Essay: Build the Bridge – 5.28.10

The Michigan House narrowly passed a bill to approve a new bridge over the Detroit River. As Michigan Radio’s Jack Lessenberry says, it’s now up to the Senate.

Hear Audio Story Here

What do L. Brooks Patterson, Jennifer Granholm, the Ford Motor Company and the government of Canada have in common?

They are all in favor of the proposed new Detroit River International Crossing Bridge, usually known as DRIC for short. It would be built about two miles south of the old Ambassador Bridge. Private investment would be welcome, but DRIC would be jointly owned and run by the United States and Canada.

The pro-business, Detroit Regional Chamber of Commerce is solidly in favor of the bridge. So is State Rep. Rashida Tlaib, a liberal who represents the area that includes both bridge sites.

The Michigan Legislature now needs to decide whether to proceed with the project, and it should be a no-brainer. The government of Canada is so convinced a new bridge is necessary, that it has offered to cover Michigan’s share of the costs, money to be paid back later out of tolls.

Brooks Patterson estimates a new bridge could mean six thousand jobs for his Oakland County. The governor says as many as ten thousand could be created overall.

These would be good paying jobs that might last only a few years, but which are desperately needed in Michigan now.

All that has to happen at this stage is to approve a bill to allow the state to enter into public-private partnership agreements on transportation projects like the bridge.

But the House only narrowly passed the bill Wednesday without a single Republican vote, and now the bridge’s fate is up to the GOP-controlled Senate. And prospects are doubtful, because one man is firmly opposed — Manuel “Matty” Moroun, the eighty-three-year-old billionaire owner of the eighty-one year old Ambassador Bridge.

Right now, he has a monopoly. Detroit-Windsor is the nation’s biggest and most important trade crossing. Billions of dollars in goods rumble across the Ambassador Bridge every year.

But it is wearing out. There is no backup if something happens to the Ambassador, and while the volume of trucks declined significantly during the recession, it is now moving back up again.

Even Moroun knows a new bridge is going to be needed, but he doesn’t want to lose his monopoly. He wants to build a second bridge of his own next to the current one, instead. Trouble is, few others think that is a good idea, for reasons involving security, pollution, and the freeway system in Canada.

Even the thoroughly free-enterprise Detroit News says it was time to recognize reality and start building the DRIC bridge.

The Canadian government has indicated it will never allow the Ambassador Bridge to be twinned, But Moroun isn’t giving up the fight. He figures Job One is stopping the competition.

Accordingly, he continues to oppose DRIC. He donates lavishly to political campaigns, and whether for this or other reasons, he has strong supporters in the legislature still trying to stop the new bridge.

This seems suspicious, given that the Republican-controlled Ohio senate just voted unanimously in favor of the DRIC bridge. Michigan needs the jobs it would create, and needs to avoid the very real threat of having trade diverted to the crossing at Buffalo, New York. So, now our future is up to the Senate. In this case, if we don’t build DRIC, a whole lot of jobs won’t come.

And our lawmakers need to do the right thing.

Ford Motors Tesifies: Michigan Needs World-Class Infrastructure.

Charlie Pryde, Director of Michigan Government Affairs for Ford Motor Company, testified today before the Michigan Senate Transportation Committee regarding the Detroit River International Crossing.

“Anything that improves the flow of goods across the border will help to improve our business — which is critical in today’s competitive marketplace.”

Pryde testified that Ford strongly favors the DRIC, “…an improved border crossing can prove to be a major catalyst to a strong economy and a resurgent auto industry.”

According to Pryde, “on a typical day, 600 trucks carrying a full range of components, engines and completed vehicles cross the border between Ontario and Michigan.”

Pryde also sees the vulnerability in only having one span across the Detroit River.

“If anything were to happen to stop or disrupt traffic for any extended period of time on the current Ambassador Bridge, the economic effects for Ford, our suppliers and the hundreds of other businesses that depend on the crossing, would be devastating.”

While the Ambassador Bridge management and their billionaire bridge owner Matty Moroun continue to contend that the current traffic flow does not constitute a new bridge, Pryde refuses to see the merit in that argument.

“[W]e should not be planning the State’s future on the current economic conditions. A major project, like an international bridge, takes years to build. A traffic study, released earlier this month, shows truck traffic across the Ambassador Bridge up more than 21% or 1,000 trucks a day over the same period last year.”

Pryde’s testimony illustrates the importance of the DRIC to both Ford Motor Company and the economics of Michigan as a whole.

Ohio Legislature recognizes the need for the DRIC bridge

NEW DETROIT RIVER BRIDGE CRITICAL TO PRESERVING OHIO’S ECONOMIC RELATIONSHIP WITH CANADA

Since 1929, the Ambassador Bridge stretching from Detroit, Michigan to Windsor, Ontario has served as a vital economic link between Canada and the United States. Approximately 54 percent of U.S. trade with Canada moves by truck, and nearly half of this truck traffic travels through the Detroit and Port Huron, Michigan border crossings to and from
states across the Midwest, including Ohio.

