The Trans-Texas Corridor is Deader than a Doornail

June 2, 2008

by Paul Burka, Texas Monthly

First, here is Tx-DOT’s official release following the meeting of the Texas Transportation Commission last Thursday, which I attended:

Texas Transportation Commission Affirms Toll Road Building Principles

AUSTIN, Texas, May 29 — The Texas Transportation Commission today adopted guiding principles and policies that will govern the development, construction and operation of toll road projects on the state highway system and the Trans-Texas Corridor.

The Commission’s unanimous vote reaffirms policies and the requirements of state law regarding toll projects, particularly involving the use of comprehensive development agreements (CDA).

“The Commission’s action today reflects the comments we have received from Texas drivers, legislators and members of our citizen advisory committees,” said Commission Chair Deirdre Delisi. “Texans deserve a clear, straightforward explanation of what we are doing to solve our transportation challenges and how we are doing it.”

The Texas Transportation Commission is a five-member board appointed by the Governor to oversee the Texas Department of Transportation (TxDOT).

The Commission reaffirmed its commitment to meet or exceed the requirements of state law on five key issues:

– All state highway facilities, including the Trans-Texas Corridor, will
be completely owned by the State of Texas at all times.

– All Comprehensive Development Agreements will include provisions that allow TxDOT to purchase or “buy back” the interest of a private developer in a CDA at any time if buying back the project would be in the best financial interest of the state.

– The Texas Transportation Commission shall approve, in a public meeting, the initial toll rates charged for the use of a toll project on the state highway system and the methodology for increasing the amount of tolls. All rate-setting actions will come after consultation with
appropriate local metropolitan planning organizations.

– Only new lanes added to an existing highway will be tolled, and there will be no reduction in the number of non-tolled lanes that exist today.

– Comprehensive development agreements will not include “non-compete” clauses that would prohibit improvements to existing roadways. The Department and any governmental entity can
construct, reconstruct, expand, rehabilitate or maintain any roadway that is near or intersects with any roadway under the CDA.

In recognition of the Texas Legislature’s commitment to protecting landowners’ property rights and in following the department’s long-standing practice with other transportation projects, the commission affirmed two additional principles:

– TxDOT will always consider the use of existing right of way that satisfies the purpose and need of the project as a possible project location when conducting environmental studies.

– To the extent practical, TxDOT shall plan and design facilities so that a landowner’s property is not severed into two or more separate tracts and the original shape of the property is preserved.

“These principles will help guide TxDOT as we work to improve our state’s traffic congestion and air quality problems,” said Delisi. “The Texas Legislature shares our commitment to improving highway safety and creating economic opportunity, and they expect us to meet these goals in keeping with our state’s tradition of protecting the rights of property
owners.”

Delisi said that the Trans-Texas Corridor implementation plan “Crossroads of the Americas,” should be updated to reflect changes in the state’s transportation challenges since it was first released in June of 2002.

“As we work to develop important projects like a parallel corridor to I-35 and the long-awaited I-69, we will work toward meeting our goals with these important principles in mind,” she said.

When I said in the headline that the Corridor is dead, what I mean is that the grandiose plan conceived by Ric Williamson — a network of privatized toll roads criss-crossing Texas with a 1,200-foot right of way, and funded by upfront payments — is not going to reach fruition. I mean that Tx-DOT and Governor Perry have capitulated to public and legislative opposition. I mean that Interstate 69 and TTC-35 will not be built as originally planned. But they will be built and they will be toll roads. In short, Tx-DOT and Delisi appear to be saying that Tx-DOT will follow a traditional road-building policy rather than Williamson’s vision, which envisioned long-term private ownership and control of roadways.

Why did this happen?

I think the answer is obvious. A year ago, Governor Perry was resisting legislative efforts to rein in Tx-DOT. Now he is capitulating about the same things he was fighting a year ago. What is the difference between then and now? He decided that he wanted to seek reelection. I know that he was advised that he had to give up the privatization model if he wanted to run again. Neither the public nor the Legislature has any confidence in it.

There is another reason. The political clout in transportation issues lies with the business communities in Houston and Dallas, not with Tx-DOT or the governor. Local leaders in the two regions have insisted that their regional tolling authorities be allowed to build the roads (rather than private interests) and that the revenue generated by new toll roads in their areas must stay in their areas. Houston and the Metroplex have seen the gasoline tax revenue they generate be distributed all over the state, and they weren’t going to let it happen to their toll revenue.

