Posted at http://www.saintpetersblog.com

Florida Department of Transportation Secretary Ananth Prassad has been on a legislative crusade for the past two years as he has repeatedly attempted to take over the Tampa-Hillsborough Expressway Authority (THEA), the Mid-Bay Bridge Authority, and the Orlando-Orange County Expressway Authority (OOCEA).  By hook or crook he is determined to “consolidate” these entities either within the FDOT or the Florida Turnpike Enterprise.

However, these three local toll road authorities have successfully beat back these attacks and will be forced to continue to do so until he gives up his stubborn quest.  So, what is this all about really?  Well, it’s about a number of things but most importantly it is about the desire to bring these local agencies with well-earned and very strong revenue potentials into the departments fold and use that money to fund projects around the state.  Except that is not what these authorities were created to do, rather they were created to allow local board members to craft smart solutions to their local road challenges – to meet their local needs.  FDOT by definition is about creating solutions on a state-wide basis and connecting urban areas together.  In fact, no other state in the country is pushing all decision-making to the state level except for this Secretary.  Meanwhile other states are actually following Florida’s model and creating moreregional toll authorities to insure that there is a local focus on urban traffic congestion, and this is especially true in Texas, a state that Governor Rick Scott sometimes looks to for idea’s.

Now, THEA saw this legislative train moving out of the station last year and so they developed a comprehensive strategy to accelerate their debt re-payments to the state, which lent money in the first place so that THEA (and other toll authorities) could begin construction.  Since toll authorities need toll revenue to pay back bond holders, and since new roads have little toll revenue, someone must loan them the money up–front and the state realizing this many years ago developed the state infrastructure bank and the lease-purchase concepts.  As toll revenues start coming in, then the local toll authority can begin to repay the bank the money plus interest.

But what happens when a local toll authority wants to repay their debt, yet the state refuses to accept the cash?  Who would look a gift horse in the mouth and refuse the money?  Secretary Prassad for one.  What?  Yep, you read it right.  FDOT refused last summer to accept a finance plan from THEA that would have THEA directly fund $100 million of their own work versus FDOT insisting on funding the THEA work.  THEA’s plan would have freed up $100 million of FDOT funds and the plan would have THEA making an early re-payment of $65 million to FDOT for prior loans.  In sum, THEA’s plan would have made FDOT the beneficiary of $165 million and FDOT’s excuse for not taking the money is so logically convoluted that it is indeed difficult, if not impossible, to rationalize.  By refusing to accept the plan however – and simultaneously refusing to allow THEA to pay back the money early – FDOT is able to continue to control the future of the authority.  When FDOT testifies before the legislature, if you listen carefully you will hear him say that THEA is not paying back the debt quick enough.  Well, do you want the money back or not?  Or is it just a “control” issue?

What THEA had devised was a brilliant stroke to refinance their bonds, pay off some of their debt to the state bank, and with the state dollars freed by the refi; they projected about $165 million in new road construction money for Florida that would have the ability to put about 5,000 people to work.  And this would have occurred without any increase in tolls!  And the new debt would not be state debt; it would be THEA’s debt.  Sounds unbelievable huh?  Well, sometimes friends the truth is stranger than fiction.

Last summer the THEA chair wrote a letter outlining the circumstances of the early debt rejection and it has still fallen on deaf ears.  This year’s transportation budget was better than last year’s, but it could have been even better had the dollars that THEA wanted to re-pay, instead been accepted and then used to help fund other transportation projects.

FDOT and the Secretary continue to argue, as recently as last week, that by consolidating the local toll authorities the state would accrue $24 million in savings, even though the Reason Foundation’s (www.reason.org) January 31, 2011 study, Should Florida Toll Agencies Be Consolidated analyzed the numbers carefully and found them to be off base by about 85%!  That is, at best, the state might realize about $3.5 million in savings and more likely only about $2 million.  Yet, the Secretary continues to assert that the $24 million is correct without offering even scant evidence that he is correct.  And moreover he hasn’t pointed out any fallacies in the study’s accounting that would make one believe that he is right.  So, why does he continue to make the argument?  Because everyone in the transportation business is afraid to tell the Emperor that he has no clothes on.

