Ohio Senate to Michigan Senate Regarding DRIC

Michigan House Bill 4961

June 1, 2010

Chairman Gilbert, Members of the Michigan Transportation Committee, I am writing in support of House Bill 4961 which would allow Michigan to enter into a public-private agreement and further allow them to begin construction on the Detroit River International Crossing (DRIC) between the United States and Canada.

The importance of Canada’s relationship with the US and nearly every state including Ohio is critical.  One can speak of culture or tourism or the value of a friendly border neighbor, but the real driver of the relationship is commerce and trade. Canada is the largest foreign trade partner for the United States. In addition, Canada is Ohio’s top export markets with bilateral trade amounting to $35.8 billion for 2008. An estimated 267,500 jobs in Ohio are supported by United States-Canada Trade and Canadians made more than 605,300 visits to Ohio during 2008 spending more that $138 million.

A critical tool in this Ohio/ Canadian trade exchange is the international boarder crossing at Detroit/Windsor.  Between the existing tunnel and the Ambassador Bridge, this crossing is the busiest international border crossing in the world.  The present bridge was built in 1929 and in recent years has been a point of delay especially for trucks crossing the bridge.  These delays have curtailed commerce and have made goods on both sides of the border less attractive to companies of the other side.

Approximately 54% of United States-Canada trade moves by truck and about half of the truck use the Detroit and Port Huron Border Crossings. These statistics not only show the important trade relationship between Ohio and Canada, but also the importance of the new Detroit River International Crossing.

The Ohio Senate recently passed Senate Resolution 223 to support the construction of the new Detroit River International Crossing between the United States and Canada.

As the resolution states, “Plans are underway to build an additional border crossing system over the Detroit River, known as the Detroit River International Crossing.” Since the State of Michigan needs legislative authority to enter into a public-private partnership and enter into an agreement with Canada to build this border crossing, Senate Resolution 223 urges the Michigan Legislature to act swiftly to authorize the DRIC and assure that the United States can continue to efficiently and safely move people and goods across our border.

As a member of the US-Canada Relations Committee for Midwest CSG, I have had the opportunity over the past several months to travel to several regions of Canada and discuss new ways for leaders in the Midwest states and Canada to join together to create jobs, attract business investment and grow our local economies. Construction of the DRIC is critical to this effort.

Thank you for allowing me to offer proponent testimony for Michigan House Bill 4961.

Steve Buehrer

Ohio State Senator

1st District

Gordie Howe International Crossing

MDOT responds to last minute desperation resolution from the Ambassador Bridge board

Dear Members of the Michigan House of Representatives:

This letter provides responses to claims made by the Detroit International Bridge Company in their letter dated May 17, 2010.

Claim: The Ambassador Bridge is the only border project that protects Michigan and its taxpayers from any financial or other liability.

Response: The only project that protects Michigan and its taxpayers from any financial or other liability is the Detroit River International Crossing (DRIC) as a result of the offer by Canada to cover Michigan’s costs on the project. On the other hand, the record of the Ambassador Bridge owners is just the opposite. Their failure, as confirmed by the courts, to complete the Gateway Project as agreed, has exposed the Michigan Department of Transportation (MDOT) to the refund of hundreds of millions of dollars to the Federal Government because the Gateway Project is so incomplete it doesn’t work as agreed. Further, the Ambassador Bridge owners are engaged in multiple lawsuits against MDOT and the U.S Government that continue to consume taxpayer resources. The Ambassador Bridge owners have not prevailed on a single suit.

Claim: No matter how it is spun, Michigan taxpayers are left with huge financial and other liability.

Response: MDOT and Canada are confident that DRIC will mean no debt costs fall on either nation’s taxpayers. As stated by James Kusie, Director of Issues Management and Parliamentary Affairs of Canada’s Transport Minister “…over the duration of this concession, toll revenues are expected to cover the private capital and financing costs as well as operations and maintenance costs.”

Claim: The responses to MDOT’s “Request for Proposals of Interest” are suggesting availability payments NOT financing via tolls.

