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Texas Department of Transportation Commission Meeting


Ric Williamson Hearing Room
Dewitt Greer Building
125 East 11th Street
Austin, Texas 78701-2483

Wednesday, September 23, 2009


COMMISSION MEMBERS:

Deirdre Delisi, Chair
Ted Houghton, Jr.
Ned S. Holmes
Fred Underwood
William Meadows (not present)

STAFF:

Amadeo Saenz, Executive Director
Steve Simmons, Deputy Executive Director
Bob Jackson, General Counsel
Roger Polson, Executive Assistant to the Deputy Executive Director

PROCEEDINGS

MS. DELISI: Good morning. It is 10:08 a.m. and I call this meeting of the Texas Transportation Commission to order. Note for the record that public notice of this meeting, containing all items on the agenda, was filed with the Office of the Secretary of State at 4:18 p.m. on September 15, 2009.

Before we begin, please take a moment to place your cell phones and other electronic devices on the silent mode, please.

Today's meeting will involve a series of discussions on various topics currently before the department and the commission. We will accept public comment that is relevant to the posted agenda items but we will not have an open comment period. To comment on an agenda item, please complete a yellow speaker's card and identify the agenda item on which you'd like to speak. You can find these cards on the registration table out in the lobby, and we'd limit each speaker to three minutes.

Our meeting format is a little different this month. We will take up the first item on the agenda this morning, and at the conclusion of that item, we will recess until 1:30 p.m. to take up the remainder of the agenda.

So before we begin, commissioners, do you have any comments, anything you want to say?

MR. HOUGHTON: I want to note for the record that the person that called this meeting is not in attendance at this meeting.

MS. DELISI: So noted.

MR. HOUGHTON: Thank you.

(General laughter.)

MS. DELISI: Okay. With that, Amadeo, I'll turn it over to you.

MR. SAENZ: Thank you, Madame Chair. Good morning. This morning's session we will conduct a workshop, go through a process to assist the commission in developing the elements of our strategic plan, some of the guiding principles that go with that. Mary Meyland, director of our Strategic Policy and Performance Management Office will introduce our facilitator who is going to work with us this morning, and she's asked that we join her at the table that we have up in front of the hearing room, she figures we can work better that way. So with that, if you all would move over.

MS. MEYLAND: We appreciate you moving for us and coming down to our little discussion table. We have a few handouts to kind of lead us through this portion of the workshop and then I'm going to turn it over. We appreciate this time that you've given us to go through a very important process of this organization, and that is to solidify and somewhat at least draft our strategic direction statements.

As you well know, you've had a little bit of opportunity to meet individually or discuss individually with Dr. Newmann on this subject, and we've brought together some documentation to help us move forward, and the objective today is really to solidify through discussion and through your concerns and issues, what those guiding directional statements are.

Of course, these direction statements, goal statements, focus areas will be the basis of our new Strategic Plan which is from 2011 to 2015. We do realize the process that it will be updated every two years to be consistent with the new goals and objectives that we would like to focus in on.

From today's results we will continue to involve our public which we have been doing and our work groups that we've put together of our stakeholders, not only just internal stakeholders but our MPO partners, our transit providers and our aviation contractors for our local airports, they've all joined us in a work group effort.

I also wanted to make note that we recognize that we have a parallel effort ongoing, and that is with the Grant Thornton organizational study. We are somewhat aware that there may be some things that come out of that study within the next month or two that would have some issue with the direction and the goals and the mission that we're trying to establish today in this month.

Recognizing that, we just want to let you know that we'll remain open, we'll keep this very fluid for the next couple of months so that if anything comes to your attention by way of the Grant Thornton reporting process, particularly in the next month or so, that we would be able to encourage that and incorporate those concerns into our overall mission, goals and objectives. Just so that you know there may be some things that we want to consider later on that we don't necessarily have in front of us today.

Before we go into the formal presentation or the formal workshop, I wanted to take a little bit of time to go through or at least point out the high points of those documents that you have in front of you. We have just recently completed our public and our internal work group effort to kind of give us a basis of issues and concerns that we're gleaning from the general public. You have in front of you three documents that help summarize, in one page, those efforts.

The first one is the Cambridge Document that was done -- Ms. Kelsey is here today from Cambridge Systematics, she basically led that effort. This was our internet poll that we did, and there were about 1,200 individuals that were participating in that poll.

As you can read from the little overview, we had about 1,200 people that were involved and they completed surveys. It was representative of all of our metropolitan statistical boundaries, we feel like it was a really good relative sample of Texas' population in general. What we want to bring out from all of these things that there were some similar concerns that everybody agreed that highway travel in Texas is predominant, motor travel, and that Texas's highway focus should align with the public priorities.

There was some sentiment and prioritizing goals for TxDOT, and that was the third bullet on the findings, of looking at congestion, obviously, and preservation, and I think we saw that paramount through all of the evaluations that we got, not only the public poll but the focus groups as well. Nothing real surprising, and I think probably most over-arching is the opportunity to tell our story more, there's still a lack of understanding generally in the population in whole of who and what TxDOT is responsible for, and that really became evident in the second exercise that we did, and this as the TTI focus group effort.

Dr. Tim Lomax is here today and he helped put together the program for that focus group effort. We conducted eight focus groups, as you see, all throughout Texas, trying to be representative of our metropolitan areas as well as our urban and our rural. What they asked are basically those ten or fifteen different questions to kind of get a sense from these individuals who participated in these workshops of what they really thought TxDOT was responsible for and what direction we needed to go in our responsibilities, and then probably most importantly, they did a lot of work of talking about the big challenges that we face, particularly as we look at funding.

What I think is probably most interesting from this exercise was the prioritization exercise that's summarized in the paragraph where they gave every person a location specific game sheet and they were asked to prioritize how they would spend their $100 in two categories: pavement and bridge quality, congestion reduction and connectivity. And overall, 60 to 80 percent of the participants, based on their location specific needs, were consistent in saying they'd put most of their money into preservation which means generally the public has a strong value on the preservation of our system as it is.

MR. UNDERWOOD: Mary.

MS. MEYLAND: Yes, sir.

MR. UNDERWOOD: You're saying that the Cambridge study and the TTI study both said preservation?

MS. MEYLAND: Yes, sir.

MR. UNDERWOOD: Thank you.

MR. HOUGHTON: But, Mary, at the same time when you talk about preservation, you also said that the department has a hard time distinguishing whose roads belong to whom.

MS. MEYLAND: That's correct.

MR. HOUGHTON: So a city street could be in disrepair but they throw that in the entire mix.

MS. MEYLAND: That's possible, yes, sir. So overall, it's Texas' transportation system they wanted repaired. And Tim is here if you want to draw some interest. The distinguishing issue became very obvious from the focus groups that they did not understand or have a real understanding of what a county road was and what a city road was and what a highway system road was. But generally speaking, I think they were very concerned about the highway system as it was and that it needed to be maintained because they depended on it.

Very good questions. Yes, sir.

MR. HOLMES: Was there much disparity in that particular answer between the urban areas and the rural areas?

MS. MEYLAND: Can you help me? Thank you for being here. He came all the way from College Station today to join us. This is Tim Lomax.

MR. HOUGHTON: It's such a long drive.

(General laughter.)

DR. LOMAX: Thank you for saving me a seat here. There was some difference but I wouldn't call it major metro/urban/rural split, it seemed to be more geographic. The folks in Houston were very concerned about pavement quality because they tied that to safety. You'll note one of the questions we didn't ask was how would you prioritize safety because we were drawing off of the 2030 needs study, and that had essentially pavement quality and mobility in it, it didn't have a safety element. But in Houston, the pavement quality was tied to things like slippery roads and potholes banging cars and causing unsafe conditions, and so they were very concerned about that.

Arlington, the safety, I wouldn't say it wasn't brought up but it wasn't highlighted as much by the participants. Likewise, in some of the rural areas, they were very concerned about connectivity to other regions and that's what we focused on in Brownwood and Lufkin, so they wanted to make sure that they got divided highways between their town and Fort Worth or Houston or a big interstate because of the safety benefits, and that was in the rural connectivity element of those efforts.

MR. HOLMES: One of the interesting phenomenons in the Houston market -- which I'm probably more familiar with -- is that not only is there a congestion issue but there's a paving score issue too, and then if you take that -- as Commissioner Houghton pointed out -- into the city streets, the city streets are in terrible shape, particularly relative to the highways in Houston. I've never seen a paving score but it's got to make ours look great -- I mean, they're really in bad shape. And so I wonder to what extent they understand whether they're addressing the TxDOT system, the state system, versus the city system.

DR. LOMAX: We tried to make it clear that TxDOT was generally responsible for major roads and the city was responsible for things that you might think of as city streets, but we pointed out like Westheimer is a state road and issues like that, but I'm not going to say that we convinced them or got them up to speed on that issue at all.

MR. HOUGHTON: That would be a hard reach. I agree with Commissioner Holmes that I don't think they delineate. They drive a road and they hit a pothole and they don't care who's responsible for it. So I think everything gets thrown into the mix as far as preservation is concerned.

MR. HOLMES: And the potholes on those city streets in Houston are teeth-rattling, and they will damage your vehicle -- I mean, they're serious.

MS. MEYLAND: Thank you. Very good questions.

I just kind of want to final out with our workshops, in addition. We just completed our last of five workshops that we conducted -- this is the last piece with the blue across the top -- and the purposes were to convey the importance of the Strategic Plan to our internal customers as well as those that are active stakeholders, to gain their buy-in in the initiative, and to gather information from them concerning the future.

All in all, we basically had a prioritization that was not uncommon, from what we've seen in the past, of service areas and the priorities. Obviously improve system operations was up there, next to correct structural deficiencies which is the preservation issue, not necessarily focusing as much on pavement but on bridges and structural issues. And this is your internal operations people that are most commonly used to working in our environment, and their concern was to optimize our preventive maintenance practices so we get the best bang for our buck in that area.

Most importantly is that overall in those five workshops we had about 200 service improvements actions that were drawn down to say these are things that we could do in the future to maybe help enhance or achieve some of these specific action areas or focus areas. So at least we have a group of about 100-plus individuals that are actively engaged in helping us build the next layer of the transportation plan once the goals and our strategic direction statements are finalized by you, the commission.

MR. HOUGHTON: I have another question on the paving scores. Somebody in this room may have it, but the trucking industry rates state roads by state, some of the best, some of the worst. Do we have that information? I've seen it before. Amadeo, you've seen it too. But the trucking industry -- Steve, somebody had it -- rates the roads.

MS. MEYLAND: We have it.

MR. SAENZ: As far as the trucking industry, I think we rated pretty well.

MS. MEYLAND: Yes.

MR. HOUGHTON: That's a good index because they travel the trunk system, you know, for our perspective.

MR. HOLMES: Well, it gives you a distinction, too, between the state system and the balance of the roadways.

MR. HOUGHTON: I mean, how many times have you had your friends come up to you and say that road is a lousy road, and you go: Not our road.

MR. UNDERWOOD: My friends want me to pave their alley.

MR. HOUGHTON: Why don't you go ahead and start down that road.

(General laughter.)

MS. MEYLAND: Well, I do know that we've had some communication with the trucking industry and from an economy standpoint, they would much rather operate in Texas than they would in any other state because of that, the wear and tear on their vehicles and they can keep their speeds up, even with the congestion issues that they deal with. So they come at it from an economy side of how expensive it is to operate in different states, and we're one of the best.

That's basically my introduction comments, and at this time it's time to put you all to work.

MS. DELISI: One question real quick. Can we get a copy of the full survey that you did?

MS. MEYLAND: Absolutely. It's in the process of being compiled at this point and we'll have a formal report on each one of these activities.

MS. DELISI: And when I say that, I mean cross tabs, the whole nine yards on the poll.

MS. MEYLAND: Okay. We've got that request, she's here in the audience.

MS. DELISI: Thank you.

MS. MEYLAND: I'm going to introduce Dr. Lance Newmann. Of course, you met him last time and we appreciate your participation as we move forward. Thank you.

DR. NEWMANN: Thanks Mary. Commissioners and Mr. Saenz, nice to see you again. I've put on a flip chart here, and I'll warn you ahead of time if I go up to the flip chart, it's because we want to capture some thoughts as we have our discussion. I'll be using a hand mike and writing. I could probably do those two things simultaneously, but spell correctly at the same time, we'll see, and as long as it's phonetic and we can recognize it, we'll just move forward.

So in terms of the agenda and what I'm hoping we can focus on and talk about this morning are two blocks, and another piece of the material that you have in front of you is a document that the staff has produced called "TxDOT Strategic Planning, Proposed Vision, Mission and Value Statements." We touched on this very briefly in the August meeting that the staff had thought about this, when I talked with each of you individually, we talked about the notion of tweaking those statements a little bit to reflect sort of the current environment and issues we want to sort of suggest we're sensitive to.

And I think many of you, while you were supportive that, made the point that mission statements, vision statements alone don't mean a whole lot and don't move us to change, don't move us to action. We all understand that. So it's really from a symbolic point of view and kind of signaling what we're trying to do. The staff has developed a proposed revision to the mission statement, a proposed revision to the vision statement, and some value statements that they would suggest that we think about including in the Strategic Plan.

So the first thing I want to do is just walk through each of those, get your reaction. Obviously easy to edit and change those, those aren't long statements, and the staff is, of course, open to that and really would like your input. But at some point, we want to kind of bring closure to those things, and so that's the first thing that I propose we're going to walk through piece by piece.

