Horizon, Host: Ted Simons

March 25, 2008


Host: Ted Simons

Toll Roads


  • A bill that would allow three Arizona counties to set up toll road authorities is making its way through the state Legislature. The bill would also allow the counties to enter contracts with private companies to build toll roads. HORIZON will discuss the pros and cons of the bill.
Guests:
  • Jay Tibshraeny - State Senator
  • Tom O'Halleran - State Senator


View Transcript
Ted Simons:
Tonight on "Horizon," Arizona lawmakers are working on a bill to allow toll roads in our state. We'll discuss the pros and cons of that issue.

Ted Simons:
Plus if you are getting ready to purchase a car or make other consumer transactions, our state attorney general has some tips for you. Those stories next on "Horizon."

Announcer:
Horizon is made possible by the contributions from the "Friends of Eight," members of your Arizona PBS station. Thank you.

Ted Simons:
Good evening. And welcome to "Horizon." I'm Ted Simons. Only one of three toll road bills introduced in the legislature this session made it past all the roadblocks as of today. The senate killed one earlier today that would have allowed the Arizona Department of Transportation to enter into partnerships to build toll roads. A bill by Senator Jay Tibshraeny is still alive. That one would allow special authorities to be formed in the state's three biggest counties to work with private companies to build, finance and operate toll roads. Here to talk about the pros and cons of that bill and toll roads in general is Senator Tibshraeny and Senator Tom O'Halleran. Gentleman, thank you both for joining us. Welcome to Horizon. Jay, let's start with you. Let's get philosophical first, and then get to the nitty-gritty. Where would the toll roads go?

Jay Tibshraeny:
There's a few areas they could go. One important point that we need to make is, right now, the state is at a crisis in terms of transportation needs. The demands of the transportation system are far outpacing the funding and the building of the roads. The particular proposal to involve and activate the private sector is something I think we need to do to build some roads quicker than they were going to be built and also I think with this issue going on right now it might supplement some plans that are going to be released shortly. The long and short of it is, there's a couple of areas of key transportation and corridors that could be used. I think on a limited basis toll roads can work, but the Hassayampa on the west side, the I-10 bypass from Tucson to the west side of Phoenix, Pinal county has a few transportation corridors, that may be candidates for this.

Ted Simons:
Can you see, Tom, I-10, especially Tucson to Phoenix, but then you've got that I-17 question as well, but let's start with Tucson to Phoenix. Can you see that as viable with a toll road?

Tom O'Halleran:
I don't know about being viable under the current bills that I've seen at the legislature. There's number of issues. Bonding issues that are within all three of the bills. The issues about what role does growth and the development industry play and pay for our roadways versus just the citizens of Arizona, the people that are really making money off these extensions of these road? How are we going to develop the private partnerships? What are they going to bring to the table? None of that has been clearly identified to date in any of the bills. And an analysis, a complete analysis, of what has been going on throughout our nation, to be brought to us and policy makers and be able to identify clearly the options that we have before us. I appreciate Senator Jay Tibshraeny bringing the bills forward at this point as a discussion point, but to move forward without a complete analysis I would find problematic for almost anyone.

Ted Simons:
Are those kinds of analysis points; are they again viable at this stage in discussing something as complicated and complex as toll roads? I mean, can you get more than what's being offered right now?

Tom O'Halleran:
I think what you can do is do the best job that you can in putting the agreements together. If we are to have toll roads, I don't know if we have to yet. That's to be proven. We need a comprehensive package. Toll roads, as Senator Jay Tibshraeny identified, are only going to make up a small percentage - maybe 10, maybe 15\% of the long-term need of roads in this state. We are behind $40-plus billion. That's behind. We will build $20 billion in roads and we're still short 40 billion. We have a tremendous issue in front of us. I want to see a comprehensive package brought forward: toll roads. If we are going to raise taxes on citizens, let's be honest with them and identify for them why they have to pay additional taxes and who else is going to share that burden with that taxpayer that lives in that home and has to commute to work.

Ted Simons:
Can something be crafted more comprehensively that would address some of those concerns?

