Austin-San Antonio Intermunicipal Commuter Rail District Board Meeting

Friday, June 6, 2008
10:00 a.m.

San Marcos Activity Center
501 E. Hopkins
San Marcos, Texas

1. Call to Order

   Notice was duly posted and a meeting of the Austin-San Antonio Commuter Rail District was held on
   Friday, June 6, 2008. Vice Chair Tullos Wells called the meeting to order at 10:14 a.m.

   Participants:

   • Tullos Wells, Vice Chair
   • Gloria Arriaga
   • Hal Baldwin
   • Jeff Barton
   • Lisa Birkman
   • Mary Briseño
   • Mariano Camarillo
   • Will Conley
   • John Cowman
   • Gerald Daugherty
   • Debbie Ingalsbe
2. Carroll Schubert
3. John Thomaides
4. Jeff Wentworth
5. Pat Wiggins

Other participants included Ross Milloy, Bill Bingham, and Alison Schulze.

6. Chairman and Member Comments

   Vice Chairman Wells noted that Chairman Covington is in New Mexico. Mr. Wells reported that due
   to the rising cost of gas, mass transit systems nationwide are breaking ridership records. He then
   introduced Tony Kimmey with Jacobs Carter Burgess, Clif Davis’ replacement as Project Director of
   the Planning & Preliminary Engineering Team, and Mike Marler, Jacobs’ Rail Group Manager.

   Councilmember John Thomaides welcomed Board members to San Marcos and thanked local
   citizens for attending the Board meeting.

   Commissioner Jeff Barton announced the Alliance for Public Transit in Austin is promoting mass
   transit and has expressed interest in passenger rail service between Austin and San Antonio.

   Senator Jeff Wentworth reported that TxDOT annually tracks out-of-state tourist destinations in
   Texas and the top four destinations are in the Austin-San Antonio corridor: 1) the Alamo in San
   Antonio, 2) the Riverwalk in San Antonio, 3) the Outlet Mall in San Marcos, and 4) the State Capitol
   in Austin.

7. Consider Approval of March 7, 2008 Board Meeting Minutes

   Upon a motion by Gloria Arriaga and second by Commissioner Debbie Inglasbe, the March 7
   meeting minutes were unanimously approved.

   Vice Chair Wells asked Ross Milloy to brief the Board on the background and current status of the
   passenger rail project, in advance of the remaining agenda items. Mr. Milloy reported that when the
   Rail District determined it would probably not qualify for the Federal New Starts Program, the
   District began to pursue two separate strategies: initiate interim passenger service from San Antonio
   to Georgetown (short-term strategy), and expand to full service once Union Pacific’s through freight
   is relocated to a new corridor (long-term strategy). The Rail District’s goal for starting service is
   2011-2012. To implement interim service the Rail District began discussions with Amtrak, and
   Amtrak and TxDOT are currently negotiating a contract to conduct a feasibility study. The Rail
   District also met with Union Pacific (UP), which will be reported in greater detail in Agenda Item 9.
   Additionally, the Capital Area Metropolitan Planning Organization (CAMPO) recently awarded the
   Rail District $10 million (which includes $2 million from the Rail District as required matching
   funds) in fiscal years 2009 and 2010. The CAMPO award partially matches the $20 million award
   from the San Antonio-Bexar County MPO for FY 2011 and FY 2012. When CAMPO funding for
   FY 2011 and FY 2012 becomes available, the Rail District will apply for an additional $10 million.

   The long-term freight relocation effort includes two studies on relocation of the UP’s through freight.
   TxDOT’s Phase 2 Freight Rail Study, to be issued in July, examines various alignments that may be
   suitable for UP and looks at the implications on a broader level. The Phase 3 Freight Rail Study will
   be discussed in detail under Agenda Item 7. Additionally, the Rail District has organized a statewide
   coalition to encourage the legislature to allocate at least $200 million per year to finance a bond
   program that will fund rail relocation projects. TxDOT has identified $18 billion statewide in rail
   chokepoints, including critical projects in Austin-San Antonio, Dallas, El Paso, and Houston. Mr.
   Milloy asked Board members to encourage their individual state senators and representatives to
   support financing the Rail Relocation Fund during the upcoming session.

8. Report on Status of Appointments to the Board

   Bill Bingham reported the Rail District has 20 Board members, all 2008 Board appointments have
   been made and oaths have been executed, with the exception of the City of Austin which is scheduled
   to make a new appointment after the City Council runoff election on June 14.