The second area which I think is the more important, from my point of view, in terms of you directing the department's Strategic Plan, is to review the key issues or goal areas that we think the Strategic Plan should focus on. And again, certainly in the August meeting and in our discussions, very clear strong support that the commission needs to own this Strategic Plan, this is the commission working with the department management team to define the key focus areas, the key priorities.

And again, what I'm hoping we're going to be able to do today is review what I heard in our discussions -- and I'll summarize what I think I heard -- let you then react and make sure that I heard correctly, and have a discussion of those goals and issues and see where we are in terms of have we captured them all, is there a subset that we think are more important than others, are there some relative priorities within that list, and very importantly, is there a general consensus on these areas which then will allow the staff to, obviously, take a next step. So that's kind of what I'm suggesting. Sound okay, any concerns, reasonable?

Okay. So why don't we start with the handout the staff prepared on the proposed revisions to the mission statement, the vision statement, and the value statements. And I think there were copies of this available so the audience has copies of these. I'm happy to read the proposed revised mission statement, but obviously you all can read it as well.

And the question is, again, in the sort of staff discussion of the rationale for the changes that you see there, there were really three sort of themes that they were trying to capture in the mission statement that maybe weren't captured as explicitly in the prior mission statement. And those were: the notion of the department becoming more accountable and transparent; the department working harder in a different way in terms of establishing partnerships with local governments and other stakeholders as they go about their business; and then certainly, recognizing that in all the work the department does, they have to be sensitive to safety, efficiency, getting the most out of the resources that we have, cost-effectiveness and environmental stewardship.

So reactions, comments, does it seem okay to you folks, are there things that aren't in there, is it too much, what's the reaction?

MR. HOLMES: Cooperation with everybody? That's kind of all-inclusive.

MR. HOUGHTON: The other thing is to utilize what they think the mission statement ought to be, MPOs, RMAs, tolling authorities.

DR. NEWMANN: I haven't been involved in any outreach with these statements at this point. This come up in the workshops?

MS. MEYLAND: No. At this point we've just focused on our goal of focused areas, we haven't taken these documents out, but good question. Once we get them vetted through the commission, we were going to take them out as sample sets, draft sets to let our stakeholders give some feedback, our MPOs, our real partners, and the public, and that's to be happening this month and part of November. We wanted to give them something to shoot at.

MR. HOUGHTON: Something to shoot at? Literally, huh?

DR. NEWMANN: And I'm reading your question, Commissioner Houghton, as that would be a real good idea once we have a draft that you're comfortable with?

MR. HOUGHTON: Well, yes. I think we're going through the process now of a management audit and study, and major recommendations that Commissioners Holmes and Underwood are championing and monitoring, but we may be putting something before -- this may get, I don't want to say blown up, but significantly amended, so as we speak today, it may be changed in January. So in their outreach to our partners, again, to put a lot of work into this, go out to our partners, I think Grant Thornton has gone out to those partners and asked what should we look like, what should we be doing. I don't know if we're going to be revisiting this mission statement again in six months. I've got to believe that it's going to be a work in progress, the mission statement.

DR. NEWMANN: And I don't think there's anything wrong with that. I think if the rest of the commission is comfortable with this sort of direction, I think what we just want to have a sense from the commission today is are you comfortable with this as a draft, as something to bring out today as what we think.

MR. HOUGHTON: Mission statements, I think, are just feel-good more than anything else.

DR. NEWMANN: Do you see the mission statement changing? I see the management audit as how we best utilize our resources.

MR. HOUGHTON: It could be direction of the agency, it could be what we are, what we're going to be or what we should be, depending upon the results of that study. With all due respect, I think we're putting the cart before the horse, personally. I think the management study is going to be profound, I really do. I think the work that these two are doing are going to be very profound because it involves a bigger universe than just the people at this table or in this room, elected officials, MPOs, but that's just my opinion.

DR. NEWMANN: And certainly I think that was Mary's point to acknowledge that that's going on, and it may make some changes to this.

MR. HOLMES: I'm not sure whether the management study impacts the mission statement, although it might, and so really you're just kind of putting a marker down that says this looks good, it's a good direction, it's directionally appropriate, it may change a bit as we get more input. Is that fair?

MR. HOUGHTON: Fair.

MR. UNDERWOOD: Question for you. The mission statement proposed is emphasizing cooperation, accountability, and at the very bottom you say the mission statement outlines four key priorities. To me, emphasizing cooperation and accountability is a priority, as well as the four that you list here. That's been part of our problem is that the perception is that we're not cooperating, that we're not accountable.

DR. NEWMANN: I think that's a great point and I think what we should do in terms of explaining this mission statement to anyone else is add those other -- the mission statement, as rewritten, focuses on a number of priorities and here they are, include those four and add in the transparency and accountability.

MR. UNDERWOOD: My point is that there are not four priorities, there's more than that.

DR. NEWMANN: I understand.

MR. UNDERWOOD: And one of our priorities is to regain the status that we had prior, and to do that it's going to take accountability and cooperation with all of the entities that we do business with, or that come before us even.

DR. NEWMANN: I agree with you and I hear you, and I think what you're saying is they should be at an equal level of priorities of anything else.

MR. UNDERWOOD: That's correct.

DR. NEWMANN: And so when we explain it beyond this meeting, let's make that change, I think that's a good change.

MR. HOLMES: The four becomes six or seven.

MR. UNDERWOOD: Exactly.

DR. NEWMANN: With that said, my sense is, as a working mission statement -- with the qualification that Commissioner Houghton has put on the table that let's recognize other things are going on, we may, as a result of those other things, want to come back and revisit this -- is the sense that you're all comfortable with this as a working mission statement at this point?

MR. UNDERWOOD: You're speaking of the proposed now. Correct?

DR. NEWMANN: Yes, the proposed.

MR. UNDERWOOD: Right, as long as you do it in pencil.

DR. NEWMANN: Pencil, make sure that we clarify that there are more than four priorities, we've got that. Okay, that's good.

I think it's on the flip side, similarly there's a revised vision statement, and again, the whole point of this was very similar to the revisions to the mission statement, to try and again signal in this statement some additional themes that we think are important for the department, including achieving trust or re-establishing trust with the citizens and stakeholders of the department, being performance-driven and focusing on accountability. Again, the notion of collaboration and partnerships, and certainly recognizing that an awful lot of what the department is about is enhancing the quality of life for the citizens of Texas and increasing the state's economic competitiveness for the business community in Texas.

So that was sort of the thought behind this. Again, let's just get some reactions.

(Pause.)

DR. NEWMANN: And I should say -- and I'll make sure this is okay with Mary -- this is kind of on-the-spot reaction, general sense that it's okay as a working vision statement, we recognize you'll think about it a little bit more, we're going to have more discussions with stakeholders, there may be additional adjustments, and that's, obviously, I think fine with the staff as we move forward.

MR. HOUGHTON: The value statements.

DR. NEWMANN: We're going to move on to those in one second, I just wanted to make sure Commissioner Underwood, Commissioner Delisi, again, with that kind of qualification, okay as a working vision statement?

MR. UNDERWOOD: Yes.

DR. NEWMANN: Okay, great. So the value statements, I think the existing Strategic Plan of the department does not contain value statements. I think it's very typical in strategic plans that organizations include value statements, and again, they are simply an articulation of what are the fundamental values of the organization in terms of how they do their business, what are they focused on. The staff is recommending that in the revised Strategic Plan we include some value statements, and obviously, the statements are the statements, the real world and the citizens will not look at the talk, they'll look at the walk.

So the most important thing, of course, is that the department then has to be committed to living these values, and I think that's the suggestion. But the point is let's put into the Strategic Plan a very explicit statement of the department's values. There isn't an existing list so this is a first crack, I think very open to changes, very open to maybe themes or value areas that aren't included here. So again, I'll open it up for reaction.

MR. HOUGHTON: The nine commandments is what you're calling them?

DR. NEWMANN: I didn't count but it might be nine. If it's nine, we probably should come up with another maybe.

(Pause.)

MR. UNDERWOOD: I've got a question for you, sir. Earn and maintain the respect of Texas citizens by listening, seeking to understand and by being responsive to our customers and stakeholders, tie those two together.

DR. NEWMANN: I see.

MR. UNDERWOOD: To me, it flows better.

DR. NEWMANN: Yes, that's good.

(Pause.)

DR. NEWMANN: Working list seem okay, everybody okay?

MR. UNDERWOOD: Question. Honor our commitments with accountability and transparency, I feel like we need to explain who we're going to be accountable and transparent to. Does it say that? Maybe you can help me understand that one.

DR. NEWMANN: I think adding a phrase to make it clear is a good idea.

MR. UNDERWOOD: Who are we being accountable to and transparent to?

DR. NEWMANN: The citizens of the state and your stakeholders.

MR. UNDERWOOD: That's my point.

DR. NEWMANN: So let's make it explicit.

MR. UNDERWOOD: Are we accountable to ourselves? I don't think so. We need to be accountable to whom.

DR. NEWMANN: Citizens of the State of Texas.

MR. UNDERWOOD: Right.

DR. NEWMANN: Good.

MR. UNDERWOOD: If that's all right with y'all.

DR. NEWMANN: The clearer they are, the less room for interpretation, the better.

MR. UNDERWOOD: Exactly. It's that first bite of the apple that's important and it needs to taste good or you're going to pitch it in the barrel.

DR. NEWMANN: Absolutely. That's great. Two changes suggested, we'll make those changes, we'll consider those as sort of working value statements, and again, over the next few months if for any reason we want to make some edits or changes again, I think that's perfectly fair game, but that's great.

Now there is another handout, I think it's the last one probably on your list. It's labeled Summary of Key Issues, and then a second page Key Themes for the Strategic Plan. And I have to absolve the staff or anybody for any responsibility for these two pages, I'm 100 percent responsible for these two pages. And this is my summary of in our discussions what I think I heard you and Commissioner Meadows identify as the key issues and focus areas that the Strategic Plan needs to focus on, as well as some other themes that I thought came out very strongly in our conversations that didn't necessarily strike me as goal areas but that the Strategic Plan probably needs to address and reflect.

So what I thought I would do -- and let me just flip this over; it's just a short form of the list of issues -- quickly just walk through this set of issues and give you how I'm characterizing them. It's the same 1 through 7 that's on the sheet. So just quickly walk through the issues, characterize them as I understood them from our conversations, then, of course, I'll want to know did I get it right, am I missing any or not, discussion about are there others as we start to think about this.

And again, this is an important discussion, I think, for the Strategic Plan because this is where we're hoping the commission will give very clear direction to the department in terms of what the department needs to be focusing on over the next two to five years. So let me run through them, and of course, these are my phrases in trying to capture the goal notion or the issue notion.

So the first one I've called creating a 21st Century DOT to meet the transportation needs of all Texans -- interesting phrase. What this one is all about is the transformation of the department in certain key respects, and it came through loud and clear in my discussions with all of you that this is a concern and it's obviously a concern for the management of the department as well, as well as the employees of the department. And I heard there were at least three key elements to this goal. One is that the department needs to establish partnerships and different kinds of partnerships with local government and other stakeholders than may have been the case in the past.

Secondly is that while we talk about transparency and we support the notion, we really need to have a very proactive communication strategy and approach to explain the issues that the department is confronting, explain the constraints facing the department's budget and other things, and not just post things on the web or send out reports but really think about a much more proactive way of communicating what the department's mission is, what it faces in terms of issues.

And the third area was a much stronger notion of accountability, and obviously Mary's efforts and the department's efforts to focus more on defining performance measures and reporting on performance is certainly consistent with that.

I should also say, because this is very much an organizational focused kind of goal area, that all of you also acknowledged many of the department's recent efforts addressing some of these issues. So the creation of four regions as a resource-sharing sort of notion, working to work more closely with local governments, trying to explain and make more transparent the project selection process, and those kinds of activities, I think you acknowledged the department is taking some steps.

But what I heard loud and clear is if we don't re-establish more trust and more credibility, we're not going to make the case for our resources, and if we don't do that successfully, we probably can't achieve our mission. So it was pretty fundamental the way I heard it, so that's the first one.

Second issue was -- and I phrased it and maybe we need to phrase it a little more effectively -- essentially providing information on financing options. The notion that, and you were very sensitive in my discussions that you can't dictate the solution and the legislature and others will decide how much and how, but it seems that it's such an important issue that the commission and the department should take some steps to provide resource material, provide information on what the funding options are and obviously for others to then make determinations on how they want to proceed. So that's essentially the second one.

So those two, the first one is kind of organizationally oriented, the second one is obviously providing information around the finance topic. The next set are very much focused on aspects of what we deliver in terms of transportation service. So first, maintenance and preservation of the existing system and I think there was strong recognition from many of you that given the current budget situation, this has to be high priority because resources are stretched -- not necessarily the only priority but a high priority -- and recognition that, of course, there's some support to economic and safety goals through maintenance and preservation, as well as just preserving infrastructure.

Congestion relief, critical area in terms of supporting the state's economy, critical recognition that urban areas where a lot of the congestion occurs or the most extreme congestion occurs are critical economic engines for the state, and so that a sense that even though we have to, first and foremost, make sure preserve what we have, congestion relief and addressing those congestion problems also a critical issue.

Fifth, system expansion and improved accessibility. Again, the way I heard this from my discussions was obviously in addition to congestion relief there may be places in the state where we need to think about some transportation improvements and they might be multimodal improvements in terms of access between urban areas, reliever routes, access to market kind of routes, access to port kind of routes. So more of an accessibility sort of issue than necessarily just congestion relief, but they're not completely independent actually.

