The SH 130 toll road is the poster child for FAILED toll road policy in Texas. Taxpayers were sold the SH 130 toll road as the panacea to fix congestion on gridlocked I-35 through Austin. Politicians and planners said it would draw trucks off of I-35 and over to the toll road. As the article below demonstrates, it hasn’t worked. Truckers can’t afford the toll road any more than motorists can. In fact, the SH 130 toll road is SO EMPTY, a distressed airplane landed on it in the middle of what is supposed to be rush hour! If they really want to relieve I-35 traffic, they’d make SH 130 a FREE bypass route. But as the Texas Turnpike Authority spokesman says below, the government has no motivation to fix I-35 traffic since it means fewer customers for their toll road.
Big rigs still drive on I-35, despite alternative routes
by ANDREW HORANSKY / KVUE News
Friday, May 7
When the SH-130 toll road opened a year ago this week, it was supposed to ease congestion on Interstate 35. It was also supposed to move cars and trucks from one end of Austin to the other more quickly.
But recent KVUE helicopter video shows a different picture. Traffic remains congested on I-35, and SH-130 is empty. The Texas Turnpike Authority has a theory on why.
“A lot of traffic is still coming to destinations in Austin,” said Turnpike Director Mark Tomlinson. “And if they are, then probably I-35 is going to be the choice for a bigger percentage of that traffic.”
Though some big rig drivers told KVUE the toll road works well, they said they cannot justify the expense. Ken Dukes says he stays on I-35 because it costs him $27 to take SH-130.
“Yeah, it’s 45 minutes to an hour and a half of my time,” he said, “but it’s not worth $27.”
Others say the saving of time is worth their money.
“Absolutely,” said William Brown, driver. “It wouldn’t make sense for me to go through that traffic every day.”
A spokesperson for the Texas Turnpike Authority believes it will take time, as well as more congestion along I-35, before the public fully embraces the benefits of the SH 130 toll road.
That 130 project commences in 2012, when it will connect I-35 in Georgetown to I-10 in Seguin.
The people of this community have expressed time and again in every way available to them that they DO NOT want toll roads. With tourism such a major industry and economic engine for our region and the adverse impacts of a high cost of transportation on the region’s economy, toll roads are not the right fit for San Antonio, nor are they sustainable. They will bury us in debt to the tune of BILLIONS with no way out (except a taxpayer bailout and draconian tax hikes). When the cost of transportation goes up, driving goes down.
Toll roads rely on ever increasing traffic volumes and more driving to pay off the debt of toll roads, which is anti-thetical to the economic reality of what occurs when the cost of driving goes up…driving goes down and so does toll usage. Also, increasing the cost of transportation through tolling makes the the cost of goods go up, which everyone pays whether they take the toll road or not. San Antonians cannot afford tolls, when a third of Bexar County doesn’t make enough money to cover their basic needs for daily living. San Antonio has also been ranked by Forbes Magazine as one of the top 10 cities hardest hit by high gas prices. When tolls are like adding $4.00-$17.00 more to every gallon of gas you buy (for toll rates from 25 cents up to 75 cents per mile as we’re seeing around the state), they’re completely out of reach for the vast majority of San Antonians.
Based on the MPO plans, it claims a funding gap figure of $18 billion. To put it in perspective, that’s like saying they need more than $10,000 from every man, woman, and child in San Antonio in the next 25 years…that’s from every person in San Antonio, not just motorists, and that’s $40,000 from a family of 4! A study conducted by the Surface Transportation Project published in June of 2005, shows the two biggest costs for every household since 1984 are housing and transportation and account for 52% of the average family’s budget (or $21,213 a year)…the highest level in 20 years! Now compare that with the median household income in San Antonio of only about $36,000 a year and compare it with TxDOT’s claim they need $40,000 from the average family in San Antonio in the next 25 years, and you’ll see this will not only cripple the economy, it’ll tax people into bankruptcy. Their plan is unrealistic and totally unsustainable! With 57 toll projects in the MPO’s plans, there will be no escape form this new tax on driving.
Add to that, San Antonio has been consistently shorted the highway funds that it sends to Austin and Washington. In addition, vehicle sales tax revenues have been dumped into general revenue instead of going to roads as the taxpayers intended. Ending this diversion of funds amounts to $2-3 billion a year (on track for $4 billion this year, this reaps more than doubling the gas tax) for roadways, and would nearly triple our region’s money for roads WITHOUT RAISING TAXES! Restitution needs to be made before ANY taxpayer is asked to pay more.
As long as ANY project is marked “toll” in the MPO’s TIP (and there are 57 of them), the RMA (which is the tolling authority) has control of the project and a vested interest in ensuring projects remain tolled even when new sources of revenue become available. RMA Chair Bill Thornton promised on WOAI radio January 14, 2009 that they’d fix 281 non-toll if they got a new source of funds. When stimulus funds became available, the RMA STILL submitted the project as a toll project (they planned to build it with stimulus money and still charge users a toll to drive on it, a DOUBLE TAX). The FHWA also informed MPO Chairman, Commissioner Tommy Adkisson, that as long as a project is marked toll in the MPO plans, it will be done as a toll project.
With 800 people packing an auditorium in October 2009 to tell the MPO they don’t want toll roads (and only 100 got to testify with all but 7 against), and with MPO Board members assuring the public that both toll and non-toll options are on the table for 281 and 1604, how can they have an ounce of credibility when both are marked toll projects in the MPO’s TIP and when the tolling authority (RMA) is conducting the “study” of the options? How can the MPO have any credibility that non-toll options are even being studied when its attempt to find a contractor to do an independent study of non-toll options yielded ZERO takers?
This demands ACTION, not words, and must be remedied.
MPO MUST remove all toll projects from its plans
The federal government requires an agency to show a reasonable source of funding for a project in order to place it in an MPO plan. The RMA can’t show any of its toll roads are funded by any reasonable funding sources since toll revenue bonds won’t cover 100% of the project costs and all of them need massive public subsidies. In other words, none of the toll projects in the TIP are toll viable (meaning they cannot pay for themselves with the toll revenues of projected users).
TIFIA loans can only fund up to a third of the project costs. The current federal TIFIA loan pot of money is EMPTY, and there’s a cloud over the program after the first PPP toll road to receive a TIFIA loan went bankrupt a few months ago (at the hands of an Australian firm, Macquarie. (Read more here). The taxpayers aren’t going to get their money back, and many in Congress are doubting the efficacy of this controversial program that has, up until now, been used as a backstop to primarily benefit private toll operators at taxpayer expense. The TIFIA program may or may not be funded in the next federal highway bill, and there’s talk that the focus be shifted away from funding PPP & toll projects and directed to more mass transit and rail projects. Yet the RMA lists it as a “reasonable” source of funding for both the 281 and 1604 toll projects.