Jay Tibshraeny:
Any comprehensive plan is going to be put out to the voters at some point, whether it be sales tax or gas tax, although I heard polling on that is very poor right now, maybe impact fees the governor may be unveiling. So I don't know. I don't think my plan for limited toll authorities is mutually exclusive of any plan that comes forward in the state. Like Tom mentioned, it's 10-15\%. It can mesh into any plan. If we wait for a plan to be unveiled and a plan to maybe get out to the elector and a plan to be voted on, we're not talking about $40 billion shortfall in transportation needs, we'll be talking about an $80 billion shortfall in transportation needs. This discussion is good but I also think we need to do something to start addressing some of these corridors and activating the private sector help us with a problem we're having with the funding of building roads.

Ted Simons:
What was the problem with ADOT getting more control over this as opposed to local municipalities?

Jay Tibshraeny:
I don't know what the problem was with ADOT on the other issues. I know on my bill, which I've worked hard on, I think a lot of people have confidence in their local governments and maybe even their county governments. Those local and county governments will be very involved with the formation of the authority. They will have accountability and a lot of accountability to put elected officials on the authority to oversee it. The accountability factor is very important. The statewide issue with ADOT, I'm not sure where that was going to go. I know with my issue more local control begs the question the public has more confidence in that.

Ted Simons:
Does it sound better to you to have more local control as opposed to ADOT overriding?

Tom O'Halleran:
I want to see a comprehensive state-wide plan. In fact, the local control feature that is in the Tibshraeny bill clearly identifies that the local entities can shift some of their bonding burden over to the authority that's created, opening up more bonding capacity for those cities, towns and counties and thereby circumventing some of the protections we have in law today and increasing -- what they can pay for. I have a problem with that and I think most citizens would. Not that it can't be changed. This whole concept that these entities are going to be created to compete with the rest of the state on prioritization of projects and competition for federal monies. That's problematic to me. I think there's a state board for a reason and that's to create a fair environment across the state of Arizona and a comprehensive plan that we don't expect to piecemeal. ADOT has some level of control in this process. But I would rather see and be more comfortable with the statewide authority that deals with this in a comprehensive fashion.

Ted Simons:
Jay, it seems as though we were hearing about a freeway around South Mountain 10-some-odd years ago. It sounds as though maybe one company bid and it wasn't even close to getting the job done. Are there companies out there willing to do the job?

Jay Tibshraeny:
There is legislation on the books currently to build a toll road. But the legislature got so involved and I know Tom talked about legislature oversight, there was so much legislative oversight in that bill that the private sector said, "This is not workable." That's why I drafted this that is workable, and would allow the private sector to come in and build this. We would not be competing with the state legislature for federal funds. We told them, and it's in the bill, that we will not supplant funds. It may actually help the state get more federal funds by having other entities go after them. It will also have to go through the mag and pag process in terms of getting approval. So there are a lot of controls in on this. But the current statute in the books is unworkable. We're trying to get a statute in the books that actually somebody, some company, can come in and work and actually build roads and help move some traffic around.

Ted Simons:
Is it your feeling that, with the right statute, there will be a company willing to do this? Because this is all a wonderful conversation, but if you can't get anyone to build a road or to take that risk, nothing happens.

Tom O'Halleran:
There's billions of dollars worldwide that are going to be helping build infrastructure whether it's roads or sewers or water lines across our nation and all over the world. It's a way for them to make money and it's an appropriate way for them to make money if it's fair to the taxpayers. Part of what Jay just said goes directly to the issue I have. How do we allow this process to occur that's fair to the taxpayers? This bonding authority would have to have a formula to identify maintenance issues and increasing costs and escalating costs and making sure the partners in the process got a fair and equitable return on their investment. I have been and lived in areas where the toll roads were built. The promise was in the past when we paid for the toll roads, the tolls will go away. They have never gone away. They have only increased. I want to make sure that as we pass the legislation on, I agree with Senator Jay Tibshraeny that the legislation we have now is unworkable. But as we pass this legislation on, as we pass it on like today, I don't think we have done our homework to the level we have before we allow the agency to take over a very complicated process without identifying the criteria and identifying the protections for the taxpayers that should be put in place.

Ted Simons:
What is the alternative in terms of getting roads built in Arizona?

