Canada and the US Need This Bridge Now: Get the Facts

Dear Connect2Canada Friends,

On June 15th, Prime Minister Harper and Governor Snyder agreed to build a publicly owned bridge between Windsor and Detroit, the New International Trade Crossing.

The rationale for this bridge is clear. Over Eight million jobs in the US, including 237,100 jobs in Michigan, depend on trade and investment with Canada. Much of this relies on the Ambassador Bridge, which saw more than $120 billion worth of trade cross over it in 2011. This is fully one quarter of Canada-US trade in goods, making it the most important bridge crossing in the world.

However, the Ambassador Bridge is 83 years old, is too narrow for today’s needs and lacks adequate customs plazas. In addition, access to the bridge is located in downtown Windsor, which requires trucks to travel through residential streets and 16 traffic lights to reach the on-ramp. Any plans to expand the current bridge do not therefore solve the larger congestion and delay problems.

With truck traffic conservatively predicted to increase 128% over the next 30 years, it is imperative that a solution is found. The New International Trade Crossing is that solution. It will be six lanes wide, with dedicated lanes for pre-screened cargo, and a direct freeway-to-freeway connection that avoids downtown Windsor and Detroit, thereby reducing delays and the massive costs associated with them.

There have been a number of misleading advertisements about the bridge and its costs — here are the facts:

  • There will be no cost to Michigan. Michigan’s share of the bridge cost, estimated to be $550 million, will be paid by the Government of Canada and recouped through bridge tolls. Any cost over-runs or revenue short-falls will be paid by Canada.
  • The bridge will be built with US and Canadian steel. The waiver to Buy America allows for Canadian steel to be used, but not steel from other countries.
  • The bridge will create 10,000 – 15,000 direct construction jobs in Michigan.These well-paying construction jobs will provide a direct boost to Michigan’s economy. The New International Trade Crossing has the support of Governor Snyder, the Governments of Indiana, Ohio and Kentucky, the Chambers of Commerce of Michigan, Indiana and Ohio, as well as automobile manufacturers, building trades and steel workers unions and farm organizations. In fact, the only real opposition comes from one company trying to protect its current monopoly on the Ambassador Bridge.

This bridge is needed to increase the competitiveness of our manufacturing sectors, create jobs on both sides of the border and ease travel between our two countries. I hope that I can count on your support in seeing this project through.

Yours sincerely,

Gary Doer

Ambassador of Canada
to the United States of America

Bridge proposal opposed by a wide diversity of people

Kalamazoo Gazette

Proposal 6 is a constitutional amendment that would require voter approval for any new bridge or tunnel from Michigan to Canada. Though the language is broad, it’s specifically aimed at the proposed New International Trade Crossing between Detroit and Windsor. It was filed by billionaire Manuel “Matty” Maroun, owner of the 82-year oldAmbassador Bridge, to maintain his monopoly on international bridge traffic and tolls. Maroun paid roughly $2.3 million, mostly to the People Should Decide Ballot Committee, to collect the signatures needed to put the Proposal on the ballot.

The Oct. 7 Kalamazoo Gazette printed two lengthy articles analyzing Proposal 6, plus comments by an opponent and a proponent. Rather than rehash that material, I want to focus on a list of four individuals and 177 organizations that oppose Proposal 6, which I found on in a report called Bridging the Border. Because of the list’s length, I’ve recapped it as follows: four surviving past governors, three automakers, 25 Chambers of Commerce, 13 labor unions, 56 businesses, 25 transportation and municipal leaders, 6 agricultural business organizaitons, 35 business organizations and community associations and 13 newspapers.

This list of Proposal 6 opponents is extraordinary not only in its diversity, but even more so because some of its groups are more often than not on opposite sides of an issue. In pursuing his nefarious goal of embedding Proposal 6 in our Constitution, thereby assuring his family’s stream of income from the ancient Ambassador Bridge will continue, presumably until it crashes into the Detroit River, Maroun is spending freely from his billions. In addition to the $2.3 million mentioned earlier, he has spent $9 million on TV ads last year.

All things considered, I intend to vote no on Proposal 6, and I urge everyone else who believes in good governance to do the same.


Grand Rapids area chamber president: Proposal 6 is bad economics, will result in disastrous public policy

By Rick Baker and Sandy Baruah |

There are 31 million reasons and counting to vote “no” on Proposal 6. That’s the amount of money – $31 million – reportedly committed by Ambassador Bridge owner Matty Moroun on Proposal 6. Why would one person spend such an unprecedented amount of money trying to thwart Michigan’s economic recovery? The quick answer is he wants to buy your vote so he can protect his lucrative monopoly.
The Detroit Regional Chamber and Grand Rapids Area Chamber of Commerce represent hundreds of organizations and thousands of businesses from East and West Michigan that are united on this issue. Proposal 6 is bad economics for Michigan and will result in disastrous public policy. Our members are committed to moving the economic needle and moving Michigan forward, but Proposal 6 would be a giant step backward.

