In This Issue

	I-10 Stimulus Contract Raises Questions
	Bill to Stop ‘Hot Fuel’ Reintroduced
	Conn. Legislators Override Rell’s Transportation Bill Veto
	ITD Director Speaks about Termination
	Competition Steep for High-Speed Rail Funding
	State tries New Bid Method to Stretch I-15 Funding
	Local Calif. Officials Fume over Denied Tax Revenues
	Illinois Spends Stimulus Cash on Repairs
	Cities Spike Parking Fines to Increase Revenue

I-10 Stimulus Contract Raises Questions

The bid process in a top Arizona stimulus project is raising questions from a bidding firm about why DOT officials used only a verbal agreement when awarding the $21.8 million contract last week. Bids for the project to widen six miles of I-10 in the west valley resulted in a formal protest regarding a yearlong agreement between top ADOT officials and the lowest bidder, Tempe-based Fisher Sand & Gravel Co, DBA Southwest Asphalt Paving.

Three days before bidding on the I-10 job, three top executives at Fisher pleaded guilty in federal court for filing fraudulent tax returns and face sentencing next month. Bidding companies are required to submit a written explanation if they are involved in court proceedings associated with fraud allegations. Fisher submitted its I-10 bid by computer, but the ADOT system did not allow the fraud case disclosure to be submitted with the bid. ADOT officials, who have known about Fisher’s legal trouble for a year, allowed the company to fax a paper appendix. Fisher officials have bid on about 40 ADOT contracts over the past year, following the same procedure every time and were awarded about $45 million in contracts over that time.

In the complaint, second lowest bidder, Phoenix-based Pulice Construction Inc, claimed Fisher did not disclose the fraud case and state highway officials did not follow procedures. A criminal conviction would not prevent Fisher from winning the highway contract, as the lowest bidder, the company would have won anyway.

Pulice is concerned over ADOT’s side agreements with Fisher about how to file, thus creating an uneven playing field for the state’s second-largest federal stimulus project. The Arizona Transportation Board and ADOT recommended awarding the project to Fisher after hearing July 10 to hear Pulice’s objections. ADOT plans to sign the contract on Monday.

Bill to Stop ‘Hot Fuel’ Reintroduced

A bill to stop the sale of ‘hot fuel’ at retail pumps has been re-introduced by a U.S. Senator in order to force oil companies to monitor fuel temperature and install automatic temperature compensation devices on pumps. U.S. Sen. Claire McCaskill, D-MO., originally introduced the Future Accountability in Retail, or FAIR Fuel Act in 2007, but it did not move forward.

Oil companies, refineries and wholesalers calibrate their sale prices to themselves for hot fuel, or fuel sold at temperatures higher than 60 degrees, which is a benchmark in place for years. Currently, retail prices are not compensated for temperature changes. Under McCaskill’s bill, retailers would be required to install automatic temperature compensation devices on pumps within six years, and would receive financial assistance and incentives to cover the cost.

Hot fuel costs consumers approximately $2.57 billion a year at current fuel prices, according to a press release by McCaskill. She also noted that Canada retailers immediately implemented temperature compensation devices on fuel pumps 15 years ago when they found they were losing money because of ‘cold fuel.’

Conn. Legislators Override Rell’s Transportation Bill Veto

Lawmakers in Connecticut overwhelmingly voted to override Gov. M. Jodi Rell’s veto, allowing a comprehensive transportation bill to move forward, including passing several new laws. Two weeks after the governor’s veto, the House and Senate again approved the bill, which authorizes a $500,000 study of electronic border tolls. The controversial measure caused early opposition among some legislators; however, the transportation department said the study will be delayed because 178 transportation employees have taken an early retirement to reduce an estimated $9 billion deficit.

Rell objected to the wide-ranging transportation bill because she said it gave the state unnecessary authority to stop municipalities from dissolving and reorganizing port authorities in their jurisdiction, and because the bill contained a program to rename state roads and bridges, which she considered nonessential, given the state’s financial condition. “This was not a bill that was critical to the DOT’s mission in any way, which I think was her central objection to it,” said Rell spokesman Rich Harris.

ITD Director Speaks about Termination

IDAHO FALLS – Idaho’s former transportation department director Pamela Lowe, who was fired on July 16 by the Idaho Transportation Board, says her removal may violate state law. ITD Board Chairman Darrell Manning said the change, effective July 31, was necessary for the transportation department to improve operations and relations with the state legislature. Manning said the board had discussed Lowe’s future with her over the past several months. The ITD director differs from other Idaho agency directors, which are appointed by the governor, because he or she is chosen by the seven-member ITD board.

Lowe, who served as department head for the past two years, says she was not given a reason for her termination, and state law mandates that the ITD director can only be removed for inefficiency, neglect of duty, malfeasance or nonfeasance in office. “There was nothing specific,” said Lowe. “I think there’s a possibility that (my firing) may not be legal…And if it’s not legal, then I will take appropriate action.” Lowe is currently on administrative leave until the termination takes effect July 31. Deputy Director Scott Stokes was named interim director by the Idaho Transportation Board.

Competition Steep for High-Speed Rail Funding

Federal rail officials have been flooded with 278 applications for high-speed rail grants from 40 states and the District of Columbia desperate to get a piece of the $8 billion federal stimulus funding for rail projects. The U.S. Dept. of Transportation’s Federal Railroad Administration reported that as of July 16, “pre-applications” totaled $102 billion. Some states submitted multiple proposals; California requested the highest amount – its applications totaled $24.2 billion to help pay for a $40 billion, 800-mile rail line.

