Texas Tribune article, Toll Road Projects in Limbo Following Session, is about toll road funding following the 84th legislative session.
The Policy Research Center published a report titled, Public-Private Investment Models for Roadway Infrastructure, which looks at public-private partnerships (P3s) as a means to support the increasing infrastructure demand in Texas. Researchers studied global and national P3 projects to determine what makes for a successful public-private partnership. Research findings include effective factors for the success of P3 programs and strategies to enhance benefits derived from P3s.
Find the final report here and below the Texas Tribune article, which has been edited for length.
Toll Road Projects in Limbo Following Session
The Texas Legislature began this year’s session with a major case of toll fatigue. After more than a decade of letting local and state planners partially fund large highway projects through toll collections, most lawmakers had little appetite left for such projects. Some talked openly about scrapping many tolls already in place.
Five months later, the state’s vast toll network remains intact, but the prospects for new toll projects have dimmed. In Dallas, Austin and San Antonio, major highway projects originally planned with toll lanes are in limbo as local officials try to work out the path ahead, according to lawmakers and state officials with knowledge of the projects.
“The CDA delivery model has not been killed, but it has been mothballed for now,” said Texas Transportation Commissioner Victor Vandergriff, referring to “comprehensive development agreements,” a common way for local or state entities to partner with private companies to launch a toll project. This session was the first since 2007 during which lawmakers didn’t pass a so-called CDA bill authorizing a list of new toll projects.
Lawmakers also agreed to ask voters to boost spending to the Texas Department of Transportation by billions of dollars, but specified that none of the new funds can go to toll roads. Another bill signed by Gov. Greg Abbott blocks lawmakers from borrowing from the Texas Mobility Fund, a rotating fund set up in 2001 to provide money for state transportation projects that has helped fund toll projects in the past.
Together, the measures choke off state funding for toll projects, and could encourage planners to avoid tolling on highway expansions. But if the state can’t help pay for enough free roads to unsnarl Texas traffic, local officials might still decide to borrow private money — and pay higher interest rates — to get toll roads built, warned Brian Cassidy, a managing partner with Locke Lord, a law firm that works with regional mobility authorities.
“There’s less money available that TxDOT controls that will be used for toll roads,” Cassidy said. “That has the potential to make it harder, or more expensive really, to do projects.”
State transportation officials have said for years that they need about $5 billion more annually to keep traffic congestion from getting worse as the population booms. Lawmakers this session gave them a large chunk of what they requested. By 2020, road funding could be up by more than $4 billion a year, mostly by dedicating tax revenue the state already collects to transportation.
Yet TxDOT leaders stressed during the session that the $5 billion estimate came with some fine print; it assumed that the agency could continue to use tolling to complete certain highway projects faster. Without that option, the agency’s annual funding shortfall is closer to $10 billion.
In San Antonio, the largest city in Texas without any toll roads, plans to add toll lanes to U.S. 281 and Interstate 10 appeared all but certain until last week, when local officials sent a letter to TxDOT and local members of the Legislature requesting an extra $268 million in state funds to remove all tolls from the project.
The letter, from Bexar County Judge Nelson Wolff, County Commissioner Kevin Wolff and John Clamp, chairman of the Alamo Regional Mobility Authority, cited the extra transportation funding approved this session as a reason why the county didn’t believe the project should need any tolling.
“In fairness to the citizens of Bexar County, both segments need this funding in order to avoid managed tolled lanes,” the letter reads.
In Austin, local and state officials unveiled plans this month to expand the busiest part of Interstate 35 over 10 years, a multibillion-dollar endeavor that would be funded in part through toll lanes. State Sen. Kirk Watson, D-Austin, tried and failed to get the project added as an authorized CDA this session. He said he and others are still working on “the funding puzzle” for clearing up one of the state’s most congested roads. To get the project started sooner, tolling may be unavoidable, he said.
“I would prefer to seeing us do this in the pay-as-you-go fashion, but the problem is the state has been negligent getting to this point and we have a crisis on I-35,” Watson said. Despite the funding increases approved this year, he predicted that many lawmakers won’t realize until the 2017 session how transportation funds remain far short of the state’s needs.
“We have done all the easy stuff now, and we still don’t have enough money,” Watson said. “So we’re going to have to figure out what other tools might be available to us and how we can make them work in conjunction with this additional money.”
This story has been edited for length. Full article may be found here.
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