Bacon's Rebellion

Democracy Thrives in Sunlight

U.S. 460 Project Implodes: State Suspends Spending

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by

James A. Bacon
in

Aubrey Layne
Aubrey Layne

by James A. Bacon

Having spent $300 million on the U.S. 460 upgrade between Petersburg and Suffolk, the state is suspending contract and permit work on the project until a critical environmental review by the Army Corps of Engineers can be completed. Secretary of Transportation Aubrey Layne made the announcement yesterday.

The Corps has given repeated warnings that it might not be able to issue the necessary permits for the 55-mile project, which, according to Southern Environmental Law Center attorney Trip Pollard, “would destroy more wetlands than any other project in Virginia since the Clean Water Act was enacted in 1972.”

The McDonnell administration had bulldozed the $1.4 billion project forward with full knowledge of the Corps’ concerns. The state has been paying US 460 Mobility, it’s public-private partner, $20 million a month as a “mobilization fee,” according to the Times-Dispatch. It was not clear from press accounts what that mobilization fee was paying for.

“How can you spend close to $300 million of the taxpayers’ money on a project where you don’t even have a shovel of dirt turned, no right of way purchased and don’t have a permit in hand?” Del. S. Chris Jones, R-Suffolk, head of the House Appropriations Committee told the Times-Dispatch.

“I was speechless,” Jones said. “The way it appeared to have been done, the fact that we were at risk, and that we were paying them a fixed fee every month — and they were getting paid without permits,” he added. “I just have never heard of it.”

If you’re looking for a scandal in the McDonnell administration, this is it. As I have long maintained, the focus on former Governor Bob McDonnell’s ethical lapses in his dealings with Star Scientific CEO Jonnie Williams Sr. were purely penny ante. What really needed scrutiny was the administration’s policy of funding mega-projects costing in the multiples of hundreds of millions of dollars, including the Charlottesville Bypass. Virginia’s press corps focused on the shiny bauble while ignoring the dusty chest loaded with treasure.

Layne, a vocal backer of the project while serving on the Commonwealth Transportation Board under McDonnell, said the state had temporarily halted permitting work and suspended the contract with US 460 Mobility Partners. According to the Virginian-Pilot, he said the state is more likely to improve the existing U.S. 460 by adding bypasses and bridges — an alternative that had been ruled out previously. The McAuliffe administration, he said, remains committed to improving the corridor.

This extraordinary development raises fundamental questions about the way transportation policy in Virginia is determined. In theory, the Commonwealth Transportation Board (CTB) exercises independent judgment over projects like this, but board members, including Layne, never provided any pushback against McDonnell’s forceful transportation secretary Sean Connaughton. Basic questions about the viability of the project went un-asked. In an in-depth piece I wrote about the role of the CTB in January 2013, I asked, “Who really establishes transportation policy for Virginia, the Commonwealth Transportation Board or the McDonnell administration?” Even before the environmental-permitting issues had arisen, I wrote:

Not a single board member voted against allocating $1.4 billion, including roughly $1 billion in public funds, to the U.S. 460 connector between Suffolk and Petersburg — even though increased traffic on the highway is not expected to materialize for years and the economic return on investment is predicated upon the proposition that massive industrial development will occur in the U.S. 460 corridor.

For that article, I asked Layne if the CTB were a rubber stamp. He told me: “I don’t consider myself a rubber stamp. I ask questions. I go through the agenda a week in advance. I get on the phone and ask questions. … I don’t see how I could make an intelligent vote on something without doing it.”

His perspective has changed. “I’m much more informed than I was a year ago as a CTB member,” Layne told the Pilot yesterday.

While the McAuliffe administration tries to fix the mess it inherited from its predecessor, the General Assembly needs to give serious thought to a higher-level issue: how to reform the CTB. Virginians need a board that asks the kind of tough questions that the CTB simply isn’t accustomed to asking.

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17 responses to “U.S. 460 Project Implodes: State Suspends Spending”

  1. larryg Avatar
    larryg

    This is pro-forma VDOT – the part of VDOT that does new location roads.

    they hate NEPA and they have utter contempt of the Corps of Engineers and would gladly ignore both if it were not for the FHWA – and I’d bet more than a plug nickel that FHWA sat down with VDOT recently and had a come-to-Jesus discussion with them.

    they have a history of this – up in Fredericksburg with a proposed bypass belt of I-95… in Charlottesville… with the Pocahontas Parkway and the Western Transportation corridor and it’s morphed offspring the Bi-County “parkway”.

