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State auditor criticizes Trans Texas Corridor

I think Clay Robison put it well when he said that Rick Perry’s bad week has continued with the release of a critical audit of the Trans Texas Corridor.

The State Auditor’s Office issued a sharply critical report on the Trans-Texas Corridor on Friday, concluding that taxpayers may never know how much they could end up paying for a toll road that parallels Interstate 35 from San Antonio to Oklahoma.

And if the Texas Department of Transportation doesn’t improve its accounting of project costs, taxpayers won’t know if the public costs are appropriate, auditors said.

[…]

Although costs for the Trans-Texas tollway, including financing, are to be provided through a developer, some costs could be partially paid by the state, the audit report said.

Texans could pay $13.6 billion in financing costs for the initial phase of TTC-35 plus a possible $16.5 billion for additional rail line projects, according to the audit.

[…]

The state agency has succeeded in carrying out part of the agreement with the consortium, auditors noted.

“However, weaknesses in the department’s accounting for project costs create risks that the public will not know how much the state pays for TTC-35 or whether those costs are appropriate,” they concluded.

The audit noted a “lack of reliable information regarding projected toll road construction costs, operating expenses, revenue and developer income.”

The transportation agency plans to enter separate contracts with developers for each segment of TTC-35 and is negotiating a contract for the first segment, Texas 130 near Austin.

Although the state could receive $3 billion in concession payments from developers, such payments could be reduced if inflation, interest rates and other factors increase the developers’ costs, auditors said.

Auditors recommended more legislative oversight of the Trans-Texas Corridor, the transfer of toll revenue projections from TxDOT to the state comptroller and increased public access to information about the project.

They also proposed that TxDOT officials provide regular financial forecasts to the governor, the Legislature and the comptroller and submit development agreement contracts of more than $250 million to the attorney general for review and approval.

The full report is here. This may be a critical report, but it’s not one that challenges the concept of the TTC, just how it’s being carried out. If we must have a TTC, then I’d want to see these recommendations carried out, but I don’t accept the need for this scheme, and I’d hate to see this audit become the default compromise position. There is a better way. Let’s not lose sight of that. Eye on Williamson has more.

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