2060 PERMITTING ISSUE CASE STUDY
Prior to the 2013 Legislative Session, the Texas Department of Transportation (TXDOT) reported to the Texas House Resources Committee on the impact of heavy truck traffic in the energy producing regions across the state, including the Barnett Shale, Eagle Ford Shale, and Permian Basin. Local county officials were pushing this issue due to concerns over road damage from oil and gas production and asking for financial relief.
TXDOT observed that the current 2060 permit (oversize/overweight) had not been increased in several years. The average fee was $250.
Due to concerns internally with the Trade Associations, an energy company engaged Texas Star Alliance to communicate on their behalf in order to mitigate the impact of the proposed 2060 fee increases. This engagement was key to defeating the fee increase, as trade association opposition became compromised with alternative deals made to protect the limited interests of certain companies within the associations.
Near the end of the 2013 Legislative Session, the Chairman of the Senate Transportation Committee filed a bill to increase the 2060 fee to $1300 per year. The legislation also moderately increased the penalties for illegal haulers – something supported by our client and industry – but not in a way that would serve as a major deterrent to this growing problem.
Upon analysis, it was determined that the fiscal impact to the state would be minimal, at $7 million in new revenue annually, with each county receiving less than $14,000 per year. However, there are only a handful of companies that require a 2060 permit, and a steep rise in permitting fees would result in a heavy financial burden to these companies while doing little to address the underlying issues facing the transportation system.
After several other measures to add new revenue to the transportation system failed to come to fruition, both the Senate and House Transportation Committees – along with their respective Chairman – were determined to see that this bill made it to a vote. Thanks to our active engagement, we were able to keep the bill from moving forward in the House.
However, in the final days of session, the fee increase language was reintroduced as an amendment on the Senate floor and successfully added to a separate piece of legislation. With the bill now set for final passage on the House, we worked swiftly to identify a “point of order” (a legislative rules violation) and engage key members to successfully stop the idea of “the fee increase” from moving forward.
Proactive Engagement with Key Members
Our efforts to stop this fee increase bill from passing were successful. As a result, our client averted a cost increase of more than $2 million from new fees. Meanwhile, penalties for illegal hauling were increased.