Tom O'Halleran:
I think there's going a time shortly where we have to be honest with the citizens of this state. Growth in Arizona has been mismanaged. It's been mismanaged terribly. We are short, as I said before, 40 billions of dollars. Somebody's going to have to look at the taxpayer, those that are in leadership and elected positions and say, folks, it's about time that we start to talk about where we are going to get the revenue stream for the next roads that will deal with the economic viability of this state. This is a critical piece of infrastructure for the state of Arizona and the type of growth that we project into the future. That's going to have to be paid for by somebody and it's going to be the taxpayers one way or the other.

Ted Simons:
Jay, with that said, how do you get the message across? It's Arizona, we don't have toll roads, lots of folks came from states that had toll roads and they don't like them, they don't want to see them. How do you get the message across?

Jay Tibshraeny:
I think as people start paying more for gas, start sitting in traffic longer, have longer commutes and there's no alternative offered by the state, they are going to say what else can we do to move traffic? I think that's why tolls will be on the table in certain locations. But it will become this frustration that we're already seeing with longer commute times and the public will say I'm interested in looking at that option. Obviously if that option is not economically viable for the person that is going to use that road, they won't use it and the operator won't build the road. It's a balance thing in itself and I think that's part of the contract. You try to make this something that works for all sides. If it doesn't, nobody will use the road and the state may end up with a free road.

Ted Simons:
Gentleman, thank you so much for joining us. Appreciate it.

Ted Simons:
March is Consumer Protection Month. Arizona Attorney General Terry Goddard has been talking to the public about avoiding consumer fraud. The message to learn the financial facts of life goes out particularly to young consumers. Pointers include making smarter money management decisions using credit wisely and building a solid financial future. The Attorney General will join us in a moment. First, Merry Lucero spoke with one valley consumer with a financial dispute that drove him to take action.

Merry Lucero:
Brian Becker's auto lease was up and he was in the market for a car. So he checked out the deals at Bell Honda in Phoenix.

Brian Becker:
I hadn't decided if I was going to go with another Honda, but it seemed like after looking around they gave me a better deal.

Merry Lucero:
He got the car and the lease price he was looking for.

Brian Becker:
The sales experience was good. It was better than I expected. The problem started with the finance department. I had never had that experience where they take you into the back, like, business offices type of thing into a private office and you're with one person there and it's videotaped and where you can't see the computer screen and they are shuffling papers.

Merry Lucero:
After several hours at the dealership, Becker was worn down. That's when the options started coming out.

Brian Becker:
Five different options, the gap insurance, the tire maintenance, the expanded alarm option and glass coverage and a maintenance agreement -- I thought the prices were outrageous, of over $20 a month for each one of them individually and the gap insurance was, he told me, $55.

Merry Lucero:
Becker says he agreed to gap insurance.

Brian Becker:
It's Friday night and it's probably 9:00 at night and I couldn't call my insurance company. So I thought to make sure I'm covered over the weekend and he told me it was refundable. I could cancel the gap insurance at any time he told me. So I thought, "Okay, I'll go ahead." Well, he said that he would get me the gap insurance for $53 a month, and as I'm thinking about it, he says, "I'll just throw in all the other options free. And all of them are refundable. You can cancel at anytime."

Merry Lucero:
Monday morning Becker discovered he did not need the gap insurance. He says he tried to cancel it with Bell Honda but got no help from the financial manager.

Brian Becker:
I felt he was just trying to bully me into this. And at that point he refused -- refused at all to help me resolve this. And never returned any of my phone calls ever again, was not there whenever I stopped in. It took several weeks and to the point that I was getting nowhere on this.

Merry Lucero:
Becker eventually turned to the state Attorney General's Consumer Protection and Advocacy Office.

Brian Becker:
That worked. Because it probably was only a couple of weeks later and I received a letter from them that they had gotten my email and were looking into this. And it was followed shortly after with a check from Bell Honda.

Merry Lucero:
The refund from Bell Honda more than $1,900. That's the charge for the gap insurance, $53 a month, for the entire 3-year lease. Although his monthly payment is still higher than he originally wanted, Becker was satisfied with the resolution and will likely look for his own financing before he goes to lease a car in future.

Ted Simons:
Bell Honda did return our call. They said Mr. Becker's case had been resolved and they would not talk about his complaint. Joining me now to talk about consumer issues is Arizona Attorney General Terry Goddard. Good to see you again. Thanks for joining us.

