An unaccountable transportation body in North Central Texas on Thursday awarded $3,615,214 in taxpayer money to a foreign corporation for its failure to produce a winning toll road project bid. The Regional Transportation Council (RTC) of the North Texas Council of Governments approved the payment to Cintra Concesiones de Infraestructuras de Transporte, a Spanish company, as a “stipend for unsuccessful bidders” and for costs associated with applications the company made for loans that would have been backed by federal taxpayers.
Although Cintra received a conditional green light in February 2007 for its bid to construct a 26-mile extension of State Highway 121 as a toll road through Denton and Collin Counties, the state legislature within a matter of weeks expressed second thoughts about the deal. New legislation restricted the private development of certain toll roads and forced the consideration of an alternative bid from the North Texas Tollway Authority (NTTA), a public agency.
On June 28, 2007, the RTC voted 27 to 10 to approve the NTTA proposal which was described as “more lucrative” than Cintra’s. In return for an up-front payment of $2.5 billion, plus $1.5 billion in future payments, NTTA would have free reign to impose tolls on motorists for the next fifty years. The $4 billion in payments to the state would, in effect, be an advance loan of money that the agency expected to collect from motorists, less the substantial costs for overhead.
The switch to NTTA came in spite of Governor Rick Perry’s strong support for Cintra throughout the process. In 2004, Perry had even hired his legislative director, Dan Shelley, away from his work as a consultant for Cintra. After the company landed several major state deals, Shelley returned to Cintra in 2006. By 2008, Shelley had collected an estimated $300,000 from the Spanish firm for his work as a registered lobbyist.
The payments to Cintra were made possible by Governor Perry’s approval of legislation in June authorizing unlimited compensation to losing bidders on toll projects. Denton County taxpayers will pay the most, $1,961,063, to Cintra. Collin County will pay $1,446,086 and Dallas County $253,065. The anti-toll group Texans Uniting for Reform and Freedom (TURF) expressed outrage at the decision to send taxpayer money to Cintra.
“Wanna know why there’s no money for roads?” TURF Founder Terri Hall asked. “Here’s your answer. We’re paying losers for not even building the roads. The cronyism is only getting worse, and it’s at the expense of the taxpayers.”
Amazing!
I can ACTUALLY hear Bill O’Reilly foaming at the mouth!
@KatiePuckrik:
As well he should! It’s just this type of government waste and stupidity that gets people upset. Ridiculous.
Dwford,
To be fair, Cintra put through a bid which was given a conditional green light until legislation (which wasn’t around before Cintra placed their tender) FORCED Texas to look at someone else’s bid.
Cintra weren’t outbid, they had their tender forced out.
I bet Bill O’Reilly will miss that salient piece of information out (like he does on any topic he talks about)…..
Ah yes, the efficiencies of a free market system on display again.
“The switch to NTTA came in spite of Governor Rick Perry’s strong support for Cintra throughout the process. In 2004, Perry had even hired his legislative director, Dan Shelley, away from his work as a consultant for Cintra. After the company landed several major state deals, Shelley returned to Cintra in 2006. By 2008, Shelley had collected an estimated $300,000 from the Spanish firm for his work as a registered lobbyist.”
“The payments to Cintra were made possible by Governor Perry’s approval of legislation in June authorizing unlimited compensation to losing bidders on toll projects.”
Manus lavat Manum.
The bottom line is this:
1) The State of Texas is forcing toll roads down people’s throats.
2) The State is forcing the taxpayers to pay out to “losing” bidders because of the way the State manipulated/screwed up the bidding process.
Texas used to be a fairly well-run, fiscally conservative, reasonably voter-responsive state. I think the GOP has forgotten the lessons of the last 30 years, much as the “federal”-level GOP did. And there’s no excuse for this at all.
This kind of corrupt behavior is bound to happen with government privatization schemes. Just like the billions wasted with KBR, etc., to provide more “efficient” food and logistics services than the US military could, even though that was a complete lie. In fairness Obama has chosen one of the most pro-private road assholes as his Transportation Secretary.
This couldn’t happen to a more deserving state than Texas.
