducting surveys and appraisals and making sure that state law matches and tracks closely federal law in SAFETEA-LU so we can fully implement our delegation of environmental review that was given to us by SAFETEA-LU.

Two other items on utilities in the right of way, the cost we pay to relocate them and the right they have to use the right of way for free.

There is perhaps no more important issue before us next session than seeking to capitalize the Rail Relocation and Improvement Fund. We've been working with a number of outside partners to discuss how to best capitalize that. Morgan Stanley and a few others have been very, very helpful in helping us to crystallize some of those ideas and I think we'll have a set of suggestions to present the legislature when the time comes.

And as instructed last month, we will be meeting with the Class 1 railroads to discuss this issue more in depth. We've started that dialogue with them and I believe we're going to meet next week.

MS. ANDRADE: Coby, I have a question on that.

MR. CHASE: Yes, ma'am.

MS. ANDRADE: I know that you have been having ongoing discussions on this, but it hasn't been brought to us yet so at some point do you plan to discuss this with us, the ideas that are being brought up there?

MR. CHASE: Yes, ma'am. I did early and we kind of skimmed the best off the top, but there are something on the order of 40 or 50 and after about number 10 they kind of drop off in viability or logic, in some cases. Yes, ma'am, absolutely you will know fully what they are.

MS. ANDRADE: Okay, thank you.

MR. CHASE: Enhancing safety on our highways is, of course, tantamount to everything we do. Authorizing a system of sobriety checkpoints has proven to be effective. The commission has clearly stated they believe that it's time in Texas that these be established, and we are working on that issue as well.

Also, authorizing the department to implement a variable speed limit system to address fluctuations in roadway conditions.

Some issues relating to comprehensive development agreements. Repeal of the CDA sunset date and the statutory cap on CDA-related expenditures. The 50-year cap on concession terms needs to be lifted -- at least that's what our research is indicating at this point. TxDOT should be granted the authority to assume the debt of a CDA developer and issue the bonds necessary to terminate a CDA if that were to ever come to that. We should be granted the ability to deposit concession fees into the Mobility Fund, and then, of course, the CDA process should be opened up to non-tolled highway projects as well.

Other toll-related issues include granting the commission the ability to acquire toll roads from other public entities and issue debt for that purpose, and in addition, we should be granted the ability to enforce the payment of tolls through the denial of motor vehicle registration and driver's license renewals.

One issue in particular I'm interested in seeing involves the notion that TxDOT create its own separate entity that can compete in the CDA process. Our research section is digging into that now.

MR. WILLIAMSON: Wouldn't we face similar federal restrictions as are faced by NTTA?

MR. CHASE: I don't speak with authority on this, but I believe that we do and we're looking into that on the federal level as well.

MR. WILLIAMSON: I think federal law, when the congressman from southeast Texas got the statute put in to protect engineers from competition, all you engineers, that's when they installed the prohibition against government or quasi-government operations competing with the private sector for contracts.

MR. CHASE: Right. And we have NTTA and possibly HCTRA some day who kind of want to get into the game and offer things that the private sector can offer, and we certainly want to see that occur, and we'll make sure that if TxDOT needs to be part of that, we certainly will.

MR. WILLIAMSON: Have you topped out of the safety category?

MR. CHASE: I did.

MR. WILLIAMSON: Yes?

MR. CHASE: Yes, I have left the safety category.

MR. WILLIAMSON: Let's go back to the red light cameras a minute, Bob Jackson's and my favorite discussion topic. We understand the red light camera ruling or the camera ruling by the attorney general, the matter is may monitoring equipment be installed on our right of way, yet to be resolved is whether or not enforcement can take place as a result of those installations. Is that correct, Bob?

MR. JACKSON: Yes, sir.

MR. WILLIAMSON: So I'm thinking that we need to add to our list for the legislature to clarify for us, however they wish to clarify, the extent to which electronic surveillance can be used for enforcement. I think it would be better for us to have it clarified than for us to continue down the road kind of guessing and letting the courts decide how that can be done.

MR. CHASE: Yes, sir.

MR. WILLIAMSON: Eventually DPS is going to want to put a camera up at a red light, so we might as well just put the issue on the legislature's table and see what they want to do.

MR. CHASE: All right, we will do that.

