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The committee met to take up and consider bills. This report focuses on SB 1601(Kolkhorst) and SB 1294 (Nichols).
 
SB 1601— Kolkhorst, Relating to eminent domain authority of and safety standards applicable to high-speed rail systems

  • Implementation of high-speed railway system from Houston to Dallas would provide imminent domain to private organizations and inevitably take away property rights from Texans
  • Bill would create a tighter definition of high-speed rail systems to distinguish them from traditional railroads – private organizations should not have state authority of imminent domain
  • Sen. Kolkhorst introduced a committee substitute to add more direct language to define a railroad company – certain requirements must be met for an entity to be deemed a railroad
  • Walker County initially started the conversation on the need for this bill
  • Expressed concern with the devastation that will happen in rural areas – small cities will be overlooked
  • Texas legislature needs to control the number of authorities that have imminent domain
    • Comptroller Hegar stated there are at least 5,000 current entities
  • Sen. Hall added imminent domain control in the hands of the government should be increased
  • Vice-Chairman Huffines asked what would happen if the bill was passed
    • Federal authority approval for imminent domain – state would not be involved
  • Sen. Kolkhorst stated public land should not be taken up by a private company and is firmly against the Houston to Dallas high-speed rail system

 
Public Testimony
 
Peter LeCody, Texas Rail Advocates

  • Oppose the bill
  • Cities in towns along the way between Dallas and Houston should provide regional stations for mobility in those regions – more jobs and opportunities for revenue
  • Sen. Hall asked if there is an adequate safety zone set in place for the rail system and how fast the rail system is expected to run
    •  Yes, the train would move up to 200 miles per hour; the railway would be 50-100 feet wide and is the same size as projects successfully implemented in Japan

 
Drew Carson, Student Body President, Sam Houston State University

  • Oppose the bill
  • SHSU joined other universities to analyze alternative transportation solutions in Texas
  • Rail system would provide students an efficient and affordable way to commute throughout Texas

 
Don Dixon, Self

  • Support the bill
  • Government agencies should be careful about condemning a person’s land for private use – property has strong value to citizens
  • Against the high speed rail system

 
Spencer Copeland, Student Body President, San Jacinto State University

  • Oppose the bill
  • Unclear if there should be exemptions carved out of certain industries that would affect the future
  • Sen. Kolkhorst noted the railway would not be in Huntsville
    • Sam Houston students and alumni would commute from the Houston/Conroe area

 
Richard Lawless, Chairman and CEO, Texas Central Railway

  • Oppose the bill
  • High speed rail will complement other modes of transportation of Texas including both air and ground transportation
  • Japanese model has worked for over 50 years without a single fatality in the country
  • Public subsidies will not be sought out and the new system will rise or fall on its own merit – will create a bigger tax base in areas that it will pass
  • High-speed railways should not be prohibited in Texas because they go faster than other trains
  • Sen. Nichols clarified TCR is not looking to take federal money but is wanting to take out a federal loan
    • TCR will not take any grants but wants to take advantage of loans in the future like any other company has the privilege of doing; not necessary now but maybe for the future
  • Sen. Hancock asked who was responsible for offering landowners compensation and who would reimburse the state for excessive court case fees
    • Organization will work with its own operations to offer compensation to landowners arguably higher than compensation usually offered by the state
    • If residents choose not to sell, the imminent domain process would begin
  • Sen. Kolkhorst asked what happens if the company goes bankrupt and asked if the rail system parts would be made in America or Japan
    • $10 billion (out of $12 billion) of parts would be made in America but $2 billion of additional manufacturing would take place in Japan and then assembled in America
    • $1 billion contingency fund will make up for any shortfalls during the implementation of the first several years to sustain itself
  • Sen. Kolkhorst asked what the travel time would be from Houston to Dallas
    • Including a mid-corridor stop in College Station, there would be an 80 minute travel time
  • Sen. Ellis was supportive of the project and hoped for TCR to highlight what private carriers in the past have done in similar situations

 
Judge Robert Eckels, Texas Central Railway

  • Oppose the bill
  • Toshiba plant in Texas would help manufacture parts for the railway system
  • TCR would be able to begin operations if the bill was not passed and would not require any government funding – first of its kind in the United States
  • Sen. Taylor noted this would be an opportunity for Texas to lead the nation in innovation
  • Sen. Kolkhorst argued the high speed railway system would take away individual property rights
    • Court cost and fees will pay for judicial staff salaries just like any other matter of law
  • Sen. Kolkhorst noted the project could still be built if this bill was not passed
    • Could potentially rely on the federal government but would much rather work with Texans
  • Sen. Huffines asked if TCR would take the issue of additional court costs to the voters to see if this would be a cost taxpayers were willing to spend
    • No, costs of court proceedings will be covered just like any other matter of law

 
Terri Hall, Texans for Toll-free Highways

  • Support the bill
  • No private entity should have the power of imminent domain
  • Previously conducted public hearings overlooked many cities involved in the conversation – publication of these hearing were not openly made available to the community; word of mouth

