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Burge: Exxon needs Grand Parkway and soon

This month is make or break

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“Exxon has designated and will go on record some time in April that this will be their home campus there at 45 and Grand Parkway and obviously they need that in place and moving that way by  2015,” Grand Parkway President William F. “Billy” Burge told the Texas Transportation Commission at their January 27, 2011 meeting.

Burge urged the Commission to quickly begin construction of the Grand Parkway now that Harris County has withdrawn from the project and turned it back to the Texas Department of Transportation. Following testimony from Burge, Harris County Judge Ed Emmett, and Grand Parkway Association executive director David Gornet, the Commission voted unanimously and without public comment to move forward with the project, beginning with Segment E in the Katy Prairie.

Burge began by telling the Commission, “We now have one quarterback, one process that we think will work all the way from 59 to 59. We’ve acquired almost all the right of way and environmental, which has taken us some 26 years since the inception of the Grand Parkway.

“It’s compelling that it needs to be done for a couple of reasons,” he said, citing the new Exxon project and then said “All of the other areas that we’re going through we have really been able to come up with enough right of way and environmental to really get, I think, the right contractors and a program that can finance.

“If we don’t do it, though, in the next 60-90 days, this is the month that will make us or break us, because, you know, timing is everything. And we’ve gone through a perfect storm and we do have the advantage the next 90 days to be looking into a perfect rainbow, a rainbow going from 59 to 59.”

Burge noted that the money issue need to be addressed and said Commissioner Ned Holmes, chairman of Parkway Investments, “has worked to try to come up with 400-500 million, which we hope would seed the project, get it going up to 290 and from there look at other financial delivery systems but we feel like if we can put them all together that will be a project that, when traffic’s up there it will not only open up that area, but more importantly it will loosen up areas around Houston that have never seen this type of coming together.”

Commissioner Holmes later noted that the “Exxon headquarters” Burge had spoken about is in fact the North American headquarters and the world headquarters would stay in the Dallas-Fort Worth metroplex.

Grand Parkway executive director Gornet said the Exxon/Mobil move is a consolidation of some 11,000 employees they have in the Houston region now and some 4,000 employees that would move here primarily from Virginia. Other sources say the number will be 17,000.

“They’ve bought a 400-acre tract of land just west of I-45 and just north of the Grand Parkway. I-45 cannot be the only point of access to this, they need the Grand Parkway there, those 15,000 jobs will be individuals that will have a strong opportunity to use a toll facility and I think this will be a great benefit to the project,” said Gornet.

Holmes indicated that the Parkway is a must for the Exxon project. “Exxon representatives have stated very clearly to me that TxDOT moving forward on the Grand Parkway is essential and that if that did not happen they would not select this site,” Holmes said. “And I think they’d move their North American headquarters, so that’s kind of a dealbreaker for them.”

Gornet agreed. “Yes, sir, that’s my understanding as well,” he said.
 Many of those employees currently office in the Greenspoint District at I-45 and the Beltway. “We would be sad to see them go, they’ve been a great partner,” said Jack Drake, president of the District. “But If Exxon decides to consolidate and move some employees from our market, Greenspoint will survive and thrive. We are happy they are planning to expand in the north Houston market, which is experiencing tremendous growth.  There is a misperception that our market is dominated by ExxonMobil. In fact, they make up 12 percent of space in our market.”
A Brazilian company has offered to provide the equity capital for building the Grand Parkway segment in Montgomery County, according to a story in yourConroe.com.

Estimated costs to build Segment “G” of the Grand Parkway – a 14-mile segment to be connected from Interstate 45 just south of the Harris County line to U.S. 59 in the Porter/New Caney area – are upward of half a billion dollars. Segment “G” is part of the 180-mile Grand Parkway designed to encircle the greater Houston area.

The Texas Department of Transportation’s original estimate in 2007 of $184 million to build Segment “G” has since skyrocketed to around $500 million. County officials have received inquiries from construction companies across the nation and within Texas since issuing unsolicited requests for proposal in November.

Now, Odebrecht International, based in Brazil, has offered to put up the risk capital and build Segment “G,” County Judge Alan B. Sadler said.

Recent Coverage: TxDOT takes on Grand Parkway ‘in its entirety’

Video is available from TXDOT in .wmv format.  [This will require installing a converter like Flip4Mac if you are using a Macintosh computer and in that case, you will not be able to fast forward until the movie has loaded in real time.  We do not know if this is the same on a windows machine.  Discussion of the proposed Grand Parkway begins at 01:12:55.]

TXDOT has not yet posted minutes of the meeting. Houston Tomorrow compiled the following partial transcript of sections pertaining to the proposed Grand Parkway, beginning with Judge Emmett’s comments:

Harris County Judge Ed Emmett
“Now, 26 years later, it is a desperately needed economic engine for not only Harris County, but also the region. It is assumed that this project will be maintained as a project that the entire Grand Parkway will be eventually built and that revenues off the segments in Harris County will be used on other segments of the Grand Parkway.”

