Unlimited Dulles Tolls: Tim Kaine’s Transportation Legacy

By Thad Hunter, Monday, September 10, 2012

Former governor Tim Kaine is the central player and the initiating root cause that led us to the escalating tolls controversy on the Dulles Toll Road (DTR).  Immediately after taking office in 2006, Kaine exploited a legal gap that short-circuited the normal procurement process.  He then cut a deal outside of normal legislative oversight while also ignoring protests.  This deal transferred complete control of the DTR including toll setting power to MWAA in return for funding the state’s share of the Silver Line construction and operational costs.

As predicted, MWAA has continued to increase tolls and they will continue to do so up to whatever level they deem necessary.  The latest estimates predict that tolls will ratchet up to $4.50 next year, $6.75 by 2018, and $16.75 by 2043, and yes, that is the cost each way. [1]   In May, Bill McMorris described why Kaine’s deal “could sink his candidacy for U.S. Senate”; and he may soon be proved correct. [2]

The Silver Line is a complex $6 billion project; however, MWAA is an airport operator that has never built a transit project, which explains their incompetent management thus far.   MWAA is also a unique federal creation that is not subject to normal public or private sector regulation and oversight, which explains their corruption.  In addition, MWAA is not even part of WMATA, which is the overall METRO manager.

Virginia’s ability to influence on MWAA is limited to selecting 5 of the 13 board members.  Naturally, Kaine picked Dennis Martire, an actively serving union Vice President of the Laborers’ International Union of North America.  Martire led the effort to alter the Project Labor Agreement, which is designed to drive more contracts to the Silver Line union honey pot. [3]

Kaine’s MWAA deal occurred from December 2005 to May 2006.  His actions back then illustrate how he would legislate in the future as senator, God forbid.  And as is often the case, Kaine’s actions readily diverge from his stated beliefs.  His career, whether it is the Silver Line, Obamacare, or taxes, is a pattern of intransience despite his affable style and courtroom-honed communication skills.

Tim Kaine nominated himself to be the chief salesman of the Silver Line because 1) it fit into his Cap and Trade green agenda, 2) it guaranteed future union contributions and foot soldiers for him and other Virginia Democrats, and 3) it quickly got him off the hook with Democrat-rich Fairfax.  NoVa commuters were upset over traffic congestion and they demanded action, any action; and he wasn’t about to waste the crisis.

This episode reveals three of Kaine’s personal traits, which do not mix well with good government.  Specifically he showed a:

1. Lack of Integrity:  He feigned support for the prescribed formal selection process, which was well underway, while starting his own private negotiations with MWAA.
2. Lack of Transparency:  He unilaterally signed a formal Memo of Agreement (MOU) with MWAA without consulting the legislature and took advantage of a legal gray area.
3. Lack of Bipartisanship:  He did not respond to repeated concerns raised by House Speaker Howell or even Fairfax Democrats who also recognized that their constituents would someday be at the mercy of MWAA tolls.

1.  Lack of Integrity

Virginia has a process called the Public-Private Transportation Act (PPTA), which allows vendors to submit a broad range of options.  Tim Kaine said that he favored this business-like approach, or as he called it the “Yellow Pages Rule”:  If government is providing a service that two or more private companies also offer, then government ought to get out of the business. [4]

By December 2005, four companies had submitted competing Silver Line proposals and made it through the first approval step.  One bidder had structured a proposal that gave Virginia $800 million up front, which the Commonwealth could use on other projects.   Using the PPTA process, Virginia could negotiate terms, service level agreements, penalties and performance incentives.   Richmond’s Pocahontas Parkway (Route 895) was a public-private partnership.

However, right after Kaine was elected but before he took office, MWAA went into gear and solicited Kaine directly with a competing proposal [5].  Since MWAA was not a private company, Kaine used this technicality to justify keeping MWAA’s proposal out of the PPTA process that was underway.   The Dulles Toll Road was an extremely valuable asset that was paid for and generating revenue.

As a result, no advisory panel was ever formed to evaluate all of the proposals against each other.  This violated common due diligence practices, as well as the spirit of Virginia’s laws.  Clearly, it was not an objective and agnostic “Yellow Pages Rule” approach.

The Washington examiner summed it up like this:

In fact, there were so many early warning signs that this megaproject would go off the rails that Kaine should have spotted them a long time ago. But he ignored them all. [6]

2. Transparency

While the General Assembly was in session, Kaine continued to conduct his private discussions with MWAA.   Naturally, questions were asked such as “what about the current proposals” and “why would we even entertain a proposal from an organization that has no qualifications in building a transit system?”

But the public will never know what transpired.  The following reviews and checks did not occur:

• No public hearings were held.
• No minutes were published.
• No public comments were accepted and responded to.
• MWAA was not required to meet the minimum qualifications that the other vendors had already passed.
• MWAA’s proposal was never scored and documented against the other competing proposals.
• No vendor post-selection review was held, which is traditionally the end of a government procurement process where losing vendors are provided feedback on why their proposal was not selected.
• No third party analysis or independent due diligence was conducted, which is amazing given the cost and a non-revocable type of arrangement.
• No one asked if MWAA was even permitted to offer the proposal since they were regulated by myriad of airport revenue utilization rules.
• While MWAA used their control of the Access Road property as leverage, in fact the land is owned by the federal government and is only assigned to MWAA.  The federal government can step in at any time and grant new easements or even return the land back to Virginia.

