Magnolia, January 9 – Montgomery County Judge Craig Doyal and County Commissioner Charlie Riley are leading the charge forward on a $100 million non-voter-approved road bond project that will cost Montgomery County taxpayers more than $100 million to construct a 3.6 mile tollroad extension of State Highway 249 at the far southwest edge of the County. U.S. PIRG, a nonpartisan public interest research group, as well as many citizen groups in Waller and Grimes counties have questioned projections for the engineering and construction project, where the County has already awarded $8 million of general fund tax dollars to major campaign contributors of Doyal, Riley, Commissioner Jim Clark, and Commissioner Mike Meador.
Some people have begun to refer to Doyal’s and Riley’s $100 million 3.6 mile toll road as the “Decimation of Hope Highway” because it will destroy the ability of Montgomery County residents to afford to live in their homes if they have fixed or moderate incomes and because it will prevent the spending reductions necessary for County citizens to obtain any relief from high property taxes. $100 million is more than twenty-six percent (26%) of the annual Montgomery County budget. Residents already face gigantic tax increases in the form of higher Appraisal District valuations from the Commissioners Court-controlled Appraisal District (Riley and Meador serve on its board along with former Commissioner Ed Chance, and their longtime close allies Bruce Tough and Tom Cox). Many residents are clamoring for substantial spending reductions in the County’s $381 million budget, which has grown at a pace far greater than population growth since 2000. (See Chart 1). The burden of the Decimation of Hope Highway expenditures would make such reductions very difficult.
Doyal and Riley have caused the County to pay more than $2 million to Halff Associates, Inc., the engineering firm of which Bobby Adams, Doyal’s business partner in other ventures, is Vice President and manager of Halff’s local sales and engineering office. Halff Associates State PAC and Adams are major campaign contributors to Doyal, Riley, Clark, and Meador. In a December 20, 2016, vote, the Commissioners Court voted 4 to 1 (Noack dissenting) to award $358,000 in additional funds to Halff Associates.
Myth #1: It’s about mobility.
Truth: TxDOT plans to build this tiny 3.6 mile expansion of SH 249 with or without Montgomery County’s expenditure. TxDOT already has funds available from federal grants to design and construct the entire TX-249 extension from the Sam Houston Tollway in Harris County to the vicinity of College Station, Texas. The primary purpose of Doyal’s and Riley’s quest to build this tollroad is so that they can funnel engineering and construction funds to their major campaign contributors.
The following list shows the contracts Montgomery County has approved and paid since Doyal became the County Judge in 2015:
Contract, January 26, 2015, Halff Associates, Inc., $1,987,000.00
Contract, February 9, 2015, Geotest Engineering, Inc., $194,178.00.
Contract, April 21, 2015, SWCA Environmental Consultants, $142,300.00.
Contract, September 15, 2015, Brown & Gay Engineering, Inc., $710,000.00
Contract, September 15, 2015, Jones & Carter, Inc., $1,599,500.00.
Contract, September 15, 2015, Aguirre & Fields, LP, $1,599,500.00.
Contract, February 9, 2016, Landtech Consultants, Inc., $268,140.31.
Change Order, December 20, 2016, Halff Associates, Inc., $358,000.
Harris County Commissioner Jack Cagle, a close political ally of Doyal’s and Riley’s who has also received substantial contributions from the aforementioned engineering firms, has made clear that if Montgomery County Commissioner James Noack (Precinct 3, The Woodlands) continues to oppose the SH 249 Cagle will obstruct any road and bridge construction projects in south Montgomery County to the extent Cagle is able to do so.
Doyal and Halff’s Bobby Adams are partners in WS&G, LLC, a shadowy company that contracts with taxing authorities outside of Montgomery County. In January, 2015, Montgomery County Attorney J.D. Lambright rendered a written opinion that he felt it was okay for Doyal to vote on Commissioner’s Court deliberations whether or not to award contracts to Halff, in light of Doyal’s business partnership with Halff’s Vice President Adams. Lambright rendered that opinion based upon his conclusion that Doyal did not own any interest in Halff Associates, so it was okay for Doyal to award contracts to his business partner’s primary employer. Clearly, Lambright did not consider Texas conflict of interest laws that deal with awarding contracts to entities where a government official has a business relationship with an officer of the vendor. Lambright gave Doyal the myopic opinion Doyal and Halff Associates wanted.