Legal experts have analyzed the language in Proposal 6 and have determined it could require a statewide and local vote for any bridge, tunnel or overpass built in Michigan after January 1, 2012. This flawed language could require voters to approve by statewide and local elections any new bridge or tunnel built in Michigan. Our state could essentially be forced to wait until the next election before being able to build a bridge anywhere in the state.

Major projects that could be impacted by Proposal 6, like the New International Trade Crossing and Detroit rail tunnel, are infrastructure projects Michigan needs to compete in the global economy.

Canada is Michigan’s largest trading partner with more than $70.2 billion in trade in 2011. About 237,000 Michigan jobs depend on Canada-Michigan trade. In fact, one in seven jobs in West Michigan and one in eight jobs in Southeast Michigan rely on that trade. Keeping this trade relationship robust is crucial to our economic success.

Michigan’s current infrastructure is not equipped to accommodate the growing demands of international trade. Over 8,000 trucks cross the Detroit-Windsor border daily, 99 percent of which cross the 83-year-old Ambassador Bridge, which has no direct freeway-to-freeway access.

Traffic is forced to travel seven miles on a commercial street with 17 stoplights to reach Highway 401. In the global market, minutes of delay costs businesses millions of dollars, particularly for the auto industry which depends on just-in time delivery. These frequent delays caused by traffic jams on the Canadian side of the current bridge significantly hinder economic expansion and our businesses’ ability to compete.

Windsor-Detroit truck traffic is projected to increase by 128 percent over the next 30 years. This will only exacerbate the congestion problem and as delay time at the border grows, so will the likelihood that national and global businesses will look for a more efficient route to the market. The international border is one of Michigan’s greatest economic assets. Businesses in every corner of the state benefit from this flow of commerce and investment. Proposal 6 will erode this advantage and sends the wrong message to investors across the globe.

The dark days of 2008 and 2009 proved one thing – the global economy is ruthless. Fierce competition drove Michigan’s auto industry to the brink of collapse. The global economy will not stop evolving and international trade will flow along the path of least resistance.
States – like Michigan – that fail to invest in the future and stay ahead of competitors will fall behind. A No vote on Proposal 6 will help ensure that doesn’t happen. Support Michigan’s future, protect our constitution and vote no on Proposal 6.

Dave Murray is the Grand Rapids community engagement specialist. Email him at and follow him on Twitter @ReporterDMurray or on Facebook.

Rick Baker is president and CEO of the Grand Rapids Area Chamber of Commerce, and he writes this with Sandy K. Baruah, president and CEO of the Detroit Regional Chamber.
The chambers oppose Proposal 6, which would require the approval of a majority of voters at a statewide election and in each municipality where “new international bridges or tunnels for motor vehicles” are to be located before the State of Michigan may expend state funds or resources for acquiring land, designing, soliciting bids for, constructing, financing, or promoting new international bridges or tunnels.

The proposal defines a “new international bridges or tunnels for motor vehicles” that means, “any bridge or tunnel which is not open to the public and serving traffic as of January 1, 2012.”

Say no to the Troll

Jack Lessenberry | Metro Times

Oct. 31, 2012

The last word on Matty Moroun’s Proposal 6

Next week, Michigan voters will make a vastly important choice, and if they choose wrong, it may cripple any attempts to revive our economy — forever.

If you vote yes on Proposal 6, you’ll be selling out your state, your democracy and your constitution so that one lying, bloated, greedy billionaire can get even richer at our expense.

His name is Manuel “Matty” Moroun, and he has spent a fortune — $31 million so far — in an attempt to confuse voters into giving him the right to ruin their hopes for a brighter future and preserve his monopoly for all time.

Moroun is, most likely, the worst citizen in this state who isn’t currently behind bars — and that’s saying something. He’s an 85-year-old slumlord whose symbol is the hulking ruins of the mammoth train station people see as they drive into Detroit from the south. Moroun and his family also own the Ambassador Bridge, the only way heavy automotive components can cross the Detroit River.

He also owns a vast trucking empire, and his trucks get preference crossing the bridge. He makes hundreds of millions every year from diesel fuel and gasoline stations at the bridge.

Diplomats, especially perhaps Canadians, tend to be very cautious about what they say about citizens of other countries. But monsters are different. Here’s what Roy Norton, Canada’s consul general in Detroit, says about the Morouns, meaning Matty, his wife, Nora, and his son, Matthew:

In all his years in government, many of which were spent in Washington, “I saw special-interest behavior that would make you cringe. But never did I see such a comprehensive effort by one interest to bend the entire system to its will.

“The Morouns act as if, by virtue of being billionaires, they are entitled to do whatever they want … and if you are above the law, as the Morouns seemingly think they are … they’ve decided to get even.”

Getting even isn’t the right term for it. The Morouns want to preserve their monopoly by any means necessary — lying, legalized bribery, endless lawsuits, you name it.

Proposal 6 would prevent any new international bridge from being built without a statewide vote. Which is a laugh, since the Morouns own enough state lawmakers to prevent any referendum from ever getting on the ballot.