At a meeting of the Florida Transportation Commission and TEAMFL next week in Tampa, Robert Poole, one of the co-authors of the study, and probably the preeminent toll road expert in the country, is to be given an opportunity to present his study to the local toll authorities, engineers and road builders who do this for a living.  Not only does the study reveal that the figures are mostly smoke and mirrors, the report goes on to say that local toll authorities are where real innovation is taking place. For example, OOCEA was able to get rid of toll booths entirely and use transponders to access driver’s accounts.  Even the latest innovation:  reversible express lanes with all-electronic tolling was developed by the Tampa toll authorities, not the state.

The FDOT Secretary is a smart man whose job is serving the Governor and the people of Florida.  But when he refuses to acknowledge the facts, and continues to assert numbers that cannot be justified by independent analysis, then something is clearly wrong with this picture.  When he was quoted last week in the Tampa Bay Times calling local toll authorities a “shadow bureaucracy,” it became evident to me that it was time that we teach the Secretary a lesson in civics.  Mr. Secretary, we call that local government and it is generally believed by most Americans that government closest to the people is the most accountable.  Not in Tallahassee, but at the local level.

Barney Bishop III, who just founded his third company – Barney Bishop Consulting, LLC, is an outspoken, lifelong Democrat with a strong fiscally conservative streak. He believes that government is not the answer to all of our problems, that civil discourse is obligatory, that compromising on details will not undercut one’s core beliefs, and that a resilient, robust private sector is the elixir needed for a true democracy to grow and survive. You can contact him at barney@barneybishop.com.

Destination resorts, the preferred phrase for those of us who support casinos, is dead for this legislative session after the House voted down the proposal in committee late last week. In my book, that’s a shame, because it could have brought much-needed construction jobs to South Florida, along with a slew of permanent work for people at all skill levels.

I know a lot of people in Florida are vehemently against the expansion of gambling, but as the Ben Stein TV ad says, we already have lots of gambling and gaming in our state, with the Florida Lottery being the big kahuna. The list is long: gambling ships to nowhere, dog tracks, horse tracks, pari-mutuels, Internet cafés, bingo parlors, Indian gaming around the state and so on. So, what is it about destination resorts that get folks’ dander up?

First, opponents argue that Florida is a family destination, and that is certainly true. But I’m not sure everyone thinks South Beach and Miami Beach — with their topless shores, all-night clubs and anything-goes attitude — is really very family-friendly. I suppose it depends on what kind of family you have. Nevertheless, Europeans and Latin Americans come to South Florida because the culture is similar to theirs in many ways, because the language is familiar and because we encourage foreign tourists to visit and spend their money. But when you get right down to it, why must all of Florida be a family-friendly place? Since residents in Broward and Miami- Dade counties have already voted to allow casino gambling, doesn’t their voice count? Exactly when did the “will of the people” in Southeast Florida get cast aside because everyone else in the state knows better? I thought home rule was best because it was “closest to the people.”

And how does Walt Disney World have the right to proclaim that all of Florida will be family-friendly? Who gave it that license? Sure, Disney is a major Fortune 500 company that has transformed Central Florida into a virtual paradise for kids and their families. But does it get the right to rule over the rest of the state? Can’t Disney just be happy with having the central part of the state, or does it have control all of us? I’m a big supporter of business, but this just doesn’t make sense to me. I think Florida is big enough that different parts of the state can appeal to different kinds of tourists without one group ruling the roost exclusively.

Next, the opponents tell us that crime will increase. And I can’t help but agree, but I don’t find that to be enough of a reason to oppose destination resorts. Isn’t that why we have law enforcement to protect us from the bad guys? I don’t want to make light of this because officers put their lives on the line for us every day, and we should do everything we can to provide them with the tools to be effective. And destination resorts will generate a lot of money for the state and local government, and some of those dollars should be used to fight crime.

Then we are told by the opponents that the jobs will be low-wage jobs. Really? When you can’t get a job, how low is too low? For those of us lucky enough to have a job, do we really need to look down our noses and say these jobs aren’t good enough for someone else? From what I can see, every time a company announces new job openings, it doesn’t suffer from a lack of applicants. Furthermore, at a time when we want people to get off welfare and find work, wouldn’t any job do? Since taxpayers are footing the bill for welfare, I vote to let them get any kind of legal job they can, and if I can help them, then it’s certainly in my best interest. I’ll share with you that a beginning job at a low wage doesn’t mean that you will never advance. Do you know that one of the top executives for Wynn Resorts started out as a blackjack dealer?

