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Thoughts and Opinions On Today's Important Issues
ANSWER TO QUESTION---No it was NOT Dan Stamper speaking about the Mayor. It was Hillary Clinton who accused rival Barack Obama of lacking substance and experience. She "Clinton portrayed herself as a fighter and Obama as someone who makes a lot of speeches that sound good but do not offer solutions." (Windsor Star, Feb 14)
Who did he think he was huffing and puffing with no aces in his hand. He needs the University to save his neck not the other way around. He is in no position to demand anything. After all, it is only a project worth over $100 million that can make Windsor a leader in research for the automotive industry.
As if the University should care. Imagine if the Engineering Complex was opened at the University campus, would he refuse to attend, would the City refuse to play, would he “snub” them too? Obviously not.
How about the Capitol and the threats against the Trustee to have him removed. Did the Trustee back off and do what Eddie and his lawyer wanted. As Councillor Halberstadt wrote some time ago:
The Trustee did not give in to the Mayor. We are still going to have litigation although with a new Capitol Board a settlement is easily achievable that should give everyone exactly what they want.
Interestingly, the Theatre seems to have re-opened anyway and is taking bookings until the end of the year. Don't you find it strange that the "fire hazard" issue that the Mayor talked about before seems to have disappeared from sight? Was the problem fixed and if so, why could it have not been fixed before? I guess the theatre is no longer a "fire trap."
The arena....wait until we find out what the price tag is going to be. I wonder if there is a pool amongst contractors as to what is the final number. And the Global Spectrum deal...has it been signed yet?
Our new IT industry, why there are allegations of poor working conditions, workplace violence, payroll shortfalls, cancelled lunch breaks and lower than promised commissions [NOTE: These have not yet been proven] But I notice that the Star has now linked Eddie back into it:
There is also a poll from Today's Trucking where the industry basically says we don't care if it is a public bridge or not, just keep it operating properly. Hardly a ringing endorsement for a Public Authority running a bridge from people whose business lives depend on a smoothly operating facility.
Of course, one of the best indicators of public opinion in Windsor, other than the increased number of readers to the various BLOGs in town, is the Windsor Star Forums. I'm sure that the Mayor and Councillors read them. If not, they had better do so. They are brutal, no matter what the story, against the City Government in language that frankly I would be afraid to use on my BLOG.
What I also find it very amazing about all of this, when talking about the Bridge Company, is that they have not been allowed to present their proposal to the public at the lengths that Sam Schwartz has been able to do so. Nor have they been involved in spending thousands and thousands of dollars, taxpayer dollars, when it is the City that does so in a massive advertising campaign previously and getting ready to start a new advertising Blitzkrieg.
What Eddie has done and is proposing again to do clearly reminds me of what ex-Mayor Mike Hurst did with his blanketing the City with billboards promoting DRTP. That didn't work either.
So I will say what the Mayor said in a Star story about Greenlink, just changing the words slightly:
Don't you think, dear reader, that we would be better served in Windsor if the feud game ended and all of the "families" started working together and cooperating.
It is absolutely accurate. Under his lack of leadership, this City is perishing, very quickly. While other cities prosper, our businesses close. While employers in other areas are begging people to come there because they lack manpower, our citizens are moving out. As house prices rise in other jurisdictions, our homes are being foreclosed. I told you the other day about the absurdity of the comment that a depression could be good for Windsor.
Look at the B.C. story
Don't you get it... our future is being encouraged to move out of this City. The young people who are just starting their careers are looking elsewhere....machine operators, automation technicians, shipping and receiving clerks, nurses and lab technicians, cooks and landscaper, electrical engineers, designers, technicians and support staff. They see no hope here and can you blame them. Heck, employers even want some of our "seasoned," grey hair types too.
Ahhh, you say, you're not being fair to the Mayor. After all look at all the jobs, jobs, jobs that will be created at the airport exporting onions. Wait a minute here. I thought foreign goods were to be shipped to Windsor to be re-distributed to the United States not the other way around as is being described now. All the high-paying jobs are going to be created in Germany not here.
I get it. The jobs that will be created in Windsor are warehouse type functions offloading products from trucks and putting them into airplanes. More minimum wage ones to go along with the call centre ones and the ones serving retired, rich Torontonians. Those should be terrific opportunities for newly educated University and St. Clair graduates.
