Saturday, December 10, 2011

To see where California is headed with High-Speed Rail, watch Texas.

"By indirections, find directions out." Hamlet, Act 2, Scene 1

Let us also discover what our high-speed rail project in California is all about by looking -- indirectly -- at a very similar effort in Texas.

Although it's very long, this article about Governor Rick Perry from Texas is critically important to all of us high-speed rail watchers.  It's like a cautionary object lesson in politics and the kind of manipulation that is taking place under our noses to make California's high-speed rail project happen, whether we like it or not.

Deborah Sontag's article is a thorough, fact-filled, in-depth analysis of the Trans-Texas Corridor.  As you may know, Texas had a major push in the '80s and '90s for a combined highway and high-speed rail corridor called the T-Bone.  Southwest Airlines, while not the only factor, did contribute significantly to the termination of that effort. 

An even more expansive version of the Texas-T-Bone was, like a Phoenix reborn, resuscitated by Perry and that's what this article is about.  

By the way, Florida also went through this on again off again process several times even before Rick Scott became Governor and rejected the federal HSR funding.  Under Governor Jeb Bush, first there was support, including a voter action, and then Bush closed that process down.  

Thinking back on Hamlet and his indecisiveness, High-Speed Rail in America may also have a tragic flaw that prevents its becoming a fact on the ground.

What has been going on in Texas, has also been going on in California, more or less, for many decades. Insider and croney politics, "pay-to-play", the buying and selling of properties -- land speculation -- by large financial interests with insider information, aggressive lobbying for beneficial legislation, developer deals, the mis-use of eminent domain powers, the list goes on.  

Much of this is fraudulent, or not quite so but close. The government positions itself -- in our California case it's the CHSRA -- with such a project so that it influences, and is influenced by, big buying and selling opportunities for the benefit of a few. Vast funds are raised for re-distribution to decision-makers and political manipulators; it's politics at its grubbiest.

All these greedy, self-serving behaviors constitute the sub-structure of mega-billion dollar projects such as this, and the Texas story and the California story have much in common.

“You’d get hit up by the state at the same time as they were trying to bid out public assets,” said a consultant who represents a European company and spoke on condition of anonymity to protect his client.
The consultant said Mr. Perry’s representatives solicited a $100,000 contribution to a group called Texans for Safe Reliable Transportation, saying, “It will be good for the governor and good for you.”
“My client was aghast,” he said.

Insider deals are not unique to the US, and exist in every country, as do kick-backs and other forms of under the table negotiations.  Nonetheless, here in the US, like everywhere else, when the bidding and contracting process involves not merely a few million, but billions of dollars, ethics takes a back seat while greed becomes the driver. 

While anti-toll road groups sprang up and environmentalists forged alliances of convenience with landowners, the governor and his advisers consistently misread and underestimated the opposition.

This, the case in Texas, also seems to have been common for the CHSRA.  One of the reasons for beginning the HSR construction in the Central Valley was that the rail authority believed the residents, business people and farmers would offer none of the confrontation and opposition felt from people on the Peninsula in the Bay Area.  These people are easy to fool with promises of jobs and a stimulated economy goes the rail authority reasoning. We will build them rail yard depots and train stations, went the rail authority logic, we will hire their unemployed, and besides, it's just open country.  Even today, the rail authority Board argues that these two Central Valley sections will have the lowest per mile cost of any part of the rail route. 

The rail guys were totally wrong in that conception.  That continues to be a major problem in California where a recent poll found that a majority in the state now oppose the project and that the Central Valley has already generated one lawsuit, with more to follow.  It must be said that at this moment, objection to this project is wide-spread, but at the same time, such turn-around public opinion is assiduously ignored by the Democratic majority in the Legislature and by the Governor, Jerry Brown. 

The rail authority, despite its blatant dissembling about "outreach" and "stakeholder communication", has failed to listen to and hear the concerns of all those directly, and now indirectly, adversely affected by the rail project.

In the way that the article talks about an "asphalt fairy" going 'poof' and putting down highways overnight, there is a similar fantasy on the part of our HSR promoters that the "rail fairy" will put down rail corridors in an eye-blink, quickly and cheaply, and we will be forever appreciative.  

As it happens, these fantasies are now fully transparent and so deeply flawed that the future of this project in California should finally be challenged by the Governor, the highest ranking supporter who has the power to pull the plug.

