Kiwanis Speech

A speech I delivered to the Kiwanis a few weeks ago on border matters.

I want to thank you again for inviting me to give you a talk about what is going on in Windsor these days.

I could speak about 86% water utility increases or the $65 million and counting East End arena. What about the fleet operations audit where dead man didn’t pump gas or the 400 Building audit that has been going on now for about two years.

Perhaps I could talk about economic redevelopment. Members of our Development Commission just spent a few days in London England at our expense to try to promote the region. Perhaps I could talk about how the Automobile Capital of Canada soon may not have an auto industry here. Or the $100M Jobs fund that has gone nowhere. Our Mayor believes that sending our best and brightest out of the City is the way to solve our unemployment problem.

There is the Engineering Complex and urban village fiasco, the problems with the downtown, the Capitol theatre, and so on and so on and so. The only bright light seems to be Caesars Casino and who has won money there?

I didn’t mention one matter and that is the border. I thought that it might make sense for me to talk about this subject today in some detail since it has so dominated our City for so many years. I hope then that you will understand where we are.

All I can say is that no one could ever write a story about what I will tell you because it is so unbelievable. There is some kind of a hidden agenda at play here. Unfortunately I have not been able to discover it.

Let me deal with the issue as it effects Windsor directly. Let me talk about the following matters:
1) The Tunnel Plaza Improvements
2) The Tunnel deal with Detroit
3) The DRIC Road and Greenlink
4) The Bridge Company Enhancement Project compared with the DRIC Bridge and Plaza

TUNNEL PLAZA IMPROVEMENTS

I could never understand this transaction when it was first announced. It was entered into on March 11, 2004 as part of the Phase 1 agreement for the “Let’s Get Windsor-Essex Moving strategy.”

Under this agreement, the Federal and Provincial Governments would each contribute $10 million to the cost of the improvements while the City would contribute another $10 million making $30 million in total.

The reason that I say that I do not understand the transaction is because, at the time it was entered into, the key issue was truck backups on Huron Church.

For truck traffic solutions, we did get the pedestrian overpass on Huron Church Road at Assumption High School and the long left turn lane at Huron Church Road at Industrial Drive. But for the Bridge Company opening up new Customs booths, we still might be having back-ups.

Obviously, it seems with hindsight that our Mayor was more concerned about the Tunnel than truck backups because he wanted Senior Level money to help improve the Tunnel Plaza so that he could do his deal with it with Detroit as I shall discuss later.

Where are we with this project… nowhere. The City has put it on the back burner for a number of years. It would appear that the City cannot put up its $10 million. There has not been any finality with respect to the plans, it is over-budget I’m told by many millions of dollars and the three levels of Government cannot get any agreement as to who shall pick up the extra costs.

This leads into:

THE TUNNEL DEAL WITH DETROIT

I’m scratching my head here. If we do not have the money to improve the Tunnel Plaza, then how can we do a Tunnel deal for the money involved?

I cannot tell you what the transaction is, it has changed so many times. The terms of the transaction have been kept secret from Windsor taxpayers.

Just so you will have some idea of what it’s about, apparently the City or its new Tunnel Company wants to borrow $75 million from the Province of Ontario’s Infrastructure fund. Now I would have thought that this fund was to be used for Provincial purposes but apparently our Mayor believes that it can be used to plug a budget hole in the City of Detroit. That money would be loaned to Detroit or its new Tunnel Company so that Windsor would get a lease on the Detroit half of the Tunnel and would be able to operate it for the next 75 years.

This transaction has been going on for well over a year again with no finality. I’m sure you know about all of the votes that the Detroit Council has taken on this. In every vote they took, they opposed this transaction. However, in literally the last second, they flip-flopped and gave the Detroit Mayor another 120 days to try and do the deal with Windsor.

I wish I understood the business case for this transaction but I do not. The City of Detroit to has to pay back the loan to Windsor. However, it only makes $700,000 a year on the Tunnel because now and for the next dozen years its half of the Tunnel is leased out to a company called Alinda.

My understanding is that the Province of Ontario loan will bear interest at around five or 6% a year. A payment therefore of about $4 to 5 million per year is required to pay down the loan. How will that loan be paid off by Detroit if it only has $700,000 for the interest? How will Windsor be able to pay the Province what it owes since its dividend from the Tunnel has been reduced to zero dollars?

Frankly, why would anyone enter to the Tunnel deal in the first place since the volume at the Tunnel has shrunk dramatically since its peak and is still going down. The Tunnel has lost market share to the Ambassador Bridge which has just opened up seven new car lanes into the United States, almost the equivalent of the number of lanes that the Tunnel has today. Moreover US DRIC has said once its new bridge opens it will take away about 25% of the Tunnel’s business.

DRIC ROAD AND GREENLINK

Can you really believe this? We’re fighting over some tunnels. 15,000 jobs are at stake, high-paying ones too, that are desperately needed in the City with one of the highest unemployment rates in Canada and our Mayor is running ad blitzes against the DRIC Road and still threatening lawsuits.

The obvious reason why DRIC ignored Greenlink is that the tunnels were too long. DRIC did not want a tunnel that was more than 240m and Greenlink has several that are much longer. On that basis alone, Greenlink does not meet the DRIC’s criteria and is therefore rejected.

With the changes in diesel fuel and diesel engine technology, one has to ask what are the quality of life issues that our Mayor is so concerned about. When most of the pollution in Windsor comes from the United States, why is he making such a big deal about Greenlink?

In my opinion, it all comes down to money. One has to be naïve to believe that the Senior Levels will spend an extra billion dollars to please our Mayor by giving him a few extra acres of green space which the City can’t afford to maintain in any event.