Response: The Ambassador Bridge owners fail to cite which two of the largest transportation infrastructure developers in the world have to say about financing DRIC:

“The appropriate business model for this project is a Public-Private Partnership where the developer is responsible for traffic risk and is granted the right to retain toll revenues.” Cintra
“A preliminary financial analysis based on the traffic forecasts prepared by Wilbur Smith on behalf of MDOT, and a series of assumptions revealed that the project (excluding the customs inspection plazas) can be financially viable without a government subsidy under a 50-year concession. While this analysis is preliminary in nature, it is our assessment that toll revenues should be sufficient to cover costs for the bridge, the U.S. interchange and the toll plazas currently estimated at US $1.48B (estimates derived from Appendix B of the RFPOI) Meridiam
So, if these responses were part the formal bidding process to engage a private partner to build DRIC, only Meridiam and Cintra would remain in competition. From these two, the one successful bidder would be chosen. In the end, Michigan taxpayers will have no financial exposure with DRIC.

Question: Why would Michigan support DRIC while it is failing to maintain its roads and

bridges?

Response: As Governor Granholm has stated “..this project is a no brainer” because all of

Michigan’s costs will be covered by Canada. This includes use of any federal highway formula funds. So, road and bridge projects are not affected at all anywhere in the state by Michigan’s involvement in DRIC.

Claim: The proposed Ambassador Bridge second span has only red tape delaying implementation and construction.

Response: The Ambassador Bridge owners do not have a valid application submitted to Canada to build this project. The application is designed by law to protect the health and welfare of its citizens and protect the environment–doing that is NOT red tape. When a valid application is submitted to Canada, it will take years to gain all approvals.

The Coast Guard is the U.S. agency charged with granting or denying the approvals necessary to permit the Ambassador Bridge to construct a second span. The Coast Guard issued a letter on March 2, 2010, “…to the Detroit International Bridge Company (DIBC), terminating the U.S. Coast Guard bridge permit application process for the proposed Ambassador Bridge Enhancement Project (ABEP) ….(because) .. despite several meetings between the Coast Guard and DIBC and its counsel there has been no movement by DIBC or other involved entities on those issues which resulted in (placing the project in) abeyance (on June 15, 2009). Developments since the issuance of the abeyance letter include several ongoing lawsuits between DIBC and state/federal agencies and a court decision that ruled DIBC does not have the necessary property rights to construct the bridge.” In Canada, the Canadian Transit Company does not currently have any approvals necessary to proceed with construction. In addition to the requisite approval of its environmental assessment, the Canadian Transit Company will require a number of regulatory approvals, including approval under the International Bridges and Tunnels Act and the Navigable Waters Protection Act.

Claim: The Ambassador Bridge owns all property on both sides of the river needed to complete its span except for a ¼ acre parcel of contaminated park (which has been closed to the public for more than 10 years) owned by the city of Detroit

Response: Public parks are protected by federal law. The Bridge owners have illegally seized this park as if they are not bound by the laws of the land. Likewise, they claim they are a “federal instrumentality”. The U.S. Attorney has petitioned the federal courts to have the Bridge owners cease that claim.

Claim: Past and future capital investments by the Ambassador Bridge are eligible for “Toll Credits” which can be used as local matching funds to U.S. federal funding for road and bridge repairs.

Response: The Ambassador Bridge has refused to make any information available to support its claim, after multiple requests from MDOT to do so. On the other hand, expenditures on DRIC will be readily available for public review and, as such, available to gain “Toll Credits” for use on other projects throughout Michigan.

Claim: The Ambassador Bridge has invested $500 million to fulfill its obligation to replace the original span.

Response: The claim of a $500 million investment is unsubstantiated. And, it is a different claim than made in testimony before the Michigan Legislature on May 19, 2008, when the Ambassador Bridge representatives stated “…the Ambassador Bridge has invested over $500 million–a half billion dollars–in property acquisitions on both the U.S. and Canadian sides of the river.” Just as in the Toll Credits instance, talk is not substantiated.

Claim: The Ambassador Bridge owners are fully committed to the Gateway Agreement.

Response: If this claim were true, there would not be multiple lawsuits on the Gateway Project to require enforcement of the agreement because the Bridge owners failed to complete the project as agreed. This position has been ratified by decisions of Judge Edwards.

Gordie Howe International Crossing

A statement from L. Brooks Patterson

May 5, 2010

A statement from Oakland County Executive, L. Brooks Patterson.

“The DRIC is the only game in town,” Oakland County Executive L. Brooks Patterson said. “If we don’t partner with Canada on this deal and accept its offer of funding, the only alternative is to sit back and watch New York builds its fifth span. I encourage support on this important project.”