Commissioner Ned Holmes
“My understanding [is that] one of the challenges that Harris County faced in developing the Grand Parkway is the fact that you would be required to develop it in seven counties – six of which were not Harris County and that presented really significant financial challenges, as well as general development challenges.”

Emmett
“Yeah, that’s generally correct. Harris County would not necessarily have developed it in those other counties, but there’s no question that the revenue generating segments of the Grand Parkway are in Harris County and that revenue then would have had to have been committed to the other segments, the same as we hope will occur when TXDOT takes I over.

This does free us up in a true partnership situation – without mentioning any specific corridors.  It frees us up then perhaps to develop other projects at the same time you’re developing the Grand Parkway, and so we get more transportation projects in the region if we work together and let you do this and we do something else.”

Holmes
“The agreement to retain the economics of any one section for the benefit of all sections was memorialized in the Market Valuation Waiver Agreement, and so I feel comfortable in saying the requirements that were placed on the counties when they exercised primacy also apply to TXDOT. Its an agreement that was signed by both TXDOT and the counties and so its clearly appropriate that the economics are retained in the Grand Parkway in order to build all segments.”

...

William Burge
“Pleased to be here for several reasons.  Number one, I think with hearing from Judge Emmett and their position on the Grand Parkway.  We now have one quarterback, one process that we think will work all the way from 59 to 59.  We have acquired almost all of the Right of Way and environmental which has taken us some 26 years since the inception of the Grand Parkway, and you know I have a list of things that tell you why this needs to be done.

I’m gonna let David do it because really its compelling that it needs to be done and for a couple of reasons I think we’ve outlined that Exxon designated and will go on the record some time in April that this will be their home campus there at 45 and the Grand Parkway and obviously they need that in place and moving that way by the 19 and 15 [Ed note: It appears he meant to say 2015].  All of the other areas we’re going through we have really been able to come up with enough right of way and environmental to really get I think the right contractors and a program that can finance.

If we don’t do it though in the next sixty to ninety days, this is the month that’ll make us or break us cuz you know timing’s everything and we’ve gone through a perfect storm, and we do have the advantage the next ninety days of looking into a perfect rainbow going from 59 to 59, and there are 2 or 3 benchmarks along the way that need to be met, need to be put together and hard decision need to happen in order for this thing to facilitate. I think that with TXDOT now having the project back and what work Grand Parkway [Association] has done for 26 years, I think there is a comfort level of being able to not only identify the property, get comfortable with it, but move forward on a delivery position.

The other half of the equation is the money and I know Ned has worked to try to come up with four to five hundred million which we hope would seed the project, get it going up to 290 and from there look at other financial delivery systems but we feel like if we can put em all together that that will be a project that when the traffic’s up there it will not only open up that area but more importantly it will loosen up areas around Houston that have never seen this type of coming together.  So it should be the impetus that Houston has needed for a real long time.  I’m gonna let David outline some of his points, but I’d like to say on something like this when timing is everything we really can’t afford to hiccup and we’ve got to look at a system in a in control one person has to be in control or this stuff gets away.

I had been past chairman of the Harris County Sports Authority which we undertook over a seven year period to build our 3 downtown stadiums: Minute Maid, Reliant, and Toyota and the Rodeo shared with Reliant.  The project was a little over a million two and we tried to fast track them and it was critical for many reasons, but the biggest thing that we learned that would keep it on schedule is to have the right people on the ground working with the subs. And when I say TXDOT needs to have a designated entity; a group that’s there you know they’re not drawing the plans but they’re in there keeping everything honest and they know how to make the quick decisions if something changes and David Gornet, our Executive Director, has been out there like I said twenty-seven years.

He knows the property owners.  He knows the elected officials.  He is I think a strong ongoing source for TXDOT to use as now you start to pull out the plug and I think he should be in some role as your project director to keep not only sanity but understand what’s important and how phases should go.”

[At this point, Burge begins to present Commissioner Holmes with a series of gifts, and it is difficult to hear everything that is said]

“…it’s twenty five years in the making
…we think it’s the way of the future
…and just what we’ve done on the Katy Freeway from downtown out to Katy and how much a difference that has made for our city”

...

Holmes
“How long have you been chairman of the Grand Parkway Association?”

Burge
“Well you know you had one – who was the guy that was on there 4 to 5 years and couldn’t get along with everybody? I’ve been on it about twenty years and I tell you the funny story. We were. This was pre-Grand Parkway.  We were developing Cinco Ranch and we had Mason Road and the fellow that rand Friendswood called and said would you all consider adding another 40 feet of Right of way to you 100 and then we’ll call it the Grand Parkway and we’d already filed our plats and we said no, move it over to somebody else’s property, it’ll never be built and that was the origin. That was ’82.

…I guarantee you the movement of the city in that direction.”

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