There is no question we should all want to bring high-tech jobs to our state, but rather than hitting a grand slam, shouldn’t we try to hit a few singles, doubles and triples while we are waiting for the big one to come to Florida? I mean, Gov. Jeb Bush brought Scripps to Florida, which begat Torrey Pines, Burnham Institute and then Max Planck. Do you really believe these scientists don’t ever want to have fun and go to a casino? I do, and I’m not even a gambler. I don’t really care to gamble because I work very hard for my money, and I know the odds are in the house’s favor and that I’m not a particularly lucky person. But I do enjoy the wide range of entertainment, the restaurants and the striking, world-class architecture.

Last year, I went to an Indian casino in Tampa. When I went into the casino, I was surprised to see a lot of folks who look just like me: white hair, over-age and feeling good. Just about every one of them had a drink in his or her hand and some were even smoking. But you know they were all having a good time, laughing and enjoying the company of others. Now, I know there will be a certain percentage of folks who will use their last dollar to try and win it big, but does everyone have to suffer just because some people can’t control themselves? Has the nanny state evolved so much that now I have to be infringed upon because some other person isn’t smart enough to make the right choice? I hope not, as that doesn’t portend well for the years that I have left to live.

We can put our heads in the sand and deny that gambling exists only here or there, but the reality is that we send a lot of Floridians to Indian casinos or to Biloxi, New Orleans, Detroit or Las Vegas — you name it. But in not a single instance are we reaping the financial benefit of the jobs created since a lot of people are going to entertain themselves with games of chance, whether we like it or not. We can make the money and create the jobs here, or we can send our citizens to another place where they will spend their hard-earned dollars. To me, it just makes economic sense to keep them here in Florida, where, if you are interested in family fun, you can go to Central Florida, and if you are interested in adult entertainment, you can go to South Florida. Shouldn’t Florida be a destination for everyone, whatever they want – so long as it is legal?

Posted at http://www.saintpetersblog.com

The Florida Department of Transportation (FDOT) is on a mission, like never before, to amass power and control over our state’s mass transit system.  Though the department would like for you to believe that it is simply following the model of other states, in fact no other state in America is going down this lonely road.

Ananth Prassad is the Secretary for FDOT and he was one of three finalists presented by the Florida Transportation Commission to Governor Rick Scott.  Ananth is warm, personable and very qualified and has the distinction of working within the department and rising to become Assistant Secretary before joining the private sector and finally returning to become Secretary.

The department’s mission is to oversee Florida’s integrated transportation system and insure that it performs well.  This, of course, is an especially difficult job at a time when the state’s coffers continue to decrease and since neither the legislature nor the Governor are inclined to raise taxes or fees; this puts real pressure on the department.

Enter the three existing expressway authorities around the state: Orlando-Orange County Expressway Authority (OOCEA), Tampa-Hillsborough Expressway Authority (THEA) andMiami-Dade Expressway Authority (MDX).  While MDX is a horse just like the other two, it is a horse of a different color inasmuch as it was created by a Charter Government in Miami-Dade County.  Importantly, MDX owes no money to FDOT because it realized the precarious position that it was in and decided years ago to pay off their debt to the state.  On the other hand both OOCEA and THEA owe money to FDOT because the department advances money to these two expressways (called Lease Purchase Agreements) so that new sections can be built without taking revenue from their existing local toll roads.  The expressway business can be very lucrative because the authorities can take in tolls and use those monies to pay for operations and maintenance and can also pay back the department – if the department is willing to accept the money.  More about that later.

Last session, FDOT rolled out the idea of bringing the Orlando and Tampa expressway authorities within the fold of the department under the guise of saving money.  In fact the department and their supporters said that by consolidating them into FDOT, $24 million would be saved.  That’s not a lot of money in a $70+ billion state budget, but every nickel counts and especially when we are facing another $1.4 billion deficit for the 2012-13 fiscal year.  The Florida Senate tried to make this consolidation happen last year, but House Speaker Dean Cannon would not hear of it, and so it died.