Battle over new bridge is ramping up

BY JOHN GALLAGHER AND CHRIS CHRISTOFF

DETROIT FREE PRESS STAFF WRITERS

Today, the Free Press separates the swirling exaggerations from the truth in the border showdown critical to Michigan’s future.

On one side: Ambassador Bridge owner Manuel (Matty) Moroun, wielding the family fortune and political connections to defeat a proposed publicly owned span that would cut deeply into his business.

On the other side: the U.S. and Canadian governments, with strong support from business groups that want a new crossing between Detroit and Windsor to speed commercial truck traffic across the busiest trade crossing between the U.S. and Canada.

The weapons: muscular lobbying by the Morouns, with controversial TV ads and arm-twisting in Lansing, to convince lawmakers and the public that a second Detroit River bridge is unnecessary and a potential burden for taxpayers.

Gov. Rick Snyder and his aides have the bully pulpit to muster support for a publicly owned bridge. They say they have bulletproof legislation to protect taxpayers against use of any significant Michigan money to build a new bridge.

The stakes: control of the border crossing. And key decisions are expected in coming weeks from Lansing.

Questions about bridge battle answered amid swirling accusations

The claims and counterclaims about the benefits, the risks, the fairness and the vulnerability of Michigan taxpayers are flying in TV ads, in political caucuses, in boardrooms.

Whether to build a second span over the Detroit River or not to build?

Whether to allow Ambassador Bridge owner Manuel (Matty) Moroun to build his own twin span alongside the Ambassador, or to have the Canadian government and Michigan partner to build a new public bridge 2 miles downstream, near Zug Island?

Those are the key questions.

Today, the Free Press examines the issues that will emerge as state House and Senate committees take up the debate in the weeks ahead.

QUESTION: Do we need a new bridge over the Detroit River to Canada?

ANSWER: Just about everyone, including Moroun, agrees that a new bridge is needed to replace or supplement the 82-year-old Ambassador Bridge that connects Detroit and Windsor.

The debate is more about who would own and build it — either Moroun (who wants to build a replacement span next to his privately owned Ambassador) or a public consortium of Michigan, Ontario and the U.S. and Canadian federal governments, which hope to hire a contractor to build a new bridge in southwest Detroit near Zug Island. That plan is called the New International Trade Crossing.

Q: Why do many people oppose Moroun’s proposal?

A: His opponents cite at least four reasons.

First, they say there is a need for redundant spans in the event of unforeseen problems, repairs or a terrorist attack on one of the bridges. Many believe such a huge volume of U.S.-Canadian commerce — the busiest such crossing in North America — should not be entrusted to such an aging piece of infrastructure.

Second, supporters of the public bridge predict traffic volumes will rise to new peak levels in the next 25 years, leading to congestion unless capacity is added. This is a hotly disputed point. Moroun points out that the volume of border crossings plummeted after the Sept. 11, 2001, terrorist attacks. Traffic has been rising as the economy picks up, but it’s still only a little more than half of the totals of the late 1990s. Passenger-car traffic is down more sharply than truck traffic, as more stringent border security measures apparently have discouraged casual visitors.

A third reason is that the Ambassador Bridge doesn’t connect directly to Canada’s 401 expressway. Instead, it funnels traffic onto Windsor’s Huron Church Road, where trucks run a gantlet of traffic lights for several miles, creating problems of traffic and pollution. The public bridge would link directly to a yet-to-be-built, limited-access road called the Windsor-Essex Parkway that would tie directly to the 401. The parkway also would help 401-bound traffic coming off the Ambassador Bridge, reducing to a handful the number of traffic lights between the bridge and the 401.

Finally, modern border crossings have as much to do with the customs inspection plazas as bridges. A modern inspection plaza has dedicated lanes for prescreened and automated inspections. Such a plaza would be more easily designed, built and operated with an entirely new bridge.

Q: What would a new bridge cost?

A: The publicly owned bridge itself would cost an estimated $950 million. The customs and inspection plazas to be built on either end of the bridge and the connections to nearby expressways add major costs. In Windsor, connecting a new publicly owned bridge to Canada’s 401 via the planned Windsor-Essex Parkway would cost about $1.7 billion. Add that to other pieces (bridge, plazas, connections to expressways, and the current cost of financing) and the price tag reaches about $3.8 billion.

Moroun estimates that his replacement span for the Ambassador Bridge would cost about $500 million.