If they win, it’s bad news for the rest of us. Anyone who takes any time to understand what’s really going on here is apt to be blown away by the nakedness of the Moroun family’s lies.

Here’s the scoop: Every major corporation wants a new bridge over the Detroit River. Every politician not on the take from Matty Moroun knows a new bridge is necessary.

The economies of Michigan and Ontario are terribly dependent on trade. Billions of dollars’ worth of heavy manufacturing components cross the Ambassador Bridge every year. But it was built in 1929, and it’s wearing out.

If anything were to happen to it — say, a terrorist attack — there’s no backup, and our economies would plunge into crisis. Incidentally, it takes years to build a new bridge.

Knowing that, those who really care about our future want to build one now. The new bridge is even more important for Canada than the United States — so much so, that they’ve offered us one of the world’s all-time sweetheart deals.

Canada will make sure we get the bridge, free of charge. Actually, it’s a much better deal than that. Canada will shell out the estimated $550 million the bridge will cost Michigan.

Eventually, we’ll pay that back to them — without interest — from our share of the tolls collected. But we get an added bonus: If Michigan accepts Canada’s money, Washington will allow us to count it as federal highway matching funds.

That means we get an extra $2.2 billion dollars from Washington to fix Michigan’s crumbling roads. Obviously, our federal government knows we need a new bridge.

But that doesn’t please Moroun. He and his paid mouthpieces, Dan Stamper and Mickey Blashfield, are capable of saying in the same sentence that a new bridge isn’t needed — and that they want to build another one, right next to theirs.

Idiots who have been fooled by them sometimes say, “Yeah, why not let them build it? Private enterprise is better.”

But there are a few small problems. The Morouns don’t own enough necessary land on either side of the border. Plus, there’s no way Canada would or should let him twin his bridge. It would be a logistical and environmental disaster.

Heavy trucks crossing the Ambassador now face 16 traffic lights and horrendous backups before ever making it to the freeway.

That’s another reason a new bridge is needed. Gov. Rick Snyder tried to secure legislative approval — but Moroun paid off key committee heads in the form of “campaign contributions” and other donations. The governor couldn’t even get the Legislature to take a vote. But Snyder found a legal way to circumvent Moroun and struck a deal with Canada.

The two governments agreed on a New International Trade Crossing two miles downriver. Besides the other benefits, the NITC will create at least 10,000 good-paying jobs, many of them permanent ones. Enraged, Moroun shelled out millions to canvassers to collect enough signatures to get Proposal 6 on the ballot. Since then, he’s coughed up roughly another $31 million, mainly for incessant TV ads that are nonstop lies.

“You should believe nothing said in those ads,” Norton said, correctly. “None of what they say is true. None of it. These ads are an insult to the people of Canada, which is why I’m so active in speaking out.

“These ads, it’s worth remembering, are paid for by the same scoundrels who reneged for six years on the Gateway project, designed to improve U.S. access to their bridge, taking the people of Michigan for a $230 million ride.”

Gateway, remember, only got done after a judge threw Matty Moroun in jail last winter, took the project away from the Morouns, and made them pay the state to get it done right. Some people really are bad to the bone.

Can Michigan voters be so stupid as to sign their rights and their hope for a better future away to this gang?

The answer is entirely up to you.

High Noon in the library stacks: Thanks to the current Supreme Court’s reading of the Second Amendment, and millions of morons who cling to their weapons the way a baby does his blanket, we live in an age of insane gun worship.

That means a never-ending series of entirely predictable atrocities, from the losers who murder their children, to the creature who shot up the theater in Colorado last summer.

Yet this wasn’t enough for two judges on the Michigan Court of Appeals. Last week, Henry Saad and his comrade Jane Beckering ruled that Lansing’s Capitol Area District Library could not continue to ask people carrying guns to leave.

Why? Well, they said Michigan law says that local units of government aren’t allowed to set different firearms rules. There was one dissenter: Judge Elizabeth Gleicher, long one of the brighter lights in the Michigan judiciary, who said the law her colleagues cited doesn’t even apply to district libraries.

But common sense wasn’t what her conservative colleagues had any interest in. As Brian Dickerson of the Detroit Free Press observed, “My problem isn’t that (they) have decided to enforce a law I don’t like; my problem is that they don’t seem to have read the law they’re claiming to uphold.”

Jack Lessenberry opines weekly for Metro Times. Send comments to

Could ‘Yes’ vote on Prop 6 backfire on Ambassador Bridge Gateway Project?

By Paul Egan
Detroit Free Press Lansing Bureau

LANSING — Passage of Proposal 6 could have the perverse effect of blocking access to the Ambassador Bridge, Lt. Gov. Brian Calley said today.The proposed constitutional amendment, bankrolled with more than $31 million from companies controlled by Ambassador Bridge owner Manuel (Matty) Moroun, is intended to create an obstacle to a proposed public bridge to Canada by requiring a statewide vote on new international crossings.