Safety, I think you all acknowledge that the department has to be focused on that, that has to be on the list as something that the department thinks about.

And then finally, I think air quality and environmental stewardship -- I sort of broadened the term in the existing goal statement -- there was discussion about that, acknowledgment that it's an important responsibility of the department to be good environmental stewards, but I think also -- and I'm not ascribing amongst anybody -- I think there was also some concern to remember, though, that the department is a transportation agency, not an economic development or environmental agency, and so we need to focus heavily on transportation but recognize impacts on the economy and recognize environmental responsibilities.

So that's my sort of summary of what I heard. Now what I'd like to do is just get a sense, did I get it right, are there questions about these things, do we need to change how I've characterized these, do we need to add some things to the list.

MR. UNDERWOOD: I liked, on part two, providing information on financing options. I just want to reinforce something that the key word is providing, not recommending any one strategy for financing and whatnot. Sometimes I feel like we get pushed into a corner or trapped, whatnot, and the legislature will say what is your recommendation, and then they dash out and say TxDOT wants this. And I want to make sure that they understand that we're not going that direction, our goal is to say: Sir, here are your options, you tell us; here's what we have, here's the available deals, if you have any others, we're open for any other suggestions on how to finance the desperate need for the roads that we need right now.

DR. NEWMANN: And I might just make a comment on that one because, and just to test this with the commission, in discussions with some staff in the department and one of the comments that one of you made as we were having our discussions last week was, gee, if I'm hearing something a little different from staff than I'm hearing from you, to by all means note it so it can be part of the discussion. So it's not so much that it's a different thought but a concern about whether this as a goal has some risks associated with it in terms of being misinterpreted.

And coming out of an era when there was a lot of toll financing as a strategy that now has kind of receded a bit as a strategy -- still there, still part of the toolkit -- whether there's a risk that it will be misinterpreted if the department and commission get very proactive, even in exploring options. So I just wanted to make that comment, again just so you folks can react to it and give us some input.

MR. HOLMES: I want to go back just for a minute to the environmental and economic development comments that you made a minute ago. I don't want that to be seen as de-emphasizing the environmental sensitivity and issues that relate to it, or the preservation of our economic engines in the state. And so I want to be thoughtful about how that gets worded and implanted into the document.

MR. HOUGHTON: By default, we're in the economic development business. You know, roads, transportation assets will make or break economic development, land values, ports, airports, whatever you want to call it, international bridges. So I think we are in it big time.

MS. DELISI: Going back to something you raised earlier, I think of all these where the Grant Thornton review can impact it is on number one, sort of the organization of the agency. I think what's missing in here is a recognition of that we come up with a structure for the agency that matches up with the agency looking forward, not backward, not a structure that reflects what the agency did ten or fifteen years ago, but a structure that reflects what we're going to need to be doing -- reflects that as we enter into more partnerships with local agencies, it's going to change the way this agency is going to operate a little bit.

So I think that's where the study is going to impact the most and I think that's need to be reflected in the first bullet.

DR. NEWMANN: As kind of another sub-bullet, as I'm interpreting it, that another aspect of this is to sort of redesign the organizational structure to reflect today's mission and today's challenges.

MS. DELISI: And the future challenges, not doing the same things we've always done because that's the way we've always done it.

DR. NEWMANN: Exactly. And so let's add that, assuming there's general agreement that that makes sense, and clearly, that's exactly where some of the results of the Grant Thornton study may be most relevant in terms of making suggestions for what those changes might look like.

MR. UNDERWOOD: And also our mission will be dictated by funding; we may just end up being maintenance.

DR. NEWMANN: So did I hear correctly, are there issues, whether we talked about them or not, as you look at this list, you think aren't captured strongly enough in this list or there needs to be additional, as Commissioner Delisi just suggested, clarification or emphasis? And again, this is just what I want to try to do is coax out of you as much of that reaction as possible so that when the staff takes these broad areas and then tries to begin to detail a little bit more what do we mean by this, and then what are kind of the strategies and actions we might take support it, that we give them as much guidance as possible.

So I'm not trying to torture you guys, I'm just trying to make sure that the way I've characterized these things is a reasonable reflection of what you think the key issues are. And everything is fair game, there may be missing issues. Does it seem like the reasonable starting set to have some further discussions on, I guess, from your point of view, Commissioner Houghton?

MR. HOUGHTON: Well, I'll just chime in on what the chairman just talked about is I think that Grant Thornton will have a profound effect on, going forward, what that vision is. I may have my ideas but that may not be what comes out, and I'm going to hold my powder until that is brought forward. I think I know what it should be but I'm only one in the room.

MR. UNDERWOOD: Lean more into the microphone about holding your power to the end.

MR. HOUGHTON: Can't you hear me?

MR. HOLMES: He just wanted it on the record.

MR. UNDERWOOD: I just wanted it on the record.

(General laughter.)

MR. HOUGHTON: Like I said, I'm holding off until that because I think the chairman hit on a pretty central theme, it is going forward what's this thing going to look like or is the recommendation.

MR. UNDERWOOD: Please understand I'm not making fun of your passion.

MR. HOUGHTON: No. You know what, I take no offense to that.

DR. NEWMANN: And I think one thing, once we get through this discussion that we may want to discuss a bit -- and again, with your indulgence -- is how far the staff should take next steps on detailing the kind of working set of goals as a framework for the strategic plan in advance of getting some of the findings from the Grant Thornton report and recycling through this. Again, I'm hearing loud and clear that we don't know what the recommendations are going to be -- they may be fairly fundamental, at least from an organizational point of view -- we're all acknowledging that as a result of that we may want to revisit all of this material which, of course, is perfectly fine, but let's touch on that after.

MR. HOUGHTON: Well, I personally don't want to cover the same ground twice. I mean, these are all well and good, but I can tell you that congestion relief in -- I've got to pick on a community -- in San Angelo is not an issue, that's not the issue. Now, that's over-arching congestion relief to the metros, but then that deals with partnerships. In Harris County and Houston you have toll operations, a couple more, Fort Bend and all of them now, so it changes the dynamics. NTTA in Dallas-Fort Worth, and we have a different collaboration with NTTA these days, and hopefully that morphs into something even more progressive. So we'll see.

MR. HOLMES: The point being is it has to be forward looking.

MR. HOUGHTON: Has to be forward looking.

MR. HOLMES: Right, it has to be.

MR. HOUGHTON: I think the chairman hit on a great theme.

DR. NEWMANN: Other comments?

MR. HOLMES: Don't leave the economic part of it out.

DR. NEWMANN: And don't use words to de-emphasize or not to acknowledge the importance of the economic connection, and certainly what I heard from you, as well as the department's environmental responsibilities.

MR. HOUGHTON: Interstate highways, roads, the opportunities and how it affects the tax base in communities is huge, and that's what these communities live off is that tax base and how we affect that. Now, how we can participate in that is another story, that happens across the street.

DR. NEWMANN: So working list, okay from your point of view, Commissioner Underwood?

MR. UNDERWOOD: On the summary of key issues?

DR. NEWMANN: Yes.

MR. UNDERWOOD: That's fine. And my comment was on part two that I really want it to express that we're just out giving information, we're not pushing a product.

DR. NEWMANN: Right, on issue number two, yes, got that.

Commissioner Delisi, also okay?

MS. DELISI: Yes.

DR. NEWMANN: So the last thing I'd like to just test with the list of issues is the extent to which there are in your minds relative priorities amongst them -- in other words, we've got seven potential sort of goal areas, if you will, issues that the Strategic Plan should identify and which we're stating the department then needs to develop some action plans around, and whether in your mind they're all important, they all ought to be there, but just from a general sense of priorities, is there a consensus on a subset of these as sort of the most important -- it doesn't have to be, I'm just asking.

Now, Commissioner Meadows isn't here, so I will --

MS. DELISI: Pick on him.

DR. NEWMANN: I will pick on him on his behalf.

MR. HOUGHTON: Do you want to call him? I know where he is.

(General laughter.)

DR. NEWMANN: It's in the public record. He can then refute what I am characterizing as when we had this discussion about relative priorities. I think he was strongly supportive of issue one as something that was pretty fundamental, and by no means am I suggesting that Commissioner Meadows doesn't think all seven are legitimate and good issues, but his sense was that issue number -- beyond issue one, issue four, issue five and issue three, three, four and five, maintaining the system, focusing on congestion relief, focusing on accessibility and connections were kind of the way he would describe the core business of the department, and therefore, relative priorities in his mind. I'm not trying to impose that on you, I'm just providing that as sort of his thoughts on the issue of relative priorities.

MR. HOLMES: You know, when you look at these seven, you don't really see as a bold print any of the economic development, preservation support as kind of a bold bullet point, and I think that that's an omission.

DR. NEWMANN: Okay. And just to make sure I'm interpreting that correctly, make sure that in each of these where they're key to providing support to the economy of the state we make that very clear, maybe in how they're phrased but certainly in the bullet points that elaborate. Is that fair?

MR. HOLMES: The economic component is present in all of them, but I want to make sure that we don't lose focus on it, I want it to be a highlighted, visible component.

DR. NEWMANN: Good, okay.

MS. DELISI: I guess along those lines, I would say either -- because you have a separate for air quality and environmental stewardship which to me is sort of the same -- it's an element of three, four and five, so it's either they're both pulled out as separate points or they're both subsumed into the overall responsibilities of the agency when it comes to maintaining and preservation of the system, congestion relief and expansion of the system. I think one pulling out but not the other is sort of saying maybe this is more important than that, but I think they're both part and parcel of all of those elements that we're responsible for within the agency.

DR. NEWMANN: So when you just made your comment, Commissioner Holmes, I didn't necessarily interpret it as creating an eighth goal area focused on economics but making the economic connection, making sure that we emphasize the importance of the DOT's business to the economy of the state and acknowledging that much more visibly and explicitly than we do in this written list as opposed to adding an eighth.

MR. HOLMES: It doesn't mean you don't add an eighth or maybe you combine a couple of them which I think is what I was hearing.

DR. NEWMANN: Well, no, understood.

MR. HOLMES: And quite frankly, congestion relief, maintenance, safety, air quality, environmental stewardship, they're all a component of that, each one of those has an element of an economic impact.

DR. NEWMANN: And again, this is good discussion, and I think there's no magic to the number of issues we identify, but the reality is, from my point of view, fewer is better in terms of focus and priority, not to leave anything important off the list but we could certainly within this list or a somewhat shorter list acknowledge that environmental responsibilities are an important part of achieving some of these goals, and certainly we can also make sure we emphasize the importance of these goals to helping to support the economy of the state.

And that would mean -- again, I'm interpreting your comment or suggestion that we at least think about it, Commissioner -- that maybe air quality and environmental stewardship is not something that we not separate out as a separate goal but acknowledge as a very important part of meeting some of these other goals.

MR. SAENZ: The same thing with economic development.

DR. NEWMANN: And the same thing with economic development, yes, exactly.

MR. SAENZ: Incorporate the economic development, how it supports economic development and how it supports the air quality and environmental stewardship into each of the core functions of the department, the core goals. Each one of those goals will have a component that will lead to that.

MR. HOUGHTON: Multimodal.

DR. NEWMANN: Multimodal, yes. You know, it's only mentioned very briefly under five.

MR. HOUGHTON: It's not brief anymore if you look at the metropolitan areas.

MR. SAENZ: Would you say, Commissioner, something like maybe focus on transportation solutions instead of highway solutions, or multimodal solutions.

MR. HOUGHTON: Multimodal solutions.

MS. DELISI: That's a good point, because when people talk about our agency, they think of roads, the emphasis is roads.

MR. HOUGHTON: The integration of being total.

MS. DELISI: Exactly, and so that's probably something that's been missing in this discussion, a recognition that it goes beyond one solution.

MR. HOUGHTON: If certain members of Congress have their way, we'll be riding bicycles, bike paths.

MS. DELISI: Bike paths, moving sidewalks.

MR. HOUGHTON: If my district engineer would sweep the streets on the bike paths more often in El Paso, I'd ride on those streets.

MR. SAENZ: He would certainly use a much smaller seal coat rod, depending what street you were on.

(General laughter.)

MR. HOUGHTON: But I think multimodal is key.

DR. NEWMANN: Yes, okay, that's good.

MR. HOUGHTON: You know, we have expertise in this organization that like the smaller fledgling RMAs, some of the tolling operations would die for, so it's a matter of support that way. Our financial prowess is great, we have great folks that we hire, we have access to that information, and it's a sharing and it's that kind of cooperation that we need to work harder at. And I see partnerships, but we have great talent here, we have some great knowledge in the multimodal areas, rail, and if not for rail, most of the cities in the State of Texas wouldn't exist. Now roads have replaced the rail and that's the economic development driver that rail once did way back when.

DR. NEWMANN: So direction is to make sure we make much more prominent the multimodal aspect of how we go about addressing some of these issues, make sure we make much more prominent the connection between addressing these goals and impact on the economy and support for the economy, and also integrate into some of these core transportation objectives the notion of environmental stewardship and responsiveness to environmental issues.

Could we just go back for just a minute to number two, because I just wanted to get a reaction from you folks. Do you share the concern that by elevating providing information on financing options to this level, we're running a risk in terms of just misinterpretation of what the department is trying to do? You mentioned it so it came through loud and clear.

MR. HOUGHTON: One commissioner mentioned it. I have no fear of that.

DR. NEWMANN: Okay, all right.

MR. HOUGHTON: I really don't.

