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    Everyone wants to know about pass through tolling, so here's a good explanation of what it is, and why we might all want to learn about it, by my friend Vince May.

    HB 3588 enabled creation of RMAs to build toll roads. It also created "pass through tolling". (PTT) (Since the term pass through tolling is so confusing, most people are calling it 'pass through financing.')(PTF)

    TxDOT does not have enough cash to build everything it wants to build TODAY. Nor does the state have the power to sell bonds unless the people vote on it in November. Even if the people authorize the state to sell bonds, the state has other hurdles it must cross before selling road bonds.

    County Commissioners can sell bonds more easily than the state. But they know that they will HAVE TO RAISE property taxes if they do. They don't want to do that, for obvious reasons.

    Pass through tolling (PTT) allows County Commissioners to sell bonds without necessarily raising property taxes. They first sign a contract with the Texas Transportation Commission (TTC) whereby the TTC promises to pay off the bonds with gas tax money. The contract is usually for 15 years.

    With this "free money", County Commissioners have an incentive to build a hundred new roads, even useless roads that nobody wants or will ever use. TTC doesn't want to pay for junk projects, so it writes terms into the contract.

    For example:
    We will pay off your bonds on Project A if the road has traffic levels of
    1. 10,000 vehicles per day in 15 years; and,
    2. 20,000 vehicles per day in 10 years; and,
    3. 30,000 vehicles per day in 5 years

    If the road fails to meet the specified numbers, the county taxpayers will pay part of the cost of paying off the bonds through higher property taxes.

    While HB 3588 created PTT / PTF, it left the details up to the TTC. Texas Transportation Commission could write a contract that says "We will pay off your bonds if it snows on Dec. 15th, 2009." I suspect that TTC is giving sweetheart deals to projects that benefit Republican interests. I NOTE THAT EVERY ROAD INTO TAYLOR, TEXAS is PTT / PTF. Taylor is the home of Mike Krusee, the Texas House Transportation Committee Chair.

    Our Travis Commissioners could sign bad PTT / PTF contracts in our name. It would be 5 or 10 years before we learned how bad the deals were. Sam Biscoe would be retiring just about the time our property taxes double. On the other hand, CTRMA tolling is forever!

    The bottom line: We should demand that our roads be built with gas tax dollars - especially those that have already been approved for construction, like 183S and 71E. Other projects like 290E and 290W should be built with traditional finance, too. PTT / PTF should be considered a last resort.

    You can view the video of my discussion of PTT / PTF with county commissioners on 5-23-06 at the Travis County web site. After I finished speaking they began suggesting that PTT / PTF was a really bad deal for the people of Hays and Williamson counties. This is the first time they ever responded to me and obviously touched a raw nerve.

    by --- Vincent J May

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