Just before Kaine signed the MOU, MWAA came forward with its first of many cost increases and design cut backs.  The new estimate in March was raised from $1.8 to $2 billion for Phase 1 and another cost analysis was scheduled later in the summer. [7]

Despite questions and the surprise cost estimate increase, Governor Kaine signed a Memorandum Of Understanding on March 24, 2006, which transferred the DTR to MWAA.  [8]

The MOU and MWAA would later be unsuccessfully challenged in court.  AG Ken Cuchinelli later advised that it was legal because there “was no precedent from the Supreme Court of Virginia delineating the precise authority of the Governor in this context”.  However, in terms of a transportation solution, Cuchinelli called the Silver Line an “economic boondoggle”.

Afterwards, Transportation Secretary Pierce Homer provided talking points, which were met with more unanswered questions.  Here is a link to VaCostCutting.com who nicely summarized the concerns. [9]

3. Lack of Bipartisanship

Not unexpectedly, the Republican House Speaker Howell immediately called foul and challenged Kaine for not submitting the MWAA proposal to public review, a PPTA Advisory Board, the Transportation Committee, or General Assembly.

Key Republicans like George Allen and Frank Wolfe said the Silver Line should be built; but they did not support Kaine’s unilateral actions or selecting MWAA.  Frank Wolfe has recently been offering various proposals to deal with MWAA corruption and regain Virginia control.  (Atomizing their MWAA Frankenstein and starting over with an actual transit expert would be a nice warm-up exercise for the new Republican Congress.)

Even the “Jim Moran of Fairfax” and then County Board of Supervisor Chairman Gerry Connolly and Barbara Favola sided with the Republicans on this issue and expressed concern about the potential impact of Kaine’s opened-ended deal on the Fairfax budget.  From day one, politicians foresaw the resulting higher tolls that are now materializing.  But Fairfax didn’t force the issue when they had the chance to do so.

Kaine’s attitude was expressed by his spokesman Delacey Skinner who said,

“The Governor has confidence in the airports authority to do this. That’s kind of the end of it.” [10]

“That’s kind of the end of it” is also a good description of Kaine’s relationships after a contentious first legislative session after which he demanded a Special Session rematch.  Kaine’s first session as governor was contentious because he tried to push through a surprise tax proposal while the Commonwealth was running a surplus due to Mark Warner’s earlier tax increases.  In addition, he led everyone to believe that he would not raise taxes during the 2005 campaign (although it’s more accurate to say that he declined to state, to use a Kaine campaign phrase.)

For a self-ascribed bipartisan, Kaine had the shortest honeymoon in Virginia history and he never again regained the trust or had a productive relationship with the Republican opposition.  This falling out, along with the slowing economy and unemployment probably explains why Kaine jumped at the chance to be Obama’s DNC Chairman during his last year in office.

But then in a final show of Wasserman-style chutzpah, Kaine testified before US House Committee on Transportation and Infrastructure just a month later in May 2006 and offered the following admonition on how to effectively run public-private transportation partnerships.  In his opening statement he said:

“Fourth, the decision to enter into a public-private partnership, as well as the implementation of that partnership, needs to be open to the public.  Protection of bargaining rights and proprietary information can exist in a climate of transparency and accountability.” [11]

Summary

While it is tempting to explore the other Silver Line debacles, to do so would require Ken Burns and documentary level resources.  Suffice it to say that the Silver Line was never about reducing commute congestion.  The number of estimated riders has always been soft and only a fraction of the total daily commutes.  And you have to admit that when the US Department of Transportation tries to pull out of a major project in a Democrat-rich Virginia county, then the project is clearly a bad idea.

The Silver Line will not solve congestion because it is driven by social causes, money flowing to developers and special interests, and most importantly:  getting politicians off of the hook after decades of kicking the can.

So as Virginians watch DTR tolls increase outside of their control, remember how Tim Kaine started this mess and how he set up the deal which left Virginia vulnerable.  If he had followed a transparent process and if had collaborated in a bipartisan manner based on objective engineering data, then a better solution would have probably resulted.  At least Virginia voters would still own their paid-off DTR and they would have the political recourse to change leadership and direction.

And just as the predictions of higher tolls are coming true, remember the other prediction:  that those higher tolls will drive commuters off of the DTR creating an even worse congestion and pollution.

Thank you Tim Kaine.  Your legacy will indeed live on.

References:

[1] Excerpts from Information Paper Traffic and Revenue Study Update and 2012 Process for Establishing Toll Rates, February 2012, CDM Smith.

[2] Mark of Kaine”, McMorris, B. May 17, 2012, The Washington Free Beacon.

[3] “Who Is Dennis Martire?”, May 23, 2011, Bacons Rebellion blog.

[4] “Follow the Rule”, April 9, 2006, The Richmond Times-Dispatch.  Article accessed from VaCostCutting.com on September 8, 2012.

[5] ”Letter to the Governor and Governor-Elect of Virginia”, December 20, 2005. MWAA.  PDF

[6] “Dulles Rail: Call it Kaine’s Katastrophe”, Hollingsworth, B. , May 17, 2011.  The Washington Examiner.

[7] “Dulles Rail Project Faces Cuts as Costs Swell”, MacGillis, A., March 23, 2006, The Washington Post.

[8] Memorandum of Understanding, March 2006, Metwashairports.com. MOU pdf.  Additional MWAA documents on their website.

 [9] “Dulles Toll Road: MWAA v. Private”, April 5, 2006, VaCostCutting.com blog.

[10] ”Opposition Building Over Toll Road Deal”,  Shear, M. and Ginsber, S.  March 30, 2006.  The Washington Post.

[11] “Testimony before the United States House Committee on Transportation and Infrastructure on Public-Private Partnerships”, Kaine, T., May 2006, US House.

Categories: Virginia Politics