And to wrap up, I would like to let you all know that the staff in the State Legislative Affairs Section, we do this every time we go through this exercise every other year, but we're going to be a little bit more deliberate about it. Each of these, almost all of these issues have a constituency around them, some of them are no more than TxDOT, but others do have constituencies built around them, and we will be contacting each one by letter that we can identify, usually groups, occasionally individuals if we know that they've expressed an interest to say this is what the commission has been discussing for eight months, openly, publicly, don't act surprised, and we are interested in your opinion on these things. And some have been good about it.

Like I said to Commissioner Houghton, day before yesterday we met with the City of Sugar Land because they have been listening and they have some interesting ideas as well, and a few others. Texas Transit Association has been very good at working with us on these matters as well, too. But others have been kind of quiet and it isn't because we don't get up every month and say something, but we are going to deliberately let them know what we've been saying and invite them in to come in and talk, and then it will be their call, and we will go anywhere at any time to do that.

And that concludes my comments.

MR. WILLIAMSON: This is a discussion item, members, so no vote is necessary. Do you have any other matters you wish to raise with Coby at this time?

(No response.)

MR. WILLIAMSON: Thank you, Coby. I know it's tedious but this is what's required.

MR. CHASE: Thank you.

MR. BEHRENS: Okay, James, if you'll come forward and take us through item 2(b) on the Legislative Appropriations Request for the upcoming session.

MR. BASS: Again for the record, I'm James Bass.

Over the past several months we've had discussions over the department's Legislative Appropriations Request, and similar to Coby, I'm just going to highlight some of the results of those discussions that we've included in our draft document, and next month when I come before you, we will be seeking your approval and adoption of the final Legislative Appropriations Request to then turn in to the Governor's Office and the Legislative Budget Board. It will be due the day after the August meeting.

As the draft document now stands, for the biennium of 2008 and 2009, we'll be requesting a total of $18.4 billion in appropriations and that includes almost $2-1/2 billion from the Mobility Fund and almost an additional $2 billion from Proposition 14. Included in those two numbers is $765 million of debt service, so not all that's going to build the roads, some of that's going to pay off the bonds that helped us to build the roads.

Another important factor is general revenue funding and what the department will be seeking within that. We'll be seeking a total of just over $63 million, as the draft document now stands, in General Revenue for the biennium. $2.2 million of that is associated with the Rail Safety programs that were transferred over to the department during the last session, but in addition to that, through our discussions we looked at some of the programs that are part of TxDOT that over the years had traditionally been funded with General Revenue but during the GR crisis in 2004 were switched over to the State Highway Fund.

We went through those and we looked at them, and the feedback that I got at that time was well, let's see if we can go back to where it was in 2004 and before and actually ask for General Revenue for those items and those will just have go to in a special section of the Appropriations Request.

Just to refresh your memory what those are, one of them is for Public Transportation and we would be requesting $17.6 million for the biennium out of the General Revenue Fund for Public Transportation, the same level that we had prior to 2004. The operations of the Automobile Theft Prevention Authority Program, we would be asking for $30.1 million in the biennium from General Revenue, again going back to the prior to 2004 days.

In addition to that, as we collect revenue from oversize/overweight permits, that money is deposited to General Revenue, and again, in years prior to 2004 that money was then distributed out to the counties. That's changed, that money is still going to General Revenue but the payment to the counties is coming out of the State Highway Fund. We'll be requesting that the money collected that goes into General Revenue will continue on its path back to the counties, and so that's about $10.8 million for the biennium.

Another associated with Commercial Carrier Operations, a program that we received years ago from the Railroad Commission, we'd be asking for $2.4 million of General Revenue and another quarter million for the Rail Safety Program would fit in the special category called Exceptional Items in the Appropriations Request.

So again, all told, it will be just over $63 million request for General Revenue within the draft document that we have.

Also, through our discussions, a continuation of what we attempted and had in our Appropriations Request two years ago, looking at the capital budget, listing the items and the categories that we plan on now but also offering some flexibility to respond to changing demands and to have a limit on our capital budget expenditures be a percentage of our budget rather than a firm fixed dollar amount.

And in that same vein, with the department employees, rather than having a limit based upon the number of full-time equivalents, or FTEs, having that limit be based upon a percentage of our overall budget that can be spent on salaries. Both of those are currently in the draft document.

One thing we are requesting appropriations for 2008 and 2009 but we also report on our expenditures in 2005, 2006 and 2007. One thing I would like to point out to you, focusing on 2007, is that the way our current projections are we will be spending in 2007 more than we were originally appropriated by the legislature, to the tune of almost -- actually in excess of a billion dollars.