So far, that's not happening.  Time to ask, Why is that? What's in it for him?

Published: December 9, 2011

Perry Survived Even as His Big Plan for Texas Failed

AUSTIN, Tex. — In the bachelor-style apartment of his legislative years, where Rick Perry liked “to kick back and watch football with a cold one,” the future Texas governor forged a lasting bond with a hard-charging roommate who preferred smoking a pipe, studying flip charts and strategizing.

Over time, that friend, Ric Williamson, an oilman known as Nitro, would become “the intellectual guru of Team Perry,” as one colleague put it, and steward of the governor’s boldest initiative and biggest failure, the $175 billion Trans-Texas Corridor.

Unveiled by Mr. Perry in early 2002, the public-private transit project was intended as a centerpiece of his governorship, “a plan as big as Texas and as ambitious as our people,” he said, to create 4,000 miles of road, rail and utility corridors each as wide as four football fields.

But neither Mr. Perry nor Mr. Williamson anticipated just how politically toxic the mammoth toll road plan would become or envisioned tractors advancing on the Capitol with signs like “Rick & Ric, Our Land is Not Your Land.”
When Mr. Williamson died suddenly in late 2007, their venture all but died with him. Shortly before announcing his candidacy for the Republican presidential nomination this summer, Mr. Perry quietly signed a bill erasing all mention of the Trans-Texas Corridor from Texas statute.

“He had to bury his own baby,” said Paul Burka, senior executive editor of The Texas Monthly.

For many here, the epic battle over the corridor epitomizes how Mr. Perry operates — from his self-image as a business visionary and his hands-off management style to his interdependent relationship with an insular cadre of old friends and what critics call the pay-to-play culture of his administration.

It also shows his ability to weather controversy. Whether by political calculation or deference, Mr. Perry’s designation of Mr. Williamson as the point man for this project helped him avoid repercussions at the polls. “He’s a Teflon governor, I guess,” said Dick Kallerman, a Texas environmentalist.

By the end, opposition to the project had united environmentalists and ranchers, big cities and small towns, Democrats and even Mr. Perry’s own Republican Party.

For conservatives, the plan, which would have required vast land seizures, represented a political misfire akin to his executive order mandating the HPV vaccine for girls. They saw both as government overreach — trampling parental rights with the vaccine and property rights with the corridor.

“Perry speaks about getting government out of our lives but that’s not what he has practiced,” said Ken Emanuelson, a Tea Party organizer in Dallas. “We usually say it as a metaphor that the state of Texas is for sale, but with respect to the Trans-Texas Corridor the ground was literally for sale.”

Transportation industry executives say Texas was singularly aggressive in pursuit of private financing of public projects. At meetings where firms were courted, state officials draped a big banner, “Texas: Open for Business,” and some were urged to support the governor with more than just business proposals.

“You’d get hit up by the state at the same time as they were trying to bid out public assets,” said a consultant who represents a European company and spoke on condition of anonymity to protect his client.

The consultant said Mr. Perry’s representatives solicited a $100,000 contribution to a group called Texans for Safe Reliable Transportation, saying, “It will be good for the governor and good for you.”

“My client was aghast,” he said.

Ray Sullivan, a campaign spokesman for Mr. Perry who was involved with the corridor advocacy group, said, “I don’t believe those conversations ever took place.”

Mr. Sullivan acknowledged that the group, headed by a former senior adviser to Governor Perry named Bill Noble, courted “those interested in infrastructure development.” But, he said, “Neither myself nor anyone who made those pitches were involved in procurement.”

The transportation group, established to promote “market-based transportation solutions,” reported $345,590 in membership dues in 2006, its first year. Mr. Noble said that members paid $2,500 to $25,000, and that Cintra, the Spanish firm that won the initial corridor contract, was “at a higher level of membership but not our largest contributor.”

“The characterization that there was some sort of quid pro quo or pay-to-play is not accurate,” he said.
A Grand Vision

When Mr. Perry inherited the governorship from President-elect George W. Bush in late 2000, many considered him an accidental governor. Some believed that the Trans-Texas Corridor was born of his desire to lay claim to an issue, as his predecessor had done with education.

Even before becoming governor, Mr. Perry had discussed the state’s aging roads as a hindrance to economic development with Mr. Williamson and State Representative Mike Krusee. They debated how to finance new highways without raising the gas tax.

