It is properly a part of the Executive Branch. We don’t have a separate Authority for every government department, and shouldn’t; an elected representative should have direct management control over the Big Dig.
As frequent BMG writer LeftCenterLeft wrote on their blog:
Finally, there is no good reason for an autonomous Turnpike Authority. The state roads and Big Dig project should be subsumed under the Department of Transportation. If autonomy had positive effects, Iâd say stick with it. Instead weâve got nothing but graft, overruns and shoddy construction. Obviously, public works themselves arenât impossible to do, even with impeccable quality, but Massachusetts has given a textbook case on how not to have a big public project.
Please share widely!
This kind of quasi-gov’t. authority proliferated under the example of Robert Moses in New York in the era of aggressive, neighborhoods-be-damned urban redevelopment (sorry no citations right now). They existed in various forms before that, but the redevelopment true believers seized on them as mechanisms for avoiding democratic accountability. We often take their existence and autonomy for granted, but they have no real reason to exist except as sites of self-perpetuating power.
The reason the Turnpike Authority was created, was the same reason Turnpike Authorities are created across the United States. First States can’t afford to pay cash for the massive construction involved (so must float bonds). Secondly, the institutuion of user fees (tolls) creates a dedicated income stream that can be applied to the borrowing (bonds) needed to fund construction. Third, to make investors happy, and to pay lower interest rates but actually have a higher ROI, these bonds can be made “tax-exempt”.
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And above all it is the responsibility of the Governor to appoint qualified and experienced individuals to these authorities.
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Well yes they could be tax exempt if the state did it also. But, the bonding limit restricts the state from doing all of the projects it might like, whereas the bonding limit is now held against only the Turnpike Authority.
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As the first commenter said, a full explaination of the motivation and many of the concepts can be found in the book by Robert Caro, “The Power Broker” about the career of Robert Moses, and the building of New York City, a man so powerful even the President of the United States could not get him fired.
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The MWRA is a good example of a typical senerio. For years Water Projects just couldn’t get off the ground in the eastern Massachusetts area. They were under the control of too many separate entities. Plus the political willpower wasn’t there to create the rate increases needed to fund the improvements. The compromise? Create and authority (in theory) insulated from political pressure to keep rates down (thereby let the system continue to degrade) and create a legally enforceable rate base to charge off the direct costs in improving the system to meet state and federal laws and regulations. Bottom line, the state had failed, create an authrity to get it done. Downside: lack of direct political control. Notice I said direct.
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So how does that lead us to the Big Dig? Wasn’t the Big Dig constructed under the Highway Department in the beginning? I could be wrong, but I think the issue became one of funding. The Turnpike Authority had the existing structure (legal, staffing, etc.) plus the existing cash flow, so that the Big Dig could be taken “off the books” of the state and put on the books of the Turnpike Authority.
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This problem to me is a design/construction/inspection/oversight problem.
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The proof? Ask yourself this, the next time some state highway bridge comes down (see existing lists of deferred maintenance on state bridges throughout the state, or deferred maintenance in state parks ($750,000,000 parks alone).
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“Deferred maintenance during the decade-long Artery project has created a backlog of hundreds of bridges to repair and other safety projects, yet state officials and the legislature refuse to consider new funding sources. The state gasoline tax has not been changed since 1991, even as its real value has been eroded by inflation, and political efforts have focused on reducing tolls rather than to supporting additional transportation investment” According to the Boston Indicators Project link
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In fact Massachusetts has been graded C- in infrastructure in a comparison done with all 50 states.
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So ironically the Big Dig has caused this giant sucking sound vis a vis statewide bridge maintenance. Gee, who’s in charge of “statewide bridge maintenance”? Can we get Romney on the record once more on how safe state bridges and highways are? Especially now that he’s taking over the Big Dig?
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If you remember, the complaint against the Turnpike Authority was always that it maintained the Turnpike too well. At the end of the day, if this was a Columbo segment, he would be coming back to this simple question over and over again: Q: Who appointed the Turnpike Authority? A: 16 years of Republican Governors.
Though I suspect that the Turnpike Authority has been hideously corrupt for far longer than the past 16 years; there are just a few extra billion dollars availble to skim now.
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Every one of these types of authorities eventually turns into a self-perpetuating monster and is subject to all of the sleaziness that we see here. It was a dreadful idea not to put an expiration date on their existence, and now we continue to pay the price.
If these Authorities are so great, why not put the whole government into one and be done with it. The financial argument is a bit of a canard: the toll revenues could support payments on state bonds just as easily as on Authoirty bonds, all things being equal. Really what these things are is (a) a statement of despair at representative government, and (b) a nice opportunity for a small group of people to gets its hands on a revenue stream without having to worry about getting voted out.
I bet many states (ours?) have balanced budget rules that would prevent the state from incurring the bond obligation. So the authority was a great short term fix for that. Short. Term.
Many areas of state government function without gridlock. Environmental Affairs, Public Saftey, Human Services, and many more. Authorities would be the worst structure to place these service under.
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Either: when there has been political gridlock, for instance they kind that forced the eventual creation of the MWRA. Then an Authority is the appropriate structure.
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Or: when there is massive infrastructure costs, with the potential for a capured revenue stream, such as a tunnel, a bridge, or a turnpike.
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The challenge is to reduce corruption. I don’t think shifting everything to Mass Highways automatically eliminates the potential for corruption. Corruption will “Follow the money”. Massive Corruption will follow Massive Money (look at the War we’re funding).
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How do you legislate “Good Management”, “Integrity”, “Ethical Behaviour”, “Transparency”? Better yet how do you enforce it? I’m all ears if you can think of new innovative vehicles or solutions to these age old problems…
I didn’t mean to imply that you personally were suggesting these entities are “so great.” It was just a general musing.
The only thing I would add to that is the fact that the Pike (and other bonding Authorities) help lessen the debt load on the state government through their bonding authority. It’s a win-win: state gets the projects done and doesn’t have to put the debt on the books while investors get quality, tax-free bonds that have little chance of default (because of the toll revenue stream).
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This is an interesting site with some additional history/info on the Pike.
except the last one happened in 1838.
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“I like my herrings red.”
–gbridgman
Investors want a dedicated revenue stream like tolls – that’s what keeps interest rates low.
For revenue bonds (i.e. Mass Pike bonds), you’re right, revenue is everything; but, for general obligation bonds, there are more factors: (1) debt load (2) revenue (tolls, taxes, etc) (3) economic environment of state (i.e., the wealth of the average household), (4) the diversification of industry in state.
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Mass bonds rate very high with AAA pretty much across the agencies and general obligation issues. There are some agencies with AA, but ALL G.O. bonds and the Mass turnpike bonds are AAA with similar yields.
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Do away with Authority and the revenue stream goes into the general treasury and wouldn’t affect the AAA.
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That’s why I think that the interest cost is a red herring.