SACRAMENTO, June 25, 2018 (GLOBE NEWSWIRE) -- Prior to the first committee hearing on AB 382, which seeks to which seeks to limit the growth of the Transportation Corridors Agency (TCA) in Orange County, Fieldman, Rolapp & Associates, Inc., an expert in the field of municipal finance in California, released its report on the history of debt obligations of the TCA.
Using the TCA’s own Comprehensive Annual Financial report (CAFR) and their annual budgets, Fieldman, Rolapp found that TCA’s total debt has grown from about $2.9 Billion in 1998 to over $6.4 Billion in 2018 . Their debt has more than doubled despite TCA not building one mile of new road during this same period of time . TCA’s current debt is structured so that instead of paying down the debt, both principal and interest owed by the TCA will continue to increase every single year until at least 2057.
When the Orange County Toll Roads were originally proposed in the 1980s, the promise was that these roads would eventually become free freeways for the public once debt obligations were paid. According to a 2013 study by the Pacific Research Institute, the TCA’s toll roads are projected to never pay off their debt while continuing to receive annual subsidies from taxpayers which have totaled over $1.7 Billion since initial construction.
When approved in 1995, the toll roads were supposed to be free to the public by 2035. Now, the earliest date for making the toll roads free, due to the TCA’s growing debt obligations, is 2057, although this date is expected to be pushed back as well. This report from Fieldman, Rolapp comes just months after the report from IBI Group, which found that the SR-241 Toll Road Extension would only serve 10,000-15,000 drivers a day despite a $2 Billion price tag.
“The TCA is the poster child of government waste in California,” stated Assemblymember Rocky Chavez, author of AB 382. “How can a governmental organization allow itself to more than double its billions of dollars of debt despite not actually building anything. We have a responsibility to taxpayers throughout the State to stop runaway governmental agencies, especially those that have received almost $2 Billion in taxpayer subsidies.”
While the TCA continues to charge high tolls for roads, it continues to enrich those working for it at the expense of Orange County residents. In addition to the annual $412,487 total compensation for CEO Mike Kramen (about $100,000 higher than the statewide director of Caltrans) the agency has 67 other budgeted positions (at least six of whom also make more in salary than the Governor of California) including 7.5 positions devoted to public relations, 3.5 positions devoted to strategy and public affairs, 3.5 planning positions, and 31.5 staff positions devoted to finance and contracts. Toll operations, the only allowed purpose of the TCA, only has 12 budgeted positions. In addition, TCA spends millions of public money each year on lobbyists and consultants to fight for their continued existence.
“The TCA treats public money as its own personal credit card and continues to expend ridiculous sums without results,” stated City of San Clemente Mayor Tim Brown. “They make minimal payments while allowing their debt to mushroom. Now, the TCA wants to spend billions more to build a new toll road through developed communities that barely anyone will use. The time has come to stop this waste of public money for the sake of all Orange County residents”
“Where did over $3.5 Billion go over the past 20 years?” asked San Clemente City Councilmember Kathy Ward. “TCA has failed to build a single mile of new road during this time, but the amount they owe to Wall Street has risen to $6.4 Billion. At the same time, they are relying on taxpayer subsidies, including development fees on homeowner and businesses and payments from Caltrans to maintain their toll roads, to justify their existence and growth. Enough is enough.”
TCA, which was originally formed in 1986, oversees the San Joaquin Hills, Foothill and Eastern Toll Roads. The TCA has not built any new toll roads since 1996, existing solely to continue to collect development fees, to manage the existing roads, and to propose new toll roads to justify TCA’s continued existence while spending millions to battle Orange County residents and other stakeholders who oppose TCA projects.
Efforts to consolidate the TCA’s function with other agencies have been around since the 1980s. In 1996, Paul Glaab, the director of public affairs for the TCA stated, “We're a single-purpose public agency, [whose purpose] is to finance, design and build the roads and then go out of business.” 1 Since 1996, the TCA has not built any new toll roads nor have they gone out of business.
Attachment : Fieldman, Rolapp & Associates, Inc. Memorandum re: Foothill/Eastern TCA and San Joaquin Hills TCA: History and Attributes of Debt and Recent Financial Results -- http://resource.globenewswire.com/Resource/Do...da802cb776
Contact: Adam Englander – (310) 717-8311 or adam@ekapr.com
1 “Heavy Lobbying Helps Spare Tollway Agency” Los Angeles Times, April 22, 1996. http://articles.latimes.com/1996-04-22/news/m..._toll-road