“Williamson lived in the world of ideas and he wasn’t happy unless dreaming up new ones,” said Mr. Krusee, now a lobbyist. “Perry wasn’t like that. But Perry was a better implementer. So Williamson became like the intellectual guru of Team Perry.”

In 2001, Mr. Perry appointed Mr. Williamson to the Transportation Commission, later naming him chairman. The two friends were also financially entwined. Mr. Perry owned, and still owns, a working interest in Mr. Williamson’s MKS Natural Gas Company (which his widow, Mary Ann, also a governor’s appointee as Lottery Commission chairwoman, now runs).

The following year, Mr. Perry introduced the outsize corridor idea during his first run for governor; it presaged his predilection as a presidential candidate for tossing out radical proposals, like making Congress part-time.

Few Texans took the Trans-Texas Corridor seriously. But Mr. Williamson, and the Transportation Department, ran with it, developing a detailed plan to get private companies to finance and build a spider web of transportation corridors in exchange for long-term operating leases and future toll revenues.

In 2003, after Republicans gained control of the Texas House for the first time since Reconstruction, Mr. Krusee became chairman of the Transportation Committee and set about designing the complex legislation.

Mr. Williamson suggested an omnibus transportation bill to avoid having each of the many statutory changes required “die the death of a thousand cuts,” said John Langmore, a lawyer hired to draft the bill.

“Every move was his,” Mr. Langmore said. “Perry just turned Ric Williamson loose and gave the nod.”

The 2003 legislative session during which Mr. Krusee introduced the corridor blueprint was tumultuous because of a Republican-drawn Congressional redistricting plan that prompted scores of Democratic legislators to decamp temporarily to Oklahoma.

Eventually, the bill passed — unanimously. But it was 350 pages long, few legislators had read it thoroughly, and many said later they felt deceived by its scope.

“We were bamboozled,” said State Representative Garnet F. Coleman, a Democrat. “Members always support transportation. What they didn’t realize was that this was a total redo of the system and mostly about privatization. It was a money-making operation for Perry’s friends in perpetuity.”


In mid-2002, in their farmhouse in Fayette County, Linda and David Stall, small-town Republicans, were probably among the first Texans to read the original corridor plan, “Crossroads of the Americas.”

Among other things, what truly horrified them was the realization that the corridors were going to rip through the heart of rural Texas and require 146 acres of right of way for every mile of road — or 584,000 acres total.

“I flipped,” Mrs. Stall said. “I looked out my window and saw people going about their lives who had no idea what Rick Perry had in store for them.”

She and her husband created a Web site, Corridor Watch. They bird-dogged public hearings and visited Chambers of Commerce and Lions and Rotary Clubs, putting 200,000 miles on their truck.

One of their most effective propaganda tools came from the state Transportation Department — an illustration of a quarter-mile-wide corridor with 10 highway lanes adjacent to six rail lines and dedicated utility zones.

“That rendering freaked everybody out,” Mr. Krusee said.

Mr. Langmore said, “All of us were like, ‘What on earth are they doing showing that?’ Can you imagine a farmer sitting on his ranch thinking of a 1,200-foot-wide corridor hacked through the middle of it?”

Scott Ging sat on his century-old family ranch in Williamson County and thought about just that. He imagined the corridor splitting his land, with no crossings “and for no good reason.”

“Traffic is not that bad in Texas; if we have to wait 10 or 15 seconds to get on the highway, that’s a traffic jam,” Mr. Ging said. “The idea that they would take our land and give it to somebody else to make a profit on it — I don’t know how Perry thought that would ever fly.”

While anti-toll road groups sprang up and environmentalists forged alliances of convenience with landowners, the governor and his advisers consistently misread and underestimated the opposition.

Mr. Kallerman, of the Sierra Club, said that Mr. Williamson had summoned environmentalists to convince them that the project, with its trains, was environmentally friendly.

“We just kind of sat there stunned,” Mr. Kallerman said. “I mean, it was going to eat up huge amounts of the best growing land in Texas, go right through habitats and over aquifers, encourage more rubber-tire travel, foster urban sprawl and make our air quality even worse. We shook our heads and said, ‘This is total madness.’ ”

By June 2004, Mr. Perry’s own Republican Party had called for the repeal of the Trans-Texas Corridor. In early December that year, the Texas Farm Bureau, his longtime ally, voted to oppose it at its convention while Mr. Perry, anticipating a different outcome, waited in the wings to speak.