One of the primary reasons for that is the Texas Mobility Fund, $340-, $350 million worth. The projects and the districts are spending faster than we had hoped for, faster than we thought was humanly possible. Those projects are moving forward, work is being accomplished and we're paying out, so those projects are moving faster than we had anticipated so the cash flow is coming in faster.

MR. WILLIAMSON: Cash demand is coming in faster, so we're issuing the debt to make sure we have cash there to meet those demands.

Similarly, Proposition 14, the State Highway Fund revenue bonds, is going faster than anticipated, and part of that reason deals with, obviously, cash flow and our federal partner. Most people are familiar with that under SAFETEA-LU the State of Texas, on average, is receiving more money than we did under the previous federal program. However, that situation is not true for each and every individual year within SAFETEA-LU.

The first year in a federal program normally starts out low and then ramps up over time, but from one program or one bill to another, you normally see a gradual increase. That's not true in the first year of SAFETEA-LU. The State of Texas actually has in the neighborhood of $250 million less of obligation authority in 2006 than we had in 2005, so we actually saw a slight drop-off and then it will grow over time.

MR. WILLIAMSON: So it's something like that.

MR. BASS: Yes, a lightning bolt.

MR. WILLIAMSON: A backwards lightning bolt.

MR. BASS: Yes.

MR. WILLIAMSON: It stopped up here with TEA-21 and then fell back here and we're going to end up higher five years out and that first year and a half we're actually lower.

MR. BASS: Correct. So on our planning what we had was projects that were planned to move forward with federal funds, those projects were ready to move forward but there was no federal funds. And in our thinking, it didn't make sense to delay those projects when we could kind of shift the resources around a little bit and start to tap into the State Highway Fund bond program earlier than originally anticipated to help cover that shortfall, if you will, or timing difference on the federal fund cash flow, then the projects that we had thought three years from now that might be from the Proposition 14 money, they will take advantage of the increased federal money when it comes in in those later years.

But all told, those combined together are going to have our expenditures be higher in 2007 than originally anticipated but all of that is going into project delivery which we think is a good thing, but it will catch some people's attention and I wanted to make sure you were aware of that.

MR. WILLIAMSON: Amadeo, is one of the reasons the projects are being completed faster because of the dry weather?

MR. SAENZ: Dry weather. Of course, the other thing is our projects are costing more, so the project that was scheduled to be let, we're letting it on schedule but some of our projects are costing more so we're drawing more money than we would normally. But dry weather, the contractors are working diligently, and being a rancher, I can tell you we've had a lot of dry weather. Johnny can attest to that also.

MR. WILLIAMSON: How much of it is also due to the fact that we're doing more and more reward if you finish sooner, punish if you finish later contracts?

MR. SAENZ: I think to some extent we do have some of that. I don't have the exact number. Contractors have changed their mechanism of working, and if you put a milestone, they're going to meet that milestone.

MR. WILLIAMSON: Every time I go to Houston to visit my grandchild, they're working 24 hours a day.

MR. SAENZ: The Houston projects have large milestones and every one of those milestones is being met and the contractors have -- we put in Houston with a 24-7 model, started slow but they've been able to perfect that model and they have that machine well oiled and it's working and producing a lot of widgets, building a lot of road. And you see also every time you go to Houston it's unbelievable what you say from maybe two weeks before.

MR. WILLIAMSON: It's pretty remarkable.

MR. HOUGHTON: But at the same time, I guess, Amadeo, what you're expending on the reward to get it finished sooner, you're saving on the back side on the indexes, on the inflation.

MR. SAENZ: We're getting it back not as hard dollars but we're getting it back with respect to reduced congestion and improved air quality and increased safety because the public is able to have the new asset to them much faster.

MR. WILLIAMSON: But as we refine our indices, surely we'll be able to calculate how much we've reduced the $86 billion gap as a result of building faster.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: You know, I guess I'm saying this to Amadeo, Steve and Mike, James's report in this regard is further reinforcement that we need to watch carefully our lettings over the next probably 12 months to be sure that because of good things happening a bad result or an unintended result doesn't present itself.

MR. SAENZ: Yes, sir.

MR. WILLIAMSON: It's easy to do when you catch it ahead of time and plan. Thanks, Amadeo.

Anything else, James, on the LAR?

MR. BASS: No, that was it.

MR. WILLIAMSON: Any reaction from across the street on our different requests to do things differently?

MR. BASS: None yet.

MR. WILLIAMSON: No news is good news.