At a news conference in Lansing today, Calley repeated an argument he’s made for months that due to an “enormous error in the drafting” of the proposal, it would affect any Michigan bridge that was not open to traffic by Jan. 1, 2012, not just new international bridges.

Calley today gave that argument a new twist, saying Proposal 6 would compromise the recently connected Gateway Project that links the Ambassador Bridge to the state freeway system.

“That was not open to traffic as of Jan. 1,” Calley said of the Gateway project. “Their proposal might even prevent access to their own bridge.”

An Ambassador Bridge spokesman could not immediately be reached for comment. But Moroun officials in the past have rejected suggestions Proposal 6 applies to projects other than international crossings. They say the Michigan Supreme Court effectively rejected those arguments also when it approved the question for the Nov. 6 ballot.

Calley said the Supreme Court never considered the question of what types of bridges would be affected by the proposal.

The lieutenant governor was joined at a Lansing Regional Chamber of Commerce news conference by a local government official and a union official. Both expressed grave concerns about the scope of the proposal/

“No bridge could be built without having statewide and local voter approval,” said Judy Allen, director of government relations for the Michigan Townships Association.

After significant delays, the $230-million Gateway project opened to traffic in September.

State sues Moroun’s company over noncompliance in selling gas at Ambassador Bridge



Detroit — The state of Michigan is again suing Manuel “Matty” Moroun, accusing the billionaire’s Ammex duty-free store of selling gasoline with lower than advertised octane ratings.

The suit, which was filed by the Michigan Department of Agriculture and Rural Development, also accuses Ammex of releasing higher than allowed amounts of fuel vapor into the air from its pumps located on the Ambassador Bridge plaza.

According to Agriculture Department Director Jamie Clover Adams, Moroun’s company faced the same complaints in 2009 and 2011.

“We went to Ammex in early summer…and found they were selling gas that was labeled as 93 octane when it was really 91,” Adams said. “We returned in June, and they were in compliance with octane ratings.”

But inspectors discovered an air quality problem when they took vapor pressure samples.

“They had higher pressure vapor readings than allowed,” Adams said. “Between June 1 and Sept. 15, stations in southeastern Michigan are required to sell a summer blend of gasoline, which produces low vapor pressure.”

That special blend is more expensive because it is more highly refined. Ammex had a financial advantage by selling noncompliant fuel, which was unfair to the other stations in the area that were paying higher prices for their gasoline.

The agriculture department issued a stop sell order to Ammex, which Adams said the company ignored.

“They continued to sell gas…we could have padlocked the pumps, but that would have been pretty drastic. We’d rather focus on having people come into compliance.”

According to Adams, Moroun’s company did finally meet air quality regulations, but only four days before the summer gas season ended on Sept. 15.

“In the last three years, we’ve only had three or four instances where stations haven’t been in vapor compliance,” Adams said. “On average, it only took those stations about nine days to correct the problem. It took Ammex 82 days, which is financially unfair to the 1,952 stations in the Metro area.”

On Sept. 21, the state sent Ammex a settlement offer in which the company would pay fines based on the financial benefits the company received from selling the wrong gasoline.

“So far I haven’t heard back from them, which is why we were forced to file suit against them,” said Adams who noted that any recovered fines would go to the state’s motor fuel quality fund.

Over the past four years Moroun, who also owns the Ambassador Bridge, was involved in a number of lawsuits with the Michigan Department of Transportation over his noncompliance with the massive Gateway Project.

MDOT and the Detroit International Bridge Co. agreed to build the $230 million Gateway Project, which was meant to move thousands of trucks off local streets and directly to and from the bridge to nearby interstates.

MDOT sued the DIBC after it unilaterally made changes to the Gateway contract not agreed to in the original terms.

The DIBC’s portion of the project was finally turned over to MDOT in early 2012 and was completed by September.

Moroun is also in a protracted battle with Gov. Rick Snyder over his plans to build a second international bridge between Detroit and Windsor, Ontario.

Moroun, who is bankrolling millions in ads against the New International Trace Crossing, has said the new span is unnecessary and would steal away up to 75 percent of the commercial traffic which now uses the Ambassador Bridge.

According to Adams, the suit against Moroun has no connection to his current struggle with Snyder.

“I would have filed the same suit if it had involved Company ABC in Gaylord,” she said.

Calls to Moroun and the DIBC for comment were not returned Thursday.

(313) 222-2023

From The Detroit News:

Snyder urges Windsor-Detroit business leaders to fight against Moroun’s proposal

The Windsor Star

Posted by:
Dave Battagello

The push to build a $1-billion downriver bridge triggered  a war of words Monday as Michigan Gov. Rick Snyder came to Detroit as guest speaker for a prominent group of business leaders from both sides of the border.

Snyder and Canadian Consul General Roy Norton spoke and answered questions for nearly an hour during a town-hall style luncheon meeting of the Canada-U.S. Business Association held at the downtown Westin Book Cadillac Hotel.