Q: Who pays for a new bridge?

A: For the New International Trade Crossing, the U.S. and Canadian governments would pay for their respective customs plazas. Canada is pitching in for Michigan’s portion. A private contractor (a company or team of companies hired jointly through bids by the Canadian and Michigan authorities) would build the bridge with money raised by issuing bonds that would be paid back from toll revenues. The same contractor would operate the bridge.

Michigan is supposed to pay to create the ramp connections to I-75, but Canada has said it will pay for that up front — with $550 million — to be paid back through tolls, making Michigan’s cost zero.

Moroun would build his own replacement span from his own resources, most likely borrowing the money and paying it back through tolls.

Q: The Moroun family has said Canada has backed away from the $550-million offer. What’s the truth of that?

A: The Morouns base that claim on a statement made by Canadian Transport Minister Chuck Strahl in the Canadian House of Commons on March 23. In reply to a question, Strahl said, “We are going to spend zero taxpayer dollars. It is a P3 project. It will not have a single dollar in it.”

He was referring to the private-public partnership (P3) that will be created to design, finance, build, operate and maintain a new public bridge. The P3 (a private company or team of companies yet to be selected) would borrow the money to build the bridge and pay it back through toll revenues. Thus, the money to build the bridge will come from the private investment market.

It may be disingenuous for government officials in either the U.S. or Canada to say not one dime of taxpayer money will be spent, since normal staff time is being used on this project. But it’s also a stretch for the Morouns to claim Canada has backed away from its offer to front Michigan’s side of the costs.

Q: In a TV ad, the Moroun family says building the public bridge would cost Michigan taxpayers $100 million a year. True?

A: At this point, the charge seems like a stretch.

An anti-public bridge group plans to release details to back up this claim this week. In general, the Morouns say the losses stem from lost property-tax revenues from businesses that would have to close to make way for a new public bridge, and revenues lost at the Ambassador and Blue Water bridges as traffic shifts to the public bridge.

Q: Draft legislation from Gov. Rick Snyder’s administration is touted as carefully written to protect Michigan taxpayers from any possible liability. Will it?

A: Yes, according to Richard McLellan, a Lansing attorney and expert on legislative and state constitutional law who reviewed the draft legislation for the Free Press. He said it is strongly worded so that taxpayers won’t be on the hook if the bridge loses money. “A bridge between two of the largest economies in the world is a risk” a potential investor would have to evaluate, McLellan said. He said other state statutes have prohibited backing bonds with the state’s “full faith and credit,” so this bill would not be unusual.

Q: Wouldn’t that make it more difficult to sell bonds?

A: Yes, but the real question is whether it will make it impossible to sell bonds. Investors will decide whether to invest in the NITC based on their belief that the bridge’s future revenues would pay its costs — and knowing that Michigan taxpayers would not be liable if the project failed. Some investors, however, are attracted to such bond offerings.

Q: How would the Canadian money help Michigan roads?

A: It would be used as matching funds to receive four times as much in federal highway funds, spread over 10 years. Snyder has proposed using $50 million of the promised Canadian money as a match in next year’s budget.

Q: Is Moroun correct when he says the publicly owned bridge would kill Michigan jobs, especially at his companies?

A: The new bridge would almost certainly draw traffic and tolls from the Ambassador Bridge — one of just two privately owned spans between the U.S. and Canada. If Moroun’s revenues decline, he probably would downsize his operations.

The new public bridge would create many (estimates run in the thousands) temporary construction jobs. The convenience of a new bridge that ties directly into expressways on both sides of the border via ramps or a new Windsor highway could boost commerce and development, leading to new jobs.

Q: The Moroun family says it’s unfair competition for the two governments to use their powers of eminent domain to condemn and buy land at reasonable costs, avoid taxes and regulatory red tape, then steal what has been estimated at 75% of the traffic they now get. Isn’t that complaint reasonable?

A: The bridge isn’t your typical private endeavor. Most bridges are publicly owned. The Moroun argument has some appeal, but consider that the Morouns enjoy a virtual monopoly at the Detroit-Windsor crossings. (Cars and some trucks also can use the Detroit-Windsor Tunnel or the Blue Water Bridge in Port Huron, 60 miles northeast of Detroit).

Governments often build new infrastructure — from highways to airports to bridges — when there is a perceived need, and that often tilts a competitive advantage somewhere.