MR. BASS: And over the next four weeks we'll be putting the document into the Legislative Budget Board's system so we have it ready to go on August 25. If you have any questions or concerns, myself and the budget staff is ready to meet with you or your staff at any time. I'd just ask that we do that as early on in the process as possible so we have time to fully implement it into the final document.

MR. WILLIAMSON: Members, do you have questions of Mr. Bass?

MR. JOHNSON: No.

MR. WILLIAMSON: Thank you, Mr. Bass.

MR. BASS: Thank you.

MR. WILLIAMSON: Does that conclude our agenda?

MR. BEHRENS: I have reviewed it, and yes, it does, sir.

MR. WILLIAMSON: Do we have some general comments?

MR. BEHRENS: We have people that would like to speak at Open Session.

MR. WILLIAMSON: We now enter the Open Comment Session. I think I forgot to announce this at the first, didn't I?

MR. HOUGHTON: Yes, you did.

MR. WILLIAMSON: Do I get shot?

We will hear from Ray E. Gilbert, Jr.

MR. GILBERT: Mr. Chairman, members of the commission, I'm Ray Gilbert. When people stand up and say how long they've been in Texas and everything, I'm an eighth generation. We were here before Spain, we came in when Spain controlled Texas, we fought under every battle that's ever been fought, and we're fighting a battle here now, and this battle is against the RMA.

Now, I guarantee you at least 60 percent of the people in El Paso are opposed to the RMA, maybe 30 percent of them support them because they have -- I was just talking to Stanley Jobe a while ago and I said, Well, you support it but you're going to make just as much money out of the road-building without the RMA.

I have watched it. I sat at a table at the Del Norte Club the other day with about 300 people there but this table had about 18 people. Of those 18 people, only one person supported the RMA. That one person supported it because she goes to Houston quite a bit and she said, Oh, it's a dream, Ray, to be able not to go down those crowded roads but to get on the toll road and it's a dream because nobody else is on them. And I said, But who's paying for it?

El Paso has the lowest average income of any place in the state of Texas, probably, and how are these people going to pay for it when they want to go home and they've got to pay for a toll road to go home instead of having their six-pack of beer on Friday. Now, that's how much it affects the people in El Paso.

My father died in 1935, he was a leader here, he was one of the first students at the university and he led, he set up the Sun Bowl, set up a lot of things. One thing that he did do right before he died in 1935 was take me up on Scenic Drive. Scared the hell out of me because it was just a narrow road -- I don't know whether you guys rode it -- and it had nothing, and we had an old Chrysler Touring Sedan and I looked down and it just scared me. But he took me up there and showed me El Paso and what El Paso was going to be someday, and he was right on the button.

But he said, Look down there by the smelter where the railroads cross the bridge, and he said, there you have a funnel, everything that comes into El Paso and goes out of El Paso is going to have to go through that funnel. And he said, It's a horrible thing and you're going to have to see a tunnel through this mountain. Well, we haven't done the tunnel through the mountain but we do have an alternate.

We don't need an RMA to have a toll road. The first time way back when, when they built the first toll road between Fort Worth and Dallas, it was the greatest thing I ever saw. I'd go down and visit my relatives and travel over that toll road. When that toll road was paid for and everything, it became a public road, didn't it? It became one of the greatest things that ever happened to the state of Texas.

We can do the same thing here. We can get the trucks and a lot of traffic, a lot of people off our highways, off of our funnel right down here by getting these trucks and everything else to go through what you all call the Northwest Route.

Now, in 1964 I helped build O'Hare Road which is the New Mexico part of what they have described to you all from I-10. That overpass there was put in by the state for the gas company because we had our patrol road there. We had to drive down towards Anthony and then come back over it, and we built O'Hare Road ourselves. The state had some leftover equipment, some leftover materials and everything else, we had construction there at the county and we also had some volunteers, and we built that. It was like a road built in the '20s but it cut 20 minutes off for me to drive from Las Cruces to the airport because that road connects with the War Road.

And if you were to drive it, you would see that that is the best route you could possibly take to get the traffic off of downtown El Paso. There's nothing better. You come through, that 10 miles is there, you enter into the War Road. I was astonished to hear people say and exaggerate the cost of building that road, that 20 miles. What was it, somebody said half a billion dollars and the right of way was going to cost so much, et cetera, et cetera?

You need to say, El Paso, get it together, see what you can do, don't just accept this RMA the way it's set up now, let's look at everything. Commissioner Houghton even supported this route initially way back when before he became a commissioner, and then when he became a commissioner, this route went out.

