Update: TCA requesting $1.1 billion federal “bailout” loan. Just say NO

UPDATE: I overlooked the third member of the proposed merger of the 241 and 73 toll roads, namely the TCS, Transportation Corridor System. The representative for the city of Mission Viejo is Frank Ury.

 While this post is not related to the debated extension of the 241 toll road an environmentalist group has posted some data worth our reading which I am adding at the end of this blog post.  Larry

When I first moved to California in 1975 we did not have any toll roads. Over time we have seen the private sector entering this arena to expand our roads in southern CA including the Foothill Eastern Transportation Corridor that is responsible for managing the 241, 261 and 133 toll roads to the east of Interstate 5.  We also have the San Joaquin Hills Transportation Corridor Agency that manages the 73 Toll Road that is west of Interstate 5 terminating onto the 5 in San Juan Capistrano.

Representing our city of Mission Viejo on the Foothill Board is Lance MacLean and John Paul Ledesma serves on the San Joaquin Board of Directors.

What ever became of public servants who campaigned on being free market fiscal conservatives?  As our federal government is currently engaging in major bailouts is this an effort to stop at the public troth with hat in hand?

The lead story on the California Page of today’s LA Times reads: “TCA asks for federal bailout.”  They are asking for “a $1.1 billion loan of taxpayer money to shore up the finances of its networks of turnpikes.”

Did you ever hear the expression risk, reward?
As we fall deeper into a recession, with crashing home values, increasing unemployment, etc., the Board says don’t forget us as they approach the public troth.
The article states that the Toll Roads has $4.6 billion in debts to pay off. Not too long ago we heard positive reports on the financial status of the tollroads.
Where do we draw the line on government hand outs, even if someday in the future we might get our money back.  Larry, it’s a loan not a bail out!  No problem, go to the Royal Bank of Scotland not the US of A.

It seems as though it was only yesterday when Orange County voters were asked to vote on a 30 year extension of the Measure M temporary tax for our public roads. The majority of voters approved that ballot measure and we now pay more at the pump. As a co-author in opposition to that $13 billion ballot Measure I have to question public support for this private sector system which at one time had a non compete clause.

As I focus on transportation I have read that the federal government admits not having adequate funds to meet maintenance and expansion of our public roads yet they may make money available to the private sector through their Transportation Infrastructure Finance and Innovation Act.

“DOT 138-08 Contact: Brian Turmail 
Friday, September 19, 2008 Tel.: (202) 366-4570 
Statement by U.S. Secretary of Transportation Mary E. Peters on the President Bush’s Action on the Highway Trust Fund”Following the President’s signature of legislation to prevent a funding shortfall in the highway trust fund, $8.017 billion of general funds has now been transferred to the Highway Account of the Highway Trust Fund. Yesterday, we paid all current state payment requests, and today, we will resume daily payments. While the Highway Account has been temporarily replenished, we should not delude ourselves into thinking the fundamental problems of transportation funding are somehow resolved. It is imperative that the debate begin now as to the most effective means to finance and improve highways and transit infrastructure in the U.S. Clearly, the current tax and spend model is both unsustainable and unresponsive to the country’s needs.”

Added text as stated abovce.

1. The TCA loan request would pay for the consolidation of two underperforming toll road agencies and allow them to refinance their $4.6 billion in existing debt. Contrary to the purpose of the TIFIA program, the loan has no direct connection to and would not require the agencies to construct any new transportation facilities.

2. The $1.1 billion loan, if approved, would be the largest in the TIFIA program’s 10-year history, would consume roughly half of the annual loan capacity for the program and would divert funding from other projects here in California and throughout the nation that are a high priority for producing new transportation infrastructure and jobs.

3. The TCS has mislead the public regarding its toll roads by claiming that they would support themselves financially, and that taxpayers would never be asked to assume the risk of their failure. Now it is clear that the toll roads are falling far short of projected usage and revenues. TCS has responded by seeking a massive federal bailout that would put more than a billion dollars of taxpayer money at risk.

Without speaking about the other Board Members, I wonder if my city’s representatives, Frank Ury, Lance MacLean and John Ledesma, are in favor of this request.

About Larry Gilbert