NAFTA Inter-Country Highway to be operated by foreigners?

TRACKSIDE © by John D’Aloia Jr.

November 22, 2006

At issue during the 2nd Congressional district campaign was whether or not there was a 10-lane wide highway being planned to extend from Mexico to Canada across Texas, Oklahoma, Kansas, and points north. This monstrous highway was often referred to as the "NAFTA Highway," and concern was expressed that it was going to be built, owned, and operated by foreigners. Sometimes in the same breath would be mentioned devious plans being hatched to merge Canada, Mexico, and the U.S. into a North America Union, much as Europe is merging into the European Union. (The mere thought of such a plan brings to mind the word "treason.") With a bit more time available, I started googling my way through web pages in an attempt to sort out what is happening. To maintain a degree of sanity, I decided to save any research of the alleged North American Union for another day. Also saved for the future is any discussion of the other NAFTA Highway type corridors depicted on web sites for the east and west coasts, up the Front Range, and through the prairie states.

Undisputedly, the Texas Department of Transportation has initiated a massive project called the Trans-Texas Corridor. In March 2005, the State of Texas selected a consortium led by Cintra Concessiones de Infraestructuras de Transporte, S.A., of Madrid, Spain, and Zachry Construction Corporation of San Antonio, Texas, to develop the Oklahoma to Mexico/Gulf Coast element of TTC-35. The Cintra-Zachry (C-Z) proposal included the private investment of $6B to design, construct, and operate for up to 50 years a four-lane, 316-mile road between Dallas and San Antonio as the initial segment of TTC-35 and the payment to the state of $1.2B for the long-term right to operate the initial segment as a toll facility, dollars which in turn the state may use to fund road improvements or high-speed and commuter rail projects along I-35 or the TTC-35 corridor.

According to the Comprehensive Development Agreement between Texas and the consortium, the TTC is a state-owned project, part of the state highway system. Any land purchased for the project will be purchased in the state’s name. The state will not transfer to C-Z its power of eminent domain, nor will C-Z be empowered to select specific corridor routes. (Eminent domain warning bells should be sounding. One estimate is that the entire project in Texas will result in about 584,000 acres removed from the tax rolls and up to one million people displaced.) C-Z will develop plans, at an estimated cost of $3.5M, to include road, rail, and utility projects along with funding alternatives for the entire 600-mile length of the TTC. Texas retains the option of developing other TTC segments with C-Z or with other groups. Route selection will be heavily influenced by the 4,000-page environmental impact statement that has been completed with public hearings now in progress. The agreement has a cancellation clause should the environmental process result in no-action for the TTC-35. (Want to place any bets that no environmentally-acceptable route will be found? With so much money on the table, one way or the other, a route will be blessed.)

A Zachry press release in March 2005 stated that the Dallas to San Antonio toll road would be done by 2010 and that the innovative transportation partnership is attracting private capital to fund transportation improvement and reduce congestion in the area. The emphasis on turning to private consortiums to build and operate roads is apparently a goal of the Bush Administration. A Federal Highway Administration press release of last year backed up this concept. It stated: "Congress is now considering six-year surface transportation legislation that would fund highway, bridge, and transit programs. The Bush Administration has proposed a number of provisions that would give states more opportunities to partner with the private sector and attract private investments in transportation." What will happen to all this in the 110 th Congress? Who knows, but some hint may be found in a Swiss study done by two researchers at the University of St. Gallen and reported on by Andres Oppenheimer. The trade positions of 62 newly-elected congressmen were analyzed. The conclusion was that the vast majority were more protectionist than their predecessors, and in no case was a protectionist replaced by a free-trade congressman. Could it be that the Democrats will stop the flow of money to the advocates of the NAFTA Highway? Could it be that they will actually not spend money on something?

To be continued.

See you Trackside.