The pair made a plea for help to defeat a ballot initiative known as “Proposal 6″ brought forward by Ambassador Bridge owner Matty Moroun that would force a statewide vote for construction of any future international crossing.

The measure will be on the Nov. 6 ballot.

“This is a bridge where we are not using taxpayer dollars (in Michigan) and we want to vote on it?” Snyder said. “There is only one special interest fighting against (the new bridge) and that’s Matty Moroun and the Ambassador Bridge. They are the one entity that will continue to make a lot of money on this (if the proposal gets passed).”

Moroun generates $60 million in annual toll revenues at his bridge and millions more in duty-free sales of gas and goods. He has spent at least $10 million in an advertising blitz to get his proposal passed.

Snyder signed a binational agreement with Canadian Transportation Minister Denis Lebel in June to build the Detroit River International Crossing bridge that would link the industrial communities of Brighton Beach and Delray.

Under the deal, Canada will pay up to $550 million to cover the state’s share of the project, which could reach $2.5 billion once plazas and feeder roads in Detroit are included.

Snyder said he believes the agreement is in force regardless of the Proposition 6 vote, but fears if Moroun’s ballot proposal prevails it will give the bridge company a pretext to tie up the DRIC project for years in the courtroom.

“In Michigan and how it’s been recently, can you think of one good reason to delay thousands of jobs?” Snyder said. “This is critically important. Lets move forward on this bridge.”

Snyder said the best way to consider the benefits of the DRIC bridge is to draw a circle on a map extending from Montreal to Chicago. That circle will encompass one-third of the North American economy, with Windsor-Detroit in the middle, he said.

“Let’s build on that,” said Snyder, noting five per cent of his state’s workforce is reliant on Canada-U.S. trade. “What you need is more crossings. This is not a project to slow down or stop. This is a fabulous project. It’s not just about a bridge, but international trade and trade jobs.

“Think how many more jobs we can add by having more crossings. Not just construction jobs, but long-term jobs. If you are not supportive of this project, then you are not supportive of 10,000 jobs coming to Michigan.”

Norton said the DRIC bridge is Canada’s “No. 1 infrastructure priority.”

The federal government has offered to front Michigan’s cost for the bridge project because it no longer wants to rely solely on Moroun’s 85-year-old bridge — North America’s busiest trade crossing handles $500 million of goods on average each day, he said.

“We need to buy insurance and that’s why we are paying for this bridge,” said Norton, who estimated Canada will recoup its investment through tolls in about 50 years and once paid off the revenues will be split with Michigan for the remainder of its life span.

He called Moroun’s ad campaign full of “distortion and fabrications.” He said the bridge owner’s refrain that “Chinese steel will be used” on the DRIC bridge is wrong. “Only Canadian and U.S. steel” will be used on the project, he said.

Norton also said construction work on the Michigan side will be done with labour from that side of the border — not Canadians as Moroun claims  — even though Canada is paying for the bulk of the project.

“Mr. Moroun knows that yet he persists in saying ‘there will be no work for Michiganders,’” Norton said. “There will be 10,000 jobs for Michiganders. We are paying the costs, but everyone wins with this project.”

Click here to read the full story.

MDOT director in Midland: Canada will incur all bridge expenses

Midland Daily News

By John Kennett

Michigan Department of Transportation Director Kirk T. Steudle paid a visit to Midland on Friday.

Steudle, who previously served as state transportation director, touched on a variety of topics headed by Proposal 6, which addresses the New International Trade Crossing (NITC) from Detroit to Windsor, Ontario, when he spoke at the Midland Area Chamber of Commerce’s Wake Up! Midland event. The bridge would be built in addition to the Ambassador Bridge to handle the volume of trade that crosses the border.

“We need a new bridge and frankly, it needs to happen sooner rather than later,” said Steudle.

However, Manuel ‘Matty’ Moroun, who owns the Ambassador Bridge, has spent millions on television ads opposing the building of the new international crossing, stating that the citizens of Michigan will be responsible for the cost of the bridge.

But the agreement that Gov. Rick Snyder signed with Canada states that Canada will incur all expenses.

“This campaign season, if nothing else, should educate people that we can’t believe everything we see on TV,” said Steudle. “At the bottom of page one of the agreement, the very last sentence says, ‘The State of Michigan is not responsible for any costs of this crossing.’”

Presently, $70 billion of trade flows between Michigan and Canada.

“One in eight jobs in Southeast Michigan is tied to trade,” said Steudle. “In Mid-Michigan and West Michigan, it is one in seven jobs that is tied to trade. Trade is very important to us.”

On a national level, almost $600 billion in trade passes between the U.S. and Canada.

“Thirty-four other states depend on the border crossings of Michigan,” said Steudle. “If this bridge and border crossing closes, 34 states are going to feel it and they are going to feel it fast. It is the largest bottleneck in the Pan-American corridor all the way down to Florida.”

Instead of traversing through the streets of Windsor and Detroit, the NITC would provide a freeway to freeway connection.