I've visited with the truckers, in Las Cruces I visited with the truckers at Horizon, I visited with the truckers down at Chevron. Every one of them that I visited with said we would be very happy to pay a toll to go through Anthony Pass, to stay out of downtown El Paso. These truckers don't stop here, they just go through. That would be the best way: they come out I-10, come down and join with 375, and we will have the problem in El Paso solved for a long time to the point where we can handle our future requirements as they come up.

I oppose the RMA and I speak for a lot of people, not just myself. I have visited with many, many people in El Paso, and like I say, I do run into an occasional one that supports it, but then I run into all these people who say you think we're going to pay to ride when we can pull on down I-10 and then we can have dinner with our family. And this is the difference here. That lady that said she would travel on the road down in Harris County, down at Houston is a very wealthy lady, all of the people that were sitting at that table were very wealthy, and they were all opposed.

MR. WILLIAMSON: Well, Mr. Gilbert, I think we understand your position and we appreciate you putting it on the record.

MR. GILBERT: Thank you, sir. I appreciate it.

MR. WILLIAMSON: You're very articulate.

John M. A Mike Rooney. Welcome, Mr. Rooney.

MR. ROONEY: Thank you, commissioner, and let me get my thing here, and thank you all for coming to El Paso. Commissioner Williamson and Commissioner Johnson, thank you for your insight and how you address these difficult transportation problems. Thank you all for collectively recognizing this as a healthy community debate, and you have rightly pointed out that there are no transportation free lunches in this life.

Thanks to Mayor Cook for pointing out the importance of the inner loop project, using pass-through tolls. In a nation at war where so few elect to serve, it is certainly not soldier-friendly to make soldiers and their family members pay tolls to get to work at Fort Bliss.

I want to commend the MPO's Transportation Policy Board for the excellent discussion they initiated at their June 23 meeting. This was a community discussion that should have taken place in the public eye six months ago. They're non-support of this current regional mobility authority proposal is reported to have provoked some rethinking by your board. Thank goodness for those members who had the courage to begin this needed community discussion.

As a citizen who has made more than a good faith effort to understand this RMA and toll road effort, I do not agree or support it. My major reason for not supporting it is I've seen no other options presented to this community for their consideration. The only option presented, this RMA proposal, has major risks associated with it which its supporters seem unwilling to acknowledge in public.

As a citizen, I hope our local members of the state legislature who have serious reservations about this RMA proposal will do the following: one, request the Texas Comptroller's Office to begin an audit of the $100,000 that was recently spent on a multi-media blitz on toll roads -- these are the ads that are now conveniently being called infomercials; two, introduce legislation in the next regular legislative session to put firmer controls on regional mobility authorities to include the requirement for a local public vote on the establishment of these non-elected public entities that can have such a vast impact on any community's life.

And thank you for allowing me to see the staff logistics effort that took place for you to come visit our community. Thank you.

MR. WILLIAMSON: We want to thank you for a clear, lucid, and civil offering of your opinion.

MR. ROONEY: Well, thank you for recognizing the difficulty, and it's a good community debate, and I think there's someplace there's gold at the end of the rainbow. Thank you.

MR. WILLIAMSON: Thank you very much, sir.

Is it Dick Brown? I hope I'm reading this right. District 19 candidate for the House.

(No response.)

MR. WILLIAMSON: Okay, then I'm going to assume that that person is either not here or doesn't want to speak.

Richard Dayoub?

(No response.)

MR. WILLIAMSON: That wraps up all who have offered general comments. Anything else, members?

(No response.)

MR. WILLIAMSON: Well, once again, El Paso, thank you. It was a great trip for us, we appreciate it, and we appreciate being included in the dialogue about local transportation matters.

The most privileged motion is in order.

MR. HOUGHTON: Move to adjourn.

MR. JOHNSON: Second.

MR. WILLIAMSON: I have a motion and a second to adjourn. 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. We stand adjourned at 1:08 p.m.

(Whereupon, at 1:08 p.m., the meeting was concluded.)

C E R T I F I C A T E

MEETING OF: Texas Transportation Commission

LOCATION: El Paso, Texas

DATE: July 27, 2006

I do hereby certify that the foregoing pages, numbers 1 through 182 inclusive, are the true, accurate, and complete transcript prepared from the verbal recording made by electronic recording by Penny Bynum before the Texas Department of Transportation.

Nancy King 8/01/2006
(Transcriber) (Date)
On the Record Reporting, Inc.
3307 Northland, Suite 315
Austin, Texas 78731