Second, TxDOT issued a letter to the MPO last fall saying the Texas Mobility Fund money ($200 million) isn’t available in one chunk any longer, it’s only available in $25 million chunks over 7 years (2012-2019). So how is this a “reasonable” source of revenue for the RMA’s toll road when the entire sum is needed in 2012 for just 281? So with two-thirds of the 281 project revenues in doubt (TIFIA and TMF), the RMA cannot demonstrate that the 281 toll project is funded by any reasonable sources of revenue. Ditto for segments of 1604 that also rely on TMF or TIFIA funds.
The RMA also has to spend $83 million on ROW acquisition for 281 (the figure given in the last TIP), when the MPO does NOT have to come up with that sum under a non-tolled scenario (since TxDOT funds ROW out of a different pot of money apart from the MPO). This ROW cost thereby drives up the project cost that the RMA bonds have to cover.
For instance, using the Zachry estimate for US 281 north of Loop 1604 from 2005, the cost to fix 281 as a freeway would be less than $200 million. The 2005 plan cost is $78 million for the first 3 miles (and that was the actual contract bid price, not an estimate, when construction costs were much higher). Extrapolate that for the 7.8 mile project area, and the cost is actually UNDER $200 million ($160-$170 million). So a $200 million project cost (with some flexibility to add extra overpasses where needed) is perfectly reasonable and is based on actual construction costs. No one has yet to give a single reason why this estimate isn’t bonafide when Zachry’s proposal had engineering and the contract had already been let (prior to clearance being yanked). Clay Smith of TxDOT stated on the record in a Technical Advisory Committee meeting last fall that the Zachry proposal is the “actual” cost, not TxDOT’s estimates.
With $3 billion more in Prop 12 bonds are expected to be approved by the legislature next session (they issued only $2 billion of the $5 billion voters approved last session), and Speaker Joe Straus announcing at the NE Partnership meeting April 15 that there is near unanimous support to end at least some of the gas tax diversions, we can use some gas tax revenues with a mix of Prop 12 bonds (or even just solely Prop 12 bonds) as the “reasonable” anticipated source of revenue to fund 281 as a freeway in the TIP to keep it toll-neutral. Prop 12 is a more reasonable expected source of revenue than the RMA’s pot of funds listed in the current TIP. With the current batch of Prop 12 monies netting our region about $200 million, a $3 billion issuance would net us closer to $300 million. That would more than cover a non-toll fix to 281.
The Legislature has also placed restrictions on using Prop 12 and other bonds backed by general revenue (and the majority of Texas taxpayers) for toll roads, since it’s a DOUBLE TAX to build a road with general funds and charge taxpayers AGAIN (a toll tax) to use the public road.
Return to sustainable transportation policy. Restore credibility and heed the public outcry. Remove toll roads from all MPO plans.
Bruce Davidson, author of the column below, heads the Editorial Board at the Express-News. He, and the paper (as evidenced by their coverage since they laid off the excellent, unbiased, and very fair transportation reporter Pat Driscoll), are sold out on tolls. This is one of many editorials that read like an RMA press release. Whatever RMA Chair Bill Thornton speaketh, Davidson prints as Gospel.
Whenever we’ve attempted to go to the Editorial Board to dialogue about the toll issue, they flatly ignore us and our concerns (as well as elected officials, attorneys, certified planners, and other experts who have joined us) and print a negative editorial in response to our “visit.” After all, the paper has the establishment to please, never mind the Express-News is bleeding readers. Why? Because of columns, editorials, and stories like this one. Or perhaps it’s because the RMA has paid the Express-News nearly $25,000 in government advertising.
I find the first line of this column inexplicable. How can we NOT blame the tolling authority, which is precisely what the RMA is, for tolling our existing freeways? Though there’s plenty of blame to go around, including the people Davidson cites, our state lawmakers led by Rick Perry (we would add there are culprits who have approved and voted for this at EVERY level of government, local, state, and federal), it defies logic NOT to address the RMA’s culpability in the toll road fight.
The RMA is a Board of UN-elected bureaucrats appointed by YOUR county commissioners, who have given them the authority to levy taxes (toll taxes) without answering directly to the taxpayers (which is taxation without representation). Their only source of revenue is tolling (and a heap of loans from the city and county and grants from TxDOT to keep them afloat until they tap the vein of your wallet with their first toll road). RMAs were created in state law for the sole purpose of tolling and off-loading the State’s job to build STATE highways to local government and its taxpayers.
This notion that the RMA “doesn’t care where the money comes from, they just want to fix the road” is a farce. They’re a tolling authority! They exist to toll roads! Most importantly, the needed fix to 281 was already paid for with gas taxes until TxDOT made the money disappear sometime in mid-2008. So the toll agenda for 281 has NOTHING to do with lack of funds. They had the funds…it’s about tapping a new revenue stream and levying a discriminatory, targeted tax on 281 users in order to fund 1604 (which they don’t have the money for). The fact 281 already had the funding is one the RMA and the Express-News like to ignore so they can push toll roads, making them appear the ONLY option.
Then, the stimulus money the RMA is using to build HALF of a non-toll interchange (for the price of a WHOLE interchange) is a one time deal. We’ve long objected to the RMA even doing a non-toll project, especially with the pricetag they can’t justify ($143 million for just the four southern ramps of the interchange when the RMA’s published price to build the northern ramps in 2018 dollars is $59 million. If they can build half of the interchange for $59 million, they can surely build the whole thing NOW for $120 million! For comparison, the 410/281 interchange just built cost $155 million). What on earth are we paying our highway department to do if we now have these high paid bureaucrats at the RMA sitting around duplicating TxDOT’s role and charging us $20 million in “management fees” to oversee the interchange project that TxDOT should be doing (without the added cost)? The RMA is a second-tier bureaucracy and a taxpayer rip-off from start to finish.
Here are just two timelines (here and here) to give you a flavor of how corrupt and untrustworthy this RMA is. Then here’s a few other zingers. The RMA operates in secrecy and has refused to hand over the financial guts to its potential toll agreements BEFORE the contract gets signed (when the public can actually DO something to stop provisions that are not in the public interest). It hides behind a state law that allows these agencies to keep toll viability studies, the market valuation, and other key financial details SECRET from the public AND even YOUR elected officials. In fact, prior to a crucial vote on financing the 281 and 1604 toll projects at the MPO December 7, 2007, the RMA did not give MPO Board members this information prior to their vote, causing them to vote BLIND.