But, this year, FDOT has again attempted to bring the Orlando and Tampa “cash cows” expressways into the warm bosom of their department, and the Senate is again trying to facilitate it.

So, the opponents of this move asked the Reason Foundation to take a look at this important issue and ferret out the truth.  You remember the Reason Foundation; those are the folks that said last year that High Speed Rail (HSR) was a boondoggle and that is should not be attempted in Florida.  The Governor listened and promptly killed it.  Who better to deliver the news of whether there is any truth to these alleged savings than the very folks who waded through the facts of HSR and  deftly put a knife through its heart?  I know that I paid attention because I was an advocate for HSR and when I lost, I wanted to know more about this foundation.  What I learned was that the founder, who interestingly is now the vice president for transportation policy (he didn’t like the admin and wanted to get back to the policy thing!), is considered one of the foremost experts on toll roads in the entire country.  Not only has Robert Poole worked as a consultant on toll roads in the states of California, Washington, and Texas, he also has worked for USDOT and even for about eight years as a consultant to FDOT!

Last Monday, Sen. Jim Norman held a press conference in front of the doors to the Senate chamber and released the study conducted by Robert and a peer researcher in Atlanta.  The conclusion was the title to the study: “Florida Toll Agencies Should Not Be Consolidated” (www.reason.org/news/show/florida-toll-agencies-consolidated).

Remember when I told you that it had been argued that we, the taxpayers, would save $24 million by folding in the agencies within FDOT?  Well, the gentlemen from Reason looked line-by-line at the figures used by the department and at best they said that maybe $3.5 million would be saved, and probably more like $2 million.  That means that about 90% of the purported savings were from fantasy land, and could not be independently justified.  This not only hurts the department’s credibility but also that of the Florida Governmental Efficiency Task Force which likewise, with little independent verification, accepted as fact that $24 million was the right number.

Certainly other arguments have been advanced as well.  Like the state Division of Bond Finance can secure bond dollars at a lower interest rate than the expressway authorities.  That is true if the locals simply auction their bonds, but if they negotiate them, then the locals have actually sometimes beat the state bond folks, so it is not inherently true that the state can do better in all cases.  And, of course, there is always the argument that the state can build roads faster, more efficiently and smarter than the locals, but that got debunked as well.  In fact, most if not all of the innovations that have been occurring in expressways have occurred at the local level:  no more toll plazas, plate-by-picture, reversible lanes, etc.

Finally, the report states the obvious.  That the state department was conceived as a way of interconnecting urban areas around the state and the expressway authorities were designed to put an emphasis on local control of intra-city toll roads.  That Texas, a favorite poster child for Governor Scott is creating more regional toll authorities, not less.  That the local authorities should be given even greater independence and should become self-supporting, not the other way around.

I commented that the local authority, at least the one in Tampa, has attempted to pay back FDOT most of the money that they have borrowed from the state.  FDOT refused the money!  That’s right; the state wouldn’t accept a check.  I don’t know about you, but when I look a gift horse in the mouth, I usually accept it – willingly.

Last week, Tampa Senators Arthenia Joyner, Jim Norman and Rhonda Storms stood up for their hometown expressway and refused to be pushed into accepting the platitudes that were offered by the Secretary that no consolidation was taking place.  None of them believed him and they voted in concert against the departments bill.  They lost in a 5-3 vote of the Senate Transportation Committee.  Obviously, the Senate is going to go down the road again of supporting the department, but I’m betting that Speaker Cannon hasn’t changed his mind one iota.  And since when is it a Republican mantra that locals should send their money to Tallahassee or Washington DC for that matter and that we should expect “savings.”  Quite simply, no one believes that or as we say in North Florida:  that dog don’t hunt. 

Barney Bishop III, who just founded his third company, is an outspoken, lifelong Democrat with a strong fiscally conservative streak. He believes that government  is not the answer to all of our problems, that civil discourse is obligatory, that compromising on details will not undercut one’s core beliefs, and that a resilient, robust private sector is the elixir needed for a true democracy to grow and survive. You can contact him at barney@barneybishop.com.

