How Festival Epicure Built The Enhancement Project

Are the pieces of the puzzle finally coming together but in a way that no one ever expected?

You remember the deal don't you...DRTP and the Ambassador Bridge each contributed 50% of the amount required to allow the Festival to go on after it looked like it was going to have to be postponed. We learned that Mike Hurst called Dan Stamper to ask him to contribute and Stamper said he would if DRTP paid half.

I always wondered why Mike made that call. I figured that something was up and there was! DRTP now wants to build a rail tunnel under the river so it means that their original plan to build a truck tunnel may now be dead. My speculation on this was correct after all. I think that Mike was having fun with the Bridge Co. but in the end, I think his phone call will result in the building of the Enhancement Project.

Mike is a strong Windsor booster. That is well known. And saving the Festival is a good civic action (and also a way to take a shot at the man who took over after he left office). However, DRTP needed to be loved by Windsorites too. They had a new plan, another change in what they were. Why not help pay for a Windsor Festival.

I am sure that most of you do not read CRAINS Detroit so let me post excerpts of a story they ran on the new DRTP rail tunnel proposal. It may be significant for the Detroit/Windsor Tunnel as well and the Ambassador Bridge Enhancement Project:

• Tunnel vision: With land in hand, partnership looks to flex muscle on new rail crossing
  By Andrew Dietderich and Amy Lane6:00 am, June 4, 2007
  
  Seven years ago, Marge Byington and a group of investors came forward with a plan to build a new commercial railroad tunnel under the Detroit River connecting the U.S. and Canada, which they say would save at least 12,000 local jobs.
  
  Until this year, the plan was stalled because the city of Detroit owned a key piece of land required for the project that it did not agree to sell to the partnership until April. While preparing to close on the sale last week, the Detroit River Tunnel Partnership, or DRTP, said it will now use political clout in and outside of Michigan to secure roughly $100 million in federal funding and permitting support to put the rail tunnel on a fast track.
  
  Without a new tunnel, freight trains will bypass Detroit for a newer tunnel in Port Huron that larger double-stack railcars can fit through, said Byington, who held economic-development posts in the former Commerce Department under Gov. John Engler and in the city of Detroit under Mayor Dennis Archer.
  
  Now the director of government relations for the U.S. side of the DRTP, Byington warns that if the Port Huron rail tunnel surpasses Detroit's, development and jobs would head north to Port Huron as companies decide to move jobs closer to rail lines that pass through the Port Huron tunnel.
  
  The DRTP claims that if it doesn't get the last portion of funding and help getting an estimated 70 state and federal permits it needs from the federal government quickly, Michigan could lose out on millions spent on new and upgraded plants while continuing to lose jobs as more companies opt to use the rail tunnel in Port Huron.
  
  Calgary-based Canadian Pacific Railway Ltd. and other railroad companies that use the Detroit-Windsor tunnel can't fit double-stack rail cars that carry SUVs through the Detroit crossing.
  
  The only other option besides Port Huron would be to truck that cargo either over the Ambassador Bridge in Detroit or the Blue Water Bridge that connects Port Huron to Canada.
  
  The DRTP's new rail tunnel would cost between $400 million and $450 million. The DRTP has most of the money from the tunnel's owners, Canadian Pacific and an investment arm of the Ontario Municipal Employees Retirement System.
  
  The partnership has enlisted congressional representatives whose districts have a business connection to Canadian rail and trade.
  
  One DRTP supporter is U.S. Rep. Lynn Westmoreland, R-Ga., a member of the House transportation and infrastructure subcommittee. “This is a national issue,” said Westmoreland, who toured the existing tunnel last September and met with members of the Detroit Regional Chamber, local union members and the Detroit City Council.
  
  “Rail is extremely important in getting timely products into and out of Canada. We need to do everything we can to remain solid trading partners. The Detroit-Windsor border crossing affects how product is delivered to and from Canada. It needs to be updated. Period.”
  
  Georgia also has automakers such as Kia Motors America Inc. with large plants in the state.
  
  James Hoffa, president of the Washington-based Teamsters union, said the tunnel, called the “Jobs Tunnel” by DRTP, should be an urgent priority. “It will attract more rail freight, will keep the region's rails service viable and will help Southeast Michigan become a logistics hub,” Hoffa said in a written statement to Crain's.
  
  In a speech Wednesday night at the Detroit Regional Chamber's Mackinac Policy Conference, Hoffa further stressed the importance of the tunnel.
  
  “The jobs tunnel will revitalize a 100-year-old rail tunnel,” Hoffa said in his speech.
  
  Dan Stamper, president of the Detroit International Bridge Co., owner of the Ambassador Bridge, supports a new tunnel, even if the bridge would lose some business to the tunnel.
  
  “We support anything that improves the logistics and transportation options in Detroit,” Stamper told Crain's Wednesday.
  
  Backups at the bridge also have been cited as a reason for the tunnel by the DRTP.
  
  John Taylor, an associate professor of marketing and logistics at Grand Valley State University, said he doesn't buy that argument.
  
  “We did a study and found that there's typically never more than a 30-minute wait for trucks at the Ambassador,” Taylor said.
  
  U.S. Rep. Mike Rogers, R-Brighton, said the tunnel and a new bridge in the works could co-exist. Two separate plans call for new bridges.
  