A Project Is Stopped

Still, Mr. Perry was ebullient in mid-December when Texas accepted a proposal from a consortium led by the Spanish firm Cintra to start work on the project. He proclaimed it “one of the most significant days in the history of transportation” and said future generations would appreciate “what a visionary group of people were leading this state.”

Then Time magazine ran an article under the headline: “The Next Wave in Superhighways or A Big Fat Texas Boondoggle?

And local newspapers soon revealed that Mr. Perry’s legislative director, Dan Shelley, had worked for Cintra until three months before the firm was selected. (Mr. Shelley, as a lobbyist, also worked for the company after leaving the governor’s office.)

Mr. Williamson said at the time that Cintra got no special preference. Clearly, though, the universe was a close-knit one.
Rossanna Salazar, a spokeswoman for Mr. Perry as agriculture commissioner, became Cintra’s spokeswoman in Texas; Mr. Langmore, a Democrat who drafted the corridor legislation, helped Cintra prepare its bid proposal.

The contract gave $3.5 million to Cintra and a local partner, Zachry Construction Company, to create a master development plan. They would also get first negotiating rights on up to $400 million in toll road work once the master plan was approved.

In 2005, the Texas Legislature, which meets every two years, reconvened and members tried but failed to scale back the project. It was, however, the beginning of the unraveling.

The next year, when Mr. Perry found himself in essentially a four-way battle for re-election, Carole Keeton Strayhorn, the Republican comptroller who ran against him as an independent (and as “one tough grandma”), repeatedly railed against “the largest land grab in Texas history.” It had an impact; Mr. Perry won but with only 39 percent of the vote.

During the 2007 legislative session, rallies brought protesting farmers to the Capitol and raucous environmental impact hearings drew hundreds. The filmmaker William H. Molina tracked the opposition for his documentary “Truth Be Tolled,” and Johnny Tex and the Texicans recorded the rollicking “Trans-Texas Corridor Blues,” crooning about “the greedy politicians” who want to “line their pockets.”

Mr. Perry, like other politicians in Texas and elsewhere, has long received campaign contributions from transportation-related businesses. Cintra, as a foreign firm, cannot make direct contributions; Zachry donated $125,000 from 2003 to 2008 when bids were sought on corridor projects, according to Texans for Public Justice, a watchdog group.

Other contractors involved in the consortium contributed, too, and Mr. Perry netted $354,450 all told, the group said.
In the State Capitol, legislators began pushing back, voting overwhelmingly for a moratorium on public-private toll road projects.

Excoriating the Legislature, Mr. Perry vetoed the moratorium, and a weaker version was then passed, exempting projects already under way. Those included a 41-mile stretch of State Highway 130 southeast of Austin that Cintra and Zachry had won the right to build and collect tolls on for 50 years (a continuing $1.35 billion project large in its own right but dwarfed by Mr. Perry’s original plan).

But the deep unpopularity of the project had become clear to all.

“The Trans-Texas Corridor became almost like a Rorschach test for statewide politics,” said Chris Steinbach, chief of staff for Representative Lois W. Kolkhorst, a Republican and a leading opponent. “People saw in it what they wanted — property rights violations, cronyism. Opponents of Nafta viewed it as an artery into the interior of Mexico. There was also a nationalist view about a foreign company being allowed to control our land.”

On Dec. 30, 2007, Mr. Williamson, having already suffered two heart attacks,, suffered a fatal one at 55. Mr. Perry had relied on him to wage the battle, not only because he trusted him but because Mr. Williamson guarded the governor against political splatter.

“Now, nobody else was going to go out and spread the gospel and face the hostility, so it kind of ended,” Mr. Burka said.
In 2009, the Transportation Department director acknowledged that the project once declared unstoppable had been stopped. Texas formally notified the federal highway department, and on that day, Mr. Perry tersely offered his own remarks on his grand plan’s demise during a visit to Brownsville.

“If anybody has any new ways to build roads, any ways to fund them, we’d love to hear them,” he said, with a tight laugh. “I think we know there is not an asphalt fairy that will come in the middle of the night and” — he paused, signaling Poof! — “roads will appear.”

Emily Ramshaw contributed reporting from Austin, and Jim Rutenberg from New York.

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