In recent years, however, the 81-year-old, privately-owned bridge has been a point of delay for trucks and other vehicles crossing the border, and there are reports that the structure is in need of major repairs. These problems have not only slowed the movement of commerce, but have left many American and Canadian public officials, business owners and workers concerned
about the future stability of trade between the two countries.

Canada is the largest foreign trade partner for the United States, with hundreds of millions of dollars in goods crossing the border each day. In particular, much of this commerce comes from or is destined for Ohio. Canada is our state’s top export market, accounting for nearly $36 billion in economic activity in 2008 and supporting an estimated 267,500 Ohio jobs.

Recognizing the vital importance of the U.S.-Canada trade relationship, the State of Michigan and Transport Canada, the Canadian transportation department, are pursing a public-private partnership to finance and build an additional border crossing over the Detroit River, known as the Detroit River International Crossing (DRIC). The new bridge would consist of six
lanes, with three lanes bound for the U.S. and three lanes bound for Canada.

While much of the preliminary work is complete, the Michigan Department of Transportation needs legislative authority to enter into an agreement with Canada and other public and private partners to move forward with construction of the DRIC. The project would have a tremendous impact on the U.S. economy, creating 10,000 construction jobs and more than 30,000 indirect jobs.
On May 18, I gave sponsor testimony in the Senate Insurance, Commerce & Labor Committee on Senate Resolution 223, which urges the Michigan Legislature to act swiftly to authorize the DRIC and ensure that people and goods can continue to move safely and efficiently across the border. The resolution states that “a modern border crossing that can support the ever-increasing amount of trade and travel between the United States and Canada is essential to the economies of Ohio and the Midwest.” It goes on to say that the Ohio Senate “fully supports the new Detroit River International Crossing project,” which will “lay the foundation for future productivity, growth and economic stability.”

As a member of the U.S.-Canada Relations Committee for the Council of State Governments Midwestern Office, 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.

For decades, the Ambassador Bridge has stood as an economic lifeline between Canada and the U.S. However, as the global economy changes and trade and travel between the two countries increases, we need the DRIC to help preserve a secure and efficient link between American and Canadian governments, businesses and people, while working to ensure that the U.S.-Canada relationship remains strong for generations to come.

To view SR 223, visit http://www.legislature.state.oh.us/res.cfm?ID=128_SR_223. I encourage residents from the 1st Senate District to contact me with any questions, thoughts or concerns about state government issues. You can write me, Senator Steve Buehrer, Ohio Senate, Statehouse, Columbus, Ohio, 43215, or contact me by phone at (614) 466-8150. I can also be reached by email at SD01@senate.state.oh.us. In addition, for more information about my work in the Ohio Senate, please visit my page on the new Senate website at http://www.ohiosenate.gov/steve-buehrer.

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For more information, please contact Kim Wheeler in my office at 614-466-8150.

Vehicle Manufacturers Urge Governments to Secure Detroit River International Crossing Without Delay

Toronto, May 20, 2010: The Canadian Vehicle Manufacturers Association (CVMA) whose members include Canada’s leading manufacturers of cars and heavy trucks fully supports the strong partnership between legislators and governments on both sides of the Canada-United States border and encourages them to proceed with securing the new international crossing at the Windsor– Detroit gateway without delay.

With the highly integrated automotive industry between Canada and the United States, automotive trade is worth roughly $100 Billion annually, with the majority of production parts and finished vehicles flowing through the Windsor-Detroit gateway. As a result, the industry has long supported additional infrastructure capacity in the Windsor-Detroit corridor in order to help support existing automotive manufacturing in both Canada and the US, and will help make the region more attractive for future jobs and economic growth.

The CVMA and its member companies applauded the offer made recently by the Government of Canada to fund up to an additional $550 million towards the construction of the much needed additional international crossing between Windsor and Detroit. The Association is hopeful that the additional support offered by the Government of Canada towards this additional crossing will help eliminate the remaining hurdles towards moving this infrastructure investment forward and along with it, the plan to improve international trade and commerce through this region.

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About the Canadian Vehicle Manufacturers’ Association
The Canadian Vehicle Manufacturers’ Association is the industry association that has represented Canada’s leading manufacturers of light and heavy duty motor vehicles for more than 80 years. Its membership includes Chrysler Canada Inc.; Ford Motor Company of Canada, Limited; General Motors of Canada Limited; and Navistar Canada, Inc.

For further information please contact:
Mark Nantais
President
Canadian Vehicle Manufacturers’ Association
416.560.4005
mnantais@cvma.ca

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.