During the last legislative session, the RMA spent $32,000 of YOUR money to hire a lobbyist to lobby state lawmakers for toll roads and more taxing authority to levy ANY kind of tax to raid your pocketbook. The RMA also recently came out in favor of thwarting legal challenges to its unwanted toll projects by lobbying to force binding arbitration. Then, the RMA Board just voted to do all of its business BEHIND CLOSED DOORS, out of the public eye, unless they have an “actionable item” to vote on. Plus, the RMA has 8 employees whose total salaries with benefits equal more than $1 million dollars annually. All but two employees make six figures, which is totally out of balance with the median household income in San Antonio, which is $36,000/yr.
As long as the 281 & 1604 projects are marked “toll” in the MPO’s plans, the RMA has control of the project and a vested interest in ensuring it remains tolled even when new sources of revenue become available. The RMA is conducting its own environmental studies on both the 281 and 1604 toll projects (the fox guarding the hen house), yet to read the Express-News editorial (see below), you’d think the RMA was a paragon of diplomacy, reaching out to its “enemies.” Diplomacy? Pleez…their consultants told the community advisory groups that the RMA didn’t have to listen to our feedback nor the public feedback at the hearings either. The RMA is using these “community groups” as window dressing, nothing more. After repeated attempts to sit down with the RMA and work out many issues regarding these projects, they’ve REFUSED to work with ANYONE who gets in the way of their toll agenda. The RMA opposed the citizens’ call for a temporary superstreet fix on 281, too, until they figured out that doing the project could boost their PR with fed-up residents and give them something to do until their first toll project brings home the bacon.
RMA Chair Bill Thornton promised on WOAI radio January 14, 2009 that they’d fix 281 non-toll if they got a new source of funds. When stimulus funds became available, the RMA STILL submitted the project as a toll project (they planned to build it with stimulus money and still charge users a toll to drive on it, a DOUBLE TAX), which is proof-positive that even when they get a new pot of money to do something non-toll, the RMA still pushes its toll agenda…regardless of the opposition to it.
Also, the FHWA also informed MPO Chairman Commissioner Tommy Adkisson that as long as a project is marked toll in the MPO plans, it will be done as a toll project. With 800 people packing an auditorium in October 2009 to tell the MPO they don’t want toll roads (and only 100 got to testify with all but 7 against), and with MPO Board members & the RMA assuring the public that both toll and non-toll options are on the table for 281 and 1604, how can they have an ounce of credibility when both are marked toll projects in the MPO’s TIP and when the tolling authority (RMA) is conducting the “study” of the options? How can the MPO have any credibility that non-toll options are even being studied when its attempt to find a contractor to do an independent study of non-toll options (apart from the RMA) yielded ZERO takers?
Toll roads NOT inevitable
Then, Davidson would have us accept his premise that toll roads are inevitable because lawmakers in Austin refuse to raise your taxes. First of all, tolls are taxes and they have yet to hesitate to charge commuters the MOST EXPENSIVE tax to fund roads. Second, where is Davidson’s call to end the diversions to the gas tax we ALREADY PAY? Why would any thinking person ask government to raise taxes when they’re misappropriating the taxes we already send them? Third, why isn’t Davidson insisting San Antonio get back the money we already send to Austin and Washington that we’re shorted before he advocates for higher taxes (tolls)? Lastly, ending the vehicle sales tax diversion (that’s being dumped into general revenue instead of going to roads) would nearly triple our region’s road money WITHOUT RAISING TAXES! But Davidson doesn’t think that way. He’s an extension of the government bureaucrats at the RMA.
Goes to show, one must do his/her due diligence before believing what you read in the Express-News.
________________________________________________________ Austin’s aversion to tax hikes makes toll roads inevitable
By Bruce Davidson – Express-News
Web Posted: 05/13/2010
Don’t blame the Alamo Regional Mobility Authority when U.S. 281 from north of Loop 1604 becomes a toll road.
RMA officials are in the midst of the lengthy Environmental Impact Statement (EIS) process. They are studying three possible approaches to dealing with the nightmarish traffic on U.S. 281.
One scenario involves overpasses at the key intersections and non-continuous frontage, as RMA spokesman Leroy Alloway described it. Another would have expressway lanes and continuous frontage road from Loop 1604 to the Bexar County line. And a third option would have elevated U.S. 281 lanes, leaving most of the existing structure in place.
RMA Chairman Bill Thornton emphasizes that while the project is listed as a toll road in Metropolitan Planning Organization plan, that status is a placeholder.
______________________________________________________ Agua should drop legal threat
Express-News Editorial Board
Web Posted: 05/11/2010
The Alamo Regional Mobility Authority is engaging in some highway diplomacy. Rather than allowing plans for road construction in the U.S. 281-Loop 1604 corridor to get bogged down in challenges, the RMA is bringing potential adversaries to the table and making them part of the development process.
The RMA has created community advisory committees for both of the two major highway projects it is managing — a 7.9-mile segment of U.S. 281 north of Loop 1604 to the county line and a 37-mile stretch of Loop 1604 from Interstate 35 North to Highway 90 West.
Among the stakeholders on these committees are representatives of homeowners associations, school districts and the business and development community.
The RMA has also included groups with which it has traditionally had an adversarial relationship: the Alamo Sierra Club, Aquifer Guardians in Urban Areas, Greater Edwards Aquifer Alliance, San Antonio Toll Party and Texans Uniting for Reform and Freedom.
This diplomatic approach is a wise one. A good faith effort by members of the advisory groups can streamline the process for road construction and avoid lawsuits and political challenges that are both costly and time consuming.
Note how Austin’s toll revenue projections are cut by more than HALF in their long-range plan. Also of note is the acknowledgment that selling our highways to foreign companies in “concession” deals has fallen out of favor with the legislature. That’s due to the grassroots’ blowback over the last 4-5 years. Stay vigilant so we can keep it that way!
Regional transportation plan nears approval CAMPO 2035 plan includes reduced road spending and much more for rail, other transit. ByBen WearAMERICAN-STATESMAN STAFF
Published: 8:12 p.m. Sunday, May 9, 2010
Think of a blueprint, one written in chalk.
In the case of Central Texas’ official transportation plan for the next 25 years, which a committee of local leaders probably will approve later this month, what goes into that blueprint to a great degree depends on who gets to hold the chalk. The proposed CAMPO 2035 plan is several hundred pages long with several hundred road, rail, bicycle and pedestrian projects in it that add up to $26.8 billion.
That’s almost $4 billion more than the last version of the 25-year plan, approved in 2005 by the Capital Area Metropolitan Planning Organization board. But that money might not all materialize. Those numbers assume a much higher rate of Capital Metro sales tax revenue than in recent years, as well as aggressive road bonding in Williamson County.
The new plan includes a much higher percentage of rail and other transit spending than its predecessor and a sharply reduced amount for maintaining highways. In the introduction, the plan claims to embrace a new philosophy of transportation planning based on encouraging dense centers of development rather than continuing suburban sprawl willy-nilly.