 
Chris Mosley, City Attorney, City of Fort Worth

  • Oppose the bill
  • There will soon not be enough concrete or spaces to pave to accommodate the booming population size and increase of automobiles in Houston and Dallas
  • Project will likely die without imminent domain – please do not turn this over to the federal government

 
Ben Leman, County Judge, Grimes County

  • Support the bill
  • High speed railway system is very different from other transportation methods in Texas
  • Traffic congestion is only found in Houston and Dallas but not within the small cities in between – there will be the same number of cars on the road whether or not rail system is built
  • Less than 5% of the current Texas population uses public transportation
  • Financial damage to private property landowners will be substantial

 
Kyle Workman, Texans Against High-speed Rail

  • Support the bill
  • 850,000 citizens between the Houston and Dallas areas have united together to oppose high-speed railways
  • Imminent domain would give a private company the ability to override the needs of the public
  • Project would be too big for the state not to step in and take over in case of bankruptcy in the future

 
 
Dan Hagan, Self

  • Support the bill
  • There are no railroad industry leaders on the executive board of TCR
  • Property rights should be protected in Texas

 
Committee substitute adopted. Bill voted out 5 Aye- 4 Nay and will not go onto the local calendar.
 
 
SB 1294 – Nichols, Relating to certain limitations on design-build contracts for transportation infrastructure projects.

  • Stated that a design-build contract may not require a contractor to maintain project for more than 5 years
  • The bill does not prohibit a design-build contractor from agreeing to other terms for periods of 5 years or less
  • The allowed construction cost for a highway project is now $250 million rather than $50 million
  • Also states that a department cant enter into more than three contracts in a fiscal year
  • The Sunset Provision expires August 30, 2015
  • TxDOT will be under the Sunset Provision next session
  • Rep Nichols stated that the 5 year increment is not to be the only increment, but for their multiple 5 year increments subject to provisions and renewals

 
Public Testimony
 
Bill Held, Texas Department of Transportation

  • Senator Hall struggled to see how the bill really affects TxDOT
  • Senator Hall asks about the increase of $250 million in size
  • As soon as this session is over TxDOT will be under the Sunset Provision
  • TxDOT will have the option at the end of the first 5 year increment to renew the contract under a new price

 
Terri Hall, Texans for Toll Free Highway

  • Support the bill
  • Said they like the fact that the bill is going to limit design-build, don’t want an unlimited number of design-build contracts given to the department
  • Said payments to losing bidders has been a long lasting problem with the public – wanted this to be thrown in to a committee substitute
  • Believed the losing bidder payments creates less competition because it becomes a big boy game
  • Another concern is that the contract team is picked before the design is done, opening up a lot of cronyism 
  • Our cost to build roads in Texas has doubled under the design build era

 
Don Dixon

  • Support the bill
  • Would like to see a limit with design-build processes
  • Problems
    • Said it’s a big boy game and smaller contractors don’t give a fair opportunity
    • When it’s a big boy game, the price is not going to be good for the public therefore, not entirely benefiting the public
    • Believes design-build creates unknown cost from the beginning which drives up cost
  • Texas designs roads 37% cheaper than other states in US but design-build puts this in jeopardy
  • Wanted to see qualified people working for TxDOT to make sure they design highways the correct way and bid them out allowing taxpayers to have the best deal possible

 
Steve Henry, Austin Industries

  • Support the bill
  • 5,000 employee owners throughout the state
  • Support this bill because taxpayers are best served when TxDOT has the appropriate level of flexibility to evaluate the conditions of each project and to determine the best, cheapest and fastest way to build
  • Says design-build is not the sole solution to infrastructure needs

 
Chuck DeVore, Texas Public Policy Foundation

  • Opposed to the bill
  • Concern
    • 1) 5 year period for maintenance; a higher upfront bid could be penalized due to the series of 5 year increments  
    • 2) don’t like increase in cost from 50 million to 250 million; said Texas should adopt Florida’s design-build push button which speeds up projects up to 25 months;
    • 3) If the 3 year limit wasn’t in place they believe TxDOT could save the taxpayers of Texas 1 billion dollars a year
    • 4) Have an issue with the maintenance and rehab being done by the same person
  • Senator Huffines asks about other states and there restrictions
    • Generally there are no restrictions on design-build in other states

 
John Wiseman

  • Support the bill
  • Thinks the bill would be beneficial for Texas and for TxDOT
  • Horseshoe in Dallas, Harbor bridge in Corpus Christi – design build examples
  • Said under the 50 million dollar process in the past, 3 projects could’ve done better
    • Would’ve been quicker and cheaper with the conventional build process
  • Wanted to add an audit function for future
  • Senator Nichols asked how big is the short list for bidding contractors under a design-build contract.
    • 3-4 people and the others do not get to bid
  • Senator Hall asked why they limit the number of contractors who can bid.
    • They want to limit the amount of groups that would potentially drop out
  • Senator Nichols asked why the 32 already designed projects in Austin were bungled.
    • Materials available was an issue

 
Bill left pending