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House defeats bill that would’ve allowed the expansion of toll road projects

The Texas House shot down House Bill 2861, a measure that would’ve allowed the Texas Department of Transportation to use tolls to fund the construction, renovation or widening of several highways.

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*Correction appended. 

Editor's note: This story has been updated throughout.

Several planned toll road projects across the state may be delayed -- or see their demise -- following a vote Friday that would’ve authorized the construction, renovation or widening of nearly 20 roadways.

The Texas House shot down House Bill 2861 in a 79-52 vote Friday, a measure that would’ve allowed the Texas Department of Transportation to partner with private companies to fast-track several highway projects. The vote, which drew heated floor debate between lawmakers across party lines, centered on tolling components of projects and casts doubt on the fate of several highway projects in Texas.

"All of those roads will be challenged," Texas transportation commissioner Victor Vandergriff said. "We will have to come up with some other source of funds."

It was unclear late Friday how exactly those projects might move forward without private capital and tolls helping pay for them faster than TxDOT and regional agencies otherwise could themselves. Vandergriff said it could take months for transportation officials and regional planners to decide whether to delay those projects or divert money earmarked for other highways to the ones in HB 2861.

Projects in the bill included the stretch of Interstate 35 through Austin, LBJ Freeway in Dallas and its eastern suburbs, Interstate 35E through Denton County, Interstate 45 in Houston and Loop 1604 in Bexar County.

“This bill provides several projects across the state the opportunity to be built within the next decade rather than the next 30 to 40 years,” the bill’s primary author, state Rep. Larry Phillips, R-Sherman, said Friday.

Texas voters in recent years overwhelmingly approved new revenue streams for highway construction that was prohibited from going toward any toll roads. Yet supporters of Phillips’ legislation say toll roads are still needed because even the new voter-approved sources of revenue won’t provide enough money for the Texas Department of Transportation to keep up with the demand for more highway lanes expected to come with population growth estimates. However, opponents of expanding toll road projects throughout Texas say the public is getting increasingly displeased with paying both taxes and tolls.

The debate over Phillips' bill led to a heated exchange between several state representatives, with state Rep. Jonathan Stickland, R-Bedford, suggesting that those who voted for the measure could lose their seats during the next election cycle.

“This is not a right or left issue,” Stickland said. “I feel there are a lot of members [who] will take the wrong vote today and ... it’ll cause you to lose your seat. Think about if you want to run home and defend this to your constituents.”

Other toll road opponents say that relying on private money for roads essentially gives companies the power of eminent domain. They also say it’s a form of double taxation if a project is partially funded by gas tax revenues and partially with tolls. While debating the bill Friday, other Republicans expressed concerns that expanding these projects would lead to more public funds being used for toll projects.

“It’s my understanding that every comprehensive development agreement, at some point, has required public money,” state Rep. Jeff Leach, R-Plano, said.

The bulk of transportation funding comes from federal and state gas taxes that drivers pay at the pump. Neither the United States or Texas has raised their gas tax rates in more than two decades. Inflation, higher construction costs and more fuel efficient vehicles have since left those revenues with less spending power than they once had.

Texas for years has turned to toll projects to fill in the funding gaps. Such projects rely on private companies or government toll agencies to secure investments or take on debt for up-front construction costs. They then repay those costs over time with revenues from the tolls drivers pay to use the roads.

That has allowed planners to stretch TxDOT dollars across more projects that relied on smaller shares of gas tax revenues. But as more and more toll projects popped up, a statewide and bipartisan pushback against such roads has gained steam.

Texas residents and elected officials have had success in scrapping the tolling components of some projects or killing entire roads. During the 2015 legislative session, a bill pushed by Rep. Joe Pickett, D-El Paso, asked TxDOT to figure out the cost of removing tolls across the state.

The price tag was about $36.7 billion — a hefty cost for a department that says it already can’t keep up with growth.

On the House floor, Pickett expressed reservations about continuing to allow toll projects given the state’s spotty track record with such projects. Questions have arisen in recent years over how Texas drivers benefited from $1 billion that several local entities spent developing a bevy of toll projects across the state. And the private company that operates a portion of tolled State Highway 130 in Central Texas filed for bankruptcy after lower-than-projected traffic created financial shortfalls.

Pickett also warned that if the bill becomes law, Texas would fall into a habit of taking the money it gets from toll road projects as a constant revenue stream.

“That’s pure revenue,” Pickett said of the money earned when people use toll roads. “It just grows and grows, and if we don’t stop it now, when will we ever?”

But state Rep. Victoria Neave, D-Dallas, who voted for the bill, said Phillips' measure was needed. She told the Tribune after the floor vote that LBJ Freeway was a key corridor in her district.

“When we have families sitting in hours on end of traffic waiting to get from work — we see this has a real direct impact,” Neave said. “This legislation will help us. It's about giving our local communities the option. They’re OK with paying a toll if it means being with their families an extra hour.”

Phillips' measure comes after President Donald Trump promised a $1 trillion infrastructure spending plan to be funded by private companies that would receive tax incentives for borrowing money to construct projects. Transportation planners and government officials say those firms would likely put tolls on road projects to create a revenue stream that would cover their debt and operating costs. During Friday’s floor debate, Phillips said it would “be a shame” to not let local communities work with the federal government and get these projects underway.

“We have an opportunity here,” Phillips said. “If we walk out of here ... we’re going to tell the feds to send their money to New York or California, and I’m not willing to do that.”

Because relying on private investment to build infrastructure has already been happening in Texas for years, supporters of Phillips’ bill say that makes the state a poster child for how the president’s infrastructure plan could work throughout the country.

Phillips said if TxDOT can’t use tolls for highway expansions and renovations, that private investment could go elsewhere and Texas could be left behind.

In 2007, the Legislature instituted a moratorium on new toll projects with private companies. Since then, the Legislature has passed a bill each session that authorizes specific “comprehensive development agreements” to move forward.  

“The CDA delivery model has not been killed, but it has been mothballed for now,” Vandergriff said at the time.

Read related Tribune coverage:

Correction: A previous version of this story incorrectly stated that the bill included a stretch of Interstate 35 north of Austin.


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