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ST0502B-CS071001 Page 1 of 4 Rhonda Adloo - Freeport Construction (City project # ST 05-02 A&B / NCTCOG project code 11532 & 11533) From: To: Date: Subject: Ken Griffin Christie Jestis 10/1/2007 9:42 AM Freeport Construction (City project # ST 05-02 A&B / NCTCOG project code 11532 & 11533) Rhonda Adloo ST0502B-CS070730.pdf cc: Attachments: Christi I hate to keep harping on the Freeport project, but there seems to be a lot of people giving information on when the road can start, who can do the work and refunding money to private parties for constructing the road. There are also time lines, supposedly by Bill Hale, on when money will be available. I know the STTC recommended a TIP modification on 9/28/07 to change the funding from STP-MM to DFW RTR Funds. When will this funding be finalized? Will it actually be local funds that will be handed to the City for us to disburse to private parties for reimbursement? I know there is a conference call scheduled between the City, TxDOT and NCTCOG on 10/11/07 to discuss these issues. However, my City Manager is looking to me to answer most of these questions now. I've searched the NCTCOG website for information on the DFW RTR Funds and have not found anything on what type of funds they actually are and how they are disbursed. I spoke to Michael Morris after the STTC meeting and he said the funding code was new and that it was local funds. I have also attached an email I sent to Jose Perez in July with updated costs for Freeport. Has the funding for Freeport been adjusted to reflect the updated cost? If you or someone in your office could call or email me with additional information today, I would greatly appreciate it. Thanks for your time. Ken Griffin, P. E. Director of Engineering & Public Works 972-304-3686 kgriffin@ci.coppell.tx. us >>> <michael.swaldi@staubach.com> 9/28/2007 2:48 PM >>> Michael Swaldi [michael.swaldi@staubach.com] has sent you a story from dallasnews.com. (Page at: http://www.dallasnews.com/sharedcontent/dws/news/dmn/stories/092807dntextxdot.11602ce7 6.html) Jim, Ken, and Mindi, I have been unable to reach you all in person over the past few days, and apologize for all the voice messages, but the attached article from today's Dallas Morning News was the reason for my call. We spoke with a gentleman named Bill Hale from TxDot who was brought into our conversation by file:/ /C: \Documents and Settings\rbrother\Local Settings\ Temp \XPgrpwise\4 700COEBCit... 10/10/2007 Page 2 of 4 Representative Dan Branch to assist us in trying to uncover any ways in which we might expedite the construction of the Freeport Parkway extension without losing our ability to be reimbursed for the construction costs. We were told my Mr Hale that the money to construct Freeport was not going to come from the state or the Federal govt, but rather that it would be coming from NTTA and that it would be funded with in 60 days. He was rather emphatic on this point and further informed us that the road would not be a federal or state road, but rather would be a city of Coppell road and would need to be built to city specs. He told us that we needed to circle back to Ken and coordinate with him on this, but also told us that if another face to face meeting including he and Dan Branch was needed, he would be happy to do that. Please let us know what your understanding of this issue is at this time. We would like very much to understand this fully and get all stakeholders back around the table as soon as we can. Best Regards, Michael Swaldi TxDOT running out of cash for new roads But NTTA payments expected to ease North Texas' financial burden 11 :57 PM CDT on Thursday, September 27, 2007 By MICHAEL A. LINDENBERGER I The Dallas Morning Newsmlindenberger@dallasnews.com AUSTIN -- Texas will soon run out of money to pay for new roads or bridges, state transportation officials said Thursday. Within three years, nearly all of the state's construction budget will be spent on maintenance and to pay debt incurred in building existing roads, top officials of the Texas Department of Transportation said. "The people of Texas need to understand that within a very short period of time, there will be no money for mobility projects," said Texas Transportation Commission member Ned Holmes of Houston. The impact will be less severe in North Texas, where local officials are counting on more than $3 billion in upfront payments from the North Texas Tollway Authority as part of its deal to build the State Highway 121 toll road. But even some of that money now will probably have to cover projects that had been envisioned as state-financed projects. Throughout Texas, funds for new roads will begin drying up almost immediately, officials said. Meanwhile, spending on maintenance -- especially in Dallas, where the roads are in the state's worst shape -- will be increased. State projects already under contract will not be affected. The inability to build new roads, or to widen existing ones, comes even as experts are warning that Texas' soaring population and booming economy have made traffic in its leading cities among the worst in the U.S. A national study released last week warned that traffic jams in Dallas grew faster over the past 25 years than in any other city in the country. "People and businesses are moving here because we're a low-tax, low-regulation and low-welfare state -- and that is not going to change," commission chairman Ric Williamson said. "They are going to need roads and highways to be able to get around." file:IIC: \Documents and Settings\rbrother\Local Settings\ Temp \XPgrpwise\4 700COEBCit... 