The $8 billion grant funding will be supplemented by $4 billion in high-speed rail funding the House Appropriations Committee included in its fiscal 2010 transportation spending bill. That amount is quadruple what President Obama requested.

DOT Secretary Ray LaHood acknowledges the program's limitations. “We know we’re not going to fund all the high-speed rail with tax dollars,” he said. “Some of it’s going to have to be private investment. And we know there are private investors out there that are ready to do that.” FRA says pre-applications from New York, California and Nevada include funding from “non-public entities.”

LaHood says foreign companies are already expressing interest in the program. “I guarantee you those companies that have been involved in high-speed rail in Asia and Europe are in America right now meeting with the folks that are putting proposals together to tap into our $8 billion,” he said.

278 applications with a value of $102 billion vying for $8 billion in available funding is staggering by any measure. California alone needs three times the available money. A lot of expectations are being raised that won’t be met unless more money is diverted to this program. TW

State tries New Bid Method to Stretch I-15 Funding

Highway officials in Utah are trying out a new set of rules for three major contracting teams bidding on the most expensive highway project in the state’s history. Instead of the traditional method of competing for the best price on a set project, bidders will contend to provide the most value for a set price. In the case of the I-15 project, that price is $1.73 billion.

The proposal's design will play a key role with the Utah Transportation Commission in determining how many lanes will be added to the freeway and how many miles will be included. State transportation officials hope the method will be more efficient in the difficult economic times. “When your needs exceed your budget, it gives you a chance to stretch your scope as much as you can,” said Dal Hawks, Utah Department of Transportation I-15 Project director.

Growth projections for Salt Lake and Utah counties combined with the deteriorating interstate built in the 1960s call for I-15 to be rebuilt and widened for 43 miles, from Sandy to Payson, which would cost over $5 billion; the Legislature bonded just $1.73 billion. UDOT plans to begin the expansion in American Fork and go as far south as the contractor is able, but at least as far as Provo. The project is expected to be completed by 2014.

Missouri was the first to try the “fixed-price/best design” bidding process for the urban St. Louis segment of I-64 under state department of transportation director Pete Rahn. The project reportedly slashed $200 million from the project and was able to get 98 percent of the original design.

The St. Louis experience has been very positive; MoDOT is pleased not only with the product being constructed but also with the team that is doing the job for them (Granite, Millstone Bangert, Fred Weber, and Parsons). UDOT is likely to have the same success-- this is a model that will be followed on more and more projects. In the spirit of disclosure, I provide partnering facilitation services for the I-64 project. TW

Local Calif. Officials Fume over Denied Tax Revenues

SAN FRANCISCO – state lawmakers are working to iron out details for California’s long-delayed budget, but local leaders throughout the state are heavily criticizing the plan, which depends heavily on cities and counties to fill a $26 billion budget gap. Some are vowing to fight the deal in court; the Los Angeles County Board of Supervisors plans to sue the state to keep it from withholding billions of dollars in highway tax and redevelopment funding.

California lawmakers agreed on a deal this week that includes approximately $15.6 billion in cuts, $4 billion in revenue from places like sale of state property, $2 billion in borrowing from local taxes and $3 billion in accounting maneuvers. Many local officials are appalled that legislators would pull from local funding when most municipalities and counties already face deep budget cuts and plummeting tax revenues.

“They’re stealing $1 billion in local government gas taxes,” said Paul McIntosh, the executive director of the California State Association of Counties, a nonprofit lobbying group. “They don’t have the legal authority to take those revenues. I think that’s the definition of stealing, isn’t it?” Los Angeles County board chairman Don Knabe said the county could lose up to $600 million if the state is permitted to co-opt highway and redevelopment dollars. “It’s frustrating when you try to do the right thing and you get the lion’s share of pain, Knabe said.

Illinois Spends Stimulus Cash on Repairs

CHICAGO – Illinois is spending the vast majority of its federal stimulus dollars on projects approved to fix crumbling infrastructure across the state. Watchdog groups praise the approach as the most efficient use of stimulus funding. Illinois received $935 million out of the $27 billion designated for road and bridge projects nationwide in President Barack Obama’s economic stimulus bill signed six months ago.

New data on Illinois spending shows that out of 340 projects that have received money so far, almost 250 have been repaving projects, including more than 30 projects from the federal list for bridge repair, and upgrades to fix some of the state’s hundreds of aging bridges. Six projects were categorized as bridge replacements while one project has been approved to build a new bridge.

Cities Spike Parking Fines to Increase Revenue

Municipalities across the nation are ramping up parking enforcement and hiking parking fees to boost declining revenue. California imposed a statewide $3 charge on municipalities beginning Jan. 1, 2009 for parking citations, added to the former $1.50 charge. This has led many cities to increase fees as well. In June, Santa Monica raised parking fines from $40 to $50, Berkley from $35 to $40 and Sonoma from $20 to $40.

Officials in Yonkers, New York increased parking fines in June to help pay for its $900 million budget, says David Simpson, a city spokesman. Overtime parking fines will rise to $50 from $40, and no-standing fines will increase from $50 to $70. The increases are expected to bring in an extra $1.2 million in revenue, Simpson said.

Washington, D.C. plans to install cameras on street sweeping equipment to issue citations to people who do not move their cars, says Erica Stanley, a district spokesman. The cameras are expected to generate an additional $6,828,000 after maintenance. An additional 52 parking control officers have been hired as well.