MS. DELISI: It's a risk if we don't; if we don't do it then --

MR. HOUGHTON:  -- it's withholding information.

MR. HOLMES: Well, we've been asked to.

MS. DELISI: Absolutely.

MR. HOUGHTON: We brought some things to the table, Commissioner Holmes -- and you're aware of it -- to tolling operations, here's a way to finance, here's a way to do some things, and we're creating some partnerships that way now. They're getting some assets built with our support. I think we need to do more of that.

MR. HOLMES: This is a little bit nitpicky, but you say provide information on funding options to the legislature and other stakeholders, not recommend one strategy, it's just not recommend strategies. What we're giving them is options.

MR. UNDERWOOD: Right, thank you.

DR. NEWMANN: Not recommend any strategies.

MR. HOLMES: Yes.

DR. NEWMANN: Nitpicking is fine, we want to sort of make sure we capture your --

MR. HOLMES: Get it all on the table.

DR. NEWMANN: Right. Good. So I'm not getting a sense that necessarily you're feeling that we need to distinguish relative priority among these goals which is fine -- I'm getting that sense because you haven't commented on that, that we may integrate goal seven into the others but make it prominent that the department is going to meet, has to meet its environmental responsibilities, other clarifications in terms of multimodal, the connection to economics are there and some other wording changes and clarifications, creates basically, at least, a working template of the goal areas that the Strategic Plan needs to focus on where we're again recognizing that, depending on the Grant Thornton review and other things, we may want to revisit this and certainly revisit some of the specifics.

And I think you're comment about goal number one and adding in the point about also looking at organizational structure and the right structure to solve tomorrow's problems as opposed to yesterday's problems, let's add that. So that kind of creates a very explicit placeholder for some specifics depending on the Grant Thornton thing.

Have I got it right, we've got kind of six areas -- six to seven, depending on whether we want to continue to break out the environmental/air quality as a separate goal, that staff should start to be thinking about as kind of the core focus areas to detail a little bit more in the Strategic Plan? Fair statement? Comfortable with that?

MR. HOLMES: I'm going to give you a qualified maybe.

DR. NEWMANN: Okay, that's fine.

MR. HOLMES: I want to see it when you bring it back.

DR. NEWMANN: So fair comment. The next steps that I would imagine -- and again, Mary needs to agree that these are probably reasonable next steps -- is to take what we're hearing from you today and redraft these goal statements to reflect what we've heard as well as begin to detail with a little more specifics what do we really mean by this. If we're going to create a 21st Century DOT, let's characterize in a little more detail than I have what we mean by that, and then also let's start to think about and at least put down on paper what are some of the actions or strategies that the department might be thinking about executing to accomplish these goals, bring those back to you for reaction not only to the additional detail but whether that then changes your mind about have we captured the goal right or have we got the right goals.

So I think we want to kind of work this in stages incrementally so that the qualified okay is fine in terms of you're going to get --

MR. HOLMES: Qualified maybe.

DR. NEWMANN:  -- qualified maybe -- you're going to get a few more cracks at all of this material in terms of adjustments and changes, and that doesn't create any, I don't think big concern for how the staff can and should proceed, but with that understood. Everybody comfortable with that in terms of direction to staff?

The other thing I did want to just touch briefly on is the second page because there were some key themes -- and certainly we've touched on some of them in our discussion this morning -- that came up in our discussions that didn't necessarily strike me as goal areas per se but did strike me as things that when we draft, when the department drafts the Strategic Plan for your consideration, we need to make sure are very prominent and loud and clear.

So those key themes are, and a number of folks emphasized this, that right up front we have to make it very clear -- and a couple of your qualifying comments in our discussion this morning have made it very clear -- that at the end of the day we need to acknowledge who the department is serving, who are the customers of the department: the citizens and business of Texas. And we need to make sure that as we develop this Strategic Plan there's no confusion that that's what the focus is, that ultimately is who the Strategic Plan should be assisting and aiding.

The second issue -- and we touched on it a little bit already in our discussion this morning -- is the notion that the Strategic Plan can't suggest that there's one size that fits all in terms of transportation solutions for the State of Texas, so that if we have a Strategic Plan that says there are some statewide goal areas and priorities, maintaining the system, safety, the issues we just talked about, we also in the Strategic Plan have to acknowledge that how we address those goals may vary region to region, and how we address those goals in each region has to emerge from a partnership between the department and stakeholders in those regions.

So I think this was something that came through loud and clear. The comment about presenting options to the legislature as opposed to suggesting we dictate, of course came out loud and clear, and the other thing that came out loud and clear and was reflected, I think, in the vision statement was the notion that the department across the board always has to strive to get the most value, the most productivity out of all resources, people as well as dollars.

And somebody specifically mentioned the whole four regional offices notion and equipment sharing and resources sharing as just an example of a positive step in that direction, but sort of a sense that we need to very, very strongly in the Strategic Plan make it clear that that always has to be a focus. So I just wanted to put those out and allow you to again react and make sure that I've got it right.

MR. HOLMES: It's good for me.

MS. DELISI: Good for you, the one size fits all thing, and in terms of how we are crafting it. Good.

The other thing that I think -- and we don't absolutely have to stay till noontime if we're feeling like we're getting there -- is just direction too the department staff in terms of taking next steps on the Strategic Plan in parallel with the Grant Thornton review that's going on, recognizing, as we've discussed this morning on a number of occasions, that the result of that may come back to affect some of this.

And the only thing I want to sort of get a sense from you -- and I don't think it's a huge risk that we're running, but again, Mary, you should chime in on this too -- is one approach would be we've had this discussion, sit tight, let's see what the Grant Thornton study produces and then let's revisit the strategic planning effort at exactly where we stand now. My concern -- and my concern is not a real concern, it's what the department and you want to do -- if we want to have -- which was my understanding -- a draft Strategic Plan for your consideration and potentially approval by the end of this year or very early next year, I'd probably think we want to at least take a next step, as we just discussed, and responding to your comments and making revisions based on this discussion then providing some additional detail on these goal areas in terms of what do we mean by them, what are the specific objectives or focus areas within the goal areas, what are some candidate actions the department might be thinking about taking to respond to these goal areas, recognizing that some of that may have to be adjusted too.

So we don't want to go through it twice but we've got a schedule that we're trying to meet, so just a sense from probably both Mr. Saenz and Mary, as well as the commissioners on should we just sit tight or should we go ahead and take some next steps. What's your sense?

MS. MEYLAND: I'd like to add that the reason for the deadline was this is tied specifically to the Texas Transportation Plan and moving forward in our objective to make this, on the whole, more accountable and transparent, is the performance measures. And the very first place we start in trying to gauge and incorporate those performance measures into our reporting process is at the issue level or the goal level. And so until we have these in a form to where we can say they are attainable -- that means this organization can make some progress towards them -- and too, that they can be measured, that progress can be measured and therefore we can report and be transparent and accountable in our processes, then we can't move forward very much towards that objective which obviously is all of this documentation that we've created today.

So one, we wanted to provide something that the Transportation Plan could use as it is formulated and the projects are set in the ten and five and four year formats; and two, we just needed the guidance to make this organization more accountable and know exactly what direction we're heading. And I know that's difficult knowing what we're going through with the organizational study.

MR. HOUGHTON: What goals? Where are our goals?

MS. MEYLAND: We were going to take the goals from the key issues, these are the things that the department should be engaged in doing and being proactive in promoting as an organization.

MR. HOUGHTON: Some of the things, directly or indirectly, we don't have any control over.

MS. MEYLAND: Correct.

MR. HOUGHTON: Congestion relief we may not have control over if we don't have the funding, so we could fail miserably. You know, Tim is going to do a congestion index that says Dallas-Fort Worth and Houston, their index has gone up considerably, we've failed in that goal. But again, funding has a lot to do with that, and our partners have a lot to do with getting assets on the ground.

MS. MEYLAND: So one of the action items in that relief or management area would be utilize the tools that we do have to help mitigate congestion and/or develop partnerships to help implement solutions to provide relief.

MR. HOUGHTON: I don't know how you're going to index your goals, how you're going to say that we've met or exceeded or failed at these goals -- I hope we never say we fail. Safety, that's measurable, that's pretty measurable as to accidents and fatalities, et cetera and so on, but providing information on financing options, I'm not clear on how we measure goals.

MR. SAENZ: Some of those we've yet to kind of start fleshing them out, but some of the core functions like the maintenance and the preservation --

MR. HOUGHTON: Those are measurable.

MR. SAENZ:  -- those are something we can start working up that this is the goal. Based on the measure that we want to move forward and identify, that's going to lead to a need for amount of resource, how much money do we need to be able to maintain our roads at 80 percent.

MR. HOUGHTON: Right. I mean, there are certain measurables here but there's some you can't measure.

MR. SAENZ: Right.

MR. HOUGHTON: And will depend upon us solely as the measurement.

MR. SAENZ: And I think as we move forward, you start with the Strategic Plan and the Statewide Plan and we put together our legislative appropriations request based on those goals, then that's what we'll use to go in with our LAR that this is what we need to get to here. At the end of the session, whatever we got, then we have to go back and make the adjustments so we can have a reliable work product that we'll be able to do with the resources they gave us and this is how much of the goal we'll be able to attain. We may not reach the full congestion goal because we didn't get any money, so therefore, right off the bat we'll know we won't get there or we'll have to reset the measure that we want to get, or it's an interim accomplishment.

MR. HOUGHTON: Well, let me go back. Tim, this was out of the 2006 trucking magazine, it says: Texas again had the most first place finishes in positive categories, best drivers, best truck stops, most available overnight parking, best rest areas, significant over Florida. So the truckers say we're the best. Is Esparza still running the trucking?

MS. DELISI: Uh-huh.

MR. HOUGHTON: We ought to integrate with those folks, that's a measurable.

MR. UNDERWOOD: It's 2006.

MR. HOUGHTON: I understand that but we don't bring this stuff in. Do you have this? We ought to bring the trucking operations to say that's a measurable of saying our roads, they think they're in good shape. We have another measure as to pavement scores, but they like it.

DR. LOMAX: Right. The pavement score, if I remember right, is a total system measure, it's not necessarily broken down by interstates and major trunk highways, elements like that. I think maybe if we looked at pavement condition on that level --

MR. HOUGHTON: I think you have to have different brackets of pavement instead of the total system.

DR. LOMAX: Right, especially if we're in a time of limited resource.

MR. HOUGHTON: Well, this is economic development, this ties right back to economic development that these people believe so industry says: Hey, we can get our goods to market better in Texas because we have ports, we have inter-connectability. But going back to goals and objectives, I can see measurables where you're talking about, Amadeo, but Dallas-Fort Worth has an intermodal, they have rail through DART, they have rubber tire and roads, whereas, Houston is moving on rail but when you talk about congestion relief, there's more measurables than just roads in the Metroplex area. 

MR. SAENZ: And that's kind of where we could talk, for example, we have a goal to -- and I'm just going to use Tim's congestion index -- to keep it at this same level and that's the goal for the state, and in Houston or in the Metroplex, that is the goal and based on the resources that we have, we can put together a plan that gets me almost there or gets me there, and that's what we will use to measure at the end of the year, did they get to it with the resources that you have.

In other words, one thing is if I want to get to the goal, this is what I need. If you do not get all the resources that you need, then you're going to have to adjust that to say: With these resources, this is how much I can get there, I can get to 50 percent. So in my congestion index, instead of being where it is today, it's going to go up 10 percent and that becomes the goal that we use so at the end of the year when that is implemented, we can come back and measure it.

So I think that's where we talked about the possibility that different areas will have different goals or you may have different goals for the different systems.

MR. HOUGHTON: So tying this back into what Mary is talking about on deliverables, there are certain things you can measure today without waiting for Grant Thornton.

MR. SAENZ: Right, there are some that we can, that we can continue to work on so that we can continue to get feedback from you all as we move forward. We're always going to have a maintenance and preservation goal because we've got an 81,000-mile system.

MR. HOUGHTON: But breaking that down, though, to trunk versus farm to market versus interstate, I think we ought to break it down.

MR. SAENZ: We can do that, we have that data already, we have it on the interstate and we have it also on the remainder of the system.

MR. HOUGHTON: You know, cotton wagons don't need a lot of infrastructure, they can go on a dirt road.

MR. UNDERWOOD: Not anymore.

MR. HOUGHTON: I knew I'd get a reaction.

MS. MEYLAND: Pushed a button there.

(General laughter.)

DR. NEWMANN: But certainly -- and this is a good discussion -- for each of these goal areas we want to turn it into a goal statement, we want to characterize what the department thinks it can try to achieve and whether that's conditioned on new resources or not, and for each of these goal areas make some suggestions on how the department thinks it will measure progress, and some are easier than others, and some, frankly, I think, on this list will be more qualitative than quantitative, but we need to suggest to you how would we go about, if this is a goal, documenting whether we're making progress, and the fact that some will be easier.

But I think certainly that's the department's intent, to think about that, make some suggestions, again get reaction from you in terms of whether that gives you the information you need to hold the department accountable. That's what these measures need to do: give you a tool to be comfortable with.

MR. HOUGHTON: Well, you can take your goals and you can take Tim's TTI and a survey and tie them right back, because on the survey it says people don't understand which roads are ours and what are the cities'. And we may spend all the money in the world trying to educate people and never get there because I don't think the public says that's a state road and that's a farm to market and that's a county road or a private toll road.

DR. NEWMANN: I think that's a pretty common challenge.

MR. HOUGHTON: But I think there's some stuff here that we can work on educating the public tying back to what you're trying to do, and move forward in that direction -- in my humble opinion.