In my opinion, Greenlink is nothing more than a negotiating tool that the Mayor is using to try and get money from the Senior Levels for Windsor so that we can be paid for being the “host community” for an international border crossing. It is nothing more than another tactic just the way Schwartz Report number one and full tunneling were used, and used unsuccessfully by the City.

Our Mayor’s huffing and puffing and threatening lawsuits for the umpteenth time are nothing more than his way of telling the Senior Levels that he has the ability to stall off for years the completion of the DRIC road. In other words, what he is saying to them is settle with me now so that your project can go forward.

Now some of you may think that this is a pretty smart negotiating tactic. I imagine what the Mayor is saying to the Senior Levels is that they have $1 billion to play with given the difference in costs between the DRIC and Greenlink roads. Therefore share some of that money with us and we will approve going forward with the DRIC.

My concern is that we are not the ones with the cash nor are we the ones with the strongest bargaining position. I don’t believe that the Mayor is such a good poker player. What if he calls their bluff and they decide to fold and walk away from Windsor. Then where are we? No DRIC Road, no jobs, total devastation for our economy for years to come.

ENHANCEMENT BRIDGE VERSUS DRIC BRIDGE

So what we have so far? Tunnel Plaza Improvements that we cannot pay for, a Tunnel deal that makes no business sense, a Greenlink road used as a negotiating tool and now this, building a new bridge.

There is no doubt that there are animosities involved. The Bridge Company was called the “enemy” of the City after all. We also have to remember that one Government, the City as owner of the Tunnel, is a competitor of the Bridge Company for border traffic, while another Government, the Federal Government is their competitor for the new crossing while at the same time is their judge and jury for their Enhancement Project.

Here is what is so absurd about it all. Detroit can close down an interstate highway for almost 2 years to allow for the construction of the Ambassador Gateway project while the City of Windsor cannot close a small street on a temporary and intermittent basis so that the Bridge Company can undertake some repairs to its bridge. Our City can freeze development in Sandwich for two years thereby refusing permission to the Bridge Company to tear down abandoned homes that they own already on Indian Road that they want to turn into green space using the Green Corridor group from the University of Windsor.

In my opinion, the whole the DRIC bridge concept was nothing more than an attempt by the Government of Canada to try to scare the owner of the Ambassador Bridge into selling his bridge to them as cheaply as possible. Did they ever misjudge the man and because of that error, the new bridge matter is a mess.

In both Sarnia/Port Huron and Buffalo/Fort Erie, a new bridge was built or is to be built right beside the existing bridge. But not at Windsor.

Don’t you find that strange when the Ambassador Bridge location was analyzed and said to be the best location on the US side by US DRIC itself. Don’t you find it strange that about a quarter of a billion dollars will be spent on the Ambassador Gateway project yet the Americans want to duplicate it only a few blocks away?

With their project, the Bridge Company has already the property they need. No one has to be expropriated. The DRIC project will force hundreds of families and businesses to be uprooted in Delray, Michigan and at least 30 families to be relocated in Windsor. A “handful” as the DRIC spokesperson said.

We have to remember why this project got started in the first place. Remember that the truck traffic was supposed to double over the next 30 years. Then we heard about security and redundancy and that we could not just have one bridge since so much of our commerce goes over the Ambassador Bridge.

Of course, with the slowdown in the economy, with the economic woes being suffered by the Big Three causing a decline in the automotive industry in the Windsor/Detroit area, truck traffic has decreased to 1999 levels. Car traffic has crashed at both the Bridge and the Tunnel since 1999. Can anyone truly say that there is an expectation that traffic will increase dramatically in the foreseeable future?

What a phony issue security is. If it really was a concern, there would be reverse customs where vehicles are searched before they cross the Bridge. One only has to recall that in previous terrorist attacks there were multi-targets at the same time, not just one. As far as redundancy goes, with the construction of the new bridge we would now have a backup bridge, the old one, as redundancy to be used as required.

If then there is no good reason to move forward why are we doing so? Please explain to me why Governments are so insistent to spend billions of dollars when a private entity, the best border operator in North America, is prepared to spend his own money.

Here is the complete absurdity of the situation. The Governments want to set up a public-private partnership for the new DRIC bridge. The Governments will own it but then they will turn around and this P3 will hire a private operator to construct and manage the bridge under contract for some period of time, perhaps 75 years or more. They are removing one private operator for another for what reason.

And just so you understand why the Bridge Company is upset, according to a US DRIC the new bridge would not only draw traffic from Port Huron but would take 25% of the Tunnel traffic and the vast majority of the Bridge Company traffic. In other words the new bridge may cause severe financial hardship to all the other crossings which will then mean that the Government will have to subsidize them or they risk going out of business.

I think I should stop there. I have given you a lot to absorb in a very short period of time. I’m sure that you want me to make some sense out of all this but I’m afraid I can only guess.

In my opinion, the border file is much more than the Ambassador Bridge or the DRIC road or the Tunnel. It has to do with the economic future of Canada and the whole NAFTA debate that Senator Obama has started talking about. Remember he may want to renegotiate if he becomes President and that can hurt Canada. In the end, all of this has to do with trade corridors and gateways and whether Canada can control how our goods and foreign goods that come through Canada will be distributed in the United States.

Our Government laudably wants to protect our access into the US, and we need it, but they are making such a mess of it. NAFTA-gate—the leak that hurt Senator Obama in the primaries--and the border file are just examples of the poorly thought out actions of our Government that risk our future.

Someone can tell you what is going on but no one will. Politicians and bureaucrats do NOT trust the people. Perhaps one day we may see who is behind the Wizard’s curtain and what this is all about. Perhaps, one day.