“From a logistic standpoint this is essential,” said Steudle. “It is not dumping into a city street in Windsor. Would you want to double the amount of traffic in your city, into your main street or downtown Midland?”

The NITC is not the first time that Canada and Michigan have entered into an agreement to build a bridge.

“Fifty years ago, we did this exact same thing in Sault Ste. Marie with the International Bridge,” said Steudle. “For that bridge, Michigan sold the bonds, Michigan bought the bonds, Michigan paid for the bonds. It took us 40 years of toll revenue to pay the bonds back.”

The NITC will be built, financed and eventually managed by private companies, meaning 10,000 construction jobs.

“When you have the whole thing built, we will have 30,000,” said Steudle. “(The NITC) will attain an additional 25,000 long-term jobs. It is a tremendous opportunity for us to put a national piece of infrastructure in our backyard that will help our businesses all across this state.”

Click here to read the full story.

Will new bridge to Canada cost Michigan taxpayers? We ask a law professor

“The contract is quite explicit and clear that the State of Michigan incurs no obligation, no legal obligation, to pay for the construction or the maintenance of the crossing.”

Michigan Radio

By Lester Graham

As election day approaches, you’re likely to see a lot of ads critical of an agreement between Canada and Michigan regarding a new bridge between Detroit and Windsor.

[Ad Clip:] “It will cost Michigan taxpayers $100 million a year.”

Whether Michigan taxpayers are on the hook for the cost of that bridge is at the heart of a fierce debate about the agreement.

This agreement between Canada and Michigan is basically a contract. Essentially it says Canada is fronting the money for the bridge, including Michigan’s costs to connect our highways to the new crossing. The money will be recaptured through tolls to cross the bridge.

The owners of the Ambassador Bridge want to stop the new bridge because it will mean competition to their existing privately owned bridge. The Matty Maroun family and its entities have launched a multi-million dollar TV ad campaign that insists it will cost Michigan taxpayers.

We asked Dan Crane, a Professor of Law at the University of Michigan to look over the contract and answer whether Michigan taxpayers could be on the hook for any of the cost.

“The contract is quite explicit and clear that the State of Michigan incurs no obligation, no legal obligation, to pay for the construction or the maintenance of the crossing.”

Professor Crane says there are a lot of details in the agreement and some of them indicate the people of Michigan will end up paying for some of the cost in other ways.

  • “For one, the contract specifically contemplates that to cross into Canada there will be a toll.”

So, we’ll have to pay tolls if we cross the bridge. Got it.

  • “Secondly, the contract contemplates seeking outside sources of funding. There’s a clause that defines revenue as not only the tolls collected, not only the direct funding from the government of Canada, but also seeking outside sources of funding. So, if that ends up coming out of federal, the only point is that it’s federal dollars we’re going to spend on this and not something else.”

So, if federal dollars are one of those outside sources, U.S. taxpayers could end up throwing in some more money, but that’s not definite. Okay. Got that.

  • “And, finally, even though the contract does not require Michigan or the State of Michigan’s legislature to pay any of the costs of building or maintaining the bridge it doesn’t disallow that either. And one could imagine that at a future date if there are large cost overruns or delays in the completion of the bridge, that someone might say the Michigan legislature should kick in money to get the job done.”

So, if there are cost overruns or the bridge doesn’t bring in enough money, Michigan taxpers could be asked to throw some money, although that’s not specifically in the agreement. Okay. Got that too.

Governor Rick Snyder has repeatedly said Michigan taxpayers are not on the hook and Canada is putting up the money.

“So, they are advancing the expenses on the Michigan side that will be repaid from tolls. So, there’s no Michigan taxpayer dollars being used for this project which is great,” Governor Snyder said in a video.

And Law Professor Crane says that is what’s in the agreement.

“The statement is valid insofar as they are not on the hook for the bridge as Michigan taxpayers, as people who pay taxes to the state of Michigan.”

But the Ambassador Bridge company commercials insist Michigan taxpayers will pay. Mickey Blashfield is a spokesman for the company.

“You know, we’ve documented that the figure is at least a hundred million dollars a year of cost to the Michigan taxpayer that would not be underwritten by any of the subsidy that Canada would give in building this bridge.”

Professor Crane says that’s true only if by “Michigan taxpayers” you mean “U.S. taxpayers.”

“Just to say it doesn’t come out of the State of Michigan as an appropriation is a different question from saying that Americans don’t pay for or that State of Michigan taxpayers in some sense don’t pay for it. Again, nothing that we do to create a major infrastructure development will come free to us,” Crane explained.

The $100 million mention by Blashfield is the money it would cost to operate a new Customs plaza, something we have at every border crossing in the country, including at the privately owned Ambassador bridge. U.S. taxpayers pay for border guards and Customs inspectors and, of course, Michigan residents pay U.S. taxes, but Michigan taxpayers would not pay the entire amount.