    They chew up a lot of time and dollars trying to evade NEPA and FHWA procedures and they have been using PPTA as of late as a shield from public view.

    Many states talk with the Army Corp – at the front of the process and when they are formulating corridors… in other words.. the Corps is on board from the start … this part of VDOT likes to put the Corps last and essentially play a game of chicken in hopes that the Corps will fold… as a “holdout”.

    this is not the way to do roads and someone needs to rein in this part of VDOT.

  2. larryg Avatar
    larryg

    .

  3. Darrell Avatar
    Darrell

    The 460 was one of the few projects down here that kinda sorta made sense. Then the pollys started squawking about adding in all kinds of other stuff like airports and power draining crap that needed a new coal fired generator. Things sat there for awhile before McD went nuts and started throwing his weight around with tolls, taxes, and testiness. Oh and Twenty million a month to pay someone to draw a shovel instead of using one.

  4. larryg Avatar
    larryg

    well I won’t blame it on McDonnell.

    Somewhere in the bowels of VDOT – there was someone who thought this was a worthwhile project and he/she may have been carrying the ball for some public officials or perhaps even private sector folks allied with public sector folks.

    but projects like this don’t move forward without vetting from others inside of VDOT, nor without support from the top guy Connaughton.

    This kind of project probably could been just as easily “born” under a Kaine or Warner or McAuliffe if an agency like VDOT was supporting it including the top transportation chief.

    the route never made sense from the get go – but one or more folks inside of VDOT want that route even though going west on US 58 seemed to make more sense if they wanted to avoid wetlands and connect with I-85.

    This is what NEPA is supposed to do – totally separate from environmental – to have a stated Purpose and Need – then to compare alternatives in terms of costs and benefits – a process that VDOT dislikes…

    they’d rather roll the dice and see who will try to stop them… instead. and if they can use something like PPTA to further shroud the analysis…more to the better.

    This is the part of VDOT that has at it’s heart – road building – and believes strongly that engineers should perform this role and not the public and not other resource agencies. They hew back to the the Robert “get out of my way or I’ll bulldoze you” Moses days.

    it’s a failed strategy… in my view… and while I understand VDOT’s frustrations with dealing with the public and the resource agencies, VDOT seems to forget that they work for the public – they get paid by the public – and most important – whether they believe it or not – they are accountable to the public.

  5. Breckinridge Avatar
    Breckinridge

    I have always accepted the premise that such a highway would be essential to the success of the port in the next half-century, with the massive new ships and the plans for Craney Island. The old 460 should have been upgraded in interstate standards years ago but the localities resisted the bypasses. So a new road made sense, with the extra benefit of an evacuation route. Perhaps it still makes sense, unless you want all that traffic on I-64.

    But I also have a long history of deep skepticism toward this public private scam, where private investors out for the quick score package the deal and then sell the debt with incredible guarantees from the public side (see the profit margins on the HR tunnels). Just who is behind this particular deal, which law and lobby firms, which big money investors, and who has scarfed up the land along the route, would keep investigative journalists going for years — if we had any left. I don’t completely blame VDOT. I don’t think VDOT dreamed up the P3 approach. That was the politicians.

    1. James A. Bacon Avatar
      James A. Bacon

      In this case, there were three P3 consortia pushing the project. All three agreed that the project would not viable without major subsidies. VDOT decided, then, to dump the traditional P3 arrangement in which the private partner built, designed and operated the toll road in favor of an arrangement in which the private sector partner simply designed and built the highway, thus cutting out the need for expensive equity capital. If I recall correctly, VDOT would operate the toll road.

      So, I don’t see the P3 structure of this deal having anything to do with the project’s problems.

      If I had to guess, and it’s only a guess, I think Connaughton figured if he spent enough money on the project, there would be a sense of inevitability about it, and the state would be in so deep, that it would be impossible for a subsequent governor to scuttle the project. My operating hypothesis is that the problem was political, not tied to the P3.

      1. JohnS Avatar
        JohnS

        Jim,
        The problem is that there is no true P3 structure used by VDOT, and certainly not one that is transparent to public scrutiny. How else does this shadowy US 460 Mobility group get paid $20 million a month in taxpayer money to do nothing?