9. Committee Report

   A. Executive Committee Meeting May 2, 2008

   Mariano Camarillo, reporting on behalf of Executive Committee Chair Sid Covington, directed the
   Board’s attention to the summary of the Executive Committee meeting included in the agenda packet.
   Mr. Camarillo reported on four key items discussed by the Committee:

       • Request for Proposals (RFP) for Branding Services: The Public Information
   Committee recommended—and the Executive Committee unanimously approved—
   issuing an RFP for branding services. Discussion and Board action on the RFP will
   follow in Agenda Item 6.
       • Carter-Burgess proposal to conduct a fatal flaw analysis of the SH 130 corridor: On
   April 18 the Program Management Oversight Committee approved a contract with
   Carter-Burgess to conduct a fatal flaw analysis of SH 130; on May 2 the Executive
   Committee concurred. The analysis will look at the SH 130 corridor as a possible
   future passenger rail corridor—rail in SH 130 would not be in lieu of rail in the UP
   corridor. TxDOT suggested reviewing the route in light of enormous growth along
   SH 130. The contract was executed on May 14, and results are expected in August
   2008.
       • Amtrak Feasibility Study: Amtrak will begin studying the feasibility of improving
   intercity passenger rail service in the UP corridor. Preliminary study results are
   expected in October 2008. Bill Bingham noted the contract is under review at TxDOT
   and expected to be executed soon.
       • TxDOT’s San Antonio Freight Study, Phase 3: TxDOT has completed two phases of
   the freight study. Phase 3 will determine the feasibility of using the existing UP
   freight corridor for intercity passenger rail once UP through freight is relocated. The
   Rail District will fund a portion of the Phase 3 study due to TxDOT budget
   constraints. Discussion and action on the Phase 3 study will occur under Item 7.

   B. Public Information Committee Meeting May 14, 2008

   Committee Chair Mary Briseño directed the Board’s attention to the meeting summary included in
   the agenda packet. The Committee approved an RFP for branding services and agreed on a process
   for evaluating RFPs and selecting a consultant. The RFP will be discussed further in Agenda Item 6.

10. Consider and Take Appropriate Action on Request for Proposals (RFP) for Branding
    Services
    

    Mary Briseño stated the purpose of the RFP for Branding Services is to give the Rail District traction
    in terms of identity, establish a name that is easier to understand and will communicate the purpose
    and function of the Rail District, and create an image that increases public awareness. The Public
    Information Committee met March 28 and May 14 to develop the RFP and approved the final RFP
    for Branding Services on May 14. On May 20, Board Chair Covington appointed five Board
    members to the Proposal Evaluation and Selection Committee: Mary Briseño, Chair; Mayor Hal
    Baldwin; Commissioner Jeff Barton; Senator Jeff Wentworth; and Councilmember Pat Wiggins. On
    May 2, the Executive Committee voted unanimously to send an RFP for Branding Services to the
    Board for approval.

    Upon Board approval, the RFP will be issued on June 11, and responses will be due on July 23. In
    August 2008, the Proposal Evaluation and Selection Committee will meet to review the proposals and
    interview shortlisted candidates. The results will be presented to the Board in September for
    selection of a branding consultant.

    Upon the recommendation of the Public Information Committee and second by Commissioner Will
    Conley, the Board voted unanimously to approve issuing an RFP for Branding Services. Vice Chair
    Wells commended Ms. Briseño for her leadership on the branding effort.

11. Consider and Take Appropriate Action on TxDOT Freight Mobility Study, Phase 3

    Bill Bingham briefed the Board on TxDOT’s freight study, which is being conducted in three phases.
    The study analyzes the freight rail system and freight operations from south of San Antonio to
    Taylor, which includes the proposed route for most of the Austin-San Antonio intercity passenger rail
    system. Phase 1 is complete and includes an inventory of the freight rail system and freight
    operations. Phase 2 identifies alternative freight routes; the final draft is under review and expected
    to be released in July 2008. Phase 3 is directly applicable to the Austin-San Antonio system and will
    determine the feasibility of using the region’s existing freight rail lines for passenger rail. Phase 3
    was put on hold due to TxDOT’s budget constraints; but, this phase is critical to the Rail District and
    it would be a worthwhile expenditure to contribute to the study in order to move it forward. The
    proposal before the Board is to contribute funds to the Phase 3 study, which will be conducted by
    TxDOT and its consultants. The Rail District will be engaged throughout the study.

    Ross Milloy noted the Program Management Oversight Committee voted unanimously to participate
    in the Phase 3 study. The Rail District will contribute $135,902; the total cost of the study is
    $206,606. The Rail District will be an integral part of the study via input on the study parameters,
    participation in committee meetings, and reviewing results. Vice Chair Wells noted that in recent
    years the Rail District has become a leader in freight mobility and relocation issues, and will continue
    to play a leadership role in the Phase 3 study.

    Upon a motion by the Program Management Oversight Committee and second by Mayor Hal
    Baldwin, the Board unanimously approved funding the Phase 3 Freight Mobility Study and
    authorizing the Executive Director to execute a contract with TxDOT.

12. Consider and Take Appropriate Action on Jacobs Carter Burgess Proposal to Prepare
    Texas Emissions Reduction Plan (TERP) Application
    

    Ross Milloy reported that due to Senator Wentworth’s leadership, the Texas legislature made certain
    rail projects eligible for funding through the Texas Emissions Reduction Plan (TERP) program—a
    program designed to improve air quality. On behalf of the City of San Marcos, the Rail District
    pursued funding from TERP to replace at-grade rail crossings with grade-separated crossings. TERP
    regulations require strict monitoring and reporting for 15 years, and repayment of the TERP funds if
    the air pollutants are not removed. Based on these findings, the City of San Marcos and the Rail
    District decided not to pursue TERP funding; but, to work with the Texas Commission on
    Environmental Quality (TCEQ) on application requirements, and to pursue a legislative approach
    during the 2009 session. As such the item requires no action at this time.