But even those working on the plan say the focus on centers — not an emphasis of previous plans — will make little real-world difference. The plan is only as accurate as its assumptions about the future, they said, and making predictions about the next quarter-century is inevitably an exercise in guesswork.
“To borrow a Hemingway phrase, it’s pretty to think we can plan 25 years in advance,” said Hays County Commissioner Jeff Barton , a Democrat who serves on the CAMPO board. “There’s value in the exercise, but we shouldn’t kid ourselves.”
What’s in the plan matters, however, because under federal law a transportation project can’t get federal dollars — almost all highway and transit projects are at least partially funded by the federal government — unless the project is in the long-range plan. But the 19-member CAMPO board, made up mostly of local elected officials from Travis, Williamson, Hays, Bastrop and Caldwell counties, can amend the plan at any time. And there will be another wholesale rewrite five years from now, five years after that, and so on.
The CAMPO board, recipient of more than 4,000 public comments submitted on the draft plan in recent months, will take one last listen in a public hearing today. The meeting will start at 6 p.m. in Ballroom B of the Austin Convention Center.
The board probably will vote on the plan May 24, officials said.
If it is approved as written in draft form — and some CAMPO members still intend to push for changes — the plan would include:
• $2 billion for more passenger rail, including $857 million for the City of Austin’s proposed streetcar initiative, $467 million for a segment of a commuter line from Austin to San Antonio, $327 million for an Elgin-to-downtown Austin commuter line on Capital Metro’s railroad and $149 million for expansion of the MetroRail Red Line.
Rail and bus operations account for $10.3 billion of the plan, almost double from the 2030 plan. The money for this includes an estimated $6.6 billion from Capital Metro’s 1 percent sale tax, a $3 billion increase over the last plan’s 25-year estimate. The plan assumes, based on numbers from Capital Metro, that the agency’s sales tax revenue will increase 5.3 percent a year for the next quarter-century, more than double the average increase over the past decade.
• $10.9 billion for highway and road expansion, a 6.5 percent decrease from the 2030 plan. And the drop would be much greater but for an aggressive forecast by Williamson County — some CAMPO members from other counties say unrealistically aggressive — that it will spend $4.3 billion on new roads. The plan assumes that Williamson County voters will approve $425 million in road bonds every other year from 2011 to 2027.
Travis County Judge Sam Biscoe, chairman of the CAMPO board, said having all that money in the plan, along with dozens of projects tied to it, would give Williamson County an unfair advantage in getting federal funds in future years. Travis County, by contrast, estimates it would have $1.1 billion for new or expanded roads over the next 25 years.
“We have to increase ours, or Williamson County has to reduce theirs,” Biscoe said. “I expect that to be discussed on May 24.”
Williamson County Commissioner Cynthia Long, vice chairwoman of the CAMPO board, said it’s a matter of need.
“What we’ve seen is very low tolerance among our citizens for congestion, and we are responding to that,” Long said. “Rather than asking why Williamson County’s number is so high, I would ask why Travis County’s number is so low.”
• $5 billion of state, federal and toll revenue for roads, down almost 56 percent from the $11.3 billion in the 2030 plan. That reflects the diminishing power of gas taxes to pay for new roads, a trend made worse in Texas because the state Department of Transportation in recent years has borrowed heavily against future gas tax revenue to pay for projects now completed. And the estimate of surplus toll revenue (what’s available after paying debt service and operations costs) from Central Texas turnpikes is down sharply, from $3.2 billion in the past plan to $1.3 billion.
As a result, local governments would contribute a greater portion of road spending, including state highways that historically were exclusively TxDOT’s province.
“That’s something we’re going to have to address at the state level,” Barton said. “And soon.”
• No spending over the next 25 years to expand the capacity of either Interstate 35 through Central Texas or Loop 360 (Capital of Texas Highway) in West Austin, two of the area’s most congested highways. Joe Cantalupo , CAMPO’s executive director, said that TxDOT is studying what to do about I-35 and that the plan would be amended as plans coalesce.
“We’re not looking at it and saying, ‘Oh, there’s no problem, with 2009″ Cantalupo said.
The 2030 plan envisioned making Loop 360 a toll road, with frontage roads alongside, and doing so by leasing the road to a private company. Such “concession” agreements fell out of favor with the Legislature, and new ones are no longer legal under state law. Given that and the looming cash crunch at TxDOT, Cantalupo said, Loop 360 expansion fell out of the new plan.
By Terri Hall San Antonio Express News/Houston Examiner
May 6, 2010
It doesn’t take long to size-up a gathering of transportation lobbyists hosted by the U.S. Secretary of Transportation, Ray LaHood, when 99% of the feedback at a supposed “town hall” ran to the mic to ask for their industry’s piece of the taxpayer pie.
Scarcely a handful of taxpayer advocates dotted the invite-only crowd at the George R. Brown Convention Center in Houston May 5, and none were happy with what they heard. The purpose of the gathering was supposed to be to solicit feedback on the next federal highway bill. The last one, called SAFETEA-LU, was a disaster for taxpayers.
Remember the bridge to nowhere? How ’bout the 6,000+ earmarks for congressional pet projects that had little or no relevance to the federal highway system? What about the strings it attached to our gas taxes that hold our money hostage for “enhancements” like landscaping and free WI-FI at rest stops? Worse still, are the programs in SAFETEA-LU that use “innovative financing” to sell America’s highways to foreign companies in sweetheart deals (called public private partnerships or PPPs) propped-up with low interest, taxpayer-backed loans (TIFIA loans and private activity bonds or PABs). It’s public money for private profits.
But the majority of the invited speakers, as well as LaHood, advocated PPPs. During one of the panel discussions, the USDOT’s Chief Financial Officer, Chris Bertram, actually had the audacity to claim the feds don’t push innovative financing (what are toll credits, TIFIA loans, and PABs if not federal incentives for innovative financing?), and then proceeded to say how PPPs need to stay part of the mix. So much for a “listening session.”
Bertram also attempted to defend the bankruptcy of the San Diego PPP toll road, the first to receive a federal TIFIA loan, saying it had little to do with the lack of traffic to pay for the debt, and was a result of contractors arguing over cost of the road. The tollway had been open to traffic for over two years, and he claims the bankruptcy is due to quibbling over construction costs? When the projected traffic volume was off by nearly 40,000 vehicles per day, it’s beyond disingenuous to blame the default on anything other than flawed traffic projections!
Tolling existing interstates rises again
Another panelist advocated the new highway bill lift the ban on tolling existing interstates. This is what un-elected bureaucrats are doing on the taxpayers’ dime…listening to high-powered lobbyists find every way under sunshine to not only make taxpayers pay dearly for roads, but also to make them pay TWICE!
