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House Bill 1892 |
House Author: Smith, Wayne et al. |
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Effective: Vetoed |
Senate Sponsor: Williams |
House Bill 1892 amends the Transportation Code to authorize a private entity to submit alternative proposals for state highway projects based on comprehensive development agreements with different terms up to 40 years and exempts agreements in connection with certain projects. A comprehensive development agreement with a private participant that includes the collection of tolls or fees may not be for a term longer than 40 years, rather than 50 years. The bill authorizes an agreement in connection with certain projects to be for a term no longer than 50 years. The bill authorizes, rather than requires, the Texas Department of Transportation (TxDOT) to pay an unsuccessful private entity that submits a proposal in response to a request for detailed proposals a stipulated amount in exchange for the work contained in the proposal.
The bill prohibits a comprehensive development agreement between a private participant and a toll project entity from containing a provision to permit a private participant to operate or collect revenue from a toll project; however, it exempts agreements in connection with certain projects and conditions. On or after the bill's effective date, a toll project entity is prohibited from selling or entering into a contract to sell a toll project of the entity to a private entity. These provisions expire on September 1, 2009. The bill creates a legislative study committee to study these prohibited terms in comprehensive development agreements and toll project sales and to prepare a report of its findings and recommendations by December 1, 2008.
The bill provides that, with certain exceptions, the authority to enter into comprehensive development agreements in connection with state highway projects and transportation projects of regional mobility authorities expires on August 31, 2009. Provisions related to public access to information require TxDOT to make public in a timely manner all documents relating to the Trans-Texas Corridor, including financial plans. The bill requires contract payments received by the Texas Transportation Commission (TTC) or TxDOT under a comprehensive development agreement to be used to finance transportation or air quality projects in the region where a state highway toll project is located. The bill requires the TTC or TxDOT to distribute the payments among the department districts in which the project is located based on the percentage of toll revenue from users in that district.
The bill establishes provisions that apply to toll projects in counties authorized by law to construct and operate certain transportation projects, to toll projects within the boundaries of regional mobility authorities, and to toll projects in the territory of a regional tollway authority. All of the provisions allow the entities to use state highway right-of-way owned by TxDOT and to access the state highway system. Provisions relating to the counties and to regional mobility authorities require the TTC or TxDOT to provide the entities the first option to finance, construct, or operate the portion of a toll project located within the entities' boundaries and establish timelines for exercising that option. If an authority does not initiate work within 18 months of exercising its option to develop a project, the local metropolitan planning organization may allow TxDOT to finance, construct, or operate the project. A county also has an 18-month period to enter into a contract before TTC or TxDOT may enter into a contract with a different entity for the project. A county authorized by law to construct and operate certain transportation projects is also authorized to exercise the powers of a regional mobility authority, enter into certain comprehensive development agreements with a private entity, and authorize the use and terms of surplus revenue for other road, street, or highway projects.
The bill authorizes a regional tollway authority to use a comprehensive development agreement with a private entity in connection with a turnpike project and establishes a process for entering into such an agreement that includes requirements relating to confidentiality of information and performance and payment bonds. The bill specifies that a turnpike project that is the subject of a comprehensive development agreement with a private entity is public property and is owned by the authority. The bill sets forth provisions relating to private participation in a turnpike project and to the use of contract payments under a comprehensive development agreement. The bill authorizes the board of an authority by resolution to use the surplus revenue of a turnpike project or system for a highway or similar facility that is not a turnpike project if the highway or facility meets certain criteria. The bill provides that for each toll project located within the boundaries of a regional tollway authority, after completion of the market valuation, the policy board of the metropolitan planning organization must notify the authority that the authority has the first option to develop, finance, construct, and operate the project. If the authority does not exercise the option, the metropolitan planning organization must allow TxDOT to execute the project. The bill specifies that a contract made by an authority that requires the expenditure of public funds for a turnpike project may, rather than must, be decided by competitive bidding in which the contract is awarded to the lowest bidder. The authority is authorized to procure a combination of designs for a turnpike project, provided that any contract awarded results in the best value. The bill sets forth provisions relating to the selection of a construction manager-at-risk by the authority. It makes an offense related to accepting gifts and contributions from a contractor or offering gifts to an authority director a Class A misdemeanor.
The bill provides for oversight of comprehensive development agreements by the attorney general, Legislative Budget Board, and state auditor. The bill establishes guidelines for the termination of a comprehensive development agreement and prohibits an agreement from containing a provision that limits or prohibits the construction, expansion, or repair of certain highway or other transportation projects. The bill specifies the circumstances under which an agreement may contain a provision authorizing the toll project entity to compensate a private participant for the loss of toll revenue. The bill requires a toll project entity, prior to entering into a contract for the construction of a toll project, to publish certain financial information related to the project and to hold a public hearing on the information.
Reason Given for Veto: "House Bill No. 1892 jeopardizes billions of dollars of infrastructure investment and invites a potentially significant reduction in federal transportation funding. Projects important to fast-growth communities would be placed on hold without alternative financing mechanisms to get them constructed. Even more egregiously, the bill serves to break up the state highway system by permitting local control over state assets.
"While I support greater local decision-making authority over transportation planning, I do not support turning over state assets to local entities. By allowing local entities to seize state right-of-way at any moment, H.B. No. 1892 prohibits the Texas Department of Transportation’s ability to issue any road-based debt instrument, such as toll revenue bonds, comprehensive development agreements, and pass through financing deals. As a state that grows by 1,200 people each and every day, we must consider every viable option that will allow Texas to build a strong transportation infrastructure to support present and future growth.
"I am grateful that legislators are working with me in subsequent legislation to address these concerns I have expressed about H.B. No. 1892 and look forward to receiving Senate Bill No. 792 without delay."