CDA's: Why is Perry spotlighting his weakness?
Thu July 2, 2009 11:24 am

The danger of a special session for a governor is that he won't get what he wants, and in failing to get it, will open himself to charges of failed leadership. That is why Perry planned to limit the session to the Sunset Safety Net bill that will continue the existence of TxDOT, the Department of Insurance, the Racing Commission, and other agencies, and to authorizing $2 billion in highway construction bonds that had previously been approved by the voters.

But Perry also wants the Legislature to renew the authority for Comprehensive Development Agreements, the controversial financing tool that privatizes toll roads, and to establish an infrastructure bank, managed by TxDOT, that would lend money for road projects. This is political dynamite. Toll roads are Perry's biggest political liability. They have little support other than business groups. They are particularly unpopular with captive suburban commuters who are the key voters in a governor's race.

This is the controversial language in HB 1, pertaining to the bonds, the proceeds of which may be used "to provide money for deposit in the Texas Transportation Revolving Fund or similar revolving fund authorized by law, to be used for the purpose of making loans for highway improvement projects as provided by law." Guess who administers the intrastructure bank? TxDOT, of course. This has many members worried, lest TxDOT lend money that would aid the cause of privatizing roads. One of the concerns, for example, is that the bank would loan money to local toll agencies, which could then sell the project to Cintra or another private entity. It is my understanding that Chisum will have an amendment to provide safeguards against hanky-panky. HB 3, which would reauthorize CDAs, has the safeguards, but, as has been reported elsewhere, the bill lacks the support to become law -- no one but TxDOT likes CDAs -- and has not been scheduled for debate.

These are not good times for toll projects. "The credit market collapse and political opposition have all but killed the U.S. highway-privatization trend," Barron's reported in May. That same article quoted Toll Road News, an Internet publication: "Toll-road traffic decline has been more severe than in any other post-war recession." Toll road traffic is down by 6%, and truck traffic, which accounts for half the usage on toll roads, is down 50%.

The governor's fight for more toll roads and more Comprehensive Development Agreements makes no sense politically. It puts the spotlight directly on his most controversial policy. It's a heaven-sent opportunity for Kay Bailey Hutchison to differentiate herself from Perry, but when I spoke to a Hutchison adviser today, I heard the same line, that she does not want to engage with the Perry at this time. If not now, on the best issue for her, when?

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