The Ambassador Bridge was built in 1929 by the equivalent of today’s private-public partnerships — a private firm acting with government sponsorship. It was sold to Moroun about 30 years ago.

It wouldn’t be a complete surprise if a negotiated settlement resulted in some compensation to the Morouns.

Q: Why is there only one other privately owned border crossing (at International Falls, Minn.) between the U.S. and Canada?

A: The Peace Bridge between Buffalo, N.Y., and Ft. Erie, Ontario, was built in the 1920s by a private company, but that company went into bankruptcy during the Depression, and a public authority took over. That’s one scenario why most border crossings today are in public hands. Another reason is that the customs and border security functions require a level of government involvement that the public demands should be in public, not private, hands.

Q: Why won’t the Canadians allow Moroun to twin his Ambassador Bridge, like he wants to?

A: With the Ambassador Bridge sending trucks directly onto Windsor’s Huron Church Road, causing traffic jams and truck pollution, Canadians want the new public bridge tied directly to the 401 expressway. That’s why the downriver bridge that avoids neighborhoods is more appealing. The Canadian government also has made clear its preference for government ownership.

Q: What is the state’s bridge authority?

A: It is a five-member body appointed by the governor — and approved by the state Senate — that would have power to enter into an agreement with Canada to build the bridge. The authority could issue bonds.

It’s similar to the Mackinac Bridge Authority, a semiautonomous entity that financed and built the Mighty Mac in the 1950s by selling $99.8 million in bonds, to be paid by toll revenues.

Ann Arbor/Ypsilanti Chamber says building new bridge to Canada is partly about Canadian quality of life

By Ryan J. Stanton

Beyond the basic economics of a new highway-to-highway bridge linking Detroit and Windsor, the Ann Arbor/Ypsilanti Regional Chamber says it’s an issue of Canadian quality of life.

At a luncheon this past week attended by Roy Norton, Canada’s consul general, the chamber’s John Petz talked about the traffic congestion he’s witnessed on the Ambassador Bridge, which dates back to 1929 and spits off onto a local street in Windsor.

“Especially for those who don’t cross the border very often, the Ambassador Bridge dumps out onto a street known as Huron Church Road in Windsor — not a freeway,” said Petz, who is past chairman of the chamber and a current board member. “This is a regular commercial road with businesses and residential neighborhoods.”

NITC_bridge_drawing.jpg

Petz, who works in real estate and public affairs for Domino’s Farms, encouraged those in attendance to picture 8,000 trucks a day being dumped onto Washtenaw Avenue.

“Imagine what that would do to your community,” he said. “This matters to the Canadian quality of life. This is important to what they’re addressing beyond the trade issues.”

Terri Blackmore, executive director of the Washtenaw Area Transportation Study, said Petz is correct in asserting that’s an overwhelming amount of truck traffic for a street like Huron Church Road, which she said might be more comparable to Liberty or Main Street in Ann Arbor.

“Think of all those trucks coming through, and there are a lot,” she said, agreeing with the need for a new bridge. “It’s a great idea and I think it’s really important for the state, not just Detroit.”

The A2Y Chamber first announced its support of the proposal for a second bridge to Canada last year and has continued to lobby for the project since Michigan Gov. Rick Snyder signed an agreement with Canadian officials in June. The chamber has submitted public comments in support of the so-called New International Trade Crossing to the U.S. Department of State.

“You may say, well, why do these international crossings matter?” Petz said. “What does this mean to us and our economy? There are 8 million U.S. jobs that are dependent on U.S.-Canada trade. This represents $689 billion of goods and services every year.”

Petz pointed out the Detroit-Windsor crossing serves as the main funnel of trade between the two nations. He said he personally can attest to the traffic bottleneck that exits now.

“This absolutely boggles my mind, but there are currently 17 traffic lights between Highway 401, which is the nearest freeway interchange, and the Ambassador Bridge,” he said. “There are a total of 18 traffic lights between Montreal and the Mexican border.”

On a personal note, Petz said, he’ll be pleased when the new highway-to-highway span — roughly two miles down the Detroit River from the Ambassador Bridge — is built.

“Because it will improve my travel options as I’m heading across the border to my wife’s family’s cottage out along Point Pelee,” he said, “and avoiding some of the haphazard construction-barrel shuffling that occurs with the current bridge as we navigate the schedule of their improvements.”