“Houstonians are willing to pay to get out of congestion,” noted Congresswoman Sheila Jackson Lee in her remarks. I’ll say, whether they like it or not, too. The new toll lanes, called “managed lanes,” on I-10 are 100% paid for with gas taxes and should have opened as free lanes. But instead, Houston elected officials chose to charge motorists tolls to access these lanes that are rarely used. With elected officials more than happy to double tax its citizens, perhaps that’s why Houston residents experience some of the highest transportation costs in the country.
If you build it, they will come
One of LaHood’s initiatives for the next highway bill is to “keep our communities economically competitive and affordable.” When foreign-owned toll roads (using PPPs) charge commuters 75 cents PER MILE to drive, that’s like adding $17 to every gallon of gas you buy. That’s not only unaffordable, it’s unsustainable! Texas Transportation Commission Chair Deirdre Delisi admitted in testimony February 1 that PPPs cost more due to the private operators’ building in profit (and other records show it’s guaranteed profit!).
Also unsustainable is this notion of LaHood’s that “if you build it, they will come.” Not so with toll roads. SH 130 is the poster child of failed, underutilized toll roads. The taxpayers are paying to bailout this tollway EVERY year for the life of its debt. It’s so empty that a distressed airplane landed on it in the middle of “rush hour.” SH 130 was sold to the public as the panacea to unclog I-35 through Austin by getting the truck traffic off of the city’s main artery. Few can afford to pay the $13/day to take the toll road, so the tollway sits near empty while I-35 stays mired in gridlock. If they really want to solve congestion on I-35, they’d turn SH 130 into a FREEway so truckers and those who need to get beyond Austin will take it.
Full court press by Trans Texas Corridor lobbyists
One of the first questions after LaHood’s speech was offered by Alliance for I-69 lobbyist Gary Bushell. Bushell is the guy TxDOT illegally hired with taxpayer money to lobby for the Trans Texas Corridor TTC-69/I-69. Bushell also cut a backroom deal with Senator Robert Nichols during the waning days of the 81st (2009) legislative session not only to ensure TTC-69 would continue (despite a bill that would have repealed the Trans Texas Corridor as Texans have demanded — the bill never became law), but also to ensure the private developers, ACS of Spain and Zachry of San Antonio, would never lose money on the deal.
Bushell said the TTC-69/I-69 environmental document was ready for approval by LaHood’s department and asked for a green light, to which LaHood responded, “Sure.”
The lobbyist for the Ports to Plains Trans Texas Corridor (often called a “priority corridor” by Congress is slated to go from Mexico, through Del Rio, San Angelo and Lubbock, Texas through Denver, Colorado up into Alberta, Canada) was also sure to plug his trade corridor.
Exotic financing = RISKY financing
Jeff Moseley, a panelist with the Greater Houston Partnership (Chamber of Commerce), was a voice of reason emphasizing that when the federal government fails to properly fund roads, it forces the states to resort to “exotic” financing (think “innovative financing” where taxpayers subsidize private toll road profiteers with the same multi-leveraged, risky debt financing schemes that caused the sub prime mortgage crisis). Texas power-brokers have fast-tracked and embraced such “exotic” (and risky) reliance on toll roads thanks to Rick Perry. However, Texans continue to revolt against such tax and spend schemes, resulting in their biggest grassroots victory to date: KILLING public private partnerships last year. The real challenge that lies ahead is how to keep it that way.
Read TURF’s written comments submitted to the Secretary of Transportation here.
LaHood: President still opposed to gas tax increase
By Michael Lindenbarger Dallas Morning News
May 6, 2010
In a speech in Houston Wednesday, Transportation Secretary Ray LaHood said Congress and the White House are largely in sync about what ought to be in the next big transportation reauthorization bill. (Photo: Transportation Secretary Ray LaHood speaks while IBM chairman and CEO Samuel J. Palmisano looks on. Source: IBM.)
“There is great agreement between the DOT and the Congress about what should be in the bill,” LaHood said. “The dilemma is finding $500 billion to make it happen.”
So I asked him afterward, what are the ideas being kicked around to find that money?
“There are lots of ideas. The president proposed an infrastrcuture fund, that’s a $4 billion initiative. We still have the highway trust fund, even though we know that it’s insufficient. And there are going to be some PPP’s.”
What about a gas tax increase?
“The President has consistently opposed raising the gas tax,” he said.
So what will the authorization bill look like? Here’s what he said in his speech:
“Having gone through this process, we’ve committed to a new recipe of legislative ingredients. It consists of: Ingredients that improve safety and reduce injuries and fatalities; ingredients that keep our communities economically competitive and affordable; ingredients that maintain the reliability, capacity, and efficiency of our entire transportation network; ingredients that give people more than one choice about how to get from one place to another – so kids can walk or bike to school and veterans or seniors can get to a doctor’s appointment if they can’t drive; ingredients that reduce America’s reliance on oil and greenhouse gas emissions.Blended together, this mix will help ensure that a student in Houston can go from a neighborhood with safe streets to a school that prepares her to collaborate and compete in the global economy. It will help ensure that student’s parents go from an affordable home to a job that pays the bills.
Most Texans aren’t aware that 40% of our federal gas taxes fund mass transit instead of highways. Secretary of Transportation Ray LaHood has announced a “sea change” where our gas taxes will no longer favor “motorized transportation” but bicycle paths, sidewalks, and transit.
He says: “People are sick of being stuck in traffic, stuck in their automobiles, and we want to help communities and neighborhoods that want more walking paths or biking paths—more transit.” Well, that may sound great, but not with our gas tax money that’s supposed to fund roads.
For more about diversions of our gas taxes and wasteful federal highway spending, go here and here.
Transportation Secretary Explains ‘Sea Change’ He Envisions for U.S. Transportation Monday, May 03, 2010 By Christopher Neefus
In this Jan. 28, 2010 file photo, Transportation Secretary Ray LaHood listens to a question during a news conference at the Transportation Department in Washington. LaHood said Tuesday, Feb. 2, 2010, Toyota was slow to realize safety problems with its gas pedals that has led to the recall of millions of popular Toyota brands. (AP Photo/Luis M. Alvarez, file)
(CNSNews.com) – Transportation Secretary Ray LaHood said Friday that Americans are “tired” of the congestion caused by motorized transportation, and instead are looking for other options such as bicycle lanes and walking paths, which the government will add to its infrastructure.
“People are sick of being stuck in traffic, stuck in their automobiles, and we want to help communities and neighborhoods that want more walking paths or biking paths—more transit,” LaHood told CNSNews.com.
President Obama’s top transportation official was following up on comments he had made on his official blog in March, when he announced a “sea change” in transportation.
“We are integrating the needs of bicyclists in federally funded road projects. We are discouraging transportation investments that negatively affect cyclists and pedestrians,” LaHood wrote.