So, everything in the agreement indicates in a strict sense Governor Snyder is correct: there are no Michigan tax dollars going into the project and Canada is fronting the money for building the bridge. That includes the cost Michigan would normally bear, building the ramps to and from the bridge on the Michigan side.

Experts say new international bridge won’t cost Michigan taxpayers

By John Gallagher
Detroit Free Press Business Writer

Claims that have bombarded Michigan voters for months that taxpayers will be stuck with the bill for a multi-billion dollar bridge to Canada are not based in reality, said three independent law professors asked by the Free Press to review an international Crossing Agreement signed in June.

The advertising campaign from the People Should Decide, a group financially backed by Ambassador Bridge owner Manuel (Matty) Moroun and his family, has pushed that consistent message in several rounds of anti-bridge ads that are misleading, said two advertising experts who reviewed a recently released ad, also at the request of the Free Press.

Jennifer Henderson, a law professor at University of Detroit Mercy, John Mogk, a law professor at Wayne State University, and Marcia Valiante of the University of Windsor said the Crossing Agreement between Gov. Rick Snyder and Canadian Transport Minister Denis Lebel is crystal clear that Canada pays for the bridge and then recoups Michigan’s share, about $550 million, from future bridge tolls — not from Michigan taxpayers.

“It very clearly says it’s not funded by Michigan. … And throughout the agreement those words are repeated,” Henderson said.

Even so, the two ad experts say the anti-bridge message might be resonating because it’s working like political attack ads — thumping a single message even if it’s short on context or supportable facts.

The People Should Decide says its analysis of bridge finances is sound and that approval of Snyder’s New International Trade Crossing, and other projects like it, should be put to citizen votes. They say its consultant has determined costs for the bridge will skyrocket and that other “hidden costs” will saddle Michigan taxpayers with unwanted expenses for the next 50 years.

Recent ads claim the new bridge will end up costing $8 billion — nearly four times the official estimate — and force Michigan to lay off police and teachers and even tap senior citizen pensions to cover the cost.

“Will the ad be effective? Probably. Is it legal? Probably. Is it ethical or fair? Probably not,” said Hugh Cannon, a professor of advertising at Wayne State University.

Ballot issue in play

The Free Press asked the local professors for their opinions in light of a Moroun-backed ballot referendum, which, if approved, would create a constitutional requirement that any new international bridge or tunnel get a statewide and local vote before Michigan could spend any money. The referendum language says it would apply retroactively, impacting the NITC, to be built 2 miles downstream from the Ambassador. That issue, however, likely would be decided in court if the referendum passes, legal experts have said.

Mickey Blashfield, director of government relations for the Moroun business network and head of the People Should Decide effort, points out that the Crossing Agreement contains a clause that allows the terms to be changed in the future, which, he says, could mean a reshuffling of financial responsibilities. And a reworking of that agreement, he said, is more likely in the event of construction cost overruns and shortfalls in future toll revenue, according to the recent study paid for by the Moroun-backed group.

“Different experts have tackled this cost issue from different angles, but the one thing they all seem to agree on is the fact that there’s no such thing as a free bridge,” said Blashfield, whose group commissioned O’Keefe & Associates financial consulting firm of Bloomfield Hills to examine the new bridge project’s financial structure. “With so much on the line, the people deserve the right to decide how public money is best spent.”

Major corporations, including Detroit’s three auto companies, Honda, Toyota and various auto suppliers, back the NITC project, plus multiple business groups across the state, including the three largest chamber organizations — Detroit Regional Chamber, Grand Rapids Chamber and Traverse City Area Chamber of Commerce. They call the bridge a boon for Michigan’s economic future, saying traffic across the NITC inevitably will increase as the economy in Michigan and Ontario expands and the advantages of the new modern bridge become apparent to users.

Brad Williams, vice president of government relations for the Detroit chamber, said Detroit needs another international crossing option because drivers who cross the Ambassador Bridge have to contend with 18 stoplights in Windsor.

He said many European goods making their way into the U.S. arrive to Canada at its deepwater port in Halifax, Nova Scotia, but the trucks carrying those goods need a more efficient way to cross the border into the U.S.that doesn’t involve navigating Windsor traffic.

“Detroit is a logical choice. There’s a real opportunity here to build out a transportation, distribution and logistics industry,” Williams said. “The auto industry is completely integrated between Ontario and Michigan.”

Checking the claims

The Michigan Truth Squad, an effort connected with the nonprofit Center for Michigan think tank, issued a “flagrant foul,” its toughest verdict, against the People Should Decide’s claims made in advertisements, mainly that Michigan taxpayers will end up paying for the bridge and that the state’s debt load will increase because of it. The group characterizes a flagrant foul as a “statement that distorts or incorrectly states a fact.”

The group explains its verdict on its website: “These ads repeat claims, or advance new variants of old claims, that do not match available documents. The agreement with Canada puts the financial onus on Michigan’s neighbor, not Michigan, for paying the bills, including interest. Since Michigan is not appropriating construction dollars, no dollars are being diverted away from other public uses. Michigan is not increasing its debt load with the NITC project.”