  Still, Rogers said “there are a couple things to me that are very important: competition, redundancy and security. Certainly the tunnel fits those criteria.
  
  “If they (planners of a second bridge) want to build another bridge, and the tunnel gets built, I'm not sure that's a bad thing,” he said. “The more activity we have flow through that border crossing, I think helps Detroit, helps the suburbs, helps the state...”
  
  But the rail crossing in Detroit is outdated and can't accommodate today's larger trains like the Tellier Tunnel. Because the Detroit-Windsor tunnel is too small, double stacked rail cars need to be unloaded before the tunnel and then reloaded after crossing, or take an alternate route.
  
  The report says that if the tunnel is built the region will retain between 9,000 and 12,000 jobs because of the economic activity created by the tunnel. Byington said another 1,700 jobs will be created each year for four years for construction and jobs also would be created on a permanent basis to operate the tunnel.
  
  And she said the rail tunnel — along with possible new bridge capacity; the “aerotropolis” proposal to develop the area in, around and between Detroit Metropolitan Airport and Willow Run Airport; and the Detroit Intermodal Freight Terminal under study in southwest Detroit — are all pieces of infrastructure that collectively could position the region as a hub of logistics.
  
  U.S. Sen. Debbie Stabenow, D-Lansing, at the request of rail-tunnel proponents, is seeking a $500,000 congressional appropriation for a study that would look at the rail tunnel to determine if it is the best way to increase rail freight traffic in the Detroit-Windsor corridor, said Brent Colburn, Stabenow's deputy chief of staff. He said factors to be studied would include feasibility, impact on existing infrastructure, and cost.
  
  Colburn said Stabenow “definitely sees that there's a need for a new transportation option, back and forth across the border. We're still looking at all the possibilities, and the study would be part of that process.”
  
  Though the DRTP has spent between $75 million and $100 million in engineering and environmental studies in the last seven years — about what it's seeking from the federal government — the DRTP only recently began to seek federal assistance. That's because it received approval to buy 20 acres from the city of Detroit in April.
  
  The proposal to sell the land went before the Detroit City Council “seven or eight times,” in the last four years, Byington said. Each time, however, Mayor Kwame Kilpatrick's office would request the study back for more examination.
  
  “Detroit needs to be a center for transportation,” said Matt Allen, press secretary for Kilpatrick. “But we really need to look at any international crossings that want to be here and how that would incorporate into our side of the river. That's not something you just step right into.”
  
  DRTP plans originally called for converting the existing rail tunnel — which consists of two smaller tubes side by side — into a crossing for trucks. Canadian and U.S. government agencies planning to build a new bridge Downriver as part of the Detroit River International Crossing project, however, didn't receive the truck tunnel project well, Byington said. So the project was scaled back.
  
  The amount of money committed for the tunnel has not changed by Canadian Pacific and Borealis Infrastructure Management, part of the Ontario Municipal Employees Retirement System. That amount is 75 percent of the total cost, or between $300 million and $337.5 million. Since the DRTP has committed to not seeking money from Detroit, Wayne County or the state of Michigan, it's turning to Washington, D.C. to fund the remaining 25 percent.
  
  Bill Shreck, director of communications for the Michigan Department of Transportation, said M-DOT supports the idea of the tunnel and has offered to set up a meeting with the Federal Highway Administration, Transport Canada and the Ontario Ministry of Transportation to “get all the parties together, see if there's any issues, and what we could do to facilitate.”

What is the significance of all of this:

1. Remember the Nobrega speech I quoted that said that OMERS/Borealis had $300M to invest. That was new money I believe. They had NOT said that they were going to put that money into the truck tunnel
2. The cost of the rail tunnel has escalated dramatically up to $400-$450M. Back in 2004, Marge Byington suggested it would cost around $210M
3. DRTP still wants $100M from the Governments
4. The sale of the piece of land in Detroit has to be the key signal that Borealis has a major involvement in what is going on. Kwame would have had to agree to it.
5. I have to believe that somehow Borealis is behind Windsor's Tunnel deal so Detroit's deficit can be paid off. We have no idea how Windsor is going to finance it, we see all of this funny math and project costs. It would not surprise me to see a deal amongst Detroit (sale of the strip of land needed), Windsor (DRTP lands turned into greenspace), Governments (providing money for all of these projects) to eliminate Detroit's budget problems, finance the Tunnel and rail tunnel and who knows what else. It would not surprise me either to see Alinda's proposal being used to get Windsor's bid upped so Detroit Council can say it got a victory too.
6. DRTP just helped the Enhancement Project get built!!!
7. US Rep Mike Rogers talked about "competition, redundancy and security" which were key areas of concern for DRIC. Ambassador Wildson at Mackinac talked about capacity and security. Those issues have NOW been eliminated by a DRTP rail tunnel
8. There can be no logical opposition to an Enhancement Project today
9. A DRTP rail tunnel falls into rail rationalization and Eddie's transportation hub concept
10. How can Transport Canada dare try to stop the Ambassador Bridge when it will help its competitors, the City's Tunnel and the DRTP tunnel
11. Canada's Foreign Affairs Department and Michael Wilson in particular are now running the Windsor border file NOT Transport Canada. The PMO has made that clear now!
12. If this works out, Harper might actually gain a seat or two in Windsor!