        The story here is that there is big-time corruption going on at VDOT. As far as I’m concerned every mechanism of funding/constructing/ operating these projects needs to be examined with a fine-toothed comb. I’m outraged, frankly.

        1. James A. Bacon Avatar
          James A. Bacon

          “The story here is that there is big-time corruption going on at VDOT.”

          It’s too early to say that there is corruption. We simply do not know what happened. But we definitely need a full explanation of why US 460 Mobility was getting paid $20 million per month, what it was doing for that money, and who made the decisions to pay the money.

    2. larryg Avatar
      larryg

      re: ” I have always accepted the premise that such a highway would be essential to the success of the port in the next half-century, with the massive new ships ”

      it’s plausible but there is a lot more needed for – basically for anything that is being built for an economic reason.

      what are the deficits – existing and prospective?

      where does current port traffic go right now?

      is there port traffic we are missing out on right now because we do not have a highway southwest to I-85, etc?

      can we calculate business lost if we don’t provide the infrastructure that would attract it?

      why would not having tolls on I-64 verses tolls on 460 not be a disincentive ?

      what’s wrong with using US 58 if indeed the goal is to connect with I-85?

      if we don’t upgrade – what ports and routes would be used instead ?

      what specific companies who need port and road transport have weighed in with their support?

      Jim Bacon advocates ROI on roads.. some general purpose, typical -commercial traffic roads may not be easily analyzed in that regard but one that is said to be justified on more on economic grounds – in my view – needs to have a convincing public case – … on the scale and visibility of the Keystone Pipeline -but tailored to Virginia.

      what’s truly odd about 460 is that VDOT was essentially contracting with a private company to provide infrastructure with other private companies which might lead one to ask why it was not a consortium to start with.

      but finally – this looks like the idea solution for freight rail and perhaps even a competitor to freight rail.

      do we know what a road is needed and not rail?

      if not mistaken there is already a rail corridor along US 460 and it is currently used by several companies with distribution centers.

      there are lots of questions like this that I’m not convinced have every been asked or answered that ought to be and such questions would have been dealt with in a NEPA study.

  6. larryg Avatar
    larryg

    part of the allure of the P3 approach to VDOT is essentially evade full disclosure of the projects to the public.

    If there was full disclosure present – we would know things like why follow US 460 instead of other routes … and we’d be able to compare the alternatives in terms of costs, cost-effectiveness, impacts to environment which is the kind of thing you’d get with a NEPA study and essentially allow the Army Corp to lay out their concerns formally so the public could see them.

    I think what has stopped this project is the same thing that has stopped the Cville bypass and the western transportation corridor and that is FHWA requiring an up-to-date (for current conditions) honest NEPA type approach that lays out alternatives and compares them for costs, benefits, impacts, etc.

    In a blog like this when discussing projects like this – there is should enough concrete information available to discuss the project on it’s merits rather than wondering why something was done a particular way.

    From VDOT’s point of view – the full disclosure approach is a good way to kill needed/useful projects by the public / nimby’s / enviro weenies, etc, using a thousand cuts approach to stop a project.

    it has some similarities to the bigger issue of government gridlock in general where the way forward on a given issue can be ground to a halt from opponents who actually have different reasons for opposition but as an aggregate group – they can keep things from moving forward.

    VDOT basically embraced the PPTA approach a few years back and it became apparent almost immediately that specifics about projects were said to be “proprietary”… even to the point of exactly the precise nature of the intent of the project but even worse – a de-facto pre-selection of their preferred alternative without having to show their choice was superior to
    other alternatives.

    Some folks think NEPA is an environment document. It has those elements in it but it has much more than that including the built environment but the real power of NEPA is in requiring alternatives including allowing the public to ask for alternatives to be included for study.

    and for those who like to blame government for being dishonest, corrupt and incompetent – keep in mind that NEPA is a Federally-required approach that is enforced by the FHWA – a Federal Agency that has far more influence over projects that most folks suspect.

    If you plan on using Federal money to construct a project – you have to satisfy FHWA and if you don’t, the average person may never know what a project stopped and VDOT is not amount to tell you.

    The Cville Bypass would be turning dirt right now if it were not for FHWA.

  7. DJRippert Avatar
    DJRippert

    The idea that Virginia will have the only ports with a shipping channel deep enough to handle Post-Panamax ships after the Panama Canal is widened (supposedly by 2015) is untrue. Baltimore can already handle those ships and ports from Philadelphia to Miami are dredging their channels “to beat the band”. Meanwhile, the West Coast ports which can already handle those ships make the very reasonable point that cargo reaches its destination faster when offloaded on the West Coast and then shipped east.