10/10/2007 Page 3 of 4 Trouble is, Texas just can't afford to build them anymore, he said. During the next 60 days, local officials will be asked to scale back requests for state funds, said Amadeo Saenz, who was named TxDOT's new executive director late Thursday. "This will cause delays, and some projects will be canceled," Mr. Saenz said. Scarce funds, high costs Mr. Williamson says many factors are to blame for his department's inability to keep up with the demand for new roads. Federal funds are increasingly scarce, and highway construction costs have soared 62 percent in the past five years, he said. Meanwhile, the state's aging roads are increasingly in need of repair. "We don't want to see a Minnesota bridge collapse in Texas. In order to avoid that, we are going to have to take care of the assets we have," Mr. Williamson said. But commissioners saved their harshest criticism for decisions by the Texas Legislature. They said lawmakers spend the state gas-tax revenues on too many other needs, including more than $1 billion for the state police alone. But commissioners said the Legislature's moratorium last session on private-investments in toll projects has hurt the most. The decision cost the state billions of dollars in annual construction funds, said Mr. Williamson, who like the other commissioners was appointed by Gov. Rick Perry. Mr. Williamson said Mr. Perry asked the commission to find a way to pay for the state's growing transportation needs. Convincing private companies to pay money up front to operate toll concessions was that solution, he said. Terms too steep Lawmakers need no lecture on the severity of the state's transportation needs, suggested Steven Polunsky, a top aide to Sen. John Carona, R-Dallas, chairman of the Senate Transportation and Homeland Security Committee. "We agree absolutely that there is a financial crisis," Mr. Polunksy said. "And Senator Carona will support next session a multi-pronged approach to solve it." He wants to raise the gas tax and stop the diversion of revenues to pay for other needs, Mr. Polunsky said. But the private investment deals favored by the commission were too lopsided, he said, noting that some proposed leases would have kept the toll roads in private control for 75 years or longer. "The price that came with those private financing deals was too steep," Mr. Polunsky said. file:IIC: \Documents and Settings\rbrother\Local Settings\ Temp \XPgrpwise\4 700COEBCit... 10/10/2007 Page 4 of 4 "Lawmakers found the terms unacceptable, both politically and from a business standpoint." Mr. Williamson said efforts to raise the gas tax are misplaced. The tax is inefficient because lawmakers divert too much of it to other needs, and he said it is too regressive, since poor people pay the same rate as rich ones. He did say he would probably support efforts to index the rate to inflation, if only because inflation is making it increasingly difficult for the department to simply maintain the roads it already has. The legislative moratorium nearly killed Dallas' transportation agenda, said Michael Morris, transportation director for the North Central Texas Council of Governments. "We took a lot of criticism back in the spring for working to make sure our projects were not going to be affected by the legislature's moratorium," Mr. Morris said. "But if we hadn't succeeded in that, we would be dead in the water, just like the rest of Texas is going to be." NTTA is not a private company, but it modeled its offer to pay $3.3 billion in return for operating the toll concessions on SH121 on the private companies' proposals. Without the latter, NTTA's deal would never have been so aggressive, Mr. Morris said. When state funds begin drying up over the next couple of years, it will be the NTTA's money, he said, that keeps construction projects moving forward in the Dallas area. Even that money, however, will run out over several years -- and by then, if the state or federal governments haven't found new ways to pay for projects, North Texas will suffer like the rest of the state, Mr. Morris said. Relief in sight Some short-term relief could come as soon as next month, when Texas voters have a chance to approve a constitutional amendment that would authorize TxDOT to borrow up to $5 billion in one-time construction money. That issue is on the Nov. 6 ballot. But even if it passes, the money would only be a one-time infusion, warned James Bass, the department's chief financial officer. TxDOT has estimated the state has an $86 billion gap between construction needs and available funding. The $5 billion would help -- but would also increase the state's annual debt payments for decades to come. Instead, Mr. Morris said, the state needs real solutions -- and that means new revenue. "We're just shuffling the deck chairs around on the Titanic," he said. file:IIC: \Documents and Settings\rbrother\Local Settings\ Temp \XPgrpwise\4 700COEBCit... 10/10/2007