With those comments in mind, CNSNews.com asked the secretary how he would implement that sea change.
“Well, look,” he began, “we have a state-of-the-art interstate system in America. We have the best road system in the world. That’s not going to change, and we’re going to continue to support our road system—our interstates—but we know that people want a lot of other alternatives.
“People are sick and tired of being stuck in traffic, stuck in their automobiles, and we want to help communities and neighborhoods that want more walking paths or biking paths—more transit. Some communities are going to be launching street car programs, more bus programs, but we’re promoting all forms of transportation,” he said.
“But we know that people are tired of all the congestion that’s created in cities, and so we think that promoting livable, sustainable neighborhoods by creating bike paths and walking paths and more transit and uh—really is what the people want,” LaHood added.
As for how to pay for the projects that he said would not come at the expense of the current interstate system, LaHood suggested the money would also come out of the general Treasury fund.
“We already pay taxes,” he said. “I mean, people all over America pay taxes. They pay their income taxes. People pay property taxes. People pay all kinds of taxes every day. If they buy something, they pay a sales tax. The point is, people pay a lot of taxes, and so we’re going to use—really use the resources that we have to create the kind of opportunities that people really want in America.”
LaHood had just appeared at Washington, D.C.’s Newseum, where he participated in live broadcasts of “The Oprah Winfrey Show” and “The Gayle King Show,” which runs on satellite radio. Both revolved around “National No Phone Zone Day,” an initiative to create awareness among young drivers about the dangers of texting from behind the wheel.
Winfrey, via satellite from Chicago, pointed out that several states had instituted a penalty for those found texting while driving, but LaHood said he wanted a federal statute with “good enforcement” to solve the issue.
“There are some bills pending in Congress,” he told CNSNews.com. “I’ve talked to a number of senators and House members about this, and we will work with them and hope that they can pass legislation. We think national legislation with good enforcement would be very, very helpful here.
“We’re going to work with Congress,” he said. The following is a transcript of Secretary LaHood’s conversation with CNSNews.com:
CNSNews.com: “You wrote on your official Transportation Department blog last month that a sea change in transportation was coming, that it would be the end of favoring motorized transportation over non-motorized. Can you explain a little bit how you would equalize, say, bicycle and motorized transportation? How do you create that sea change?”
LaHood: “Well, look, we have a state-of-the-art interstate system in America. We have the best road system in the world. That’s not going to change, and we’re going to continue to support our road system—our interstates—but we know that people want a lot of other alternatives. People are sick and tired of being stuck in traffic, stuck in their automobiles, and we want to help communities and neighborhoods that want more walking paths or biking paths—more transit.”
LaHood: “Some communities are going to be launching street car programs, more bus programs, but we’re promoting all forms of transportation. But we know that people are tired of all the congestion that’s created in cities, and uh, so we think that—uh – promoting livable sustainable neighborhoods by creating bike paths and walking paths and more transit and uh—really is what the people want.”
CNSNews.com: And as you create that new infrastructure then, how would it work for the users of those – cyclists, people on foot—would they be paying taxes to utilize these extra—
LaHood: “We already pay taxes. I mean, people all over America pay taxes. They pay their income taxes. People pay property taxes. People pay all kinds of taxes every day. If they buy something, they pay a sales tax. The point is, people pay a lot of taxes, and uh, and so we’re going to use—really use the resources that we have to create the kind of opportunities that people really want in America.”
CNSNews.com: “And we saw Oprah showed on the map several states that have banned texting while driving. Is there anything you can do on the federal level, legislatively?”
LaHood: “Well, we’re going to work with Congress. There are some bills pending in Congress. I’ve talked to a number of senators and House members about this, and we will work with them and hope that they can pass legislation. We think national legislation with good enforcement would be very, very helpful here.”
When Gov. Mitch Daniels sold his plan to lease the Indiana Toll Road for 75 years, some opponents said the financial projections were too rosy, that the $3.8 billion proceeds and interest would not fully fund the lease’s share of a much-touted 10-year highway construction plan.
Now, as Niki Kelly’s Sunday story explained, the Indiana Department of Transportation has begun to take projects off the 10-year plan while delaying others. In all, projected spending for new highway construction in the 10-year plan has dropped from $6.4 billion to $5.5 billion.
Some of the reduction is because of other forces – a drop in gasoline tax revenue, lower estimated construction costs. But a significant portion is because of lower-than-expected interest income from the lease proceeds. Two years ago, in the most recent update, the state said the shortfall was $220 million and counting.
“I think this is absolutely predictable,” said state Rep. Win Moses, whose Democratic Party was in the minority of both chambers of the General Assembly when lawmakers approved the lease in 2006. “It was always oversold.”
If so, it isn’t the first time supporters of a big, controversial government program used overly optimistic projections to help sell the program. Nor is it that unusual for financial projections to be revised, particularly during and after the economic changes of the past three years.
But uncertainty about the future was a primary reason to question a proposed 75-year lease. Of course the finances will change dramatically.
While a few forward-thinking lawmakers such as Moses examined and challenged the finances of the lease, the focus of the opposition was more on the philosophical decision to lease such an enormous state asset to a private, foreign company. Proponents won, largely because it meant a lot of money to finance numerous highway projects over the following decade.
Now that some projects are falling off the list doesn’t mean that Toll Road drivers pay any less. The cost for a passenger car to traverse the 157-mile length of the Toll Road was $4.65 before the lease was signed. Today it is $8 for those without electronic tolling devices, and the price will continue to rise.
Costs are even higher for truckers; the $14.55 cost for a five-axle truck just before the lease was signed has now jumped to $32. Ever-higher tolls could well force some truck drivers off the interstate onto highways such as Indiana 20, raising the cost of maintaining those roads.
Great improvements promised by lease supporters aren’t apparent either. Construction lingers on portions of the road near Chicago, causing backups and dangerous driving conditions. Occasional Toll Road drivers who don’t use the road enough to buy the electronic tolling device are finding longer lines at the cash toll booths.
Tellingly, four years after Daniels and other lease proponents sold the privatization deal as the “next big thing” for cash-strapped states, few – if any – have followed the model.
Perhaps one of the most troubling aspects of the lease isn’t that the 10-year plan is falling short but that it was designed to finance a highway plan for only 10 years – while a private company will continue to bring in revenue for 65 years after that plan is over.
If Congress wants a smaller role in building highways, they can kindly return 100% of our gas taxes back to taxpayers and let the states build them. It’s total fraud to keep taking our road money only to spend 40% of it on transit instead of highways, and to DOUBLE TAX motorists with tolls on top of gas tax now that they’ve figured out raiding the gas tax means there’s not enough money for roads.