Terry Goddard:
Great to be here. So glad Mr. Becker got it resolved.

Ted Simons:
That's a success story there. March is Consumer Protection Month. Is this time of year especially bad?

Terry Goddard:
It's hard to pick out any particular month. March characterized by March Madness and a few other things. No, I don't think it's a particular target for consumer fraud but it certainly is a good time to remind people of what it takes to be financially literate, financially aware and hopefully keep from Arizona consumers from being scammed.

Ted Simons:
Is there anything going on right now that you see this time of year more than others, maybe door to door kind of fraud? These sorts of things? The weather's nice; it's easier to walk door to door than it would be in the summer.

Terry Goddard:
The weather's nice and monsoon always brings door to door repair scams. This time of year you have the people what want to fix your roof or fix your driveway, because they just happen to be in the neighborhood with a lot of what they say is asphalt, turns out to be paint. That's the kind of thing we do see year in and year out. But this year, unfortunately, the big issue is mortgage fraud. We are now unfortunately many people who were scammed years ago are finding out because the teaser rate has expired and they are now readjusting to a higher rate than what they thought their mortgage was is not in fact what its doing and there's a lot of distress.

Ted Simons:
How many times, when you have a case like this, is it just a question of someone not reading something as opposed to being told something blatantly false?

Terry Goddard:
In the case of mortgage fraud, it's generally not reading because they took the word of the salesperson. If I have any sterling advice it's, whatever they tell you, the binding item is in the document. So they can tell you it's black and if the document says it's white, that's what the courts are going to enforce. So if it's your brother-in-law or a good friend, or just someone you trust, please park that at the door and still read the documents. A lot of times, and we hear it all the time at the AG's office, the salesman will say one thing as to an important detail like an interest rate or even the term of the payment or term of the loan and it'll turn out that what they signed was completely different.

Ted Simons:
For folks who are just simply allergic to legalese, they see a paper and the minute there's a "wherefore" or a "whatnot", that the eyes glaze and they just give up on it. What do you suggest? They are looking at a home right now, maybe their first home, but the documents just scare them to death.

Terry Goddard:
Well, you are going to have to get through it one way or another. There's some great credit counselors out there, there are non-profits that HUD that has authorized to do the work. That's one place to turn. Another one, if you don't want or think you are not up to reading the fine print, bring somebody with you who will. A trusted friend. Somebody who doesn't have a piece of the deal. Unfortunately too often people, because some of these sales folks are the best in the world, they make you believe they are on your side but unfortunately their commission comes out of how much they are able to charge you. We find, over and over again, that people say things that either are totally untrue about the loan they are asking you to sign or they kind of shade the truth and they just skip over points that are very important.

Ted Simons:
Tough economy right now. Are we seeing more get-rich schemes?

Terry Goddard:
We are, We are. The business opportunity schemes are increasing. Tomorrow we are going to do an announcement of a program called, "The Seniors Strike Back Program," where we analyze ten thousands pieces of what you normally call junk mail or solicitation mail that seniors got in Arizona. One of the big hooks is make money at home with no effort. You have seen many of them and I'm sure you hear them on the radio, you hear it everywhere. I encourage people to be very suspicious because you don't make something for nothing. We had the portal -- the web portal scheme recently where people were guaranteed, supposedly, that for a small franchise fee they could open a web portal and they'd make millions. Well, there are a lot of details that we could go into, and it didn't work out that way.

Ted Simons:
Arizona consistently ranks near the bottom in terms of consumer fraud. There's just a lot of it going on in this state. Why is that?

Terry Goddard:
Well, there are a number of reasons and it's hard to be too specific. Identity theft and consumer fraud tend to go together and I assume that's one of things you are referring to. We are very high on identity theft, partly because of the proximity to the border, partly because of the relatively affluent senior population who unfortunately tend to be targets of scam artists and, for whatever reason, maybe it's the relatively transient population, people tend to be more vulnerable in this state. At least the scam artists think they are, the way they are constantly at it. Our office is besieged -- we average 40,000 calls a year of people who believe they have been scammed and calling the AG's office to try to, as Mr. Becker did in this call that you had the piece on, to try to find some relief.

