Bill Would Ban Public Funds for New Toll Roads : Transportation: Sen. Bill Lockyer accuses private consortiums of ‘dishonesty.’ Two routes in Orange County would be affected.

A bill that may jeopardize plans to build two private Orange County toll roads cleared its first legislative test Tuesday after its sponsor warned that business consortiums backing such transportation projects were guilty of “fundamental dishonesty.”

The Senate Transportation Committee voted 6 to 4 to approve a bill written by Sen. Bill Lockyer (D-Hayward) that would prohibit the consortiums that are building four private toll road “demonstration” projects around the state from using any public money, including land or easements granted at a discount by governmental agencies.

The four projects, worth an estimated $2.5 billion, were selected by the state after an unprecedented competition that invited business consortiums to submit bids for constructing privately funded transportation projects in Northern and Southern California.

Orange County came out the big winner by pulling down two projects--a $700-million, 11.2-mile elevated toll road in the middle of the Santa Ana River flood channel and an $88.3-million, 10-mile toll road reaching from Anaheim to the Riverside County line along the Riverside Freeway.

The county is already planning three publicly financed tollways that would not be affected by Lockyer’s bill. But Orange County transportation officials said Tuesday that the private road proposals, consummated with written agreements earlier this year, could now be in deep trouble.

Lockyer’s bill was changed Tuesday to not only prohibit the use of public money but to prevent the private consortiums from taking over public land without paying “fair market value”--arrangements that are at the heart of the Orange County proposals. Both rights of way are owned by public agencies that are willing to lease the land at a nominal cost to the consortiums.

“It would absolutely kill them,” said Mark Watts, Sacramento lobbyist for the Orange County Transportation Commission. “They (OCTC officials) are going to go bonkers!”

In addition, the Lockyer bill could prevent the OCTC from spending an anticipated $300,000 to help the private consortiums complete environmental impact reports, as well as stifle exploratory talks by the agency about investing $20 million to become a partner in at least one of the private roadways, said Stanley T. Oftelie, OCTC executive director.

At the very least, Oftelie said, controversy over the bill could stall construction on the eastbound toll road that is scheduled to begin on the median of the Riverside Freeway sometime this year.

“If there are fits and starts because of this legislation, that causes us concern,” Oftelie said.

The complications now surrounding the Orange County projects actually are an indirect effect of Lockyer’s simmering anger over what he says was the “fundamental dishonesty” of toll road entrepreneurs who sought the Legislature’s approval for the four projects in 1989 as part of a political deal over the 6-cents-a-gallon gasoline tax hike approved by voters last summer.

Lockyer told the committee Tuesday that supporters of the private toll road backers led legislators to believe that only private money would be used for the projects, which were billed as an unprecedented attempt to let the private sector solve public transportation woes--while making some money at the same time.

But Lockyer said that hasn’t been the case for at least one of the projects slated for part of his district, a $1.2-billion, 85-mile toll road, the first phase of which would stretch north from Sunol in Alameda County to Antioch, on the edge of Contra Costa County.

He said the consortium is now asking local governments to ante up an estimated $200 million in public assessments and garbage tipping fees--requests that he contends are unfair to the taxpayers who would be contributing to the project but couldn’t afford to pay the tolls.

“They came and told us how wonderful it would be to have private enterprise and their creativity and genius and money used to make this happen, when we were unable to in the public sector,” Lockyer told the committee. “And now, almost the first thing they do is try to go and pick up pockets of millions of dollars of public subsidies for their private businesses.

“It just seems to me that we ought to hold them to their own commitments,” Lockyer said. “If they think they’re so good at building roads with their private investment, let them do it and show us that it works.”

Lockyer said local public officials are unable to resist such requests, since most of them are “inordinately influenced by developer politics” and rely heavily on builders for campaign contributions.

But Sen. Marian Bergeson (R-Newport Beach), who voted against the bill, said Lockyer’s measure was “overly restrictive” because it would tie the hands of local transportation officials, who may want to coordinate some public projects with the toll roads.