Myth #2: We need the tollroad revenue. Truth: It will take about two decades to pay off its cost, and that’s a wild-eyed and aggressive projection.
U.S. PIRG, a nonpartisan public interest research group, has named the TX-249 extension project among the Twelve Most Questionable Highway Projects in the United States! The research group noted, “Citing outdated traffic projections, the Texas Department of Transportation claims it needs to spend between $337 million and $389 million building a 30-mile six-lane highway from Pinehurst in Montgomery County through Todd Mission in Grimes County to College Station…TxDOT expects vehicle traffic on one road in the area to quadruple from 2015 to 2040. State traffic projections represent average annual growth rates of between 3.7 and 5.5 percent. But data at TxDOT traffic counters in the area show that from 2007 to 2013, the growth was far lower, between zero and 4 percent a year.”
In order to try to justify the economics of the $100 million they want Montgomery County to spend on this project – which TxDOT would fund and build even without Montgomery County’s participation (!!!) – Doyal and his Commissioners Court colleagues, in a study they commissioned to support the project, have relied upon economic projections of the toll revenue for that 3.6 miles that include the following assumptions, among others:
1.The Woodlands Parkway Extension, which Montgomery County voters rejected in a May 2015 bond referendum, “is assumed to be constructed and fully operational by the year 2023
2. The Harris County Toll Road Authority, NOT the Montgomery County government or the Montgomery County Toll Road Authority, will set toll rates.
3. A large system of toll lanes will be constructed on IH 45.
4. The toll road authorities will conduct “effective” advertising and promotion to make you want to use toll roads.
5. Motor fuel prices will not “significantly exceed the overall rate of inflation.”
6. “No local, regional or national emergency will arise which would abnormally restrict the use of motor vehicles or substantially alter economic activity or freedom of mobility.”
According to Commissioner Charlie Riley, he has agreed not to proceed with The Woodlands Parkway Extension. Therefore, assumption A likely won’t happen. Assumption C will be a fiscal disaster for Texas drivers. Assumption D is offensive government propaganda reminiscent of George Orwell’s classic “1984.” Assumption E is questionable, given the extent to which the OPEC nations are inflating oil prices. Assumption F is ominous.
Assuming that Doyal, Riley, Clark, and Meador get their way and ram through a $100 million expenditure for the 3.6 mile (!) tollroad at the far southwest edge of Montgomery County, and somehow miraculously complete the road project by the beginning of 2018, their own frighteningly aggressive projections from the study they commissioned show the following revenue. The Golden Hammer has added a discount analysis based upon a conservative 3.75% discount rate (Wall Street Journal Prime Rate as of December 15, 2016).
Year Annual Revenue Net Revenue After Harris Cty Discounted
Takes Its Share Cumulative
2018 $1,237,000 $1,150,410
2019 $4,592,000 $4,270,560
2020 $6,434,000 $5,983,620
2021 $7,786,000 $7,240,980
2022 $8,907,000 $8,283,510
2023 $10,675,000 $9,927,750
2024 $12,343,000 $11,478,990
2025 $14,063,000 $13,078,590
2026 $15,200,000 $14,136,000
2027 $16,307,000 $15,165,510
2028 $17,494,000 $16,269,420
2029 $18,767,000 $17,453,310
2030 $20,133,000 $18,723,690 $104,467,198
Those projections are not realistic. A twenty percent (20%) reduction in the revenue stream would require four additional years to break even on the construction of the 3.6 miles of road. Even a 20% reduction in the projection seems low, in light of the unlikely assumptions of the study and the failure of other projections of the Commissioners Court on other toll revenue projects, such as the largely unused IH 45-SH242 toll flyover.
Myth #3: It wouldn’t get built without us. Truth: TxDOT would build it anyway.
TxDOT has received federal fund grants to build the so-called “Aggie Parkway” of which the 3.6 mile Decimation of Hope Highway is only a small part. In TxDOT’s written agreement with Montgomery County, if the County opts not to proceed with the Decimation of Hope Highway, TxDOT would reimburse the County for all or most of the engineering expenditures, to date, and would proceed with the project. TxDOT’s regional director has indicated that the State has not decided with certainty whether the road would be a tollroad at all, in that circumstance.
Since TxDOT would built the road anyway, and has the funds ready from a federal grant to do so, Montgomery County’s expenditure would seem to constitute a risky waste. It won’t add to mobility. It only pours money down the Halff And Friends Funnel.