13. Report on Status of Potential Intercity Passenger Rail Opportunities
    

    Ross Milloy directed the Board’s attention to a memo in the agenda packet that summarizes the Rail
    District’s May 7 meeting with Union Pacific and TxDOT. Union Pacific is anxious to move out of its
    existing corridor and wants to form a working group with TxDOT, Rail District and Union Pacific
    staff to discuss relocation phasing and costs. Mr. Milloy noted that regardless of the amount spent to
    upgrade the existing rail corridor to add capacity for interim passenger service, the public will realize
    a benefit in the long run when the Rail District eventually takes control of the rail line and implements full passenger service. Additionally, the improvements can be fully funded through the
    Railroad Rehabilitation and Improvement Financing (RRIF) Program, a federal loan program.

    Bill Bingham noted that the Rail District’s ability to operate passenger rail service in the UP corridor
    is fundamentally tied to the UP relocation effort—one can’t be done without the other. UP owns the
    rail corridor and passenger rail would interfere with its business of moving freight; however, there are
    substantial public safety and economic benefits to moving UP’s through freight out of the city centers
    along the corridor. In the past few years UP has not been willing to discuss the Rail District’s
    proposal, but the recent meetings have been productive, key staff are engaged, and parameters are
    being established for meaningful discussions. All of the key stakeholders are encouraged.

    Vice Chair Wells reiterated that relocating UP’s through freight is critical for passenger service, but
    UP’s local freight service will remain in the corridor; thus a key issue will be dispatch rights—that is,
    control of train departures and schedules.

    Board discussion followed on the benefit of relocation to UP and why UP would consider moving its
    through freight to a new corridor. Ross Milloy stated the benefits to UP are increased capacity,
    greater efficiency, and less liability. Mr. Milloy highlighted several difficult issues for UP in the
    existing corridor:

        • Capacity: There are 136 problematic grade crossings between San Antonio and Round
    Rock. UP’s capacity is constrained in several places by tight curves and steep slopes that
    require UP to add locomotives to navigate steep grades north of the Colorado River.
    Finally, UP anticipates a dramatic increase in NAFTA trade in the coming decades.
        • Efficiency: UP currently travels at 17 mph in the existing corridor; relocation to a grade-
    separated corridor could increase speeds to 79 mph, which creates efficiency and cost
    savings.
        • Liability: The number of at-grade crossings and safety issues regarding transportation of
    hazardous materials through densely populated areas increase UP’s liability.

    Board discussion ensued on the public benefits (congestion relief, safety issues, rerouting hazardous
    materials) and the private benefits (increased speeds equal increased capacity and a competitive
    advantage with truck trade; safer and more efficient routes in less populated areas) of relocating UP.
    Commissioner Gerald Daugherty requested data on the number of at-grade crossings in each city
    along the proposed route, which Alison Schulze agreed to send. The Board also requested cost data
    on UP relocation as it becomes available. Councilmember John Thomaides reported local freight
    impacts in San Marcos: 2 overpasses over the rail line cost $15 million each, 5 freight cars carrying
    hazardous material recently derailed raising safety issues, 10,000-15,000 students commute daily to
    Texas State University, and noise issues are affecting quality of life.

14. Financial Report

    Ross Milloy directed the Board’s attention to two financial reports in the agenda packet: the second
    quarter statement for FY08 and the reconciliation report. Mr. Milloy noted the District’s finances
    remain on budget.

15. Legislative Update
    

    Ross Milloy reported on preparations being made for the 2009 legislative session: Bexar County
    Judge Nelson Wolfe has agreed to chair the statewide rail relocation coalition; and a finance working
    group is reviewing state revenue sources and collaborating on funding of the relocation effort.

16. Other Business

    Alison Schulze directed the Board’s attention to the agenda packet and the May 16 letter from Jacobs
    Carter Burgess regarding staff changes. Tony Kimmey, located in Dallas, is the new Project Director
    for the Planning & Preliminary Engineering Team. Don Karban, located in Austin, replaces Tom
    Shelton as Project Manager. Mike Marler, Jacobs’ Rail Group Manager, will be a key member of the
    team.

17. Public Comment

    Jennifer Moczygemba, Director of TxDOT’s Multimodal Division, reported on several items:
        • Amtrak Feasibility Study: The contract between TxDOT and Amtrak is currently under
    review by Amtrak’s legal department.
        • Land use impacts of Union Pacific relocation: UT’s Center for Transportation Research
    just completed a rail corridor preservation study.
        • Cost of UP relocation: Cost estimates are included in TxDOT’s Phase 2 Freight Study.
    The study is complete and under review by the railroads. Upon completion, TxDOT will
    make the information available.

18. Adjourn

    Vice Chairman Wells announced the next Board meeting will be on September 5 at 10:00 a.m. at the
    Activity Center in San Marcos. There being no further items, the meeting adjourned at 11:29 a.m.