DR. NEWMANN: Everybody comfortable with the department taking some next steps on this, even though we know we're going in parallel with Grant Thornton, recognizing that that may have more of an impact on goal one?

MR. HOUGHTON: I think we just said it, I think you have measurables right now, but I'd like to see the maintenance broken out, not as a system but as the truckers love the interstate highway system but the farmers may not like the farm to market, what are the scores on those individually.

MR. HOLMES: Drill down into it.

MR. HOUGHTON: Drill down into it, right.

DR. NEWMANN: Yes, okay.

MS. MEYLAND: I would like to suggest that as far as our program, we were trying to get to something as a deliverable by the end of the year or the first of the year that you would have as a strategic vision. Obviously that would depend on how fast we go with the Grant Thornton and what kind of impact it has on maybe one and two of these goal statements.

MR. HOUGHTON: I think you've got it.

MS. MEYLAND: I think we have the over-arching and that's what we'd like to bring back, we were going to bring back to you tomorrow a more formalization, based on your comments, of the high level --

MR. HOUGHTON: We get to do this tomorrow?

MS. MEYLAND:  -- of the high level, just to say okay, those are good to go ahead with, and give your approval to move them forward as draft statements so that we can start initiating the communication it needs, the involvement from our stakeholders to say what do you think and what actions would you like for us to take, and we'll be giving people like shopping lists and menus to help us drive this more inclusively than we have in the past. That's the objective between now and the end of the year, to try to incorporate some feedback and make changes as necessary as it becomes obvious that we need to in the over-arching, large-scale goal areas.

We'll try to bring something back to you tomorrow that will look like what you've said today and see if you're willing to let us move forward with those draft statements so we can start putting in the underlying action steps that gives it more definition.

MR. SAENZ: So really tomorrow, Mary, you're talking about maybe the preliminary draft statement for mission and vision as well as the list of these goals so that then you can move forward with the stakeholder meetings and get feedback as to what the public and the stakeholders have comments with respect to these.

MS. MEYLAND: Correct.

MR. SAENZ: And from that we can then continue to flesh them out further.

MS. MEYLAND: You bet, start building it together. Appreciate your participation.

MS. DELISI: At this time we'll recess from this meeting and reconvene at 1:30 this afternoon.

(Whereupon, at 11:33 a.m., the meeting was recessed, to reconvene this same day, Wednesday, September 23, 2009, at 1:30 p.m.)

A F T E R N O O N S E S S I O N

MS. DELISI: It is 1:35 p.m. and I call this meeting back to order. I'd like to remind you that there will not be an open comment period at the end of today's meeting, we will accept comment that is relative to the posted agenda items. To comment on an agenda item, please complete a yellow speaker's card and identify the agenda item on which you'd like to speak. You can find those cards in the lobby at the registration table. And again, also please make sure your cell phones and electronic devices are set to the silent mode.

Amadeo, go ahead with the rest of the meeting.

MR. SAENZ: Thank you again, Madame Chair. For item number 2, I'm going to call up Ed Serna to introduce our consultant from Grant Thornton who will give us an update on the management review.

MR. SERNA: Good afternoon, Madame Chair, commissioners. For the record, my name is Ed Serna, I'm the assistant executive director for Support Operations at TxDOT, and I'm here to introduce Susan Pentecost who is with Grant Thornton, she's the managing partner for their state and local business. So with that, Susan.

MS. PENTECOST: Good afternoon, Madame Chair and commissioners. For the record, my name is Susan Pentecost. I'm here speaking for Grant Thornton this afternoon, giving you an update today on the management and organizational review.

Since we had the last workshop discussion in August, we've been continuing our interview process, so much of the team is heavily involved in that day to day. As of close of business today, we should have about 135 interviews completed, we have about another 40 to do still this month. The remaining interviews are largely with the members of U.S. Congress that are on our list, some of the members of the Texas Legislature, and a few of the external organizations and former employees, but we'll be mostly through the interviews as planned by the end of this month.

Right now we have completed visits with the Lubbock District, the San Antonio District, and the team is in Houston today, will be going to Fort Worth next week. And when we do those visits, it's not only to meet with the district staff but also with the regional office staff and with the external organizations that are in those same locations. Beyond that, we also will be releasing the all-employee survey tonight that will be open for people to respond to through October 9, so we'll be gathering that input as well.

Just to highlight a couple of the interviews that have occurred during the last month, on September 8 we met with Lieutenant Governor Dewhurst and with Senator Ogden to discuss the review. The lieutenant governor emphasized to us the importance of this assessment and his expectation that it needed to provide transformational recommendations regarding TxDOT. He emphasized his concern over the assessment duration and expressed the concern that six months would be probably too short for an assessment of this scope and encouraged taking longer to do a thorough job.

He also highlighted his emphasis on addressing congestion and discussed the importance of safety, especially in the rural areas, he discussed the importance of defining the TxDOT mission for the future as a basis for making other decisions, talking about things, for example, about whether TxDOT should be focused solely on roads versus multimodal and so forth, and he stressed the importance of TxDOT being a modern, lean and very well-run organization.

On the 15th I interviewed Susan Combs, the Comptroller of Public Accounts. Among other things, we discussed the study that they've been asked to do about the cost of engineers from inside TxDOT versus from external firms. That study is meant to be completed at the end of December. We're not going to be trying to duplicate what they are doing but we will look at their analysis and try to feed that into our assessment. They're also providing results of other analysis they've performed to help us take advantage of research that was already done instead of redoing that.

Overall, the data collection process, the interviews are proceeding smoothly, the input is varied. We get very different viewpoints, for example, on things like the TxDOT relationships, missions and so forth, fairly consistent viewpoint on what the issues are that face people working in transportation across the state.

On last Thursday, the 17th, the House Transportation Committee conducted a hearing at which I presented or testified about the management and organization review. To run sort of at a summary level through the focus of that discussion, they raised comments about the focus of the assessment itself and where it targeted, and the organization needed to clarify that it includes the administration except for those statutorily required functions, districts and division offices and the regions, and that the commission had also said to look at the commission role as we're looking at everything else.

We needed to clarify also around the business process area that we're not doing an engineering review or a technical review of work, that this is focused on TxDOT operations and that really we are taking more of a diagnostic approach on that side. Representative Wayne Smith did express concern that we hadn't identified maintenance specifically as an area to look at since that's where so much of the funding is going today.

On finance, again we needed to clarify that what we're looking at is accounting operations processes, not at funding mechanisms. And on procurement they had a considerable amount of discussion around how fair, open and consistent the procurement experience is with TxDOT.

So from those observations, the kinds of expectations that they stated they had for the assessment included that we should interview additional individual companies or representatives of companies instead of relying on the associations only, and they were talking specifically about consulting engineering firms, construction firms, and then a wide range of businesses or individuals that might represent minority, small business, or disadvantaged business owners.

They had a number of questions they hoped to see answered in the procurement area things like how many contracts are being awarded to which firms and are the district engineers -- and I'm going to put this in quotes -- spreading the wealth; with the slow economy, what the pattern of competition is, whether we're seeing more companies bidding now as the economy has slowed down, and then is that resulting in a more diverse pattern on who is winning; has pricing changed since the economy has slowed down; why aren't companies winning, what can be done to get broader participation and competition, and why is the experience with TxDOT not consistent with all types of businesses. So those are their questions that they had for us.

They did state around finance that they thought the assessment should look at the funding mechanisms themselves, alternative funding approaches to transportation. As far as process and performance, they thought we should look in detail at performance by district, for example, in areas like testing and the kinds of complaints that might be received, that we should look at the environmental process in depth, that we should look at the design process in depth, that there should be cost savings tied to every recommendation, and that they also finally recommended that we should also talk with former employees about TxDOT. So those are all of the things that I think they laid out to us about the assessment.

As far as the remainder of our work right now, we are also in an analysis process, we're synthesizing interview results, we've gotten certainly enough of them done at this point to see more about patterns. We're looking at what questions or issues or opportunities those interviews point us to, in addition to the sort of base approach that we were taking, and we're then doing the followup to find the actual supporting data and verify whether there are opportunities from what people have been saying to us.

We are going to be doing focus groups, probably by the middle of October, focused around the business process areas that we had previously identified to explore. And then we're also looking at a number of areas, just some examples, the mission area which obviously was discussed this morning and we are coordinating with Mary Meyland to try to make sure that we can dovetail with what she's already got underway so that that works on the timeline that it needed to.

Looking at the funding, accounting, budget side of the organization, tracing the funding through the organization and understanding how the budgets are developed and managed, looking at staffing levels, FTE management, the correlation of staffing levels to workload and the mission, skills and experience, the organization structure, management processes and tools.

And as far as followup regarding last month's discussion about the project scope, we have followed up about the compensation study that Commissioner Houghton recommended be included in this, including a conversation earlier this morning, so we are working on a task statement to say what would the scope of that be, how long would it take, and how would that fit into what the plan for the project is.

On procurement, because of the issues that were raised or the questions that were raised last week in the hearing, I am starting to work with Ed Serna regarding what data can be pulled already so that we understand whether we can get to all the information that we'd need rather quickly to be able to answer more of those questions or whether we'd need more work. And then I'm still working --

MR. HOUGHTON: Excuse me, Susan. Does that change the scope of work?

MS. PENTECOST: The procurement? If we have to go out and do more detailed research, then it was going to take some time to do that, it wasn't one of the areas that we were originally going to look at because of the range and diversity.

MR. HOUGHTON: What kind of procurement are they referring to?

MS. PENTECOST: They did not narrow the type, they included really both services and materials, from what I could see, construction as well as other kinds of services, so it seemed to be all encompassing to me.

MR. HOUGHTON: Well, Amadeo, am I correct or incorrect to assume that most of our procurement is on a bid basis, is it not? There's state laws that we have?

MR. SAENZ: Yes, sir. Of course, all our contracting, with the exception of the CDA program, is based on low bid. We do have on the federal projects have to comply with DBE requirements, so there are DBE goals, whether they're race-neutral or mandatory, but the contractors go out and after they're awarded the project bring in their DBE program.

The consultant process follows the state law and it's based on qualifications.

MR. HOUGHTON: And we can't award on price on professional services.

MR. SAENZ: Not for professional services.

MR. HOUGHTON: You know, Susan, I'm a little concerned that we're broadening this thing when we really don't need to broaden it from the standpoint where we have to live by state law which they write the laws across the street. So I'm concerned that this thing is loading up the boat and we're going to sink to the boat from what we originally started out with on this procurement issue.

And my other question is about the new revenues, are they asking you to identify new revenue sources?

MS. PENTECOST: No -- well, I didn't take it that way, but let me put it that way. They said that they thought we ought to be looking at what the alternative sources of revenue and finance could be, so maybe that would include if we had some different idea about how things might be funded, but right now that's not a path we're heading down, I'm merely passing on to you that they have said that that's something they think should be included.

MR. HOUGHTON: Amadeo, are we not embarking on, with TTI and CTR, some revenue enhancements or potential studies on that?

MR. SAENZ: We did some work last year during the session or right before the session at the request of Senator Shapleigh; it's on our web site. We also presented it to, I believe, House Transportation, or if not, it was a subcommittee of House Transportation where we presented it up in the Dallas-Fort Worth area, what work was done where we identified additional funding sources, did a need analysis, separate and apart from the 2030 based on a federal model.

And then the second phase of that is where we identified what potential funding techniques were out there, and some included like if you raise vehicle registration, this is how much money it could bring in by raising it so much, this would be what it would take to be able to do that. We talked about indexing, we looked at gas tax, we looked at the CDA program, we looked at forms of carbon tax which is basically the same thing, there was about 15 or 16, the TRZ was included as one of the funding potential financing techniques.

Those have been on our web site. We also -- Coby is not here -- did send letters to all the legislators to let them know these are out there and these are things that you all may want to look at. Right now we don't have anything going on with TTI and CTR.

MR. HOUGHTON: Aren't we doing vehicle miles traveled, VMT?

MR. SAENZ: Well, based on last month, what you all directed us to do, we're just getting it started.

MR. HOUGHTON: So we are started down that road.

MR. SAENZ: TTI has done some vehicle mile traveled work in the past for the RMA and we're working on seeing how we can incorporate that.

MR. HOUGHTON: I also need to have some clarification on of the commissioners, who is in charge of this project? Can you answer that for me?

MR. HOLMES: Commissioner Underwood.

(General laughter.)

MR. HOLMES: Susan, it seems to me that broadening the study to look at sources of funding is beyond the scope that we had envisioned originally, and my guess is, as Commissioner Houghton pointed out, the study of procurement would be a short study in reference to state statute. I don't see that that would be a dramatically expanded component because just reference the statute or statutes. Maybe I'm misreading this, although I see Ed Serna nodding his head back there.

MS. PENTECOST: All we're looking at on the procurement side right now really was the followup to the earlier conversations to see what data is readily available that might address some of those concerns they raised, not to get into us going off and somehow significantly changing the analysis that we're doing. The other information, really I'm just reporting to you what they told us, we haven't redirected the assessment at this point.

MR. HOUGHTON: I think our staff can give them the manual with all the statutes in it that dictate how we procure, personally. How many consultants do you have on this project?

MS. PENTECOST: We have seven full-time people. So other than that, I'm continuing my conversations with Commissioners Holmes and Underwood about the study itself, and we'll be following up as we work on the analysis to start to present the issues we think we're identifying, leading ultimately to findings and then to recommendations.

Are there any other questions, feedback?

(No response.)

MS. PENTECOST: Thank you all very much.