But here's the hooker and what makes me absolutely sick to my stomach:
Three years!!! For hopefully 50 jobs!!! If this was not a G-rated BLOG I would be writing a whole bunch of expletives deleted. Eddie Francis and Federica Nazzani spent all of this taxpayer money for what! So that Eddie can tell us about some ridiculous opportunity and then say:
And this one:
Kwame needs a deal or else Detroit is in more financial trouble. Eddie needs a deal or he fails again to accomplish a goal. Moreover, an interesting question to ask is whether the City is in breach of its Agreement if the City Budget has said that the City will NOT pay out now its share of the Improvement costs. That is all Eddie needs…the Senior Levels walking out.
Ultimately, if Eddie does anything with the Tunnel or is forced into doing something, (probably for financial reasons since the City will no longer be able to afford it), it is my opinion that Canada’s Federal Government will be the main participant. However the price is going to be a lot less than our Mayor hoped for. It would be a good deal for the Feds since the price of both sides of the Tunnel has probably dropped like a rock given the needs of the 2 Mayors.
I do not think that anyone including the Feds has a big interest in the Tunnel any longer. I suspect that the Feds have an interest in ensuring that they have control of the Tunnel in the same way that they want to have control over the bridge to the United States and other border crossings across Canada. They also need it to kepp prices up for a P3 operator of a new crossing. Can't have low prices at the Tunnel to keep business from the DRIC bridge can we.
They played Eddie like a fiddle ever since the Bridge Co. deal for the Tunnel was over so that now he is desperate for a deal, any deal! The only question now is when will the Feds take Eddie out of his misery and pay him some money.
I doubt that the Province has the money to invest in a border crossing as Kwame suggested and probably would be criticized severely if it chose to do so. I hardly think that the Detroit/Windsor Tunnel is something that the Province needs to be involved in and in any event would have to get approval from the Federal Government under Bill C-3.
The Feds have been involved before and were expected to be the Mayor’s financing source. However that fell apart. Was that deliberate on the part of the Feds? Did that put Eddie in a real jam since they were his final back-stop if private investors turned him down?
We were told at a Council meeting that there were negotiations going on with respect to the Tunnel Plaza Improvements and I speculated at that time that they were money issues involved as well.
Now Eddie learns that the DRIC project will take away 26% of his traffic. That should certainly impact the revenues in a negative way at the same time that the City’s budget says that the dividend has to be slashed because there were capital projects that needed funding.
The Feds must understand very well because of their due diligence what the traffic is, the condition of the Tunnel, its value, and what is happening to it from a market share perspective. It is a declining asset that very few private investors would be interested in other than perhaps Alinda who is involved on the Detroit side but who I am sure would rather just be manager.
Did it make sense for Eddie to try and do a financial deal on the Tunnel? That gets into the whole argument about should there be P3 transactions involving public assets. For the sake of this BLOG, let’s make the assumption that substantial sums of money could be brought in to the City’s revenues by leasing it out so that it would be beneficial to taxpayers.
At one time I expect that the Tunnel, especially if Windsor could have purchased the interest of Detroit at a good price, could have had some real value. However, under the management of our Mayor as the Chair of the Windsor Tunnel Commission the value has dropped significantly. As I wrote before when dealing with the US $75 million deal that Eddie proposed:
I’m sure that you remember the Bridge Company’s number for the value of the Tunnel which seemed so low but which looks remarkably accurate when looking at the Tunnel today.
In yesterday’s paper it was stated that the Tunnel dividend was slashed to zero dollars due to traffic declines. Yet in December I saw the following:
The dividend has been cut rather dramatically as well. At the Joint Councils meeting in Detroit a few years ago the dividend was said to be $6.6M. It was then cut to about a million dollars a year I believe and now it is ZERO. Yet I had written a month ago:
Does anybody know what is really going on at the Tunnel because I’m very confused about it?
The Federal Government is in a very strong position right now and is probably the only one who is interested in the Tunnel. Did the Mayor’s fear of acting ultimately do him in and us too as we may only see a fraction of what the Tunnel was worth only a few years ago?
