Plans for Texas' First Private Toll Road Roll On -- and Right Over People in its Path

Mark Haslett

Michael Morris, transportation director for the North Central Texas Council of Governments, which will decide whether to include Texas Turnpike's road in its long-range plans.

In 1913, Texas passed a law explicitly giving private companies powers to build roads wherever they saw fit. It wasn't until 1991, almost as an aside, that Texas lawmakers repealed what they described as "an outdated statute authorizing private corporations to build toll roads in the state." That statute was repealed in a bill that created the Texas Turnpike Authority, the state's government tolling agency.

The repeal didn't apply retroactively. And so, one day before House Bill 749 went into effect, investment banker John Crew formed the Texas Turnpike Corp. under the 1913 legislation that was about to expire.

"If you look at that 1913 legislation it has very broad authorities in it," Collin County Commissioner Williams says. "In recent times, we're not really aware of anybody out there with this kind of authority."

That authority comes with the power to use eminent domain to force property owners to sell, which the Texas Turnpike Corp. promises to use fairly, even though the company has yet to confirm which owners should get ready to pack their bags.

Crew's background is in investment banking at firms such as Dillon, Read & Co. The Texas Turnpike Corp. is just one of many companies he's formed. The corporation is often confused with Public Werks, a consulting and operating firm Crew formed that shares an address with the turnpike corporation.

Crew also has his hand in energy. Republic Power Partners, another one of his corporations, in 2009 announced plans to raise funds for a broad assortment of alternative energy projects around West Texas. The company partnered with the local utility to form a nonprofit, which then issued itself bonds to purchase two existing power plants near Odessa. It was a deal that critics said seemed to benefit the company more than the taxpayers. Facing public criticism, the utility backed out of its arrangement and Republic Power Partners and Lubbock have been fighting each other in court over the broken agreement ever since.

Crew's Texas Turnpike Corp. kept a low profile until 2000. It was then that an industry publication called TollRoadNews reported a corporation that was "previously inactive" presented an idea to the public to construct a private toll tunnel through the middle of Highland Park, underneath very expensive homes.

Unsurprisingly, the wealthy residents hated the idea of a tunnel under their mansions. "The project was not acceptable. People didn't like the project," the corporation's Neal Barker now says.

For the last two years, the face of the newer turnpike project has been Barker, a mild-mannered board member of the Texas Turnpike Corp. and vice president of Public Werks who appears more than happy to talk to reporters and residents about the toll road even as he deflects questions about specifics, such as why his corporation has been pushing to get approval for the road before telling people the exact route.

Barker describes his idea for the toll road as if it came on a whim. On drives down I-30 to visit his family in Sulphur Springs, he says, it occurred to him it would be good to have another route. He looked at a map with the old NETEX right-of-way and saw the possibilities. Barker showed the idea to Hopkins County Judge Cletus Milsap, a NETEX board member and family friend (Barker says Milsap lives next door to his uncle). Milsap liked it. So did Hunt County's John Horn and other officials in Hunt County who said they wanted a faster route to Dallas. In 2011, before many people even knew about the project, the NETEX board agreed to lease the right-of-way to the corporation.

The project, now called the Northeast Gateway, is supposed to span 27 miles from the President George Bush Turnpike to Farm to Market Road 1570 in Greenville.

Barker has told city councils that he expects construction to cost around $500 million and has promised that taxpayers won't be on the hook for any of it. But private toll roads have a poor track record in Texas. At a Rockwall meeting this year, minutes show that when a council member asked what tollways in Texas have been entirely privately funded and have been successful, "Mr. Barker indicated that there have not been any so far."

In 2012, TxDOT partnered with a private company from Spain called Cintra on a toll project stretching 41 miles on State Highway 130, between Austin and Guadalupe County, near Seguin. The tolled section has an 85 mph speed limit that the company had said would be appealing to truckers and others trying to escape congestion on I-35. Yet in late 2013, the credit-rating company Moody's said that traffic in that stretch was less than 6,000 vehicles a day -- one-eighth the highway's capacity. In June, Cintra filed for bankruptcy on another toll road project it operated in Indiana, and Moody's predicted that the S.H. 130 would soon default on its loans.

Barker's background is in business consulting, he says, but he ended up in transportation because he wanted to try something new. His father-in-law is Stephen McCullough, the former city manager in Irving who moved over to the Texas Turnpike Corp. to work as an executive. Barker followed McCullough to the company five years ago and spent the last two focused on his own turnpike idea. "It's been a whirlwind kind of education in that in a couple of years," Barker says.

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