Flush with highway cash, Texas still looking for toll options

Cars drive along Interstate 45 at rush hour between 610 and Beltway 8 Friday, April 21, 2017 in Houston. Lawmakers are looking at plans to add toll lanes to widen Interstate 45 north of downtown to the Sam Houston Tollway. less Cars drive along Interstate 45 at rush hour between 610 and Beltway 8 Friday, April 21, 2017 in Houston. Lawmakers are looking at plans to add toll lanes to widen Interstate 45 north of downtown to the Sam ... more Photo: Michael Ciaglo, Houston Chronicle Photo: Michael Ciaglo, Houston Chronicle Image 1 of / 15 Caption Close Flush with highway cash, Texas still looking for toll options 1 / 15 Back to Gallery

Texas is spending record amounts on transportation, but lawmakers worried it is not enough are considering extending a controversial program that’s helped spread tollways through some of the state’s largest areas.

A bill approved this week by a House committee would give the Texas Department of Transportation a chance to add six additional projects, including the widening of Interstate 45 north of I-10 and a long-planned Hempstead Tollway, meant to relieve traffic on U.S. 290 with the potential for a commuter rail corridor.

The bill, by state Rep. Larry Phillips, R-Sherman, would also allow TxDOT or regional officials the chance to build a dozen other projects.

Without an extension, the state’s authority to ink the special agreements - which typically cede control of a tollway to a private entity that then recoup its costs through revenues - runs out in August.

Phillips said earlier this month highway officials need “every tool” to complete some of the long-sought projects in Texas cities. The agreements offer a rare chance for state and local money to tap private investment, something the Trump Administration has touted.

“What I’m hearing from Washington is that is the way things are going,” Phillips said of the public-private investment strategy. “It provides opportunities for us at the state and local level... If we don’t, we’re going to sit behind the eight ball and wonder why we didn’t get our share of the money.”

Others were less enthusiastic.

“I am not against all tolls, just bad ones,” said Rep. Joe Pickett, D- El Paso, the only member of the transportation committee to oppose Phillips’ bill.

Pickett has been critical of some toll projects, and as transportation chair during the last legislative session oversaw a review of tolling that sought to estimate how much it would cost for Texas to take tolls off all state-maintained roads.

Various records

The use of comprehensive development agreements remains controversial with drivers and lawmakers because of the use of tolls and who benefits from the roads’ construction.

Since 2011, TxDOT has been permitted to use the agreements in rare circumstances approved by the Legislature. Sixteen projects have proceeded as comprehensive agreements, with a dozen of those built as design-build projects in which a company — typically a joint venture of many firms — completes the engineering and construction of the tollway under TxDOT supervision.

In the Houston area, the Grand Parkway from U.S. 290 to Interstate 69 north of Kingwood was built as a design-build project.

Four other projects were either completed or are currently under construction as part of a concession agreement, where the private company designing and building the road will maintain and operate the road for a set period, recouping their investment by collecting tolls.

Houston’s first concession project won’t open for another two years - a four-lane tollway in the center of Texas 288. Work is accelerating on the project, which is being built under a 52-year contract worth an estimated $2.1 billion signed between TxDOT and Blueridge Transportation Group in 2016. The company is a consortium of businesses including Spanish-based Grupo ACS, global investment company InfraRed Capital Partners and the Israeli building and real estate company Shikun & Binui.

Despite some support, TxDOT’s reliance on concessions has come with concerns, especially after the SH 130 toll road from Mustang Ridge to Seguin filed for bankruptcy. The default sent the road back its creditors, and it remains open, but also a source of friction between some lawmakers skeptical of TxDOT’s plans and the benefits of tolling.

Projects Abound

The past three years have been a boom time for state and regional transportation officials, with two voter-approved spending plans pouring more than $2 billion annually into TxDOT’s upcoming budget.

The added money meant TxDOT’s 10-year transportation plan, updated earlier this year, ballooned to a record high of nearly $70 billion.

Voters have balked, however, at toll road funding. Two statewide propositions - Proposition 1 in 2014 and Proposition 7 in 2015 - directed state funds to TxDOT, but stipulated that those funds be used for free highways and not toll roads of transit. The propositions were approved by more than 75 percent of voters, many of whom were fed up with toll roads.

Even then, however, lawmakers said the money would never build all the projects on the books. Many of those officials reiterated that this month in Austin, supporting the extension of comprehensive development agreements.

“With all the restrictions we have now on transportation, we may have to rely on (comprehensive development agreements) or put these projects on hold,” said Mike Heiligenstein, executive director of the Central Texas Regional Mobility Authority, which oversees transportation improvements in the Austin area.

The spectre of slower development, however, did not deter many vocal toll critics, who have long accused lawmakers of favoring corporate deals over responsible road development.

“It is the biggest taxation-without-representation scheme since railroad robber barons,” said Terri Hall, founder of San Antonio-based Texans Uniting For Reform and Freedom. “Get these projects moving with Prop. 1 and Prop. 7 dollars.”

Increasingly, critics have found more sympathetic ears in some lawmakers, who have questioned the reliance on tolls to solve metro congestion. Some consider it punishing urban residents by making them pay gas taxes and tolls while TxDOT covers all the costs of road projects in smaller cities and rural areas.

Others remain skeptical that toll roads solve current traffic problems, and question why TxDOT would use managed lanes to nudge people into carpools and transit use.

“The answer to congestion today is more capacity, not managed lanes,” Pickett said.