Ted Simons:
What kind of success have you seen so far in terms of recovery and refunds, those sorts of things?

Terry Goddard:
Last year we recovered almost $4 million for consumers. We are proud of the record. We can't always get money back and sometimes there isn't a fraud that's been committed. But nine times out of 10, or very frequently, we are able to resolve the problem just as you had in the piece about Mr. Becker. That's something we're very proud of that; we have some excellent people that work on those cases and try to get them resolved.

Ted Simons:
I know your office is, obviously, very focused on this. Does the state need a dedicated consumer fraud office?

Terry Goddard:
Well that's the AG's office, under Arizona state law. The Consumer Fraud Act is the piece of legislation, and it's a good piece of legislation, that is enforced by the Attorney General's office. We could certainly use more staff and that's something I'm always at the legislature trying to convince them that this is something they need to be far more dedicated to. But in terms of, and one of my challenges constantly is to make sure that people know that we're the place to call if you have a consumer fraud issue. Or go to our website: azag.gov, where we have a lot of very good, current information, first on how to avoid a scam, and then second, unfortunately if you are the victim, what you can do about it. It's not always our office, sometimes it's the department of insurance, sometimes it's the registrar of contractors, sometimes it's one of the other state agencies or federal agencies that are particularly empowered to help out a consumer. But unless you ask, you may never find that helping hand.

Ted Simons:
On the screen right now you can see phone numbers and you can see a way to get in touch with the Attorney General's Office regarding consumer information and complaints. I know you are also very interested in young adults and the fact that they are targets. Talk to us about this and a very nice-looking publication.

Terry Goddard:
We just did a new publication: a consumer guide for young adults, which is something that initially we didn't want to do; I didn't want to do. Because it seemed to me that we'd seen the problems of seniors so often. I was under the misconception that they were the primary target for the artists. Frankly everybody out there, including you and me, have somebody who's interested in targeting us and nobody is exempt. And young adults just entering the market place, 18-22 years old, are in a particularly vulnerable situation because they are just establishing credit for the first time, they probably don't know the ropes yet. They are getting besieged with, at least today, this may not last much longer, but they are getting credit card offers in the mail and sometimes directly on campus. That's fraught with all kinds of peril. You can destroy your credit rating before you even get started if you use credit in the wrong way, right there at the beginning. The reason for this publication is to hopefully make sure that young adults get off on the strongest possible footing.

Ted Simons:
Things like cell phone contracts I would imagine would be huge?

Terry Goddard:
Cell phone contracts. Leasing agreements and many young people don't know what their rights are in the Landlord-Tenant Act; they don't know what their obligations are vis--vis their roommates. If their roommate isn't on the lease and they decide to leave in mid-semester, you may end up paying for two. And that's something that many people get caught up on. They may not realize that there's a difference between an annual lease contract and a nine-month, or school-year lease, contract and again some people end up paying for that extra three months and not being able to use the apartment. There are lots of pitfalls out there. They are not illegal. Most of this pamphlet is talking about common sense; it's not necessarily talking about fraud in the marketplace.

Ted Simons:
With everyone, it is the common sense. The toughest thing to do is tell, especially a senior, its okay to hang up on someone.

Terry Goddard:
That's true. Senior citizens often believe that this is impolite and you don't treat people that way. We have a slogan, in fact a handout, in our office that says, "It's okay to hang up. Just say no." Frankly in some of my counseling of the seniors, sometimes you have to be rude. Somebody is on the phone, they're trying to sell you something, and you don't want it. You don't have to say yes. I hope more people are first suspicious. A little reasonable skepticism goes a long way in protecting you from consumer fraud.

Ted Simons:
Thank you so much for joining us.

Ted Simons:
The state schools chief says it will take an extra $40 million to educate Arizona's English learners. Others say $300 million is more like it. Why the huge difference? Find out tomorrow evening, at 7:00, on "Horizon."

Ted Simons:
Please visit our web site at azpbs.org/horizon for video and transcripts of the program. That's it for now. I'm Ted Simons. Thank you so much for joining us. You have a great evening.

Announcer:
Horizon is made possible by the contributions from the "Friends of Eight," members of your Arizona PBS station. Thank you.

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