Does Eddie have any leverage against them that he can use to try to build up the numbers for his failed Tunnel deal. Only one thing that I can see right now. Continue to harass the Bridge Co: more Interim Control By-law, demolition by-law, no closing of Huron Church, the upcoming heritage designation and so on.
Perhaps that might make the Bureaucrats more friendly if he helps them on the DRIC bridge and earn the Mayor a reward!
I told you my idea was wild!
Be careful what you have nightmares over, for it might actually come true.
Thanks to the Mayor talking about the "cheap" solution that the Senior Levels want to impose on Windsor, I think we are actually going to get it. Just do the math, if the Feds put in $400 million in the Budget, with no increase this time around as the Mayor clearly expected, as their 50% amount, then the Province would add their 50% or $400 million which means the amount of money available for a border road is $800 million.
Why then would the Senior Levels add in another $800 million to build the DRIC road. If you are going to be criticized as being "cheap" by the Mayor and Council for putting in $1.6 billion to build a DRIC road, then one may as well save $800 million and put in the true "cheap" solution.
I do not really believe that the Senior Levels will leave Windsor without doing something but my suspicion after the Federal Budget is that what they will do here will be the minimum required.
The way it will be done I believe is the following. The Wilbur Smith investment-grade traffic survey will demonstrate conclusively what the Ambassador Bridge Company people have been saying now for some time: that the traffic is not there to justify the building of a DRIC bridge at this time.
The "at this time" will be the face-saving way for the Senior Levels to table DRIC and allow the Ambassador Bridge Enhancement Project to go forward. After all, at the budget meeting last night, the dividend to be paid by the Windsor Tunnel Commission to the City is now said to be zero due to "decrease in cross-border traffic." How can a new bridge be justified especially when it is supposed to take away a quarter of the Detroit/Windsor Tunnel business. The Mayor will go ballistic since his valuable asset will be decreased in value dramatically by the DRIC action.
Since the Ambassador Bridge project is not adding capacity but rather is a providing a facility to replace their old one, it would be viewed as an intermediate measure until such time as the traffic increases.
As an existing structure, then the Senior Levels under the extended BIF program can provide several hundred million dollars to build an intermediate road to the Enhancement Project bridge. That road comes under an existing Government program to which some money can be added that has already been set aside at least under the Federal Budget.
Don't forget as well the Gong Show $500 million from Dwight Duncan that is supposed to be available after 2010 which I believe will provide the Province's share of the cost of that road. Why else hasn't the Province put any money in so far. They don't have it until 2010!
The timing is almost perfect for Dwight Duncan who has said "THE MAYOR IS WRONG. THE MAYOR IS WRONG" to blame everything on Eddie. Dwight will be the saviour who will bring us at least 7500 jobs as he said in one of his comments recently.
My recollection is that a number of years ago the Bridge Company said that a road could be built along the DRIC corridor at a cost of around $300 million. Add into that the cost of inflation and some "green" aspects and I would believe that the cost would fall well within the $800 million budget.
Someone obviously led the Mayor astray with respect to what the Federal Government was going to do. Knowing our Mayor, he would only say something if he knew it was going to be true. He never makes mistakes you know. Listen then to the clip from CKLW to hear how confident he was that there was going to be money that he wanted to be used for Greenlink in the Budget.
Thanks then to the stalling and the ridiculous positions put forward by our Mayor, we will now get the "cheap" solution that he is been talking about for so long. Had he negotiated from a position of cooperation rather than of threats and lawsuits, we might have achieved a lot of what we wanted. More importantly people would actually be working now rather than looking for moving companies so they can find a job in another location.
For Councillors to continue to be united behind a lame-duck Mayor who is failing boggles my mind. I assume that a whole bunch of them want to be retired as well and that's why they just don't care about the electorate.
Is this photo symbolic---Finance Minister Flaherty putting the boot to Windsor?
Am I crying wolf too much? Will it become a self-fulfilling prophecy? Or is it just another incident in a long drawn out border file that might get resolved one day but means little?
Here are the little bits that I found in the Federal Budget with respect to the border crossing:
1) Improving Canada’s Borders
Our borders have to facilitate trade, travel and commerce while protecting us from external threats. This is why Budget 2008 is investing in borders by:
2) To support our communities and ensure the competitiveness of the Canadian economy, Canada needs access to modern infrastructure. Our Government is making the largest single federal investment in public infrastructure since World War II through our Building Canada plan—a total of $33 billion over seven years for roads, bridges, water systems, public transit and international gateways.