The Michigan Board of State Canvassers on Monday voted 2-1 in favor of certification of a ballot proposal aimed at blocking construction of the bridge, but MLive.com reported the measure was kept off the ballot because it did not receive required bipartisan support.

The proposal, backed by Ambassador Bridge owner Matty Moroun, would amend the Michigan constitution to require a public vote on any international bridge or tunnel project not completed by the end of the year, including the New International Trade Crossing.

The People Should Decide, a ballot committee funded by Moroun companies, collected more than 600,000 signatures from Michigan voters in order to place the proposal on the ballot.

The Morouns have been accused of grossly misleading television ads — funded to the tune of $10 million — claiming the bridge will cost Michigan taxpayers billions of dollars.

Canada, which is bringing $550 million to the table, has agreed to cover Michigan’s upfront costs for the project and recoup investment through future toll revenue.

It also has agreed to absolve Michigan of any liability for any part of the project, meaning the Canadians are taking all the risk, Norton said at the chamber luncheon.

The People Should Decide still isn’t buying it. The committee posted this message on its Facebook page on Monday:

“The governor says the bridge will be free… But his plan depends on a $550 million loan from Canada. The Crossing Agreement makes clear: So long as that loan remains unpaid, Michigan is prevented from collecting any share of the toll revenues generated from the bridge — and Canada will continue to collect interest. That could put Michigan in debt to Canada for decades to come.”

Tunnel closing causes huge backup on Ambassador Bridge

Bomb scare closes Detroit-Windsor tunnel

This is another reminder of the need for redundancy at the Detroit-Windsor border. Crossings between Buffalo and Niagara Falls have five bridges to choose from and carry a fraction of the traffic.

Delays at the bridge could cause missed deadlines for factories that rely on just in time deliveries for parts, and force them to close down as they’ve had to do in the past when these types of closings have occurred.

The New International Trade Crossing would provide six new lanes of traffic and would serve as additional security against delays and backups that are costing the Michigan and Canadian economies millions of dollars each year.

Taking Back the Park

Last Friday evening around 5:30 P.M., some 100 protesters gathered at Riverside Park in Detroit underneath the great blue span of the Ambassador Bridge to tear down what Matty Moroun had put up: a 150 foot fence cutting off parts of the park and a section of Jefferson Avenue. Mr. Moroun is the owner of the bridge, the only privately owned border crossing between the United States and Canada.

The billionaire has long been opposed by those claiming unethical business practices, titling him a “slum lord” and painting him as a greedy billionaire obsessed with profit over anything else. As of late, this is hard to dispute.

Protesters are saying Moroun has put up fencing on publicly owned land, illegally, and were determined to get answers Friday. Saws, bolt cutters and power tools were present as demonstrators attempted to take back what was there’s. They were met with four squad cars and threats of detainment.

Siting homeland security as the reason for the fencing, police attempted to disperse the crowd after an hour of angry voices making their arguments over megaphones. The thing is, Moroun doesn’t own the land he has sectioned off.

State politicians like Rep. Rashida Tlaib have been speaking out on the issue for some time, and perhaps with much of the fencing torn down (which Moroun employees rolled up and took away, assumed to be put back up) a new light will be shed on the criminal activities of a highly caricatured businessman who is already attempting to sue the Michigan and Canadian governments over control of a second bridge, yet to be built.

SNYDER SAYS SUPPORT FOR D.R.I.C., ERR, N.I.T.C., GROWING

Gongwer News Service

Ford, Chrysler, General Motors, Honda and Toyota all back a new trade crossing over the Detroit River, but call it the New International Trade Crossing project, not the Detroit River International Crossing, according to a press release issued by Governor Rick Snyder on Thursday.

“To compete as a world-class community, we strongly support the construction of any new crossings to improve traffic flow and reduce or eliminate congestion. We also need this crossing to be built expeditiously. For these reasons we support Michigan’s New International Trade Crossing,” said Bill Ford, executive chairman of Ford Motor Company.

“Greater traffic flow and border crossing capacity gives our U.S. and Canadian manufacturing operations more flexibility to meet the needs of U.S. consumers,” said Mark Reuss, president of GM North America.

