Canada offers to cover Michigan’s share of new crossing
June 1, 2010
WINDSOR, Ont. -Now it will be up to the state of Michigan to decide -and decide soon -whether to accept Canada's offer to provide up to $550 million to fund the cash-strapped state's share of the prop...
WINDSOR, Ont. -Now it will be up to the state of Michigan to decide -and decide soon -whether to accept Canada’s offer to provide up to $550 million to fund the cash-strapped state’s share of the proposed Detroit River International Crossing (DRIC) project.
Federal Transport Minister John Baird said his government, frustrated by decades of fighting and delays over the proposed Windsor-Detroit crossing, decided to come up with the April 29 offer, which he told Truck West was not unprecedented.
“This project is tremendously important for Canada,” he said. “It’s the most important infrastructure project in the country. It’s desperately needed. And it’s been worked on literally for 20 years.”
The Michigan state legislature has set a June 1 deadline to endorse funding for DRIC. The $550-million offer could help sway that vote.
But the vote might not come easily.
State Republicans, for example, have long argued against the spending of tax dollars on the project, especially in a state ravished by job losses and that in March had the highest unemployment in the US at 14.1%.
They also argue the project would be redundant because the state has contributed the lion’s share towards the new $230-million Gateway Project, streamlining freeway access on the US side of the Ambassador Bridge.
This debate takes place against the backdrop of Ottawa, Washington, Ontario -and Michigan, in principle -years ago, having joined extensively in the planning of DRIC. The connecting freeway links, the locations of the new Customs plazas, and the bridge location, have all been chosen. Construction has already started in Windsor on the nine-kilometre Windsor-Essex Parkway -a sunken, six-lane freeway connecting Hwy. 401 to the bridge.
In Michigan, the current debate hinges on a bill to approve public private partnerships (P3s) for highway construction.
That bill was passed by the state transportation committee April 29. Now it goes to the state senate, where Republicans, who hold a majority, are reluctant to pass it, especially if it includes a project on DRIC’s scale.
“I’ll tell you, number one, take the DRIC project out, you’ll have a lot more support,” Representative Marty Knollenberg said.
The legislators fear taxpayers will be on the hook for financing if a P3 investor defaults. They also question whether estimated traffic volumes for the DRIC bridge are sufficient to recoup investors’ money.
The legislators say the $550-million Canadian offer would not pay for the bridge itself. It would only cover costs on the Michigan side of the river for constructing a Customs plaza and access road to Interstate 75.
State Representative Paul Opsommer said the $550 million offer was “clouding” the debate. He said the offer should not influence the P3 issue, “just because Canada now wants to loan us $550 million dollars -money that it will make back by tolling our drivers.”
State representative Tom Pearce also noted: “The $550 million has nothing to do with the building of the bridge.”
In a separate matter, the offer was also slammed by the competing Detroit International Bridge Co., which owns the Ambassador Bridge, and has long argued it has sufficient capacity -especially with a proposed new six-lane span -to handle future border traffic.
Bridge president Dan Stamper accused Michigan Governor Jennifer Granholm of having “caused Canada to offer to buy Michigan’s future for $550 million…Michigan is not and should not be for sale.” He also said the governor was aiming to “destroy” the company “that has paid state taxes since the early 1920s.”
And, for the first time, the race card was introduced.
Bridge lawyer Patrick Moran accused the Canadian government of “using its legislative power inappropriately to discriminate against an Arab-American businessman who has owned and operated the Ambassador Bridge for more than 30 years.”
The owner is Matthew (Matty) Maroun, born in Detroit and who is of Lebanese descent.
Meanwhile, the Ambassador Bridge has also filed a NAFTA complaint over the $550-million offer, saying DRIC would divert traffic from the bridge, the Windsor-Detroit tunnel and the Blue Water Bridge between Sarnia and Pt. Huron.
“The Canadian government is using its power inappropriately to coerce the Michigan Legislature into adopting legislation necessary to ensure the implementation of the DRIC project,” it said in a statement.
Transport Minister Baird said he was “not going to speculate” about what would happen should the Michigan legislature reject P3 financing and therefore whether his government would offer more money to cover bridge construction costs.
He said he will be travelling to the Detroit area in the next few weeks to lobby for DRIC.
Asked if his government would compensate the Ambassador Bridge should DRIC get built, the minister gave an emphatic “no” saying there are other examples where the public and private sectors compete.