To help us maximize this investment, we have created a new Crown corporation called PPP Canada Inc. It will be the first public-private partnership office of its kind at the federal level in Canada. By increasing our use of P3s and taking into account contributions by other levels of government, we should be able to leverage a $100-billion investment in infrastructure.
3) Public-Private Partnerships
Recognizing the need to look beyond traditional approaches to infrastructure financing and delivery, Budget 2007 announced measures to transform Canada into a leader for public-private partnerships, including:
The Government has made significant progress in implementing these measures. Key milestones include:
4) Investing in Infrastructure
Modern, high-quality infrastructure is vital to Canada’s long-term prosperity. That is why Budget 2008 is:
5) $400 million as a contribution towards the access road to the new Windsor-Detroit border crossing.
They should have contributed something since after all the Windsor border crossing is so important as every politician keeps telling us. Moreover, since the Province has not really put up any money other than the BIF funds, what a nice way of putting the pressure on Premier McGuinty and Minister of Finance Dwight Duncan. Put up or shut up Province!
Now when they did not make the obvious political move, I got concerned. Have the Feds become fed up with the stalling of the City of Windsor? Will nothing ever please this City? Why continue taking abuse when communities around Canada would fall over themselves to get the kind of money that is being offered to Windsor which is seemingly being turned down by our Mayor and Council to the detriment of citizens, especially the unemployed.
While I do not think that the Feds would pull out of Windsor before an election, there is no doubt that the failure to increase payments to Windsor is meant as a statement to be taken very seriously. There is no doubt whatsoever in my mind that the Feds, or the bureaucrats at least, are re-evaluating their Windsor position. This file is becoming an embarrassment to those who saw their careers shooting forward with a big success here. If it looks like it may bomb out, then why not blame it all on the Mayor and pull out before one's career is affected negatively.
Perhaps it is the Feds who are doing the Ipsos Reid poll after all.
I ask the obvious question then how can anyone justify building a new DRIC bridge that would require staffing for more than six booths if there was not enough traffic to justify the staffing of six. It doesn't make any sense to me. Not only would the Government have to duplicate the actual Customs facilities but now it would have to duplicate staffing as well. At about $1 million per lane when one takes into account salaries and benefits for staffing a lane with officers and support staff over 24 hours, that's a fair bit of money.
And wiping out Delray too!
There is no doubt that when legislators in United States see some of this information they will be hard-pressed to support MDOT moving ahead as well. Already at least the Republicans see no purpose in moving forward on the DRIC project. They can use the money required for better purposes.
And just so you know, US DRIC has estimated that the U.S. cost of the combined bridge, plaza, interchange, utilities and associated property acquisition ranges from $1.277 billion to $1.488 billion. Add in the Canadian side and we have an International Mega-Project in the billions.
But we have to keep on playing the game don't play we. We need to pretend that the DRIC bridge has a some possibility of being built because otherwise what will put pressure on the owner of the Ambassador Bridge to sell out at a cheap price. As I Blogged the other day, the way to do so is to generate traffic numbers about how much of the volume the new DRIC bridge will take away from his crossing.
According to DRIC, their new bridge would cause significant traffic shifts over the entire area from the Blue Water bridge right to the Windsor crossings. Dealing with truck traffic, the bridge in Sarnia could lose up to 18% of their traffic or more. The City of Windsor owned Detroit/Windsor Tunnel could lose up to 26% of its total traffic. The Ambassador Bridge could lose up to 75% of its truck traffic and 39% of its car traffic. Mind you, I thought part of the DRIC exercise was to remove traffic from Windsor too eg to rail, marine and to other crossings. So much for that when bridge economics come into play. We cannot have car and truck numbers crossing the bridge go down now can we!
The new bridge good carry as much as 80% of the truck traffic carried by the two bridges and 60% of the car traffic.
Now those are pretty impressive numbers don't you think. If I was a P3 operator, I'd be salivating waiting for the Governments to ask me to invest my money in a new DRIC bridge. The only fly in the ointment however is that damned Ambassador Bridge whose tolls for using their bridge would be about a third of what I would have to charge, assuming that there was fair competition. I guess that the Alinda people might want to compete as well at the Tunnel and probably the Sarnia folks might have some concerns about going bankrupt also.