MR. SAENZ: Thank you, Susan.

The next agenda item, Ed will also come up and give us an update on the Department of Motor Vehicles and the transition.

MR. SERNA: Good afternoon again. For the record, my name is Ed Serna, I'm the assistant executive director for Support Operations at TxDOT.

I'm going to give you a brief overview of where we're at with regard to setting up the Department of Motor Vehicles and transitioning the roughly three and half divisions from TxDOT to that new agency.

House Bill 3097 became effective September 1. The governor has appointed one of the nine members for that board, Victor Vandergriff, and he's designated Mr. Vandergriff as the chair. We expect that the other eight members will be appointed before the statutory deadline of October 1. On November 1, that's when the Texas Transportation Commission technically transitions all of its responsibilities with regard to these divisions -- and I'll tell you which divisions they are -- with regard to these divisions to the DMV. So we've been working under the assumption that the standup date for the DMV is November 1, that is when they get all of their statutory authority.

The affected divisions are all of Vehicle Titles and Registration, all of the Motor Vehicle Division, all of the Automobile Burglary and Theft Prevention Authority Division -- that's five people, they issue about $16 million in grants a year -- and not quite half but a portion of our Motor Carrier Division. The portion of the Motor Carrier Division that is going has to do with the registration and credentialing of motor carriers and the enforcement of those statutes. The oversize/overweight function is staying at TxDOT, along with the enforcement of those statutes.

In addition to those affected FTEs, TxDOT is also transferring FTEs and resources for central administration for that department to set that department up. We, the staff -- and I say we, I mean, the division directors from the affected divisions, plus all of the support operations, administrative divisions and finance have been meeting, since mid May, every other week to establish plans to effect the transition, a smooth transition for this new agency. Amadeo gave us an assignment and it was a simple assignment, and that was a seamless transition for our employees and our customers, not to imply one more important than the other, but if the employees experience no problem transitioning over, then they'll continue to support the customers at the high level that they're doing so now.

So we've kind of set up three phases for the transition. The phase that we're going through right now which ends October 31 at midnight -- and that's basically the planning, the getting it set up, the identifying the resources, where is the new agency going to physically be -- and they'll be at TxDOT facilities -- where is the new agency going to physically be, how will TxDOT support that agency until it can stand on its own, and then also what resources need to be transferred over.

There was no appropriation set up for this agency, all that the legislature did was create the agency, allocate four FTEs, and $200,000 for the biennium for the new agency. Everything else comes from TxDOT and out of TxDOT operations.

We're trying to be very mindful of the impact on Fund 6 to setting up the new agency, so as a result, the new agency will reside in Building 1 at Camp Hubbard -- that's where VTR is at right now and that's where the majority of the agency staff is at -- they'll reside on most of the second floor at Building 150 at Riverside, and then they'll be in a few other dedicated spaces at Camp Hubbard in Building 5 and 6, and at Riverside in Building 200.

So they're not going out and leasing a new building, we're not leasing a new building for them, and they're definitely not building a new building. They'll continue to reside in TxDOT facilities. TxDOT will provide support -- in Phase 2 now that starts November 1, TxDOT will provide support for the new agency. So starting November 1, those employees that are transitioning over will start answering the phone: "DMV, how may I help you?" versus "TxDOT, how may I help you?"

The support that TxDOT will provide will be human resources, accounting, IT, purchasing, fleet management, facilities until the DMV hires its administrative staff. So for example, once the DMV hires its HR operation and they're up and running, then the DMV will tell TxDOT you can stand down and TxDOT will stand down providing that HR support, the same thing for accounting, the same thing for purchasing, the same thing for IT, et cetera.

Probably the only support in Phase 2, which runs November 1 through August 31 of 2011, the only support that TxDOT will continue to provide will be IT because we're sharing resources, the network, doesn't make any sense to go out there and build a whole other statewide telecommunications network for the new agency, and facilities. Again, it doesn't make sense for them to set up facility management for half of one floor when TxDOT is supporting the rest of the operations in the entire building. So we'll continue to provide that under a contract, a memorandum of understanding with the DMV.

September 1 of 2011 and on, the DMV is a completely independent agency. During fiscal year 2010 they'll prepare their own strategic plan and their own legislative appropriations request, they'll submit that to the legislature like every other state agency, they'll get their appropriation for fiscal year 2012 and 2013, and they'll be completely standing up on their own.

Roughly, it's about 644 FTEs. That includes about 100 for administration -- I say about because TxDOT's administration still needs to finalize that number but we're pretty close to finalizing that at about 100 for administration. From a budget perspective, it's about $191.3 million; the vast majority of that is money that was appropriated to the divisions and can be identified in TxDOT's legislative appropriations request as dedicated to the division's operations. There's less than or roughly $55 million that's dedicated for central administration of the new agency which includes things like the accountants, the HR people, the IT people, the benefits and the employees' salaries.

And then there's also costs that were not anticipated by the legislature when they set up a new agency that TxDOT doesn't experience, having to use the State Office of Risk Management. TxDOT has its own Occupational Safety Division that does a very good job of providing support and workers' comp and other services. We can't provide that support to the new agency so they have to use the State Office of Risk Management, there's a fee for that. They have to use the State Office of Administrative Hearings at a stand-alone fee, they'll be using the Comptroller's Office Uniform Statewide Accounting System for their accounting services -- I think that should be at no cost but there may be some other fees there for reports, et cetera. So that's what's in that unaccounted for money that's not appropriated.

I believe the staff, both the affected staff -- and those are the ones that are going to the DMV -- as well as the TxDOT staff that are involved in setting up the DMV have done an excellent job. I would like to compliment the Support Operations Division directors and the staff for stepping up to the plate and saying yes, we can do that, we can keep the costs down and it ought to be a smooth transition. I'd also like to compliment the four division directors that are affected by the transfer at keeping the morale of their staff up and working very hard to set up an organization that doesn't disrupt the activities for its customers and trying to do things as smoothly as possible, so all of those division directors have been working very hard to do this.

We are on track. The one thing that we do have to have delivered by October 1, TxDOT has a deliverable of a transition plan, we deliver a transition plan to the new board and to the legislative leadership and the Governor's Office on October 1 and we are on track for having that report done and delivered to the leadership and the DMV board. We will also have a memorandum of understanding between the two agencies ready to execute when the new DMV stands up that will outline how we're transitioning and what we're transitioning and what our cooperative agreements are.

So with that, I'll answer any questions you have about the DMV or where we're at.

MR. HOLMES: Ed, you mentioned that the DMV would have a computer system run through the Comptroller's Office?

MR. SERNA: For accounting, yes, sir. They won't use FIMS; they'll use the Uniform Statewide Accounting System.

MR. HOLMES: And that will be, I guess, disaggregated from our system until we then go on the new system that the Comptroller is working on?

MR. SERNA: Yes, sir, that's absolutely right. The DMV, effective November 1, will have their accounts all maintained in USAS, of course we have our accounting system maintained in FIMS, they'll be a completely independent agency. THE DMV is included -- since those divisions were part of TxDOT, the DMV is included in the discussions that TxDOT is having with the Comptroller's Office for the new ERP, that's all being evaluated right now. It is anticipated that if things go the way they're planned, the DMV will be one of the agencies like TxDOT and the health and human services agencies and DIR that will be a user of that new ERP system.

MR. HOLMES: But it will be fully pulled apart from TxDOT's piece of the new ERP system.

MR. SERNA: Yes, sir, it's going to be pulled apart from FIMS and it will be pulled apart in the ERP as well, it won't come back in at that point.

MR. HOUGHTON: What amount of revenue will the new DMV be collecting that's Fund 6 dedicated?

MR. SERNA: They'll continue to collect, at a minimum, the same levels of revenue that they're collecting now. Roughly, those divisions collect about $4 billion annually for the state as a whole, roughly about $1 billion comes into Fund 6, the other portions go to the local governments and then also goes into the general revenue. And that's from all of the divisions. So they'll continue to collect in excess of their expenditures.

MR. HOUGHTON: Okay. So you're telling me, Ed, effective November 1 we no longer have to hear about specialty license plates?

MR. SERNA: Yes, sir, that's correct, effective November 1.

MR. HOUGHTON: Mr. Vandergriff and company will be. Bless them.

MR. SERNA: Yes, sir. And the standard issue plates and every other one of those issues. Anything else? Thank you very much for your time today.

MR. SAENZ: Thank you, Ed, and commissioners, I think Ed has kind of led the charge for us here and has worked closely with Victor as well as our division offices and done a great job and this transition is going pretty smoothly. So thanks, Ed.

Moving on to agenda item number 4, we're going to go to the John Barton show. Agenda item number 4, John is going to lead us in a discussion dealing with our Transportation Enhancement Program. If you recall, as part of the American Recovery and Reinvestment Act, or the economic stimulus program, there was some money that had to be used for enhancements and he went ahead and moved some projects, and John is going to bring all of it together.

MR. BARTON: Thank you, Director Saenz. Good afternoon, Chair Delisi and members of the commission. Roger, good afternoon to you as well. For the record, my name is John Barton, I am the assistant executive director for Engineering Operations, and as Mr. Saenz shared with you, I just wanted to briefly discuss with the commission the department's Transportation Enhancement Program and evaluate or discuss with you the potential for a future program call.

I'll give you a little bit of history on the program itself. It's a federally funded program which provides funds, as you know, to help expand our transportation choices and enhance the transportation experience through twelve different categories of projects, those being: pedestrian and bicycle facilities; safety and educational activities for pedestrians and bicyclists; the acquisition of scenic easements or scenic or historic sites; scenic or historic highway programs which include the provisions for tourism and other welcome centers, similar to the one that's seen on the screen now; landscaping and other scenic beautification; historic preservation; rehabilitation and operation of historic transportation buildings or facilities such as railroad depots and canals; the preservation of abandoned railroad corridors that can be then converted to use for other types of activities such as pedestrian or equestrian or bicycle trails; the inventory control and removal of outdoor advertising; archeological planning and research; environmental mitigation to address water pollution due to highway runoff; and then finally, the establishment of transportation museums.

Any candidate project must meet two main criteria: they have to be related to surface transportation activities and they have to be determined eligible by the Federal Highway Administration, so obviously, our partners at FHWA play a large role in this.

As projects are nominated, they're evaluated by our districts and divisions to understand the projects, as well as in cooperation with our Federal Highway Administration. And then by a committee made up of six state agencies, one of which is TxDOT, the other five are the General Land Office, our Historic Commission, the Office of the Governor's Economic Development and Tourism Division, the Texas Commission on Environmental Quality, and ultimately the Texas Parks and Wildlife Department.

Final selection of projects, though, lies solely with the commission, so as we got through a program call, ultimately, based on the recommendations that are presented to you, you do have the ultimate decision-making authority.

I think it's important to point out for the listening audience and for anyone else interested, a subtle and perhaps not so subtle reminder that this is not a grant program, this is a reimbursement program, and so as work is performed or completed by a sponsoring entity, they pay for the work first and then the department reimburses them based on the work that's done after it's been reviewed and considered eligible for federal funding. Again, the work can be accomplished by a local entity or if it's their choice, the department can execute the contract and oversee it for them.

We've had five previous program calls throughout the history of the Enhancement Program, the last was in 2005. And I think it's important to point out that part of the reason we're here today is that in 2006, due to the diminishing revenues available to the department, the last program call was canceled. So to date we've executed or awarded projects on 505 projects through the various calls for a total value of $466 million. In addition to the competitively selected projects, the department has also, through the discretion of the commission, used some of our enhancement funds to construct safety rest areas, similar to the one that's shown on the screen, as well as to promote our Safe Routes to Schools program.

Additionally, projects have been identified by the legislature to be pursued through riders of our appropriations bill, and for projects that were considered eligible under the criteria for the federal program, we've been able to move forward with some of those. We have had examples of riders where they did not meet the eligibility requirement, and therefore, we were not able to move forward with them. An example are the statues that we were directed by the legislature to put on the state capitol grounds. Federal Highway Administration determined it was not eligible and so we were not able to do that.

Others, however, we have been able to move forward with, such as the Texas State Railroad, the Woodall Rogers Park in Dallas, and then the Historic Commission's Heritage Trail program, so those are some examples of other riders that we've moved forward with. There are some other examples that are out there that we are currently trying to evaluate whether we can move forward with them, but up to date, the FHWA has determined them ineligible, and these include the Houston Fire Museum, the Museum of Music History, and then the Historic Commission's Courthouse Preservation program.

So all in all, we continue to work with these groups that sponsored these projects and try to find ways to make them eligible, and FHWA has said they're willing to reconsider these nominations if we can package them in a way that meets the eligibility criteria.

So that leads us to this point of why are we here today and why am I talking about this. As you will recall, on February 17 of this year, President Obama signed into law the American Recovery and Reinvestment Act and part of that act required that $67.5 million be used for enhancement projects here in Texas. Because of the time requirements of getting those projects selected and competitively evaluated, the commission approved and supported staff's recommendation to assign those Recovery Act funded enhancement dollars to existing projects that had already been through that competitive process and to move them forward, and at that time committed to the public that we would have an additional program call later on for that $67.5 million, so that's why we're here today.

MR. HOUGHTON: John, you talk fast for a guy from the South.

MR. BARTON: I do.

MR. HOUGHTON: All $67.5 million, was it obligated?

MR. BARTON: All of that money has been obligated, yes, sir.

MR. HOUGHTON: All right, continue.

MR. BARTON: And so those projects that we've obligated are moving forward and this program call, in effect, would be to replace that $67.5 million with additional projects to be selected through a competitive process.