The last–or let us hope it was the last–great struggle over “primacy” (the right of local toll authorities to undertake projects without the approval but with the cooperation of TxDOT) occurred over Highways 121 and 161 in Dallas. At first, TxDOT prohibited the North Texas Tollway Authority from bidding to construct and operate 121 and accepted a private-sector bid from Cintra instead. The effect was that the upfront payment would go to TxDOT and the long-term revenue would go to Cintra. The Dallas-Fort Worth region was not assured of getting any of it. That was unacceptable to the local interests, and eventually TxDOT melted under the political heat: It allowed NTTA to build the road. Another battle ensued over 161 with the same result. TxDOT had become wedded to a political posture that was unsustainable: It was adversarial to the local toll authorities when it should have been partners.

A delegation from Dallas-Fort Worth, including the mayors of both cities, showed up in force at the commission hearing to air their concerns about TxDOT. Their chief complaint was about the process for market valuation of toll roads. The governor’s office insisted that it had to be part of the toll road legislation passed at the end of the 2007 session. It was one last attempt to tip the scales in favor of the private sector against the local toll authorities. TxDOT wanted to assure that the local toll agencies would have to match the market value of the road. The testimony established that the procedure for arriving at that value was highly contentious, requiring 63 meetings and causing a considerable loss of money in construction delays. Even Ted Houghton, the last of the true believers on the commission (excluding, perhaps, Delisi), conceded that the process was broken. It is unlikely to survive.

Can Delisi rehabilitate TxDOT as a kindler, gentler agency? That will take some doing. The agency has done terrible damage to its own reputation and credibility. It has been arrogant, secretive, and incompetent. It has played fast and loose with numbers, such as the estimated cost of needed transportation projects and the increase in the gasoline tax necessary to pay for it (not that an increase is likely). It can’t account for a billion dollars of its money. It has resisted legislative oversight. TxDOT’s press release was a start, but don’t read too much into it. Most of the “changes” the agency promised were already current law.

This did not prevent Wayne Christian of the House conservative coalition from attempting to claim credit for the policies TxDOT affirmed in its press release. The group issued a release of its own saying in which Christian, [announced] “an agreement on vital issues regarding the Trans-Texas Corridor.” And what was that “agreement?” [T]he Transportation Commission has formally agreed to follow [various] statutory requirements.” In other words, they agreed to follow the law that they are already obligated to follow.

More trenchantly, State Representative Lois Kolkhorst of Brenham, an outspoken critic of TxDOT and the Corridor, said of the press release, “[It] does not offer any real reforms or serious changes from the current atmosphere. It was merely a repackaging of familiar statements that are already in state law. I’m glad to see that the new TxDOT leadership is reaching out, but it’s time to roll up our sleeves and talk about real reforms to address the public outrage over the Trans-Texas Corridor.” Again, I think that what will force the reforms Kolkhorst seeks is a lack of money. The only way I-69 will be built is if it follows the existing right-of-way of U.S. 59 and, probably, the Grand Parkway, rather than cutting a swath through rural Texas. And the same is true of TTC-35, which may end up as toll lanes added to I-35.

Kolkhorst’s concerns notwithstanding, I think that the die has been cast, and the local toll authorities have won. The Corridor (which today refers to TTC-35, the relief route for Interstate 35, and I-69) is dead not for lack of will but for lack of revenue. The beast has been starved. With the money staying in the Metroplex and Houston, where the congestion is, TxDOT will not have the funds to pave rural Texas with toll roads, unless the traffic justifies it, and that is not likely to occur for a lot longer than Kolkhorst is going to be around the Legislature–or I am, for that matter.

I have to give Delisi good marks for her first meeting. Not only did she say the right things, but she also seconded a motion to approve projects in Austin, the home of state senator Kirk Watson, who could have killed her appointment by invoking senatorial courtesy. Watson was criticized for allowing the appointment to go through, but his opinion was that Delisi was smart, and that if he busted her, the next person might not be, and he’d rather have a smart Perry loyalist as chairman than a puppet. I didn’t think Watson was right at the time, but after one meeting, at least, I think he was right after all.