P3 operators generally like monopolies and don't want to compete in the marketplace for traffic. A number of the agreements with respect to roads have clauses in them which require that the governmental authority not build a road that competes with the toll road. After all how can the P3 operator make money if there is a free road nearby.
Now that won't work with respect to border crossings because as MDOT said the new DRIC bridge would be paid for by tolls. I don't know about you but if I have a choice between two equally efficient crossings I'm going to take the one that is cheapest especially the cost is one third of the other. So how then does a DRIC bridge stay in business?
The answer came from the Leakor in another Todays Trucking Magazine online article. I am sure that the article has been distributed to government people with a cover note saying this is how we will guarantee that the new DRIC bridge is financially successful. Let me attach a few excerpts from that article:
Just in passing, the Ambassador Bridge Company already has set up these pre-processing centers so that the "main purpose" to assist truckers is already being fulfilled.
Do you get it? The way to guarantee success of the DRIC bridge is to force trucks to use a certain crossing. And obviously the crossing of choice would be the Government bridge. That's how they would get the numbers. It would have to be made mandatory to use that staging area and the means to do that is Bill C-3 as I have said before [BLOGs December 04, 2006 "Clever Bureaucrats" November 27, 2006 "Who Is In Control AT MTO"].
I am not going into all of the arguments why staging area would not make any sense, especially for Windsor. The one however that is the most important from a business perspective is how much it would cost for a truck to use the mandatory staging area. Now remember, the area has to be paved to be big enough in case there is a huge backup at the border. Of course there may never be a backup if the border is running smoothly but it doesn't matter, that facility has to be paid for.
I've seen estimates of the cost being in the range of $20-$25M or more and naturally not even a private investor like John Laing PLC is going to risk their money on that. So it will have to be government financed.
Every truck that uses the facility will have to pay a fee to pay for it. How much will that fee be... who knows. Obviously truckers will try and avoid the area if possible which means that instead of using main highways they will take back roads. After all they don't want to be stuck at some staging facility at $100-125 an hour while a bureaucrat figures out which border crossing they should take it assuming that the bureaucrat believes there is no truck back up.
In the end, I could see a whole bunch of truckers saying that it just doesn't make sense to go across the border any longer. The costs are too high and the wait periods too uncertain. They would just pull out the marketplace leaving fewer truckers for shippers to use. With fewer truckers, the obvious result is that shipping prices are higher meaning that it is more expensive to do business in this country.
If it is too expensive do business in Ontario or in Canada, then why would anyone locate their plant here or why would anyone remain here if by going south of the border the Company can deal with their customers without the border hassle.
The concept is wonderful in a world designed to meet the needs of the bureaucrat. However, unless the bureaucrat understands business and in particular transportation that business model may not bear any relationship to reality. We saw that in Canada before with the National Energy Program which was designed to protect the Canadian oil industry but in fact destroyed it and allowed foreign companies to take over a good part of the oil patch.
This is an old story that we saw about a year and a half ago with the same players being mentioned. The only difference is that there is a private investor involved that may have put in some money into the project, how much we do not know.
While it is designed obviously to ease the concerns P3 investors and to cause aggravation to the owners of the Ambassador Bridge, it does nothing except make the bureaucrats look even more foolish than they are.
As someone knowledgeable in the trucking industry told me:
And I wonder if this is part of his game-plan as well...to actually pretend to start a lawsuit to tie up the border for years to get what he wants. If you read his language carefully there is no doubt it is part of a legal case that may be in draft stage already for all I know.
The childish threat of another lawsuit to block the building of a road to the Ambassador Bridge is exactly what we need here to make this area a retirement community for rich Torontonians. Who needs 15,000 high-paying infrastructure and spin-off jobs when "hopefully" the Mayor might get 50 from sending our goods to Germany after his taxpayer paid trip, not vice-versa, and we can get thousands of minimum wage call centre ones and for looking after retired folks.
Eddie will fight "till the end he claims." Since his end as Mayor is in about three years when he will start his next career, I guess he must be talking about the end of Windsor as a viable community!
That's the future we have to look forward to with this Mayor.