I think it's important to point out that we did a reconciliation of where we stand with the program in preparation for today, and actually, all of our available enhancement appropriations have been committed either through projects that have been selected, the 505 I mentioned, or through those legislatively required mandates for projects that were put into riders. However, because some of those projects -- namely the courthouses as one example -- have thus far not been eligible to move forward, we believe that can, without risk, move forward with an additional $67.5 million worth of projects under the Enhancement Program, and if and when those rider mandated projects are deemed eligible by the Federal Highway Administration, we will be able to use future allocations of enhancement dollars to move forward with those programs and projects.

So I guess that really concludes the information I wanted to share with you about the Enhancement Program and was here today not asking for action but just to get a direction or support from the commission to issue a short program call for enhancement projects to move forward with at an estimated value of $67.5 million. And for your benefit, if you were to allow us to do that, we would anticipate that we would issue a program call early next month, close it in the two-month period of time just before Christmas, and take approximately, from that point forward, about six months to get through final review and consideration by the commission to execute the authority to move forward with those projects.

MR. HOUGHTON: It's good for me.

MR. BARTON: Are there any questions or comments?

MR. HOLMES: Is there a drop-dead date on all those being selected and under contract?

MR. BARTON: The ones that we currently have underway -- and that's a great question -- for the Recovery Act have to be obligated by March 1 of 2010. Of the 505 that we've already authorized as a commission -- as you have and previous commissions have, to be honest with you, Commissioner Holmes, some that were approved in our original program call have yet to move forward, and it is my intent to work with those entities and the districts to either identify a path forward or to cancel those contracts and remove them from our tally sheet, so to speak.

MR. HOUGHTON: What dollar amount are you talking about?

MR. BARTON: I don't have that exact number with us, Commissioner, this afternoon, but I can get it for you. I don't suspect that it's a very large number, but it's about six projects, if I recall correctly.

MR. HOUGHTON: Out of the 505?

MR. BARTON: Yes, sir.

MR. HOLMES: We canceled some real old moldy ones recently too, didn't we? I think there were some that dated back 15 years ago or so.

MR. BARTON: We have, at the request of some nominating entities, canceled some because they told us they just can't move forward with them. We still have some old moldy ones -- using your words, not mine, by the way, for the record --

MR. HOLMES: They're mine for the record, John, it's okay. They're 15 and 16 years old and haven't moved.

(General laughter.)

MR. BARTON: Some of our agreements on projects post the first round had a clause that if they didn't move forward within the three years, the authority expired to move forward with them. We've never been, I guess, forceful enough to call in that requirement of the contract but we certainly have the authority to do so if we choose to. And that's what I wanted to do is give these entities one last time to say they'll move forward within the next two years or so, and if not, let's get them canceled. We can move forward with it more quickly, if you would like.

MR. HOLMES: No. If we gave them a timeline then I would guess that we would at least talk to them about it. You gave me a list of them a few months ago and there were some that literally were 1992, '94, '96, there were some really old ones.

MR. BARTON: There are.

MR. HOLMES: Have those been canceled?

MR. BARTON: Some of them have, not all of them. As I recall -- and again, off the top of my head -- the oldest one we have on the books today that either hasn't moved forward and hasn't been canceled is from the 1994 call, and again, most likely when we contact that sponsor, they'll say that they can't move forward because the dollar amount made available to them in 1994 no longer would pay anywhere close to the amount of money needed to move forward with the project.

MR. SAENZ: Now, John, I guess moving forward, you mentioned that you looked at how much apportionment we had and obligation we had and you said it's all been accounted for because of the projects that have been included as potential riders that were charged to the program?

MR. BARTON: That's correct, Director Saenz. We have currently five riders for projects that are currently not considered eligible by the Federal Highway Administration: $80 million for courthouse renovations, $10 million for the music museum, $2 million for the Houston Fire Museum, $16 million for the Battleship Texas, and $455,0000 for the state cemetery. The likelihood of any or all of those being determined eligible to the full dollar amount that I just read or to the scope of work that would require that kind of money is uncertain, we're still working with those entities, but to date -- and these riders date back several legislative sessions in some cases -- the Federal Highway Administration has not been able to determine they're eligible.

So the recommendation would be that specifically the courthouse program, $80 million, it's unlikely that significant changes would be made to the point that the Federal Highway Administration would be comfortable determining those to be eligible, and therefore, I think it's reasonable to move forward with a $67.5 million program call to use that money rather than having it set aside unused until at which time either the Historic Commission withdraws their application or the Federal Highway Administration says once and for all we're not going to consider these applications any longer.

MR. SAENZ: I guess, John, I'm just going based on the projects that the commission approved to move to ARRA were projects that were previously selected in program calls.

MR. BARTON: Yes, sir.

MR. SAENZ: So really, it freed up $67.5 million, for all practical purposes, of previously approved projects and that's why you're asking to go with a $67.5 million program call, and I guess my question would be would it be more, I guess, efficient if we maybe go for a larger program call, taking into account that some of this money that's tied to those riders may not be used and we don't wind up with just having unused obligation in the Enhancement Program.

MR. BARTON: And that was the point I was trying to make, Director Saenz, is that although we move forward with those projects that were already selected and in the program, in effect we had already over-obligated, so to speak, knowing that the $80 million from the courthouse program wasn't moving forward. So when the staff prepared a final reconciliation for me in preparation for today, to date we have been given a little over $1 billion worth of Enhancement Fund appropriations, and we've either committed or lost due to rescissions approximately $1 billion of that funding, so our remaining balance of unobligated funding is actually close to zero.

And I will say that part of this -- I hadn't mentioned it heretofore -- part of this is the rescission matter and we do have a looming rescission that will take some of the remaining program apportionment, if you will, and remove it from our authority to put on projects. So we even, as we sit here today, have the risk of losing some additional apportionment.

MR. SAENZ: So your recommendation is that we would go forward with about a $67.5 million program.

MR. BARTON: That's my recommendation. And I guess I was, again, not seeking action but just an indication from the commission that you're comfortable with us doing that.

MR. SAENZ: Thank you, John. John will also present the next agenda item, commissioners, and this agenda item talks about the Proposition 12 and opening up a dialogue and seeking some guidance on how do we prioritize and identify potential projects under the program.

MR. BARTON: Thank you. Again for the record, my name is John Barton, assistant executive director for Engineering Operations, and I have the honor of presenting to you today some information regarding the Proposition 12 Bond Program, and specifically that portion of the program that was directed to non-tolled highways outside of the State Infrastructure Bank for improvements on highways across the State of Texas, and obviously look forward to getting any feedback that you might have or direction that you might like to share with us.

I believe that if you have questions about the State Infrastructure Bank portion of it, either myself, Director Saenz, our deputy executive director, Steve Simmons, or perhaps James Bass, our chief financial officer, would be able to discuss those with you a little later on.

I've got just a few slides that I would like to share with you to provide information about the Proposition 12 Bond Program dedicated to the non-tolled projects. As a matter of history, just to recapture for you and the listening audience, in November of 2007, voters here in Texas approved a constitutional amendment that would allow the commission to issue up to $5 million in bonds to be used for highway projects across the state, and of course, the legislature recently enacted the necessary enabling legislation to allow you to do so for a portion of the program.

This particular program allowed $2 billion of bond proceeds to be issued, $1 billion that would be used to capitalize the State Infrastructure Bank, and then the purpose of what we're here to talk about today, $1 billion of bond proceeds to be used for non-tolled projects. And the math is a little fuzzy but it's important to note that that $1 billion worth of bond proceeds could be used to initiate projects on non-tolled projects that are valued up to $1.5 billion in new construction contract obligation. So that's what I'm here to talk about today and to share with you some additional information about.

Again, I think it's important to note that because the voters actually took action on this and the legislature supported it, they provided a clear signal to us that they support the advancement of transportation and highway improvement projects here in the State of Texas through these additional financial resources. And in response to that, you, as a commission, have told us that you wanted to make sure that we do this work in a way that meets their expectations for having a transparent program that's accountable for the use of the funds and that we deliver these programs through the Proposition 12 Bond proceeds effectively, using clear and understandable performance measures that evaluate the effectiveness of the use of the use of these funds.

A few of the expectations, I believe, the public have are enumerated on this slide, I won't go over them, but it's clear to everyone that they want us to handle this program in a way that allows them to evaluate our effectiveness and whether or not we are doing projects that they believe are of importance and value.

During the commission discussion of this matter back on August 26, last month, you directed staff to do two things: one, you asked us to receive input from the legislature on their ideas for the use of these funds; and then two, to build upon the success that we've enjoyed in partnering with our transportation professionals for the American Recovery and Reinvestment Act and engage them in helping us identify guiding principles to be used as we select projects to move forward with the Proposition 12 Bond proceeds.

A letter from Chair Delisi was sent out to all members of the legislature on September 9 asking that they give us input on their desired outcomes related to the use of the Proposition 12 Bond proceeds that were dedicated to the non-tolled projects, and to date we have received sixteen responses from members of the legislature. Eleven of them provided support for specific projects, they just asked us to move forward with specific projects from around the state.

MS. DELISI: Eleven out of the sixteen?

MR. BARTON: Eleven out of the sixteen, yes, ma'am.

The remaining responses generally supported and promoted the use of these funds to address our most pressing transportation needs with a variety of focal points. Some suggested that we needed to focus on rural areas while others suggested we need to focus on urban areas. Others thought maintenance was a high priority while --

MR. HOUGHTON: That's a big surprise.

MR. BARTON:  -- that is a big surprise -- others felt like we should focus mainly on maintenance while some suggested that we should spend all the money on new construction. We had one person suggest that we needed to direct some of this money to rail activities, and I'll just point out that it's not an allowed use of these bond proceeds to support or to perform rail-related projects, but nonetheless, that was one of the comments we received. And then another suggested we make sure that we spend it only on non-tolled projects, and as I've already pointed out, that was a requirement in the legislation through the appropriations that we got in the called session recently held.

And then finally, we have had, I think, perhaps very clear indications through Rider 55 and 56 of our appropriations bill the intent of the legislature related to the use of funding for transportation here in Texas, and my view of their guidance through those two riders is that they are focused on addressing the state's congestion problems that are crippling our metropolitan and urban areas as well as our major freight corridors, and they've asked us to focus a great deal of attention on that. And so I think it's input that's important for us to consider as we look forward to the decision-making process on the use of these Proposition 12 Bond proceeds.

I also am pleased to share with you that we did convene a meeting of our transportation partners on September 16 to do what you asked us to do, engage them in looking at guiding principles, and this slide kind of encapsulates the outcome of that. We had more than 80 of our partners join us here in this very room to talk about the global priorities that they believe are important for projects in the Proposition 12 Bond Program, and I do applaud them for their willingness to set aside their project-specific interests and to discuss the more universal measures that people evaluate projects by.

Based on the consensus that they reached at this meeting, these six guiding principles came out, and I'll just briefly walk through them for you and with you. They believe it's important that these funds be used to address the most pressing transportation needs in our state that are related to the safety of our system, reducing congestion across the state that's crippling our economy, and preserving our existing system of roadways and bridges to the extent possible.

They also felt like as we evaluated projects that we should focus on corridors of significance to the state, regions and local communities that add value if they were expanded, improved and freed of congestion. They also felt that it was important to look at a fair and equitable distribution of the funding from across the state, and is clearly an indication that they felt like there should be an opportunity for all corners of the state to benefit from this particular program.

They also felt like it was important to create long term economic opportunities for our communities, similar to the things we talked about in the Recovery Act. The use of these program funds could create projects that allowed for communities to grow and prosper and to create economic advantages over other states as time goes on.

And then it's very important, similar to the Recovery Act, that we take into consideration the timeline requirements associated with advancing projects. I guess specifically what that means is that the bill contemplated that within the next two years $1.85 billion worth of construction contracts would be awarded and that $1 billion worth of contractor payments would be made. So we need to move forward with projects that can move forward to construction in the next two years and start consuming these precious resources.

And then lastly, they wanted to encourage the creation of strategic partnerships. I guess that's a fancy way of saying that they want to take advantage of other people's assets and resources through leveraging opportunities and reaching out to one another to take what other entities, communities and groups have to bring to the table in terms of real tangible assets to marry with the Proposition 12 Bond proceeds to get more bang for your buck, so to speak.

The group also recognized that as projects are selected there needs to be clear evidence of the value and benefit that these projects that ultimately are selected bring to the state, and they encourage the use of these guiding principles but also quantifiable and well documented, tangible reasons for these projects being selected, so in essence, performance measures for the value of the project that was being selected.

At this particular time, if it's all right with the commission and Director Saenz, Walter McCullough, who is our district engineer from the San Angelo District, is here today and he participated in this meeting, and I asked Walter if he could just share with you in one or two minutes kind of his experience in this process and his thoughts, as a rural district engineer, on the program and how we're moving forward.

MR. McCULLOUGH: Good afternoon, Chair Delisi, commissioners. Mr. Barton had asked me to be here today just to briefly discuss the process used in developing some priority focus areas for this Prop 12 funding.

Last Wednesday all the district engineers around the state or their representatives, our directors of transportation planning and development, as well as our MPO directors met here in Austin for some discussions on just how to prioritize and focus on Prop 12 Bond proceeds.

We started with the same priorities that were used in the economic stimulus selection process, we developed the six broad guiding principles that you've already seen that are up there on the screen this afternoon. We also recommended three focus areas that Mr. Barton will discuss here later, and those are: congestion and system improvements, safety and preservation of our system, and statewide connectivity.