The group said it is evenhanded in its assessments and looks at political commercials and speeches, issue advertisements, news releases, political websites and white papers. The group examines claims suggested by the public.

There have been several rounds of Moroun-backed ads that all push the idea that the cost of the bridge to be covered by Canada will somehow backfire on Michigan taxpayers. The Moroun-backed group has spent an estimated $10 million so far on the ads.

A recent ad called “Tough Choices,” says the bridge will become so expensive that Michigan would be forced to lose “quality teachers, cops on the beat, firefighters and EMTs,” and to reduce pension payments to seniors.

“Real cuts hurting real people,” the voice-over says. “Now that we know how much this bridge could cost us, shouldn’t the people decide?”

Cannon of WSU said the ad and others like it are dangerous because they are “deliberately using misleading imagery to “push the electorate to a certain decision,” which “undermines the very foundations of our political system.”

At the same time, Michael Bernacchi, a professor at University of Detroit Mercy, said the ads may be effective simply because they’re so bold and aggressive.

“I wouldn’t like to be combating this from the other side,” he said. “They’re out there first. They’ve been out there for a considerable amount of time with a single message. It’s developed a whole brand — it’s simple: ‘No bridge.’ “

Lt. Gov. Brian Calley, who serves as Snyder’s point man on bridge issues, condemned the “Tough Choices” ad.

“Their claims keep getting more bizarre,” he said. “They’re throwing out numbers. I don’t know what’s next. One hundred billion? A trillion? They don’t seem to be bound by any factual information.”

New anti-NITC ads starting this week follow the same story line as the others, depicting ordinary people worrying about their finances as the expense of a new bridge looms, threatening their futures. Central to the Moroun case is the claim that Michiganders will get stuck paying for the bridge despite contractual assurances to the contrary.

The legal ties

The Free Press asked the three law professors to review the Crossing Agreement language and give their opinions about the strength of protections for Michigan taxpayers in the document.

Valiante of the University of Windsor said, “The basic concept is that Canada will pay for everything up front then will recoup those costs through tolls and other revenues.”

Mogk, an expert at WSU on development issues, said, “I think it’s airtight on that question.”

On the first page of the agreement, it says the project will be built “with funding approved by Canada, but with no funding by the Michigan Parties. The Michigan Parties are not obligated to pay any of the costs of the new International Crossing.”

And on page 30 of the agreement, it says, “The Michigan Parties shall not be required to fund any International Crossing Costs, Michigan Interchange Costs, U.S. Federal Plaza Costs, Crossing Authority Costs or International Authority Costs.”

There are multiple similar references throughout the agreement.

Henderson noted that the agreement does state that the parties could amend the document in the future, which could mean some new payment scheme that might include a cost to Michigan. But she said major changes are only a theoretical possibility and not something likely to happen.

Change of heart?

Blashfield, head of the People Should Decide, contends it’s more than theoretical and a likely scenario as the Canadians find themselves responsible for a bridge that cost too much and with fewer tolls than predicted to cover the tab.

He pointed out that any shortfall in tolls allows Canada to collect its amount due plus interest from future revenues, creating a snowball effect moving forward that will push up the bridge cost to more than $8 billion, according to a study commissioned by the People Should Decide from the O’Keefe & Associates financial consulting firm of Bloomfield Hills.

Patrick O’Keefe, founder and CEO of the firm, told the Free Press the figure assumes a 10% cost overrun on construction costs, a 20% shortfall on toll revenue and a 50-year time frame for the mounting debt and interest to grow.

The analysis doesn’t explain how Michigan taxpayers would become responsible for the financial burden — which, according to the crossing agreement, belongs to Canada — nor does it assess the likelihood of toll revenues falling short.

According to the firm’s website, O’Keefe “is recognized as an expert in the fields of corporate reorganization, debt restructuring, turnaround consulting, refinancing solutions, due diligence support, valuation and litigation support.”

Blashfield said other “hidden costs” of the project also will burden Michigan taxpayers over the years. Among those:

• Tolls on the Blue Water Bridge that now go to Michigan will in part go to Canada in the future as some traffic diverts to the new bridge.

• Homeowners in Detroit’s Delray neighborhood, where the new bridge will land, will no longer pay property taxes once they’ve been moved out.

• Workers employed by the Ambassador Bridge who might lose their jobs to competition from the new bridge will pay less income tax.

Backers of the new bridge respond that new commerce generated by a more modern and efficient bridge will more than make up for any incidental economic losses, including employing its own bridge operators and construction workers. The new bridge will be wider, have more modern plazas on either end and provide seamless connections to expressways on both sides of the border.

The backers, including the governor’s office, point out that Delray is an economically downtrodden area with high unemployment, and most residents there are happy to be bought out so they can move.

Carl Smith, 60, favors construction of a new bridge, even if it means he will be forced to move from the Delray neighborhood where he has lived most of his life.

“It’s going to create jobs. It’s going to create jobs during construction and it’s going to create jobs when it opens,” he said.