April 26, 2010
Congress wants a smaller role in the highway biz
By Gordon Dickson
Congress may shrink its historic role as the main funding source for building new highways, and officials from several states worry that the result could be crippling traffic across America. “In Washington, D.C., we’re hearing voices say we’re done investing in highways and we can’t build our way out of congestion,” said John Horsley, executive director of the American Association of State Highway and Transportation Officials.The group on Monday released a report, Transportation Reboot: Unlocking Gridlock, which warned that demand for car travel is far outpacing the available space on the nation’s roadways, and an infusion of new federal highway dollars is needed to avoid a level of gridlock that will choke the economies of dozens of cities. The report identified more than 100 urgently needed road projects, including one in Texas — U.S. 290 in Houston. But members of Congress, who are expected to debate a five-year transportation bill later this year, are showing little appetite for raising the gas tax or other funding sources to pay for new road work, Horsley said. Even if a new revenue source is identified, the money is more likely to be spent on public transportation such as buses and rail.
“In the field of high-speed rail, President Obama is considered visionary,” Horsley said during a news conference after releasing the report at the National Association of County Engineers’ annual conference in Fort Worth. “In the field of transit and highways, we’re still looking for that visionary leader.”
If states balk at paying for highway projects themselves, local governments such as cities and counties could be left with a greater responsibility for handling traffic, said Chris Bauserman, president of the National Association of County Engineers. About 70 percent of existing roads are already maintained locally, he said. As a result, new roads may not get built at all. In Texas, an estimated $300 billion in new dollars is needed to provide roads for an expected population boom during the next 30 years, said Texas Transportation Commission member Bill Meadows of Fort Worth. Because of a chronic shortage of gas tax funds, the Texas Department of Transportation has supported development of toll roads and investment from private developers to keep traffic moving in the state’s major metro areas. Texans pay a federal gas tax of 18.4 cents per gallon, and a state tax of 20 cents per gallon — and neither amount has increased since the early 1990s. “If we’re going to meet our transportation needs,” Meadows said, “the obligation is great.”
Add to that, the vehicle sales tax paid for roads is getting dumped into general revenue instead of going to roads. Ending the diversions of the vehicle sales tax amounts to $2-$3 BILLION a year and yields more than a 10 cent per gallon gas tax increase would. Ending this diversion alone could nearly triple the money for roads WITHOUT RAISING TAXES! They opine we’re not giving them enough money to keep up with demand, but in reality they’re pilfering our money and spending it on things that have nothing to do with roads.
N. Texas highway improvements come with a toll: Expect construction snarls for 5 years, stiff tolls after that
12:00 AM CDT on Sunday, April 18, 2010
By MICHAEL A. LINDENBERGER / The Dallas Morning News Dallas-area traffic has been among the worst in the nation for years, and for many commuters it’s about to get a lot worse before it gets better.
Call it growing pains, or just one big mess, but construction has either already started or soon will on no fewer than a half-dozen of the most heavily traveled – and already backed up – traffic corridors in North Texas, as the region embarks on what may be the most aggressive road-building program in the country.
Commutes will be lengthened and lanes closed as orange vests and red taillights become as common on our highways as bluebonnets in Burnet.
And when it’s over in five years or so, many of those same drivers will be stuck in traffic as crowded as ever – unless they want to pay hefty tolls to keep moving.
Nearly all of the biggest highway improvements will add more toll lanes. They involve just about every important corridor in the region, from the complete reconstruction of part of LBJ Freeway in Dallas to the unsnarling of the Grapevine Funnel, now known as the DFW Connector, to the extension of State Highway 161 in Dallas County and the eastward march of the Bush Turnpike.
Some projects, like the LBJ Freeway and the North Tarrant Express in the mid-cities, will combine rebuilt free lanes and improved access roads with brand-new and especially expensive toll lanes. Others, such as Bush Turnpike extension and Highway 161, will be pure toll roads.
Only the DFW Connector, the fruit of 30 years or more of patient advocacy in the Grapevine area, will see the lion’s share of the improvement come in the form of free roads. But it, too, will include some tolls.
So, North Texas, this is the toll-road future you’ve been hearing about. And officials from Arlington to Austin to Washington say it’s the best government can do to keep up with traffic in the fastest-growing metro area in the country.
Lack of resources
“We’re dealing with the reality that we do not have the resources we need to keep up with our demands,” said Bill Meadows of Fort Worth, one of five members of the Texas Transportation Commission. “I know there are people who want to say, ‘Those dirty sons of guns, why didn’t they build it all free?’ Well, we could have done that, but you would have got squat.”
Officials at the Texas Department of Transportation have warned for the past year that money for major new projects runs out by 2012. That’s thanks partly to heavy borrowing in recent years that has left the state with big annual interest payments, eating away at already inadequate gas tax revenues.
Critics of Gov. Rick Perry’s toll-road-first emphasis, and of his no-new taxes mantra, would add that he’s failed to push the Legislature to consider higher taxes that would have reduced the state’s reliance on tolls.
But on top of those issues is something simpler still: As time passes, and more roads are added, Texas’ massive inventory of highways and bridges – some 193,308 miles in all, the most in the U.S. – gets older and larger every day, meaning maintenance costs are a growing burden. Last year, Texas spent $2.98 billion on maintenance, and will spend about that much this year.
Meanwhile, Dallas-Fort Worth added almost 100,000 residents last year, and 1.3 million in the past decade. As regional planners like to say, nearly all of them brought a car, but none packed any new roads and bridges in the moving van.
“Let’s face some realities and look at the growth of this state over the past 25 years,” said Meadows, an insurance executive who was vice chairman of the North Texas Tollway Authority before Perry named him to the commission. “There are vast areas of Texas losing population, but the opposite is happening here. Given this growth, our roadways are going to be a lot more congested.”
Traffic jams have been a way of life in Dallas, and in most big cities, for decades. And the recent stimulus-funded surge of smaller construction jobs has made this spring especially busy. And with more than 1,000 workers building Dallas Area Rapid Transit’s Green Line to Carrollton and the Orange Line to Irving, traffic problems and lane closures have become routine.
But to keep all that congestion from turning the highways into permanent parking lots, North Texas has added to the regular mix of highway projects a set of marquee projects across the region, all built at the same time and nearly all of them using a new approach to keep traffic moving once they are done.
For now, it will mean a lot of taillights for drivers.
Widening the Funnel
One project already under way is the DFW Connector in Grapevine, a massive rebuilding of part of State Highway 114/121 and State Highway 26 near the airport and downtown Grapevine.
It will widen some areas to 24 lanes, including new frontage roads and four new express tolled lanes. Lane closings and other traffic bothers have already begun and will continue until the work is complete in 2014.
“I think people here are optimistic, they are just tired of all this traffic,” said Jerry Hodge, a former public works director for Grapevine who now works as liaison between the city and the private firms building the connector.