    Does our port really have a sustainable advantage sufficient to justify the expense of Rt 460?

    http://businessfacilities.com/feature-story-racing-to-be-ready-u-s-ports-prepare-for-post-panamax-era/

  8. billsblots Avatar
    billsblots

    His perspective has changed. “I’m much more informed than I was a year ago as a CTB member,” Layne told the Pilot yesterday.
    –
    Read, “The Governor told me what to think if I wanted to keep my job.” Also, why weren’t you more informed a year ago, didn’t you take the responsibilities seriously, or was information being hidden from the CTB members?

    Why hasn’t anyone been looking into exactly what is involved with this God-send “Public Private” relationship? Politicians proclaimed it as the wave of the future and the most efficient way to get things financed and done, yet I don’t remember anyone in the press questioning it. $20,000,000 a month to do what?

    Reminds me a bit of the Commonwealth outsourcing all the transportation centers and safety service patrol around the state for $60,000,000 a year, yet still having to provide the vendor some essential resources.

  9. billsblots Avatar
    billsblots

    There is an important element to the 55-mile 460 bypass other than commerce, that being public safety and the evacuation of Tidewater south of the James. On any normal day crossing the tunnels can become a parking lot, imagine if the mandated evacuation route west for all of Tidewater was the lane-reversed I-64 west.

    Likewise, trying to evacuate west out the current 2-lanes of 460 to Suffolk, Windsor, Zuni, Ivor, etc. would be such a catastrophe that they actually would mandate crossing the tunnels and going west on lane-reversed I-64. I was leaving Portsmouth in the direction of Petersburg on 460 1 day before a hurricane was due in a couple of years ago, and traffic was already backed up 5 miles getting into Windsor. This only took an hour or so but there is no indication that was even due to any evacuation traffic, rather just normal, local milling around last-minute buying milk and eggs traffic.

    This limited access 4-lane 460 would be essential for any hope of evacuating southside Tidewater. As with I-64, turn the two east bound lanes to west bound, and now we’ve got 4 lanes west to evacuate southside, to mirror the lane-reversed I-64 on the northside.

    Trying a large scale evacuation on the current -460 will result in massive gridlock, fights and probably shootings as gasoline, water and food run out while people are stuck with families in hot vehicles for 18 hours on a non moving 460.

    This concept has been used to sell the 460 project and should always be mentioned as rationale for it, but in all likelihood the main force behind this has been visions of a long term, nearly bottomless barrel of government dollars and contracts for the well-connected.

  10. billsblots Avatar
    billsblots

    “The story here is that there is big-time corruption going on at VDOT. ”
    I certainly don’t know specific facts to refute this, and VDOT certainly has earned the constant scrutiny and skeptic’s eye it should get, but my gut feeling is this, technically, was probably driven at levels and by influences above VDOT itself. I doubt even the (previous) Commissioners had much to say whether this was going forward or not, possibly providing some studies or fact finding, but this was probably driven by powerful forces outside VDOT.

  11. salz Avatar
    salz

    Virginia’s 2004 “Rail Enhancement Act” does provide state dollars to aide commercial traffic headed westbound out of Norfolk — but it does it intelligently. Last I heard a couple years ago, Virginia had spent $57 million improving the west-bound rail corridor called the “Heartland Corridor” and had built a rail-truck terminal off I-64 and I-81 intersection so that rail could take imports much closer to consumers before “last miles” delivery. The Heartland Corridor heads furthr into the Ohio River valley and the large mid-western cities.

    Norfolk Southern is trying to get the same concept going along its “Crescent Corridor” to move trucks off the 325 miles of I-81 in virginia. We taxpayers might even end up buying rolling stock for NS.

    Connaughton is the one who was (and perhaps still is) trying to get more dollars for roads, claiming public-private partnerships will create jobs, while ignoring a far-sighted law which was passed before he came into office yet provides more jobs and less pollution.

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    […] U.S. 460 project implodes in Virginia – may never get built after all (Bacon’s Rebellion) […]

  13. salz Avatar
    salz

    Some sobering reading:
    http://scholarlycommons.law.northwestern.edu/cgi/viewcontent.cgi?article=1061&context=njlsp

    http://www.nashtu.us/download/Highway-Robbery-II.pdf

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