At least the good guys, the public tollway authority, won the bid. I’m pretty sure the NTTA bid doesn’t have non-compete provisions that restrict state and local governments from making any improvements to local road that might “compete” with the toll road. I’m pretty sure the Cintra bid did have those non-compete provisions.
Texas is better off paying Cintra to go away than letting it own an additional toll road, although it shouldn’t have had to do either.
re: KatiePuckrik:
“To be fair, Cintra put through a bid which was given a conditional green light until legislation (which wasn’t around before Cintra placed their tender) FORCED Texas to look at someone else’s bid.”
Wow, the Texas legislature forced the Texas government to do something? What nerve.
How does the one eyed Scottish idiot feel about privately owned roads?
@no_slushbox
I’m not quite sure what you’re talking about.
P.S. It’s was only a matter of time before a US vs UK debate reared its head. (sigh)
Re: “KatiePuckrik:”
You used all caps for “FORCED” like some outside agency was brutally forcing Texas to do something.
It wasn’t an outside agency; it was the Texas legislature, which is the most important part of the Texas government. Most people wouldn’t use the say that “Texas FORCED Texas to look at someone else’s bid.”
I’m not starting a US vs. UK thing, even your white trash are classy enough to cover themselves in Burberry – you win. I’m just asking, non-rhetorically, how the one eyed Scott feels about private roads.
@no_slushbox
There’s 2 ways of looking at this:
1. Texas passed the legislation AFTER Cintra placed their bid. In which case, Texas stiffed themselves.
2. Texas passed the legislation BEFORE Cintra placed their bid. In which case, why did Texas entertain Cintra’s bid if it wasn’t valid to start with?
Either way you look at it, Texas forced their own hand.
As for our Prime Minister (who I assume you’re talking about), he loves them. The M25 toll road (AKA The Queen Elizabeth II bridge) and the M6 toll road are privately owned. The M25 toll is run by a French company called “Le Crossing” and the M6 toll is run by an Australian company called “Macquarie”.
What’s next, private fire departments which charge a protection fee if you want them to respond?
re: KatiePuckrik:
Definitely it’s the fault of the Texas government that it had to, or chose to make this payment.
I’m just saying that nobody forced Texas to consider another bid, Texas chose to look at another bid.
And it was for the best, even with this payoff Texas is better with the NTTA owning the road than Cintra.
Sorry to hear about your prime minister (I was referring to him as he was christened by Clarkson), although the Transportation Secretary that our President chose is no better.
re: jthorner:
Yes, we need privatized fire departments right now, unless you want America turning into Russia, into a socialist country.
Looks to me Texas welshed on the deal with Cintra, and had to cough up the equivalent of damages suffered by Cintra.
IIRC, Texas did this before. After much squawking from aggrieved motorists, the Legislature repealed a requirement for annual emission testing. The state had to pay off the private firm that had contracted to build and run testing stations, only to get screwed by the state’s second-guessing.
Katie Puckrick: “The M25 toll is run by a French company called “Le Crossing”.”
Ah, so Napoleon’s dream of invading England was finally realized–two centuries later.
Texas used to be a fairly well-run, fiscally conservative, reasonably voter-responsive state.
Yeah, but then idiots got upset about a foreign company winning the bid and wanted to change the rules later to freeze them out and hand the result to their political cronies at the NTTA. The original bid soliciting process was fiscally conservative and well-run. But some people decided that they disliked foreigners more than that they liked saving money.
This kind of corrupt behavior is bound to happen with government privatization schemes.
This kind of corrupt behavior is also bound to happen with government-run schemes. The Massachusetts Turnpike Authority wastes more money and is more inefficient than any other turnpike authority in the country.
50merc,
Don’t worry, that’s a franchise that is ending on September 2009. Taking over that contract is a consortium consisting of 40% Balfour Beatty (UK), 40% Skanska (Sweden), 10% Atkins (UK) and 10% Egis Projects (France).
It’s a UK dominant consortium. Just the way I like it! :O)
Incidentally, (if anyone cares) I was doing some research on UK companies the other day and saw that they trade open and prosperously in pretty much all of Europe (and the world, to be fair) except France. On closer inspection, France’s economy is very insular.
I’m surprised no-one’s complained to the WTO about this.
