Thread: TX: Cintra-Zachry deal done for TX-130

Private tollway contract a done deal
State, Cintra-Zachry last week signed 50-year lease for Texas 130 extension to Seguin.

By Ben Wear
AMERICAN-STATESMAN STAFF
Thursday, March 29, 2007

The Texas Department of Transportation and Cintra-Zachry last week quietly signed a final contract for the company to build and operate the Texas 130 tollway southeast of Austin for 50 years.

The signing of that long-term lease agreement March 22 almost surely exempts that project from a two-year freeze on so-called concession agreements proposed by state Sen. Robert Nichols, R-Jacksonville. Legislation for that moratorium is pending.

Nichols' bill was inspired by provisions in the Texas 130 agreement he says will cost the state heavily during the contract's duration if competing free roads are built or the state attempts to buy back the road. If nothing else, Nichols said Wednesday, the signing should spur changes in what the Legislature will allow in such long-term toll road leases.

"That contract is a done deal, and any errors in it will have to be fixed a half century from now," said Nichols, a former member of the Texas Transportation Commission. "It's a good example of why we just can't delay reform in this arena. You're trying to catch a runaway train."

Cintra-Zachry, made up of Spanish toll road operator Cintra, San Antonio-based Zachry Construction Co., and Hastings Funds Management, an Australian investment firm, probably will begin buying rights of way this summer along the road's Mustang Ridge-to-Seguin, 41-mile route. Cintra-Zachry will cover design, land and construction costs, but the state will retain ownership of the land.

Cintra's Austin-based director, Jose Lopez, said Wednesday the tollway is expected to open by late 2011, joining a 49-mile section that the state is building.The state opened about 29 miles of that road, from Georgetown to U.S. 290 in East Austin, late last year and the rest should open by the end of this year. Taken together, Texas 130 will give drivers a 90-mile bypass of Interstate 35 congestion from north of Georgetown to Interstate 10 east of San Antonio.

The state will get at least $25 million upfront under the agreement, and a minimum of 4.65 percent of the road's toll revenue initially. That split could increase to 50 percent if the road brings in enough cash. The maximum toll for passenger cars would start at about 14 cents a mile, and be inflated annually by the percentage of growth in gross state product per capita.

Nichols said he is concerned about so-called noncompete and buyback provisions in the contract. State officials defend those provisions as typical of such contracts elsewhere, and fair to Cintra-Zachry given the financial risks it is taking.

The contract sets out a zone extending several miles on each side of the road and stipulates the state would have to pay Cintra-Zachry if improvements to state roads in that area (or new state roads) drew business from the tollway. It exempts free two-lane frontage roads that will be built alongside the tollway from Mustang Ridge to Lockhart (where the road will essentially replace existing U.S. 183), and any improvements to I-35. But adding more frontage lanes would trigger compensation.

If the state wants to take back the road early, the contract requires it to pay "fair market value." Nichols says that would be a huge number, one subject to legal wrangling, and that Cintra-Zachry instead should have been promised only a fair rate of return on its investment.

Nichols said the Legislature can prevent future private road contracts from exposing the state to such financial risks.

"There's a rollout of a dozen or more of these things pending, some of which are much larger," Nichols said. "So it's the responsibility of the members of this body to try to get ahold of it and fix it, and fix it right."

bwear@statesman.com; 445-3698

Looks like the NAU is proceeding without public input. This is just the start of thr Trans Texas corridor.

Oh they have public input, they just refuse to listen.

Are there any other roads around this one? Texans should use it and let the toll road go bankrupt.

The signing of that long-term lease agreement March 22 almost surely exempts that project from a two-year freeze on so-called concession agreements proposed by state Sen. Robert Nichols, R-Jacksonville. Legislation for that moratorium is pending.

I hope State Senator John Carona is excited and proud of this deal. After all, he was one that was SOOOOOOOO gung-ho about this moratorium and about wrangling in TxDOT. Then he puts on the flip-flop face. Well, Carona, here ya go. So it begins. Now Cintra/Zachary can render whatever tolls they feel. Spain and Australia are building roads in our state. They will be making quite a bit of change off this thing, also. I know, we don't have to drive on them. But these deals don't have to get done, either.

My question is: who will be the first president of the NAU? Will it be Bush, Calderon, Mike Myers, Pancho Villa, Keith Olbermann, Rick Moranis?

we have so many criminal politicians out there. I think anyone who does a deal to line someone's pockets should immediately be put up for criminal charges. I wonder if he is getting a kick back?

My guess would be without a doubt.

Originally Posted by moosetracks

Oh they have public input, they just refuse to listen.

Are there any other roads around this one? Texans should use it and let the toll road go bankrupt.

Part of the deal includes cutting off roads that might compete with profits for the tollroad. The access roads will likely get stop signs every couple of blocks. All road projects from now on won't reflect what people want, but rather what the corporation will allow.

Here in Granbury, they have been wrangling with TxDOT about getting a road to help ease traffic through downtown. One of the hang-ups for TxDOT, though, is that they want to create a road with the experimental "controlled access". This means that you can only enter the road at major intersections, rather than at your own private opening to the road. Whatever! Good luck on those road easements. Try explaining to Billy Bob that he can't enter the main drag from his driveway, but has to go a round-about way just to find the "major intersections". I think it is a prelude toward the county getting a toll road. It is one big set up.

Let's see the state highway mafia membership 2007: Governor "GoodHair" Rick Perry, TxDOT Boss Ric Williamson, Cintra, Zachary, that Australian company, and introducing the recently bought and paid for State Senator John Carona.

i have serious problems with this contract.

it sounds like Cintra says that no roads can be built around the toll road that would take traffic off of it, but yet it does not address US 183 which is now going to be part of the tollway when it is now a free road.

and then having to pay if any construction or any improvements were made to i-35.. what kinda crapola is that? what gives this company any right to tell the government its going to cost em? last time i looked anyways 35 was a free interestate.

It's a land grab boondoggle!

I'm so mad! There needs to be some serious fireing going on at TXDot.

The citizens have clearly expressed that don't want this. TXDot know this.

Dixie