The release highlighted Mr. Snyder’s agreement with the federal government to use the $550 million the Canadian government has offered the state for DRIC as part of its federal match for transportation infrastructure funding

About

MICHIGAN’S BRIDGE TO THE FUTURE

  • A world-class international bridge to secure a transportation corridor with Michigan’s largest trading partner.
  • Providing 10,000 new construction jobs to Michigan workers.
  • Generating more then $2 billion in federal matching highway funds for Michigan roads.
  • A $1.3 billion dollar investment that will not cost Michigan taxpayers a dime.

Background

In 2004, a commission was formed to explore potential sites for a new additional border crossing in the Detroit-Windsor corridor. The 82-year old Ambassador Bridge has become the nation’s busiest bridge, but it does not have the capacity to meets the future needs of a world-class trade and transportation infrastructure between Michigan and Canada.

A joint partnership between Canada, Ontario, Michigan and the U.S. government looked at more than 20 possible locations for a new border crossing. The area where Delray currently exists (on the Michigan side) was chosen as the best possible location for a new international border crossing. The U.S. and Canadian governments have approved the environmental permits for the New International Trade Crossing (NITC) and on June 15, 2012, signed an historic agreement to build the bridge.

The Need for a New Bridge

Chrysler Corporation estimates that delays at the Detroit-Windsor crossing adds more than $600 to the average car manufactured in the Michigan-Ontario region. Today’s just-in-time manufacturing businesses lose productivity when deliveries are delayed. A recent snowstorm closing HWY 402 in Canada forced auto plants across our state to close down as well.

The Detroit-Windsor crossing is an asset that gives Michigan an edge in foreign trade. Canada is Michigan’s largest trading partner with $62 billion in trade in 2010 – 237,000 Michigan jobs depend on trade with Canada.

The Detroit-Windsor corridor also handles approximately 25 to 30 percent of all trade between the United States and Canada. More than eight million American jobs depend on that trade. The goal of the commission was to locate an ideal site for a new international border crossing that would add redundancy, security, and a direct connection between I-75 in the United States and Highway 401 in Canada while providing the added capacity needed to meet the future demands fueled by a recovering economy.

The new bridge would add redundancy as an alternate route for industrial traffic as well as provide security in the case if anything were to happen to the current border crossing. The direct connection between I-75 and Highway 401 would save Michigan shippers and manufactures millions of dollars currently lost to delays.

In 2010, truck traffic across the Ambassador Bridge was up by more than 17 percent. As Michigan’s and the national economy continues to recover, studies show the truck traffic doubling by 2035. The proposed international trade crossing project would be six new lanes bringing the total to ten from Detroit to Windsor. As a comparison the Buffalo-Niagara crossing (the third busiest crossing in North America) has 14 lanes on four bridges.

$1.3 Billion Investment in Michigan

The Michigan side of the new international bridge is estimated to cost $1.3 billion to construct a customs plaza, a toll plaza and connection to I-75 and one-half of the bridge. The bridge will be paid for by private investors through a public private partnership financing agreement. The Plaza, I-75 connection and Michigan’s share of the custom’s plaza will be paid by the Canadian Government’s $550 million investment in the project. The federal government will pay for the balance on the cost of the customs plaza. Michigan taxpayers will not pay a dime for the project. The Canadians and the private investors will be repaid by the tolls collected on bridge.

Leveraging New Federal Highway Dollars

In addition, the Federal Highway Administration has agreed to allow Michigan to use the $550 million Canadian investment to match federal highway construction funds for projects across Michigan. This will provide more than $2 billion dollars for new road construction dollars creating thousands of additional jobs.

A Private Investment in Michigan

The agreement would create a bridge authority in partnership with the Canadian government. The authority will put out bids to privately design, privately develop, privately finance, privately construct and privately operate the new international bridge. Anyone can bid on this project – including the owners of the Ambassador Bridge. The State of Michigan will not expend any tax dollars to the authority and will not be liable for any debts or obligations as the agreement states:

The Michigan Parties shall not be required to fund any International
Crossing Costs, Michigan Interchange Costs, US Federal Plaza Costs, Crossing Authority Costs or International Authority Costs.

Furthermore, should the tolls collected from the bridge fall short of the dollars needed to repay the Canadian and/or private investors in the project, the Canadian government has agreed to accept the responsibility for any short-fall.

Creating Jobs for Michigan Workers

During the construction stage of the project, Michigan workers will build the Michigan side while Canadians build their side. It is estimated that 10,000 Michigan construction workers would be hired for the project and the new bridge would help support an additional 25,000 Michigan jobs once it’s completed.