As you can imagine, when we first started the discussion, I think everyone's focus was on what would best benefit my area, but the more we delved into the process, the more we saw that each of these three areas really did impact the entire state. Even the metropolitan districts and the MPO areas deal with safety and preservation and connectivity, and I know that our metropolitan areas feel the need for congestion relief. That is also a need that impacts TxDOT statewide, even outside those metropolitan area boundaries.

You've been to San Angelo and you know we don't have congestion issues, but we and other rural areas have a need for connectivity that has an economic impact on our MPO areas. The largest and maybe the most cost-effective area, in my judgment, is the safety and preservation of our existing system. The commission has directed TxDOT to achieve a goal of 90 percent of our pavements in good or better condition, 80 percent of our bridges to be in good or better condition, and the use of Proposition 12 funds could be a very positive impact on those scores.

In our discussion last week there was a good level of participation, as Mr. Barton said, it wasn't a vote but it was a consensus among the group on these three focus areas. They all impact our highway system and how that distribution falls out is certainly up to you, the commission. One of the underlying principles that everyone did agree on was that the funding should have an equitable distribution statewide.

Thank you for the opportunity to discuss this with you and I'll be happy to answer any questions. If not, I'll turn it back to Mr. Barton.

MR. HOLMES: When you say an equitable distribution statewide, what does that mean exactly, by population, by economic activity, by paving scores, by what?

MR. McCULLOUGH: I think that since everybody in the state voted on this and it was passed by everyone, everybody needs to see those funds coming at least to somewhere in their area that they have an opportunity to see that, and that could be either based on population, it could be based on metropolitan areas, it just needs to be evident to our state that everybody has an opportunity to see that. Does that respond to that?

MR. HOLMES: Well, the issue is what is that measure. I mean do you do that by population base or do you do it by the contribution to the state GNP, what is the measure that then determines an equitable distribution?

MR. McCULLOUGH: The use possibly of our existing funding formulas across the state, especially in our rehabilitation program, would probably be a good approach to that for the maintenance side of it. For congestion, certainly that's going to have to be directed at our metropolitan areas which will be a population focus. Connectivity could possibly be a statewide focus based on trade routes, traffic volumes.

MR. HOLMES: And then how do you divvy it up between the three that you just named, for instance?

MR. McCULLOUGH: Well, that would be a commission decision, I would think. I'd hate to tell you how to do that.

MR. HOLMES: Very good answer.

MR. McCULLOUGH: We did talk about it and there was some discussion about should it be divided equally among those three areas, but it's certainly a commission issue and something that you commissioners will make that determination on.

MR. HOUGHTON: Well, let's not forget this is only one-half of Prop 12 that was appropriated. We have another billion that's going into the State Infrastructure Bank which out of that we can do a variety of things, special projects, whatever it may be. So I think you have to look in the total, not just the $1 billion that we said on Prop 12 it's going to non-tolled projects, but the total of it.

And I want to thank you for your hospitality.

MR. McCULLOUGH: You're welcome.

MR. HOUGHTON: I had a great time.

MR. McCULLOUGH: Please come back to San Angelo.

MR. HOUGHTON: It was a lot of fun and great economic opportunity, the museum and the visitor center and the fort, that was a lot of fun. Thank you, Walter.

MR. McCULLOUGH: We were glad to have you. Thank you.

MR. BARTON: Thank you very much, Walter. I think you've actually concluded the rest of my presentation for me in responding to those questions, but I'll just share with you that obviously the needs that we have for the use of these funds is undeniable. I have a few examples of the types of system needs that we have around the State of Texas, you've heard much about these in the past so I won't go over them again.

But obviously there is an unlimited number of potential scenarios that could be considered for the use of these funds and as we look forward to addressing the many competing needs and priorities that are vying for these limited resources, it's clear to me that the group concluded, as we talked about this, that it would be beneficial to have a balanced program, and that's partly in response to the question that you, Commissioner Holmes, asked about how you share and ensure an equitable distribution from around the state.

I think that one approach would be to focus on achieving a balance between the different focus points or priority functions that we talked about. Walter enumerated them and they're shown on this slide as well. Statewide connectivity is obviously something that benefits all regions of the state, even if projects from all across the state are not ultimately funded, but it's important to note that we have projects on Interstate 35, Interstate 45, Interstate 10, portions of our Texas Trunk System and other major routes across the state.

MR. HOUGHTON: What end of Interstate 10 are you referring to?

MR. BARTON: Both, quite frankly.

MR. HOUGHTON: Just wanted to make sure.

(General laughter.)

MR. BARTON: Between the two of you, commissioners, both ends of the state are represented along Interstate 10. And so we have safety and freight mobility needs along those corridors, and by focusing on one of our main functional areas of statewide connectivity, I think it would be a valuable way of evaluating projects, again using those guiding principles that have been recommended and targeting a certain amount of the funding to that particular focus area.

Another area that was talked about, and Walter briefly discussed, was addressing congestion in our major metropolitan and urban areas. A recent report performed by the Texas Transportation Institute revealed that in 2007 alone, here in Texas more than $7 billion was lost due to the delay and fuel consumed by Texans associated with congestion, billions of dollars being lost each year from across the nation.

MR. HOUGHTON: Do they assign that by region? How do they measure that?

MR. BARTON: I'm not sure. The measure was used based on a systems analysis, it is available on a city-by- city basis.

MR. HOUGHTON: Like Walter, Walter doesn't have that problem.

MR. BARTON: Walter does not have much of a problem in that particular area.

MR. HOUGHTON: Obviously they have to derive that number from someplace where there is congestion.

MR. BARTON: Well, it is, and again, it's available on a city-by-city basis. I'll be happy to get that report for the commission. But it's based on the evaluation of our traffic and our capacity.

MR. HOUGHTON: Does TTI have that information?

MR. BARTON: Yes, sir.

MR. HOUGHTON: By region?

MR. BARTON: By city, I don't know if they have it by the regions as we define them.

MR. HOUGHTON: I'd like to see that.

MR. BARTON: We'd be happy to get that report for you.

MR. HOLMES: I would too.

MR. BARTON: In fact, it might be good to have Dr. Lomax come in and brief the commission.

MR. HOUGHTON: I don't think we talk enough about that, and it was obvious TTI's survey that people don't really know.

MR. SAENZ: I will go ahead and schedule Dr. Lomax to give us a little report on his congestion study. He made a real good presentation in House Transportation last week that talked about the benefits and cost savings that deal with it, and I think it would be good to have that and we'll just schedule it for the next commission meeting up in Fort Worth.

MR. HOLMES: Well, it's not just fuel burned but time and air quality too, and there's a safety component as well.

MR. BARTON: You're correct, Commissioner Holmes.

MR. HOUGHTON: I imagine Lubbock has huge congestion problems, I know they've got air quality problems up there.

MR. BARTON: Well, I'll not get into that discussion, but avoiding that sensitive area, it is interesting to note that congestion or doing things to reduce congestion not only provides significant benefits in terms of the economy but also air quality, as Commissioner Holmes just mentioned, safety, and in general, the overall quality of life. And I think it's important to recognize, again, that 85 percent of our Texans live in those urban communities where congestion is a prevalent issue.

MR. HOUGHTON: I think that would be very profound to have that information and get it out to our partners at the MPO levels.

MR. BARTON: We'll make that available to all of them and I'll make sure you have a copy before you leave tomorrow afternoon.

MR. HOLMES: I was pretty impressed with the statement that you had 25 district engineers and each one of them had a vote. Right?

MR. BARTON: Yes.

MR. HOLMES: Or did anybody have a vote?

MR. BARTON: We actually didn't vote in the consensus-building process, it was really who was the biggest, strongest, most threatening person, I suppose.

MR. HOLMES: And so there was only one vote and that was you?

(General laughter.)

MR. BARTON: No, sir. I served the role as facilitator that day, I didn't have an opportunity to offer opinions or to vote.

The last focal point area is, of course, maintaining our existing system, we've talked a lot about it, and in light of the diminishing resources available to us, the old saying pay me now or pay me later becomes more and more important to us, and as we continue to defer our current maintenance needs into the future, obviously the return in improvement will be more difficult to fund and more expensive for us.

So in achieving a balance in the program, it may be something the commission wants to consider in providing resources through the distribution formulas that we have in place for our current maintenance and preservation programs.

MR. HOUGHTON: I've got a question for Walter.

MR. BARTON: Walter, please come back up.

MR. HOUGHTON: What are your paving scores in the San Angelo District?

MR. McCULLOUGH: They're almost 95.

MR. HOUGHTON: Ninety-five percent.

MR. McCULLOUGH: Yes, sir.

MR. HOUGHTON: So you're on the up end.

MR. McCULLOUGH: I am the highest ranked in the state.

MR. HOUGHTON: Walter needs to give some money back to Houston. Commissioner Holmes was talking about the potholes in Houston this morning and I was just trying to help him out.

That's my point is -- Amadeo, we talked about it -- we look at the aggregate but we do not look at the region, not to try to pull money away but I would think we need to look at these regions individually by paving scores.

MR. McCULLOUGH: Commissioner, I would say that our paving score is bringing up the average for everybody else in the state.

MR. HOUGHTON: Oh, I think you probably are.

MR. HOLMES: At 95, absolutely. The slippery slope is that the metropolitan areas have the worst paving scores and that's where the congestion is and that's where a big part of the safety factor exists and that's where the air quality issues are, that's where the economic opportunities actually exist. And so it gets to be a tricky distribution of funds.

MR. BARTON: It does, Commissioner, and just looking at one component of it, our preservation program, because Walter is fortunate enough to have a great staff as well as live in an area of the state where the terrain, rainfall amount and the geography and geology allow him to have roads that last a long time. His scores are good and therefore, because of the way our formula is derived, he gets less money because we don't direct money where we have great conditions, we direct it where we have our poorest condition scores.

So just to summarize real quickly, I think the recommendation that staff gleaned from our engagement of the transportation partners as well as the elected leadership of the state is that these six guiding principles would be a good tool to be used by the commission and others as we evaluate projects. Clearly, the best projects would rise to the top of any selection process by applying those principles, and then perhaps a balanced approach between those focal points that are on the screen at this time be considered by the commission.

Staff is not standing before you today to make a recommendation on the dollar amounts that you would direct specifically to any one or all three of those areas, other than to suggest that it be a balance and we're certainly more than happy to discuss that with you today or at a future commission meeting. It's our intent and desire to move forward, we'd like to bring forward, based on your direction to us today, a recommendation in the not too distant future, a list of projects or at least an approach to selecting those projects so we can move forward with this program.

Timing is important, as I've already mentioned, because we need to get projects underway, get the benefits of those projects out to the citizens of Texas, and to take full advantage of the $1 billion of bond proceeds that have been made available to us.

So I think this is a unique and exciting opportunity for our state, we're standing ready to respond to it, and I think that the voters of Texas were committed to it and I know that you are, and I think we have the ability and the desire to do it in a way that is transparent, clearly accountable, and yields tangible results that can be measured and demonstrated to the public.

So I'll pause and see if you have any questions or if you would like to provide any direction to staff on how we move forward with this.

MR. HOLMES: John, I'd just like to make an observation. Ruth Jones McClendon sent a letter that I just read which I thought had a couple of interesting points that if you take and extrapolate it against some of these bullet points up here, I think kind of brings it a little bit better into focus in respect of how you apply the principles. And in that letter she talked about didn't want to pick projects but you evaluate them based on the most urgent and the most needed, and if you have kind of an arbitrary allocation of dollars across each one of those three, it may be that the number three connectivity project, while it's very important in the respect of connectivity is really not as important or urgent or as beneficial as the number five safety/preservation.

And so you need to put some judgment in the list rather than simply an allocation across the categories. And it might be useful to see projects within each one of those categories ranked and then there could be some judgment as to whether one of them that is actually lower in one of the categories is a more important project.

MR. BARTON: Okay, I think we could do that.

MR. HOLMES: Does that make sense?

MR. BARTON: Yes, sir. Let's look at the projects that are available to move forward within the time frame we're talking about, categorize them into these three focal areas, kind of rank them and then provide an evaluation of those, and let you and others look at where projects lie within those priority categories and see if we have overlap or if there's a balance that's been achieved.

MR. SAENZ: Thank you, John.

MR. BARTON: Thank you.

MR. SAENZ: That's the last agenda item.

MS. DELISI: That concludes the agenda for today. Is there a motion to adjourn?

MR. HOUGHTON: So moved.

MR. HOLMES: Second.

(A chorus of ayes.)

MS. DELISI: Please note for the record that it is 2:45 p.m. and this meeting stands adjourned.

(Whereupon, at 2:45 p.m., the meeting was concluded.)

C E R T I F I C A T E

MEETING OF: Texas Transportation Commission Workshop

LOCATION: Austin, Texas

DATE: September 23, 2009

I do hereby certify that the foregoing pages, numbers 1 through 116, inclusive, are the true, accurate, and complete transcript prepared from the verbal recording made by electronic recording by Nancy King before the Texas Department of Transportation.

C E R T I F I C A T E

MEETING OF: Texas Transportation Commission

LOCATION: Austin, Texas

DATE: September 23, 2009

I do hereby certify that the foregoing pages, numbers 1 through 116, inclusive, are the true, accurate, and complete transcript prepared from the verbal recording made by electronic recording by Nancy King before the Texas Department of Transportation.

 

 

 

9/28/2009

(Transcriber) (Date)

On the Record Reporting

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Austin, Texas 78731

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