Gov. Rick Scott presented his vision for the second year of his administration with a good dose of ad-libbing throughout a 30-minute speech. He cited three priorities: gainful employment, quality education and a promise to keep the cost of living low.

Maintaining as he did last year that government doesn’t create jobs, the governor told a joint session of the Legislature in his annual State of the State speech that “what government gives has to be taken from someone else” – taxpayers. His mantra is that the best that government can do is to create a level playing field and then get out of the way.

The “Let’s Get to Work” governor deemed taxes the “great destroyer” and made it clear that burdensome rules and regulations slow growth, calling jobs the first casualty. With Florida ranking as the third-fastest growing state in the nation with 250,000 people moving here over the last 15 months, Scott said, “The promise of Florida is still bright.” He pledged to balance the budget despite a $2 billion revenue shortfall, pointing out that, with the Legislature’s help, Florida netted more than 120,000 jobs – the third highest total in the United States. The Sunshine State also saw the second largest drop in unemployment in the country.

Scott also repeated his pledge to invest $1 billion in education, “the bedrock of our economy,” and emphasized the need to reform our auto insurance system. Floridians, Scott said, are paying 30 percent more in premiums because of rampant fraud and abuse, singling out the trial bar as a part of the problem.

The once-a-decade redistricting process and the annual budget are the only two issues that the Legislature must address, according to Florida’s Constitution. With the imposition of litigation-friendly Amendments 5 and 6 by the Democrats, trial lawyers, labor activists and all-around government do-gooders, rest assured that the courts will be overrun by questionable lawsuits filed by anyone who can afford an attorney. Savvy leadership by Senate President Mike Haridopolos and House Speaker Dean Cannon will ensure that the state and federal plans will be submitted early in the 60-day session so that the justices can issue their verdict on any flaws with time to spare for the Legislature to fix them by the March 3 deadline.

The budget, which is required to be balanced every year, is being dealt with earlier than normal due to the re-drawing of political lines for all 160 officials. This is exacerbating problems for each chamber. The Senate is taking the predictably long view. It wants to address the budget in the spring, after the budget estimating conference finishes its work, so as to avoid any more draconian cuts than are necessary. Meanwhile, the more conservative House wants to tackle the inevitable budget cuts now, with the expectation that unanticipated revenues can be invested in the state’s rainy-day fund.

Aside from the battle over PIP reform, destination resorts will be the other high-profile issue this session. Promoted by the Associated Industries of Florida and the construction industry as a 100,000-job fixer for Florida’s economy, a coalition comprising Walt Disney World, the Florida Chamber, Florida Retail and the Florida Restaurant & Lodging Associations is lined up to defend the state’s family-friendly reputation.

Although I’m not a gambler, I don’t get the opposition to expanding gambling in South Florida. I appreciate the fact that Mickey Mouse doesn’t want to spoil its family-friendly atmosphere in Central Florida, but must the rest of Florida suffer this head-in-the-sand attitude as well? Shouldn’t it be good enough that expansion will only happen where the taxpayers have already voted their conscience and said they want this entertainment for themselves, and the tourists it attracts?

In the meantime, we allow dog, horse, harness and even barrel racing, jai alai, ships to nowhere, Indian tribe casinos, card rooms, Internet cafes and, of course, the state-sanctioned and heavily-promoted lottery and Powerball. But somehow South Florida adding world-class architecture, much-needed construction jobs for the next four years, and well-paying jobs for desperately-seeking Floridians is a stretch too far. No proponent is saying that this is the solution to all of our ills, but you’d think Florida is going to go to hell if we allow developments of this type to exist. While it is unlikely to pass this year because of staunch opposition by the House speaker, destination resorts will eventually arrive on our shores. And for those who oppose them, I hope they refuse to have their conferences and meetings there because it will leave room for the rest of us who don’t need others telling us what we can legally do with our own money.

There’s a good reason why an early legislative session is warranted only every 10 years. Our founders knew we would need 10 years to get from over the last hurrah.

Six years, $100 million. That’s what Democrats are saying Mitt Romney has spent in the race so far for the presidency, as if somehow it’s a bad thing.

I believe that, ultimately, Mitt will win the Republican nomination, and it will come down for me and, I think, other conservative Democrats, that he is the best-tested, most-vetted, smartest, most successful capitalist in the race.

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