Fact Check #2

Keeping the Facts Straight on the DRIC and Public Private Partnership Legislation

There is a deliberate misinformation campaign being waged against H.B. 4961, to block legislation that would allow public private partnership projects (including the Detroit River International Crossing project) to be built in Michigan. Below is a list of organizations that support and oppose the DRIC project.

Opposing the DRIC

Detroit International Bridge Company

Sierra Club Ontario

(Linc, Mason Dixon Intermodal, Inc., Supply Chain Solutions & Universal Logistics have been emailing legislators in opposition. These are Moroun owned companies)

Supporting the DRIC or P3 Legislation

Access Engineering

Advanced Geomatics

Alfred Benesch & Company

Alliance of Automobile Manufacturers

American Council of Engineering Companies of Michigan

Arvin Meritor

Automation Alley

Automotive Parts Manufacturers Association

Backstrom McCarley Berry & Co., LLC

BASF

Canadian Auto Workers

Canadian Automotive Partnership Council

Canadian Industrial Transportation Association

Canadian Manufacturers & Exporters

Canadian Motor Vehicle Manufacturers Association

Canadian Teamsters, Local 879

CCN Matthews News Distribution Experts

CH2M Hill

Chrysler

Conway

Corradino Group of Michigan, Inc.

CZAE

David Bing, Mayor of Detroit

Detroit Logistics Company

Detroit Regional Chamber of Commerce

Detroit-Windsor Truck Ferry

DLZ Michigan, Inc.

Eddie Francis, Mayor of Windsor

Elaham Shayota LLC

Elsey Construction Products

Evans Group

Ex-Imp Global

Fishbeck, Thompson, Carr & Huber, Inc.

Ford Motor Company

Gannett Fleming of Michigan, Inc.

Gateway Communities Development Collaborative

Governor James Blanchard

Governor John Engler

Grand Valley Metro Council

HH Engineering, Ltd.

HNTB Michigan, Inc.

International Union of Operating Engi0neers, Local 324

International Union, UAW

James Group International

L. Brooks Patterson, Oakland County Executive

Laborers International Union of North America, Local 625

Magna

Michigan Association of Counties

Michigan Infrastructure & Transportation Association

Michigan Manufacturers Association

Michigan Regional Council of Carpenters & Millwrights

Michigan State AFL-CIO

Monroe County Industrial Development Corporation

National Association of Manufacturers

Northwest Consultants, Inc.

NTH Consultants, Inc.

OHL USA, Inc.

OHM Advisors

Ontario Chamber of Commerce

Ontario Road Builders’ Association

Ontario Trucking Association

Opus International Consultants, Inc.

Parsons

Parsons Brinkerhoff

Road Commission for Oakland County

SEMCOG

Somat Engineering, Inc.

Southern Wayne Regional Chamber

Southwest Detroit Community Benefits Coalition

Steve Tobocman, former State Representative

Surveying Solutions, Inc.

TesTech, Inc.

The Mannik & Smith Group, Inc.

The Michigan Building and Construction Trades Council

Transystems

TY Lin International

URS Corporation Great Lakes

Walbridge

Wayne County Commission

Chrysler CEO Backs the DRIC

Delays at Ambassador Bridge is costing Chrylser $300 per car according to testimony by a Chrylser executive at the House Transportation Committee hearing

Comments by:

Sergio Marchionne
Chief Executive Officer
Chrysler Group LLC

March 15, 2010

Every day, the combined U.S. and Canadian auto industry sends thousands of cross-border truck shipments and well over $100 million of goods across the Detroit-Windsor border. These trucks carry vehicles and production parts that are destined for automotive assembly plants in Ontario, Michigan, as well as other U.S. states.

The integration of our industry makes the movement of trade between Canada and U.S. important and dependent on each other. The North American automobile industry and the hundreds of thousands of employees in vehicle assembly and parts production depend on the smooth flow of just-in-time deliveries across this critical border gateway.

In light of the importance of efficient and effective infrastructure to the success of the automotive industry, Chrysler strongly supports the partnership between the governments of Michigan and Ontario, as well as Canada and the United States, as they work toward securing a new gateway at Detroit/Windsor.

The automotive industry continues to support the proposed Detroit River International Crossing, or DRIC. This proposed new crossing would add redundancy and unimpeded access from Ontario’s highways to Michigan’s interstates.

DRIC will bring $1.8 billion in investment to the Detroit – Windsor area and would create 10,000 construction jobs in Michigan and generate another 30,000 indirect jobs in Michigan and Windsor.

In the coming months, the Michigan Legislature will consider a bill to authorize construction of the new DRIC bridge. It is my sincere hope that the Legislature will pass the bill by the June 1st deadline.

The need for an additional crossing to handle current and future trade flows is widely acknowledged and it is imperative that this new crossing be completed as soon as possible. It’s important to our collective future!