At least the good guys, the public tollway authority, won the bid. I’m pretty sure the NTTA bid doesn’t have non-compete provisions that restrict state and local governments from making any improvements to local road that might “compete” with the toll road. I’m pretty sure the Cintra bid did have those non-compete provisions.
Hey, no_slushbox, I’m pretty sure that the Texas government doesn’t need a non-compete provision to not compete against its own public toll roads. It’s the same sort of logic as you noting that Texas doesn’t have to “ORDER” itself to do something.
In areas of the country with public tollway authorities, I’m pretty sure I haven’t seen the state government falling over itself to improve competing roads.
re: johnthacker:
Texas went with NTTA supposedly because it was a better contract. I doubt the NTTA has much sway with the Texas legislature compared to private lobbyists.
The non-competes are an issue because the local and county governments are separate from the Texas state governemnt. Texas is not going to prevent those local governemnts from improving their roads because off the NTTA, but might prevent them from improving their roads because of a non-compete with a private company.
As sloppy as some public toll authorities are I would much rather have them than private monopolies operating roads. A private monopoly never functions better than the government just providing the service directly.
Centra got its bid reimbursement by using lobbyists, who knows how much its lobbyists would have been able to abuse drivers and taxpayers if it actually got the contract.
The big story is that gas taxes are hugely more efficient than tolls. However, if private tollway lobbyists get their way gas taxes will be completely replaced by private toll roads:
http://www.thenewspaper.com/news/24/2438.asp
Actually the area discussed is Northeastern Texas, not North Central. 121 is a new highway that runs from Allen to The Colony and then down to DFW airport. The road in question is about 25 miles north of Dallas.
As far as government F’ups, this is becoming quite typical of our Texas legislators. The Texas Legislature is a part-time body but are doing their best to act like any other full-time legislative body. When we Texans secede from the Union the first thing we will do is round up the legislators in Austin and the governor and ship them permanently to Oklahoma. Kay Bailey Hutchison, stay in DC when your term runs out. We don’t need you back here! Just keep rearranging the deck chairs on the Titanic, just like you have done so well thus far. You don’t represent Texans! You represent the monied elite of Houston. Go away!
You know, I get the impression from this piece that the Governor of Texas somehow passes legislation on his own. If I had to guess, “The Newspaper” has an axe to grind with Rick Perry.
Or he would prefer that folks not notice that the toll road legislation was drafted or passed in part by Democrats.
(Just to clarify, Denton County is Dallas. Guess who runs Dallas and sits in the legislature for Dallas. Here’s a hint: They mostly aren’t Republicans.)
Just plain Stupid.
Logans_Run: “When we Texans secede from the Union…”
Didn’t you try that in 1861? How did it work out?
“… the first thing we will do is round up the legislators in Austin and the governor and ship them permanently to Oklahoma.”
Criminy, don’t do that! We’re already afflicted with our own politicians who keep fixing what isn’t broken. In fact, we’ve been thinking of shipping ’em down to Baja Oklahoma.
@ jthorner:
What’s next, private fire departments which charge a protection fee if you want them to respond?
Yes.
I also expect to see the same thing happen with the police. Imagine an even worse level of privatization than what was portrayed in Robocop.
It’s called the Roseanne Rosanna Danna tax.
No_slushbox
Google “chav” LOL
Man, these apes can’t even figure out how to do private roads without charging those who don’t use them. And sadly, the citizens paying for this will do exactly nothing about it, except pay up like sheeple, and engage in some utterly irrelevant muttering about how Obama is a socialist and Texas is not and stuff.
Yes, we need privatized fire departments right now, unless you want America turning into Russia, into a socialist country.
What are you talking about?
First of all, Russia was a full-blown Communist, not Socialist country.
Secondly, there are things in this country that the Communist Russia would have never dream implementing of, like the multi-generational welfare, job banks, food stamps, affirmative action, just to name a few! All designed to create a permanently brain-dead underclass, dependent on the governmental protection/handouts.
Well the job banks wasn’t a governmental program. That was the only reason it’s been forced out.
This country is very well on the way towards turning Fascist.
Too bad the vast majority of Americans are still totally clueless.