“There is a little bit of question about how bad is it going to get in the meantime. But the other side is that they are relieved to see this happen.”
He noted, as did officials throughout the region, that modern highway contracts nearly always carry stiff requirements that encourage builders to keep as many lanes open during the day as possible, and sometimes impose big fines for shutdowns during rush-hour.
Mitigation efforts aside, Maggie Smits of Colleyville has already noticed the traffic snarls near her office on Grapevine’s Main Street, and especially when she takes her husband to and from the airport.
“I picked him up Thursday night, for example, and coming out of the north side of the airport onto 114, they had blocked that exit. So we took the bridge over to the back way and took 26 all the way home. It took forever.”
When the cones near the DFW Connector are finally put away, drivers like Smits will see real improvement. Most new lanes will be free, and the troubling interchanges that have bottlenecked the region for years will be smoother.
But for drivers in other areas of North Texas, the payoff won’t be as neat.
The dilemma is best illustrated on the LBJ Freeway in Dallas, routinely listed as one of the country’s most traffic-clogged corridors.
Drivers now have three free lanes in each direction, with a narrow HOV lane occupying what used to be the shoulder. Beginning next year, those lanes routinely will be reduced to two – and occasionally fewer than that – as the private toll operator Cintra and its partners completely rebuild the road.
When it opens, probably in 2016, the new LBJ will be an engineering marvel. In place of the current lanes will be four free main lanes. And tucked underneath the cantilevered top lanes will be three brand-new lanes half-dug into the earth like an open channel.
Those three new lanes won’t be cheap, as they will help usher in something new for North Texas: dynamic pricing for toll roads that means the more drivers need them, the more they will cost.
Opening toll rates during rush hour likely will be about 50 cents per mile, more than three times the rates NTTA charges on its roads. Depending on demand, the rates could reach 75 cents or more.
Michael Morris, transportation director for the North Central Texas Council of Governments, said the new LBJ will be a good deal for drivers in North Texas.
Those who won’t pay tolls, he said, still will have four rebuilt lanes to choose from. And frontage roads will be improved and made continuous.
Besides, experts have long warned that so many drivers would like to use LBJ Freeway that trying to build enough free lanes there to keep traffic moving would require at least 16 lanes in each direction. Morris noted that’s neither feasible nor wise. The managed-lane approach will give people a choice between traffic for free or a fast ride for a price.
Cintra, which also is developing the North Tarrant Express, will be contractually obligated to keep toll traffic moving at 50 mph or more at all times, a commitment it will keep by jacking up toll rates when traffic gets heavy.
Meadows said he knows some residents will feel let down when they see that the only sure escape from traffic will come with a hefty toll.
“Here’s the thing,” he said. “It really depends on what your expectations are, what the citizenry expects. If my expectation is that my drive in to my office in Fort Worth, on what we call the free roads, is going to be like it used to be – that we are going to return to 1968, when the government built all the roads for free – I’m going to be really disappointed.”
More waste, fraud, and abuse of our taxpayer money to report…note that 40% of our federal gas taxes go to transit. Plus, why should all taxpayers give government employees a FREE RIDE to work? Who subsidizes our commutes? No one!
Tuesday, May 4, 2010 Feds run off track with Pentagon transit perk
Misused aid gives more a free ride
By Jim McElhatton Washington Times
Federal officials failed to keep track of how they doled out millions of dollars in transit benefits paid for Washington-area Pentagon employees to get to and from work, resulting in overpayments, double dipping and questionable public transit fares, a recent Pentagon review has found.
The increasingly generous subsidy, expected to cost about $60 million this year, pays workers to take mass transit or join van pools to help unclog the notoriously traffic-snarled roadways in and around the nation’s capital.
With the passage of the economic stimulus package last year, area federal workers across government saw their maximum transit subsidy rise from $120 per month to $230 per month.
But after reviewing a sampling of the more than 41,000 Pentagon workers who collected transit money in 2007 alone, the Pentagon’s office of inspector general recently reported on numerous problems.
Hundreds of workers, for instance, appeared to be double dipping by collecting public transit subsidies for bus or train fares at the same time they received parking benefits. And records for more than 30,000 workers in the transit-subsidy program were incomplete or inaccurate, according to the review.
The inspector general’s office declined Monday to comment on the report, and e-mails and telephone calls to the Washington Headquarters Services, the Pentagon agency that oversees the transit program, were not returned by deadline.
The findings were contained in an April 16 Pentagon report in which the inspector general ultimately made no recommendations, saying the military already had taken actions to “adequately address the internal control weaknesses.”
The audit prompted numerous changes in how officials manage the transit-subsidy program, including the start last summer of a program to automatically cross-check Pentagon parking records against the rolls of employees receiving transit subsidies.
Still, Pete Sepp, vice president of policy for the National Taxpayers Union, said the transit-subsidy program will remain a tempting source of easy cash for unscrupulous employees.
“The new safeguards provide fewer opportunities to cheat, but thanks to the huge increase in subsidies from the stimulus bill, there’s now more motive to do so,” he said.
“It’s not easy to detect, for example, someone who gives all the proper information about where they enter and leave the transit system, only to secretly bum rides to work when loaning his or her pass to someone else.”
Washington Headquarters Services contracts out various responsibilities for management of the transit program to the Department of Transportation.
The report wasn’t the first time Pentagon officials were put on notice about problems with the transit program.
In 2007, another inspector general audit found more than 14,000 employees collecting transit subsidies who had filed incomplete applications. Inspectors also reported that more than 900 employees had collected public-transportation subsidies while receiving parking benefits.
Transit subsidies have come under scrutiny elsewhere in government.
In 2007, the Government Accountability Office estimated that federal agencies had paid about $17 million in fraudulent transit payments. In some cases, employees were selling the nontransferable perks over the Internet.
In 2008, the State Department suspended one employee for a month after the employee was caught selling transit subsidies outside of a subway stop in Washington, according to an internal report on the case obtained by The Washington Times through the Freedom of Information Act.
The worker claimed ignorance, telling investigators that the fares were simply “government perks.”
In its report last month, the Pentagon inspector general’s office said it was referring 10 cases for criminal investigation.
The review also found “inaccurate or incomplete” records for all but 8,714 of the 41,279 workers who took part in the transit program. What’s more, about 5,000 employees overstated their benefits, resulting in more than a half-million dollars in overpayments.
Mr. Sepp said several of the reforms probably have weeded out “many if not most of the double dippers.” Still, he said, “ethically challenged” employees will be tempted to game the system.
“If federal officials truly believe that offering such generous benefits will ease congestion and clean the air, then the least they owe taxpayers, many of whom pay for transit out of their own pockets, is to prosecute fraud and abuse wherever and whenever it’s found,” he said.
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